“Following the repeal of the Glass-Steagall Act in 1998, Citigroup dove headlong into the derivatives market. “By 2007 Citi was the largest issuer of CDOs [Credit Default Obligations] … $49 billion worth when the world’s total production was $442 billion.” (Source: Bailout Nation)
Citi later took advantage of Structured Investment Vehicles (SIVs) to move high-risk investments off their balance sheets – into “Enron-like side pockets.”
When the housing market began staggering badly in 2007 under the weight of increasing loan delinquencies and foreclosures, “Citigroup’s SIVs were festooned with $87 billion of toxic assets, mortgage-related CDOs, and other long-term paper…. ”
Short-term financing dried up, and the SIVs worked their way back “in-house.” And “by December 2007, Citi assumed $58 billion of debt to ‘rescue’ $49 billion in Assets.” (Bailout Nation)
The Federal Reserve then cranked open the “Secret Loan” fire hose to flood Citi (and scores of others) with massive liquidity injections (or, in the common parlance, ‘free money’).
Bloomberg – Nov 28, 2011
“Citigroup Inc., the third-largest U.S. bank by assets, received a $45 billion capital injection in 2008 from the U.S. Treasury. The New York-based lender got a bigger bailout from the Federal Reserve: $99.5 billion of emergency loans, about the cost of paying, clothing, housing, arming and transporting the U.S. Army for fiscal 2011. On Jan. 20, 2009, as the bank’s shares fell to $2.80, down almost 90 percent in a year, its Fed loans included $34.1 billion from the Term Securities Lending Facility, $25.1 billion from the Commercial Paper Funding Facility, $25 billion from the Term Auction Facility, $14 billion from the Primary Dealer Credit Facility and $1 billion from single-tranche open market operations.”
The point of this historical ‘look back’ is to simply restate the case that U.S. citizens deserve nothing less than equal access to credit extensions that was provided to Morgan Stanley, Citi, and the scores of other financial enterprises whose high risk investment profiles led to financial calamity and rescue action by the Federal Reserve.
It is time now for the Fed to create one more liquidity-generating facility, a U.S. Citizens Credit Facility, to grant direct liquidity access for American families – the same direct access that fire-hosed hundreds of billions of dollars in liquidity out to Citi, Morgan Stanley, Bank of America, and dozens of other major Wall Street financial institutions.
The Leviticus 25 Plan is a dynamic economic initiative providing direct liquidity benefits for American families, while at the same time scaling back the role of government in managing and controlling the affairs of citizens. It is a comprehensive plan with long-term economic and social benefits for citizens and government.
The inspiration for this plan is based upon Biblical principles set forth in the Book of Leviticus, principles tendering direct economic liberties to the people.
The Leviticus 25 Plan 2018 – $75,000 per U.S. citizen