The Fed: Our Next Troubled Bank? (speaking about the obvious)

istockanalyst ^ | 04/24/09 | Mike Larson

[TigerLikesRooster]

The Fed: Our Next Troubled Bank?

By: Money and Markets Friday, April 24, 2009 11:46 AM

by Mike Larson

The Federal Reserve is watching the backs of U.S. banks. But sometimes I wonder, “Who’s watching the Fed’s back? Is the Fed our next troubled bank?”

You see, all of this garbage paper that’s going bad — the troubled residential mortgage backed securities (RMBS), the commercial mortgage backed securities (CMBS), the asset backed securities (ABS), the Fannie Mae bonds, the corporate loans, and so on — hasn’t just gone “Poof.”

Instead, more and more of it has been landing on the Fed’s doorstep — either through direct ownership or as collateral against Fed loans that keep getting rolled over.

The result? The Fed’s once pristine balance sheet is starting to look more and more like the balance sheet of a troubled financial institution.

[TigerLikesRooster]

Ping!

[Attention Surplus Disorder]

To all on the financial shenanigan ping list;

This is a superb interview with Janet Tavakoli who is not only quite easy on the eyes, but absolutely dead on the money with regard to how we lunged into the financial condition we’re in and will certainly remain in for a while. Longish, it’s about 1 hour. I heartily recommend it. I wish the host were a little more focused but it’s still terrific.

http://www.youtube.com/watch?v=WA20Am0pwtA

[April Lexington]

The Fed's credibility died the minute it engaged in Quantitative Easing. It can't create currency to by bonds from the Federal Government that nobody else on Earth will buy. The market has no clue what the real interest rates are now because of Fed buying actions that are designed to keep interest rates low. If the Fed wasn't buying Obama bonds, the real interest rates would be approaching 10% right now. Its all a sham, folks...