[Pen-l] Fed caught lying to Congress

[raghu <mraghu01@xxxxxxxxx>]

I don't understand why the Fed jeopardizes its own independence with
such blatant misrepresentations just to protect the bailout
beneficiaries. The Fed truly is Wall Street's bitch..
http://www.bloomberg.com/apps/news?pid=20601109&sid=a2dHh.RbAogk
----------------------------------------snip
U.S. taxpayers may be stuck with losses on $30 billion of Bear Stearns
Cos. assets owned by the Federal Reserve even though the central bank
has said otherwise, according to Robert A. Eisenbeis, Cumberland
Associates Inc.'s chief monetary economist.

"There is no prospect for a profit on the assets," Eisenbeis wrote in
a report yesterday. "Losses are mounting."

The CHART OF THE DAY illustrates the extent of the losses since June,
when the Fed began providing data on the holdings' value. The biggest
declines were recorded after quarterly mark- to-market adjustments.

Last week's total was $4.22 billion, as shown in the chart. JPMorgan
Chase & Co. is responsible for the first $1.15 billion under terms of
an agreement completed in June, when the company took over Bear
Stearns. The Fed picks up the rest.

"The transaction was not structured with adequate over-
collateralization to protect the taxpayers from losses," based on the
risks associated with housing-related assets at the time, Eisenbeis
wrote.

The central bank's Board of Governors wrote in a Dec. 29 report to
Congress that it didn't expect "any net loss to the Federal Reserve or
taxpayers" from the Bear Stearns holdings.





-raghu.

--
Eagles may soar but weasels aren't sucked into jet engines!
_______________________________________________
pen-l mailing list
pen-l@xxxxxxxxxxxxxxxxxx
https://lists.csuchico.edu/mailman/listinfo/pen-l