Tuesday, June 9, 2020

The Federal Reserve Just Started Printing Money Out of Thin Air to Bailout Illinois

This is big. It is not going to stop with Illinois.

Bill Bergman writes at Truth In Accounting:
On April 9, amidst plunging economic conditions, the Federal Reserve announced a set of lending policy initiatives that included a new “Municipal Liquidity Facility” for state and local governments. For legal authority, the Fed cited the emergency lending provisions in section 13(3) of the Federal Reserve Act.

Normally, a central bank lends to banks, but emergency provisions have historically been used by the Fed to justify direct lending to “individuals, partnerships and corporations” in “unusual and exigent circumstances.” Section 13(3) is titled “Discounts for individuals, partnerships, and corporations,” raising questions whether the Municipal Liquidity Facility is actually authorized under Section 13(3).

The new facility is unprecedented. It is available to cities and counties meeting population requirements, and all 50 states. Smaller cities and counties may be supported by state borrowing through the facility. The lending facility is operated by the Federal Reserve Bank of New York. The facility may lend as much as $500 billion.

The State of Illinois became the first entity to use the facility, under a transaction that closed last Friday.
The Illinois funding is a one year loan for $1.2 billion.

I want to emphasize the United States government doesn't have the money to make this loan. It is the Federal Reserve printing money out of thin air. It will be far from the last state or local government that asks for money since the lockdown has destroyed incoming tax revenues.

The mad money printing is just not going to stop.

Fed chairman Jay Powell and the entire current Fed monetary policy committee, the FOMC, are going to go down in history as the most irresponsible stewards of a sound dollar the Fed has ever had amidst a long line of irresponsible Fed money printers.



  1. You know, I am not saying it is a conspiracy, but, just thinking about how everything is happening right now the sequence of events... If you were to conspire against our country....

    1. Governors and Mayors killed the economy and scared everyone to death of an invisible boogy so nobody trusts people and destroys the social framework of society.

    2. Federal reserve "Governors" print unlimited currency and begin massive wealth transfer.

    3. Incite hate against law enforcement and Mayors calling to defund, or dismantle law enforcement, enabling more lawlessness and destruction.

    What's up with the all these governors and mayors making horrible decisions? Who do they answer to? At what point does the incompetence become a crime? Treason?

    I wonder what the next step would be, but this seems like a perfect 5th column strategy being played out.
    It just boggles my mind the idiocy playing out everyday. I didn't think there was any way people in 2020 can be this stupid. So if it's not stupidity, what is it?

  2. Illinois rules of politics. 1. Democratic candidates promise money and pensions to teachers, police, fire, and other government workers. 2. Elected democrats fail to fund the promised goodies. 3.Democratic candidates promise reparations ($17T). 4. Elected officials fail to fund. 5. Federal government gives Illinois money. 6. Democratic elected officials increae spending and stiff ther Fed.

  3. In all of my years spent in the loan industry, among the first one or two questions that were asked of every loan applicant is "How do you plan to repay this loan?" As an Illinois resident for the first 50 + years of my life, I know that the state of Illinois has not two nickels to rub together. Where in the world are they going to find the money to repay this loan? My guess is they have no idea, and no intention of repaying it, and nobody cares apparently.

  4. In all my years of Lindy we were most interested in the borrower's ability to repay the loan. I spent the first 50 plus years of my life as a resident of Illinois. I know that they don't have two nickels to rub together. How in the heck is letting them more money going to help their financial situation? They need to be focused on repaying loans they already have, and not getting further in that to other people or institutions. As the previous post noted, every time a little money comes along in the form of a loan, the Democrats, who run the state, just spend more and never pay back. This loan is a loser from the beginning. Why even call it a loan? Just call it a gift and forget all the angst about worrying about Payback.

  5. No one precived to be apart of tgis rigged game
    Should consider themselves safe.