Ron Paul Bill Helped Expose $16 Trillion in Secret Bailouts by the Fed
dailypaul.com
dailypaul.com
The '16 trillion' is reached by aggregating all of the dollars in loans regardless of their term (page 131 of the actual GAO report) So super-short overnight loans which were rolled over day-to-day were counted, e.g., 365 times a year.
The GAO notes that this is ridiculous on the same page that the article cites, and then goes on to provide a more representative table on page 132, showing the annualized yearly average outstanding loan amount on a counterparty basis ('term adjusted'). Total loans come out to 1.1 trillion, not 16 trillion, and that's over a 3 year period.
"In late 2008, the TARP Bailout bill was passed and loans of $800 billion were given to failing banks and companies. That was a blatant lie considering the fact that Goldman Sachs alone received 814 billion dollars."
Innumeracy is a real problem. Political innumeracy is even more serious.
The Fed did not want to reveal which banks were getting the loans because of the fear that the release of that information would cause those banks more problems, or even collapse.
The details of who got the loans, how much, and when they repaid them was revealed because of a Freedom of Information Act lawsuit by Bloomberg News, well in advance of this audit. This audit is not the "first-ever" GAO audit. The GAO has been doing audits of the Fed since its authority was expanded by the Federal Banking Agency Audit Act of 1978. There are some limitations on the extent of its audits.
Lending to banks in a financial crisis is one of the main purposes of central banks. The Federal Reserve was established largely because of the Panic of 1907.