This article was written by WallstreetOnParade (Pam Martens and Russ Martens)
Four days ago, the Federal Reserve released the names of the banks that had received $4.5 trillion in cumulative loans in the last quarter of 2019 under its emergency repo loan operations for a liquidity crisis that has yet to be credibly explained. Among the largest borrowers were JPMorgan Chase, Goldman Sachs and Citigroup, three of the Wall Street banks that were at the center of the subprime and derivatives crisis in 2008 that brought down the U.S. economy. That’s blockbuster news. But as of 7 a.m. this morning, not one major business media outlet has reported the details of the Fed’s big reveal.
On September 17, 2019, the Fed began making trillions of dollars a month in emergency repo loans to 24 trading houses on Wall Street. The Fed released on a daily basis the dollar amounts it was loaning, but withheld the names of the specific banks and how much they had borrowed. This made it impossible for the public to see which Wall Street firms were experiencing the most severe credit crisis.
It was the first time the Fed had intervened in the repo market since the 2008 financial crash – the worst financial crisis since the Great Depression. The COVID-19 crisis remained months away. The first reported case of COVID-19 in the U.S. was not reported by the CDC until January 20, 2020 and the World Health Organization did not declare a pandemic until March 11, 2020.
The dollar amounts of the Fed’s repo loans grew to staggering levels. On October 24, 2019, we reported the following:
“The New York Fed will now be lavishing up to $120 billion a day in cheap overnight loans to Wall Street securities trading firms, a daily increase of $45 billion from its previously announced $75 billion a day. In addition, it is increasing its 14-day term loans to Wall Street, a program which also came out of the blue in September, to $45 billion. Those term loans since September have been occurring twice a week, meaning another $90 billion a week will be offered, bringing the total weekly offering to an astounding $690 billion. It should be noted that if the same Wall Street firms are getting these loans continuously rolled over, they are effectively permanent loans. (That’s exactly what happened during the 2007-2010 Wall Street collapse: some teetering Wall Street casinos received, individually, $2 trillion in cumulative loans that were rolled over for two and one-half years – without the authorization or even awareness of Congress or the American people. One bank, Citigroup, received over $2.5 trillion in Fed loans, much of them at an interest rate below 1 percent, at a time when it was insolvent and couldn’t have obtained loans in the open market at even high double-digit interest rates.)”
Under the Dodd-Frank financial reform legislation of 2010, the Fed was legally required to release the names of the banks and the amounts they borrowed “on the last day of the eighth calendar quarter following the calendar quarter in which the covered transaction was conducted.” The New York Fed released the information for the third quarter of 2019 last Thursday, a day earlier than required. We reported on it the following day.
Read more at https://wallstreetonparade.com/2022/01/theres-a-news-blackout-on-the-feds-naming-of-the-banks-that-got-its-emergency-repo-loans-some-journalists-appear-to-be-under-gag-orders/
