Wednesday, April 21, 2010

Fed Official: We Can Just Print Money, Damn It!

In an odd post, WSJ analyzes the Fed's just released financial statements as though it were simply a bank like any other, and concludes:
It has a more risky portfolio than it’s ever had before, including $1.25 trillion in mortgage securities that could lose market value if interest rates rise, if defaults climb or if it has to sell them quickly. A 4% loss on that portfolio would equal almost all of its capital.
Coming back to reality, WSJ then notes:
Of course the Fed can print money itself. (As opposed to a bank, which depends on the backing of depositors and other creditors to fund its operations.) Thus, as a Fed official notes, on condition of anonymity, it would be able to continue operating even if its capital becomes depleted.


  1. and you are still waiting on the sidelines for a correction in gold???????

    market psychology/behavior is a fickle beast ...... it can turn faster than folk can re-position themselves.

    do you smell smoke

  2. banks print money just like the fed...electronically. its called fractional reserve banking. So a bank with $10,000 can lend out $90,000, and then plan to have that money returned over time WITH INTEREST. Same with credit cards. its all leverage in a way. That's why when you owe the credit card company $10,000, you really only owe them a grand or so. That's also why you end up paying for three homes to buy one with a bank loan. Its a screwed up system geared to take every last penny you earn.

  3. its treason is what it is. theres no way the money can be paid back when the banks quit loaning money, because there isnt enough money printed up as loans are made. they designed it to fail so they can repossess anytime they want.

    the only way to fix this mess. is to do away with money altogether. make two laws, help one another, no one is allowed to own anything and things would straighten out.

    and really is there a more fitting punishment for the thieves than to make money worthless?