Posted on 02/14/2009 12:18:20 PM PST by RushingWater
On Thursday [the 18th], at about 11 o’clock in the morning, the Federal Reserve noticed a tremendous drawdown of money market accounts in the United States to a tune of $550 billion being drawn out in a matter of an hour or two.
The Treasury opened up its window to help. They pumped $105 billion into the system and quickly realized that they could not stem the tide. We were having an electronic run on the banks.
(Excerpt) Read more at dailyreckoning.com ...
Look, I see it this way. I don’t believe for a minute that swfs (sovereign wealth funds) or other large entities like banks keep their funds in the Reserve MM fund.
That’s usually a place for the retail customer, the average joe in a 401K, pension fund or j6p to keep money deemed almost as liquid as cash.
So when Reserve broke the buck and it became widely known, and you are j6p who parked money in some MM fund for what you thought was a safety play, what would you do ? Leave it there, or get it out and into something FDIC-insured ?
I know when I heard that on 9/18 I ran for the hills with the stash I had (I put in a sell order at Vanguard to wire it to my checking account). I know a lot of people who did the same thing.
So no - unless they track the outflow to overseas banks and the like, they know exactly where the money went if it went to US banks and to whom it was deposited.
Why they’re not saying...well, it just gives them more leeway to create the story they want to achieve their goals, which was a bill giving 700 Billion taxpayer dollars to the Wall Street pigmen..
No, the Fed is not saying and they’re not making the data public. It’s all say-so from a CONgressional briefing, so it can’t even be independently verified. Hence my comment about using the story to move particular legislation.
IMO it may have happened, but I believe it was institutional and retail investors who decided to move their money.
Do you really think China keeps even a trillion dollars in a money market fund or two ?
BTW - do you know what most money market funds invest in ? You should. It can be anything from T-bills to commercial paper to MBS or CMBS etc etc.
Personally, the only money market I have at the moment is invested 100% in short-term T-bills. I’m making zilch but if the US can’t make good on the T-bills the $$$ is toast anyhow.
Please forgive my ignorance but I have to ask this question if someone can answer it for me. I heard Rush talking about this a few days ago and I agree with most here that this was maliciously staged or at the very least some people took advantage of a very bad economic situation and made it worse so that Republicans would be blamed and empty suit would win the election.
In all of this one thing remains, money is still money. We are not talking about stocks but hard cash that was deposited in some Money Market Account then withdrawn perhaps in a panic.
But where did the money go?
Half a trillion dollars couldn’t simply vanish in thin air, or could it?
Also where is the $350bil we injected in the system late last year?
Any answer would be appreciated.
That’s been disproven. There was no shorting of airline stocks. However, I did use that as a hook in my thriller novel, “September Day.” It worked really well for that!
What would be the net result of ACORN and the wrongful forcing of banks to lend was a predictable "black swan" and therefore not a black swan, tho.
What would be the net result of ACORN and the wrongful forcing of banks to lend was a predictable "black swan" and therefore not a black swan, tho.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.