Fed Emergency Bank Loans Soared As Money Market Inflows Continue To Surge

ZeroHedge – May 11, 2023 – Excerpts:

“This surge in money market fund inflows strongly suggests tomorrow’s H8 deposit report will show the bank run is accelerating…

Source: Bloomberg

This surge in money market fund inflows strongly suggests tomorrow’s H8 deposit report will show the bank run is accelerating.

..…..

The total size of the Fed’s backstopping facilities remained extremely high at around $305.4 billion…

Source: Bloomberg

But, more problematically, the demand for the Bank Term Funding Program surged by $8 billion to $83.1 billion – a new high…

Source: Bloomberg

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Away from the FDIC loans, The Fed has a total of $92.4 billion of loans outstanding to financial institutions through two backstop lending facilities in the week through May 10, dramatically higher than the $81.1 billion the previous week.

Tomorrow we get the big one – more answers after the bell when The Fed releases its H8 report on bank deposit flows and whether the seasonal-adjustments are total bullshit or not.”

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2008-2010, 2021-2022, and now again 2023 – The Fed continues their “backstop lending facilities”…. and taking America around in circles.

The banking system is unstable; Federal budget deficits are snowballing; Real wages for working Americans are stagnant; Stagflation is settling in on the U.S. economy; Entitlement programs are creating ever-greater dependence on government.

Washington Democrats continue their push for higher taxes and expanded social welfare programs, and adding regulatory burdens to America’s small businesses.

Washington Republicans have NO politically feasible, economically viable plan to generate federal budget surpluses, re-ignite (non-debt financed) economic growth, reduce citizens’ dependence on government; rejuvenate the banking sector; stabilize the U.S. Dollar; and restore financial security for America’s hard-working, tax-paying U.S. citizens.

Washington Republicans have NO PLAN to get America back on track.

Main Street America’s Republicans do have a plan:

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 – An Economic Acceleration Plan for America

$90,000 per U.S. Citizen – Leviticus 25 Plan 2023 (6104 downloads)

“But the essential features of that individualism which, from elements provided by Christianity and the philosophy of classical antiquity, was first fully developed during the Renaissance and has since grown and spread into what we know as Western civilization—are the respect for the individual man qua man, that is, the recognition of his own views and tastes as supreme in his own sphere, however narrowly that may be circumscribed, and the belief that it is desirable that men should develop their own individual gifts and bents.”
― Friedrich A. Hayek, The Road to Serfdom

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“What our generation has forgotten is that the system of private property is the most important guaranty of freedom, not only for those who own property, but scarcely less for those who do not. It is only because the control of the means of production is divided among many people acting independently that nobody has complete power over us, that we as individuals can decide what to do with ourselves. If all the means of production were vested in a single hand, whether it be nominally that of “society” as a whole or that of a dictator, whoever exercises this control has complete power over us.”
― Friedrich A. Hayek, The Road to Serfdom

Mish: Tidal Wave of Money Leaving Banks Will Kill Bank Profits and Lending

Let’s tune into a mass exodus of deposits at banks for money market mutual funds and what it means.

Mish, Apr 24, 2023 – Excerpts:

Jim Bianco 21-Tweet Thread / Mish opinions:

The “bank walk” becomes a “bank powerwalk” to 5%.

More Bank Failures? – “To be clear, a bank walk will NOT lead to another bank failure, wrong metric. But it will kill their profitability, especially the smaller banks.“

Giant Bank Sucking Sound – Question On Stopping the Run 

Mish: “Banks need NEW Deposits because they already locked up existing deposits in 10-YR notes at 2.0% or so. Offering 3% will not attract much new money with others offering 5%.“

Bianco: “Exactly correct: They [banks] locked up securities and loans that generate much lower interest rates. Somewhere around 3%. Over time they mature and get rolled into higher rates. But not now. So, they lose money by trying to compete with market rates. This explains why the bank stocks cannot rally.“

Bianco The “bank walk’s” cumulative impact on markets, the economy, and lending. It will be a significant drag later this year.

Moody’s Downgrades 11 Regional Banks:  Moody’s Downgrades 11 Regional Banks, Including Zions, U.S. Bank, Western Alliance.

Regional banks, Moody’s said, are more exposed to hard-hit commercial real estate. U.S. banks hold about half of total CRE debt outstanding, and some are concentrated in construction, office, or land development.

U.S. Bank has a “relatively low capitalization” as well as unrealized losses on its securities, Moody’s said.  Zions has “significant” unrealized losses on its securities portfolio and its capital has deteriorated, Moody’s said.

