Monthly Archives: February 2012

Latest Greek bailout – U.S. taxpayers on the hook again

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Dear Congress:

With the latest Greece bailout plan announced early this week, it appears (via the IMF) that U.S. taxpayers will get soaked again. “An International Monetary Fund official said the Fund’s participation in the second Greek bailout is essential to make it work.”

The overall deal involves “237 billion euro ($314 billion).” And the IMF “itself now has to decide its level of participation the $110 billion euros of official aid being offered in the new rescue package, the official said.”

“IMF Chief Christine Lagarde is preparing to propose a new financing deal for Greece to the IMF board. But she will face concerns among some members that the fund has already pumped a record 20 billion euros into the country in the first bailout, without succeeding in stabilizing the country’s finances.”

The U.S. taxpayer has already (via the IMF) paid over $787 million to help Greece citizens with their debt burden.  The U.S. kicks in 17.7% of the IMF budget, so another round of IMF funding for a Greece bailout means that the U.S. will be borrowing / printing another boatload of Dollars to help out….. Greece (?)

It is time to “strengthen the base” here in America – Give U.S. citizens access to direct credit extensions from the Fed window with the Leviticus 25 Plan.

 Source: “IMF support essential for new Greece bailout”: http://www.breitbart.com/article.php?id=CNG.0ec34b41a1639e68a33560f385a9c2f3.91&show_article=1

 

Primary Dealers ‘mission’ – trouble ahead

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The Primary Dealers Credit Facility (PDCF) was created by the Federal Reserve in the Fall of 2008 to help restore order and maintain liquidity in the credit markets – as the banking crisis began gaining ‘traction.’

Primary Dealer’s ‘mission’ was to bid (take up the slack) at the monthly Treasury auctions whenever demand was light.  It was not unusual for them to ‘take down’  the lion’s share of a given offering when foreign central banks (indirect bidders) and domestic (direct) bidders had cold feet.  This week, for instance, Primary dealers  ‘took down’ 54.66% of the $32 billion auction of 2 year bonds (which, by the way, inched the U.S. national debt up the the $15.413 trillion level).

In the past whenever the Dealers couldn’t ‘move’ (any or all of) the bonds they took down at an auction, they were allowed to ‘flip’ them back to the Federal Reserve, sometimes within days.  They were still allowed to pocket the commissions (millions of dollars worth) for the bonds they could not successfully market (a no-lose deal for themselves – at the expense of U.S. taxpayers).

This monetizing (money printing) mechanism thus expanded the Fed’s balance sheet, and the longer term consequences will not be favorable.

The longer term risk for the U.S. Dollar (vs hard assets) is growing.  And when the Dollar eventually begins its ‘hard slide,’ U.S. citizens are going to get economically hammered.

The Leviticus 25 Plan offers a viable economic recovery plan for America.  And a real chance to avert economic calamity.