Quote:
Originally Posted by Muta
But is the Fed just creating money out of thin air to finance these loans? An audit on this institution would be amazing to see.
As well, the amount of transactions leading up to $8 trillion is sort of irrelevant. $8 trillion in bailouts is $8 trillion dollars in bailouts, no matter how you spin it. They were all used for the same purpose.
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1. There are a number of ways these loans are financed. Sometimes, yes they do create money 'out of thin air.' It's actually their mandate to regulate the money supply as inflation/economy sees fit. They have created 'money out of thin air' twice since 2008 through a process called 'Quantitative Easing.' You might recall the acronyms 'QE' or 'QE2' in the news.
2. If acting as a lender of last resort is evil then by all means we should go back to the guilded age where bank panics and lost savings were actually more common. You're viewpoint on the Fed not being able to serve as a lender of last resort is more in line with tea partiers who protest Fiat currency vs. the gold standard than OWS protesters.