Wall Street Aristocracy Got $1.2 Trillion in Secret Fed Loans

Wall Street Aristocracy Got $1.2 Trillion in Secret Fed Loans

Citigroup Inc. (C) and Bank of America Corp. (BAC) were the reigning champions of finance in 2006 as home prices peaked, leading the 10 biggest U.S. banks and brokerage firms to their best year ever with $104 billion of profits.

By 2008, the housing market’s collapse forced those companies to take more than six times as much, $669 billion, in emergency loans from the U.S. Federal Reserve. The loans dwarfed the $160 billion in public bailouts the top 10 got from the U.S. Treasury, yet until now the full amounts have remained secret.

Fed Chairman Ben S. Bernanke’s unprecedented effort to keep the economy from plunging into depression included lending banks and other companies as much as $1.2 trillion of public money, about the same amount U.S. homeowners currently owe on 6.5 million delinquent and foreclosed mortgages. The largest borrower, Morgan Stanley (MS), got as much as $107.3 billion, while Citigroup took $99.5 billion and Bank of America $91.4 billion, according to a Bloomberg News compilation of data obtained through Freedom of Information Act requests, months of litigation and an act of Congress.

“These are all whopping numbers,” said Robert Litan, a former Justice Department official who in the 1990s served on a commission probing the causes of the savings and loan crisis. “You’re talking about the aristocracy of American finance going down the tubes without the federal money.”

(View the Bloomberg interactive graphic to chart the Fed’s financial bailout.)

Read the rest here…



13 Responses to “Wall Street Aristocracy Got $1.2 Trillion in Secret Fed Loans”
  1. abs says:

    This all come down to treason. False claim act

  2. pamelag says:

    what about the $16trillion geithner secretly gave the gangster banksters according to the GAO report recently?

  3. talktotennessee says:

    The banks were given money to free up lending because when the bubble burst, defaults increased and stocks tanked, it was natural for the banks to stop lending and hold onto their assets until things stabilized. I believe B of A had the resources to survive had the money not been given them. I don’t think they would have increased lending regardless of what they had on hand. The bailout didn’t really work like so many people thought it would. Many, including the administration, believed the housing industry would receive some help on modifying loans. The focus at the time was in stopping foreclosures and helping people keep their homes. Had the housingmarket stabilized, it would have prevented lost equity, devaluation of home values and prevent job loss. The main reason it didn’t is that the bailout came with no requirements to do so. The industry resisted being “told” or ordered to modify loans and clean up their mistakes.

    Contrary to the old saying that goes, “what we have here is a failure to communicate” is the banks feet were not held to fire to reduce principal with the money they received or even to modify loans. In fact, they did the opposite, they increased foreclosures, knowing they had bad paper, to try to get out in front of their fraud, forgery, etc. before the public discerned what they had actually done. Like many people caught with their hands in the cookie jar, they lied and manipulated to cover their tracks.
    So what we have here is a major mess now and no sympathy to bail them out again. They are busy as little cats covering their – – – – trying to pay off investors, Attorney Generals, Democrat and GOP candidates to look the other way and let them go on their merry way!
    Go to the NY Times, Washington Post, local newspapers, write letters, contact politicians (they are afraid of you and public opinion) We just need to use the power we have! Write the writers of those columns that expose this mess and lift up their arms in support. Don’t just complain here, do something!

  4. Elyse says:

    Unfortunatley, it appears that when someone has been elected, based on their promise for change (and I believe that is truly what they plan on doing!) “something happens” once they arrive at their new job where everything changes? Seems like a group of the “real rulers” (ie: the insurance company, the drug company, the banks and of course, Haliburton) enter the oval office and introduce themselves to the new President!! That is when the reality of WHO’S WHO in this Zoo come to light and nothing changes?? Nothing gets better…it can’t…We the people have no one to protect us because it is all about BIG BUSINESS…

    As I have mentioned before, AMERICA was not created to operate like a business….it was created to allow her citizens to grow to our full potential!! To give us the freedoms our forefathers were not allowed in Europe….so they came here, to find a better life…and it was working!! I don’t know when the decision was made by these coorupt business people to be allowed to LOBBY our elected officials….but if the LOBBYISTS are STOPPED from going anywhere near our representitives to offer the bribes of educating their children, buy a new mansion, give a fabulous new pool in their backyard and not to mention the CASH given to vote for their interest and not ours, things could change!! Nothing will change if nothing changes and these outragous practices allowed to LOBBYISTS is brining down AMERICA!!!!

    Ron Paul wants the good for the people right now…however…think about how it all changes when they get into their new position!! And it never fails!! The Lobbyists are like cockroaches in Washington and no one is even talking about them???? HELLO PEOPLE???

    • Sherry says:

      Elyse, You are amazingly right on target. I love what you said. You sound and write exactly like me.THANK YOU for your political outrage toward our horrible, runaway institutionalized greed, today. YES, ours is a dirty, rotten Congress and their getting richer thanks to the secretive Lobby thugs and their money. YOU GO GIRL. (Sherry,Sarasota, Florida)

  5. Mad as Hell in Maryland says:

    NOT 1 POLITICIAN ACTUALLY DID ANYTHING TO STOP IT. In fact, the likes of Barney Frank touted the strength of Fannie and Freddie. Its more of the same. My opinion is to let wall street, and the likes, feel the same pain of main street. And, make ’em play by the same rules we have to. =

  6. Jim Bethea says:

    WELL ~~ Paulson told Congress ~ just give me the check and I will tell you later what we did with it ~~


    What a den of thieves ~~~~

  7. usedkarguy says:

    tell me again how it was a “subprime” problem

  8. qny81 says:

    Vote for the only presidential candidate that has been trying to audit the Federal Reserve, Dr. Ron Paul.

    • rictic says:

      Ron Paul has had his chances to “call-out” Bernanke’s lies and has said nothing.
      I think I’m going to write in Mr Potato Head for President. Couldn’t be any worse than the current or any other prospective occupant of 1600 Penn Ave.

      • lvent says:

        qny81, The people must check and see what these politicians investments are, and WHO contributes to their campaigns….There is a list out there that tells who the politicians and Congress members are that GOT FILTHY STINKING RICH OFF THE STOCK MARKET CRASH in 08….there are traitors in our midst…All of the tax breaks in this country go to the wealthiest that do not need it and it is designed that way…..so we never get ahead…Republican/Democrat all a sham and a fraud…They are bought or members of the big club. Do your homework America…these crooked politicians are getting wealthier and wealthier off of the demise of MAINSTREET…

      • rictic says:

        Everyone should have to watch that clip every morning before going off to school, work, pick up the social check, collect the drug money. Whatever folks do in the morning the first thing, watch this clip……

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