Downgraded Banks

• U.S. Bancorp USB, with $682 billion in assets
• Zions Bancorp ZION with $89 billion in assets.
• Bank of Hawaii Corp., BOH with $24 billion in assets.
• Western Alliance Bancorp WAL, received a two-notch downgrade.
• First Republic Bank, which faced a run last month, had its preferred-stock rating cut.
• Six More: Associated Banc-Corp., Comerica Inc., First Hawaiian Inc., Intrust Financial Corp, Washington Federal Inc., UMB Financial Corp.

Banks will not be taking any extra risks. Nor will larger banks that also face the “powerwalk”. This will pressure bank lending across the board.

Like it or not, the Fed is purposely angling for recession to cure inflation. 

And the Fed does not have an inflation ally in the White House. Biden is doing everything possible to fuel inflation with inept Green policies. 

This post originated at MishTalk.Com

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The right way for the Fed to rescue troubled banks:

The Leviticus 25 Plan, provides the tidal wave of fresh capital that will flow into banks through debt pay-downs by American families: Mortgage debt, Consumer debt, Household debt, Student Loan (unsubsidized) debt; credit card debt.

A good share of that debt, in ‘delinquent’ status, will be ‘satisfied,’ or ‘made current,’ which will be an important additional benefit.

The Leviticus 25 Plan will also reignite economic growth, which will help relieve pressure on Commercial Real Estate (CRE) debt service.

The Leviticus 25 Plan – An Economic Acceleration Plan for America

$90,000 per U.S. citizen – Leviticus 25 Plan 2023 (6066 downloads)

America needs a clean path to reducing dependence on government… and eliminating the massive fraud and waste built into our big government social policy ‘solutions.’

It is shocking that Washington Republicans and Democrats, for all intents and purposes, have turned a blind eye to this gigantic, ongoing tax-payer rip off.

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Improper Payments

Government Accountability Office (.gov) | https://www.gao.gov › improper-payments

Improper payments—payments that should not have been made or were made in the incorrect amount—have consistently been a government-wide issue…

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Welfare Fraud – Federal Safety Net

Federal Safety Net | https://federalsafetynet.com › welfare-fraud

Improper welfare payments, including welfare fraud and welfare abuse, are estimated to be 15.2% of all federal welfare payments. They total $161 billion in the fiscal year 2021. The estimate stems from the Office of Management and Budget (OMB) [i] and The General Accounting Office (GAO) reports. Eight of the Welfare Programs make the OMB list of “High Priority Programs.” These are programs with improper payments greater than $2 billion annually.   Shown below is information on each program.  

The table below shows billions of dollars of estimated welfare fraud and improper payments by welfare programs. The table takes total expenditures by program and applies the improper payment percentage. Adding up the programs approximates the overall improper payments from the welfare system as a whole.

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America’s Health Care Programs are Full of Improper Payments

Paragon Health Institute | https://paragoninstitute.org › americas-largest-health-c…

Dec 4, 2022 — A new report estimates official improper payments made by federal health programs are about $132 billion annually…

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How Medicare and Medicaid fraud became a $100B …

CNBC | https://www.cnbc.com › 2023/03/09 › how-medicare-an…

Mar 9, 2023 — Medicare and Medicaid programs are being brazenly targeted by sophisticated criminals. Estimated annual fraud tops $100 billion…

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Social Security Fraud: What Is It Costing Taxpayers?

Millions, possibly billions, of dollars every year

By The Investopedia Team | Updated September 02, 2022

Reviewed by Charlene Rhinehart | Fact checked by Vikki Velasquez

Social Security fraud statistics can be difficult to pin down. Some are grouped inside a larger category that the Social Security Administration (SSA) calls “improper payments,” which includes everything from innocent mistakes to willful fraud. The SSA estimates that it made about $8.3 billion worth of improper payments during the 2020 fiscal year.

Social Security-related fraud can also take other forms, such as identity theft using stolen Social Security numbers and scams involving bogus phone calls and emails purporting to be from the SSA. Collectively, these frauds cost the U.S. government and individual taxpayers millions, if not billions, of dollars every year.

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Programs Susceptible to Improper Payments Are Not Adequately Addressed and Reported

Oversight.gov | https://www.oversight.gov › oig-reports › TIGTA

May 6, 2022 — Earned Income Tax Credit (EITC) – The IRS estimates 28 percent ($19.0 billion) of the total EITC payments of $68.3 billion were improper.

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CHD, Apr 12, 2023: Biden to Spend $5 Billion on New Coronavirus Vaccine Initiative Supported by Gates, Fauci and Republican Lawmakers

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The Leviticus 25 Plan

Qualifying participants will each receive a $60,000 deposit into their Family Account – and, for five years, will no longer be enrolled beneficiaries in the following programs: EITC, child tax credits; SNAP, Housing Assistance, SSI, Child Nutrition, TANF.

