Sure it was in worse shape and they knew it was long before we found out.
King suggested that the U.S., UK, Switzerland, and perhaps Japan might form a temporary new group to jointly develop an effort to bring together sources of capital to recapitalize all major banks. END SUMMARY
http://www.guardian.co.uk/world/us-embassy-cables-documents/146196
Now the Fed has used you and your children as collateral again for the foreign banks!
Fed throws euro banks a lifeline
snippet..
For an outfit whose policies supposedly are plunging the world into unspeakable conflict, the Federal Reserve is doing an awful lot to avoid another meltdown.
The Fed said Tuesday it would extend the dollar swap lines it provides to central banks in Europe, Japan and Canada in a bid to avoid a cash crunch like the ones seen to such devastating effect in 2008.
Your dollars, our problem?
The swap lines, under which the Fed provides foreign central bankers with essentially unlimited stocks of dollars in exchange for the equivalent amount of the counterpart’s currency, are intended to help head off a banking crisis like the one that appears to be developing in the European Union.
The European Central Bank said Tuesday that money market conditions are deteriorating, raising fears that rising government bond yields and undercapitalized banks will start feeding off one another in a sort of euro doom loop.
Investors have spent recent months backing away from the debt issued by weaker countries such as Spain and Portugal amid questions about their finances and the strength of their banks, which have been impaired by steep declines in property prices.
The financial temblors of the past two months have made it clear that, for all the talk at the beginning of 2010 about the Fed and other government bodies executing their supposed exit strategies and leaving financial markets to their own devices, we are still probably years away from a world in which your taxpayer dollars won’t be propping up the misguided ambitions of bankers everywhere.
Continue http://finance.fortune.cnn.com/2010/12/21/fed-throws-euro-banks-a-lifeline/
So where is this new capital supposed to come from? Thin air. Bernanke's rear end? Where is this big pile of "new capital" that is, apparently, just lying around waiting to be used to recapitalize the global banking system? Mars? Jupiter? Or, as I suspect, the other side of the looking glass.
I feel like I need to vomit...
A swap doesn't make anyone collateral. Sorry.