Image via WikipediaAccording to this Christian Science Monitor article, the Federal Reserve has loaned banks trillions of dollars. More than $9 trillion from a single program. And, yes, Goldman Sachs was one of the happy recipients.
How can anyone look at this mess with a straight face and still think the Fed should continue to exist.
Its easy money policies blew up a bubble in the market for the most expensive thing most Americans will ever own, their homes. And in a country where homes were already heavily subsidized by interest deductions, capital gains exclusion, first-time buyer loans and grants, Fanny and Freddy nothing-down loans and probably a half dozen other things.
One can argue that all this was necessary to keep depositors from losing their money. But aren't they going to be losing it anyway by the time we have a full accounting of all of these swindles?
How much better things would be if people knew they could lose their deposits when they put them into the bank. Most would not unless a bank proved to a reputable rating firm that it wasn't investing recklessly. We'd have individual institutions failing when they got into trouble, not the entire system going down in secret until the day arrives when our leaders tell us "no one could have seen it coming."