Qualifying participants will also receive a $30,000 deposit into their Medical Savings Account, and will then have a $6,000 annual deductible for primary health care services accessed through Medicaid, Medicare, VA, TRICARE, FEHB for five years. This would eliminate tens of millions of claims and provide cleaner programs for improper payment and fraud prevention.

Participants will not receive Social Security Disability Insurance benefits for five years. OASI benefits would not be affected.

Participants would not receive free Coronavirus vaccinations.

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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 – An Economic Acceleration Plan for America

$90,000 per U.S. citizen – Leviticus 25 Plan 2023 (5993 downloads)

Much of the banking sector in the U.S. is reeling, primarily from ‘duration stress’ – having lent long-term money out in recent years at relatively low interest rates, and now having to borrow at much higher rates. Inflation hit, rates rose, and in due course market value of these paper assets on their balance sheets have dropped significantly.

The KBW Bank Index, a bellwether indicator tracking the prices of 24 large banks in this sector, began crashing in March. It is now down 46.7% year-to-date.

Index Components – As of May 2021, the individual index components included:

• Bank of NY Mellon (BK)
• Bank of America (BAC)
• Capital One Financial (COF)
• Citigroup (C)
• Citizens Financial Group (CFG)
• Comerica (CMA)
• Fifth Third Bank (FITB)
• First Horizon (FHN)
• First Republic Bank (FRC)
• Huntington Bancshares (HBAN)
• JP Morgan Chase (JPM)
• Keycorp (KEY)
• M&T Bank (MTB)
• Northern Trust (NTRS)
• PNC Financial Services (PNC)
• People’s United Financial (PBCT)
• Regions Financial (RF)
• Signature Bank (SBNY)
• State Street (STT)
• SVB Financial Group (SIVB)
• Truist Financial Corp (TFC)
• US Bancorp (USB)
• Wells Fargo & Co (WFC)
• Zion’s Bancorp (ZION)

Source:  Investopedia

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The S&P Regional banking ETF, KRE, is also under significant stress – down 35% from recent highs.

KRE vs SPX:

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The Fed has three apparent choices.  Two bad.  One good.

1. Bailouts. The Fed may be ‘forced’ into another round of bank bailouts to shore up capital requirements covering scores of Institutions within the sector – with the Fed recreating various credit facilities through which to pump hundreds of billions of dollars out to major banks (domestic and foreign) to stabilize the system.

Primary beneficiaries:  Wealthy industry insiders, Board of Director members, wealthy major shareholders like Warren Buffett and Bill Gates (circa 2008-2011), and others.

Primary non-beneficiaries:  Working class Americans, particularly those losing income, getting laid off, struggling to pay rents and mortgages.

Bad Choice: This would do nothing to restore credibility within the sector.  Federal and State governments would remain mired in debt.  There would be no positive long-term benefits for U.S. economic growth, no positive debt elimination benefits for American families.

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2.  Rate Reduction: The Fed could embark on aggressive rate reduction.  This would ostensibly shrink ‘lend long, borrow short’ rate gap that is plaguing the sector.  Duration risk, theoretically, would be at least partially mitigated as the market value of banks’ paper assets rises. 

Bad Choice:  Fed would lose a lot of credibility. Inflation would likely come back to haunt the Fed (and millions of working class Americans). There would likely be severe repercussions to credit markets (actually, ‘all hell could break loose’). Federal and State governments would remain mired in debt.  There would be no positive long-term benefits     for U.S. economic growth, no positive debt elimination benefits for American families.

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3. Re-target liquidity flows. The Fed could create a new facility, a Citizens Credit Facility, to officially launch The Leviticus 25 Plan.

Primary beneficiaries:  Working class U.S. citizens.

Good choice: 1)  Bank sector duration risk would rapidly resolve as underwater paper assets would be converted to dollars assets at par value – for banks to re-lend at market rates.  It would restore confidence within the sector.

2)  Massive debt reduction / elimination across the board for millions of American families.

3)  Marked gains in GDP growth as trillions of dollars previously earmarked for debt service boomerang back into the economy, creating jobs, re-incentivizing work, increasing economic productivity, generating enormous new flows of tax revenue and payroll tax revenue (Social Security, Medicare).

4) The Leviticus 25 Plan, through its recapture provisions, would generate $619 billion federal budget surpluses and major budget gains for most state and local governments, and would pay for itself entirely over a 10-15 year period.  

