Fed payouts: Big banks win, U.S citizens lose.
It is time for a new, citizen-centered economic plan…
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Today’s Biggest Winner: Banks To Get An Extra $5 Billion In Interest From The Fed
ZeroHedge, Mar 21, 2018 – Excerpts:
Today’s 25bps hike in rates to 1.75% will have little impact on how much interest is paid to the trillions of dollars held in checking and savings accounts across the US (simply because banks continue to drown in over $2 trillion in excess reserves and thus do not really need all those deposits). It will, however, have a notable impact on how much cash the Fed pays out to banks in the form of interest on excess reserves (just don’t call it a subsidy).
As the chart below shows, after today’s rate hike, the Fed will be paying $37 billion in annualized interest to banks, an increase of $5 billion from the last rate hike.
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And now on to the discomfiting part of this financial tale…
40% Of The Fed’s Interest On Excess Reserves Is Paid To Foreign Banks
ZeroHedge, Jul 13, 2017
Courtesy of the Fed’s H.8 statement, however, we can quickly figure out [the amount of interest paid out to foreign banks].
Recall that as we showed first all the way back in 2011, the total cash on the books of commercial banks with operations in the US tracks the Fed’s excess reserves almost dollar for dollar. More importantly, the number is broken down by small and large domestic banks, as well as international banks. It is the last number that is of biggest interest, because now that Congress is finally scrutinizing the $4.5 trillion elephant in the room, i.e., the Fed’s balance sheet, it may be interested to know that approximately 40%, or $838 billion as of the latest weekly data, in reserves parked at the Fed belongs to foreign banks.
This is a subsidy from the Fed, supposedly an institution that exists for the benefit of the US population, going directly and without any frictions to foreign banks….
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The Fed will now, following the rate hike this week, pay out $37 billion as interest on excess reserves to major bank. Since, foreign banks account for approximately 40% of those excess reserves, the U.S Federal Reserve will be paying out $14.8 billion to foreign banks in the coming year..
Again: “This is a subsidy from the Fed, supposedly an institution that exists for the benefit of the US population, going directly and without any frictions to foreign banks….”
This is a Fed-fueled foreign bank funding fiasco – of the highest order.
It is time to grant U.S. citizens the same access to liquidity that the U.S. Federal Reserve is ‘flushing’ through their ‘policy pipes’ to major U.S. and foreign financial institutions.
It all starts here, with the most powerful economic acceleration plan in the world:
The Leviticus 25 Plan – An Economic Acceleration Plan for America Leviticus 25 Plan 2018 (2695 downloads)