Did you guess the Federal Reserve? With a balance sheet over $3 trillion, an amount more than the GDP of entire nations, the Federal Reserve qualifies as a country. Ben Bernanke is President, and the sole output of this “country” is printed money. Scary times we live in.
The Fed is Now the Fifth Largest Country in the World
Submitted by Phoenix Capital Research on 02/21/2013
With QE 3 and QE 4 firmly in place and the Fed’s balance sheet over $3 trillion, I decided to go back and count the recap the Fed/Feds’ interventions since the Great Crisis began in 2007.
Here’s a recap of some of the larger moves made during the Crisis:
Cutting interest rates from 5.25-0.25% (Sept ’07-today).
The Bear Stearns deal/ taking on $30 billion in junk mortgages (Mar ’08).
Opening various lending windows to investment banks (Mar ’08).
Hank Paulson spends $400 billion on Fannie/ Freddie (Sept ’08).
The Fed takes over insurance company AIG for $85 billion (Sept ’08).
The Fed doles out $25 billion for the automakers (Sept ’08)
The Feds kick off the $700 billion TARP program (Oct ’08)
The Fed buys commercial paper from non-financial firms (Oct ’08)
The Fed offers $540 billion to backstop money market funds (Oct ’08)
The Fed agrees to back up to $280 billion of Citigroup’s liabilities (Oct ’08).
$40 billion more to AIG (Nov ’08)
The Fed backstops $140 billion of Bank of America’s liabilities (Jan ’09)
Obama’s $787 Billion Stimulus (Jan ’09)
QE 1 buys $1.25 trillion in Treasuries and mortgage debt (March ’09)
QE lite buys $200-300 billion of Treasuries and mortgage debt (Aug ’10)
QE 2 buys $600 billion in Treasuries (Nov ’10)
Operation Twist 2 (Nov ’11)
QE 3 buys $40 billion in Mortgage Backed Securities every month from now on (Sept. ’12)
That’s one heck of a list. And the worst part is I know I’ve left something out somewhere.
And yet, despite all of this…
Median income today is lower than it was during at the end of 2009 (when the recession supposedly ended)
The percentage of Americans on food stamps has increased from 11% to nearly 15%
The average unemployment duration has increased from 30 weeks to nearly 40 weeks
The civilian employment to population ratio hasn’t budged
My question to everyone, especially the political class: at what point do we start calling BS on the Fed’s claims that it has a clue how to improve the economy?
Seriously, how many trillions of Dollars are we going to let the Fed spend? The Fed balance sheet is now over $3 trillion… making it larger than the GDP of France, the UK, or Brazil. Indeed, if the Fed’s balance sheet were a country, it’d be the FIFTH LARGEST COUNTRY IN THE WORLD.
While the Fed has failed miserably to improve the economy in the US, it’s done a bang up job of letting the inflation genie out of the bottle. As Zerohedge recently noted, commodity prices have never been this high at this point in the year beforee.
So, the Fed has failed to improve the economy… but it has unleashed inflation. This is called STAGFLATION folks. And the fact the Fed thinks the answer to it is printing more money tells us point blank: things are going to be getting a lot worse in the coming months.
Indeed, it is now clear, via QE 3, that the Fed has gone “all in” in its commitment to money printing. QE 2 put food prices to record highs… what to you think QE 3 (which is unlimited) will do to the cost of living?
The time to start preparing is now. The printers are running. The Great Currency Debasement has begun. Some folks will walk out of this mess winners. Most will walk out as losers.
http://www.zerohedge.com/contributed/2013-02-21/fed-now-fifth-largest-country-world
Too bad this book wasn’t well read:
AWD says:
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21st February 2013 at 9:06 pm
Zarathustra says:
China says USD will remain the world’s reserve currency for decades to come:
http://www.telegraph.co.uk/finance/currency/9881410/China-loves-the-US-dollar-again-as-America-roars-back.html
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21st February 2013 at 9:12 pm
KaD says:
I’ve read that America has the equivalent of the country of SPAIN on SNAP too.
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21st February 2013 at 9:52 pm
Hope@ZeroKelvin says:
So what. The “assets” of the Fed, at least the ones we know about, are freaking financial instruments, most of them ghostly electronic digits or soon-to-be-toilet-paper USDs.
One big EMP or a solar flare or loss of the USD as world’s reserve currency, and the Fed can just convert their buildings to a Dollar Store or a Goodwill store, aha, aha.
Texas, if it went its own way (please God soon) would be the 13-14th largest economy on the planet and its wealth is actually based on real world goods/services.
Get OUT of the USD. Focus on food/water/farm land/ammo/guns. Other currencies, like Canada’s are doing well, but you have to be careful with the currency controls the motherfuckers in DC have recently imposed (and I wonder why, gee)?
@Zara: yeah, right, the Chicoms would say that as they are dumping long term Treasuries right and left and buying up all the tangible assets they can.
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21st February 2013 at 8:39 am
Stucky says:
Fifth place?? Why is The Fed fucking around like this? Cocksuckers. They should be going for Top Dog, Numeral Uno, King of the Shit Pile.
We MUST get to the point where we owe every single nation on earth at leat $1 trillion dollars. Make that $1 trillion for little (Liechtenstein) or poor (Eritrea) countries … $10 trillion for rich countries, like Spain.
What are they gonna do? What are your options if one of your pals owes you more than they can possibly repay? 1). You kill them 2). You keep lending them more, hoping like fuckin’ hell they’ll repay you at some fuckin point in time. (Which we won’t …. hahaha, joke’s on YOU, fuckers!)
Well, NO ONE can kill us. We have lots and lots of nukes. In the ground. In the air. Under water. Well, maybe Russia could kill us. We can give them back Europe and call it even Stevens.
Therefore, Option 2 will work for a long time. Until it doesn’t.
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21st February 2013 at 1:18 pm
Der Scheisskerl says:
What is bad for some people, might be good for other people.
If Fed is doing things which are bad for average Americans, the
most likely explanation is that these things are
very beneficial for non-average Americans.
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21st February 2013 at 3:42 pm
TeresaE says:
@Zara, that is some funny stuff.
Of COURSE China needs to come out and support the dollar (for today), they have a few trillion sitting around.
The article cracks me up, especially at the point where the Chinese minister said that we are seeing reduced costs of freight. REALLY? WHERE? None of my freight bills are going down, the volume we are shipping continues to contract but magically the cost of our freight remains the same.
Pump and dump. Pump up the “belief,” then, when the belief is rolling, dump the hell out of them.
That’s what I would do. The Chinese aren’t ignorant, they are cunning. Press releases like this proves that point.
One thing continuously cracks me up, one of the main reasons our dollar is “retaining” value (even while being printed to infinity) is that many of the newly printed/created dollars are flowing from the Fed straight to Europe.
Our dollar will continue to be reserve as long as the rest of the world continues to accept our inflation. When that stops, so will the value of our dollars.
And, we will be a net energy exporter then, but only because the corporations will sell our natural resources out from under us to those that still have money of value.
This isn’t going to end well. But it will end eventually. Even with 90% of the country refusing to believe it.
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21st February 2013 at 8:02 pm