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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 – An Economic Acceleration Plan for America

$90,000 per U.S. citizen – Leviticus 25 Plan 2023 (5969 downloads)

The Federal Reserve’s ‘secret liquidity lifelines’ for major banks:

Bloomberg LP filed a Freedom of Information Act (FOIA) lawsuit on Nov 7, 2008 to gain access to information regarding special emergency lending programs that the U.S. Federal Reserve had been running to help borrower banks deal with cash shortages and collateral deficiencies. The Fed fought the lawsuit, but ultimately lost.

Bloomberg gained access to more than 29,000 pages of previously secret loan documents and Fed spreadsheets and published the highlights of those programs in late 2011.

According to Bloomberg, the top 15 recipients of Fed’s ‘secret liquidity lifelines’ were:

Morgan Stanley   $107 billion                                                                                      

Citigroup Inc.   $99.5 billion                                                                                               

Bank of America Corp   $91.4 billion                                                                                

Royal Bank of Scotland Plc   $84.5 billion                                                                        

State Street Corp   $77.8 billion                                                                                         

UBS AG  $77.2 billion                                                                                                 

Goldman Sachs Group Inc.   $69 billion                                                                               

JP Morgan Chase & Co    $68.6 billion                                                                      

Deutsche Bank AG  $66 billion                                                                                   

Barclays Plc   $64.9 billion                                                                                               

Merrill Lynch & Co Inc.  $62.1 billion                                                                                

Credit Suisse Group AG  $60.8 billion                                                                             

Dexia SA  $58.5 billion                                                                                              

Wachovia  $50 billion

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Meanwhile, here’s how Main Street America made out.

8.7 million Americans lost their jobs during the financial crisis years.

4.1 million American families lost their homes through completed foreclosures from September 2008 through December 2012, according to CoreLogic..

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Round and round we go – the Federal Reserve is once again bailing out troubled institutions in the banking sector.;;

ZeroHedge, March 16, 2023: Today’s weekly H.4.1 update from the Fed :

In the week ended March 15, borrowings under the Fed’s deeply stigmatizing last-ditch liquidity facility, the Discount Window, exploded to $152.85BN, a record $148BN weekly jump to an all-time high which surpassed even the borrowings during the financial crisis!

It is time to re-target Fed liquidity extensions: U.S. citizens deserve nothing less than to be granted the same direct access to liquidity that has been so generously provided, time and time again, to Wall Street’s financial sector during times of financial stress.

Let the liquidity flow through the hands of U.S. citizens first – and then on up to the banks (to reduce/eliminate household debt, student loan debt, mortgage debt), instead of mass-pumping newly-created electronic ‘money’ into the banking sector, with mere crumbs falling through for America’s hard-working, tax-paying U.S. citizens.

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 – An Economic Acceleration Plan for America

$90,000 per U.S. citizens – Leviticus 25 Plan 2023 (5967 downloads)

Note: There is a clear path out of this mess…

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World Bank Warns Of ‘Lost Economic Decade’ As Turmoil Spreads

ZeroHedge, Mar 29, 2023 – Excerpt:

“A lost decade could be in the making for the global economy,” Indermit Gill, the World Bank’s Chief Economist and Senior Vice President for Development Economics, warned in a new report. 

The report “Falling Long-Term Growth Prospects: Trends, Expectations, and Policies” reveals new forecasts that show global long-term potential output in growth rates are expected to slide: 

Nearly all the economic forces that powered progress and prosperity over the last three decades are fading. As a result, between 2022 and 2030, average global potential GDP growth is expected to decline by roughly a third from the rate that prevailed in the first decade of this century—to 2.2% a year.

For developing economies, the decline will be equally steep: from 6% a year between 2000 and 2010 to 4% a year over the remainder of this decade. These declines would be much steeper in the event of a global financial crisis or a recession.

World Bank’s chief economist continued:  “The ongoing decline in potential growth has serious implications for the world’s ability to tackle the expanding array of challenges unique to our times—stubborn poverty, diverging incomes, and climate change.”

However, he said: “But this decline is reversible. The global economy’s speed limit can be raised—through policies that incentivize work, increase productivity, and accelerate investment.”

Ayhan Kose, director of the World Bank’s forecasting group, said the fracturing of the global economy implies “the golden era of development appears to be coming to an end.”

Earlier this year, the World Bank cautioned global central banks to stay alert to the economic risks related to aggressive monetary policy tightening aimed at combating inflation, as these risks may have widespread consequences. Just weeks ago, the emergence of a regional bank crisis in the US and problems with Credit Suisse in Europe demonstrated the validity of these concerns.

Besides a banking crisis, central bankers are also facing their nemesis… Stagflation…

While the global economy appears to be on a crash course with a ‘hard landing,’ no thanks to reckless central banks, the World Bank said, “It will take a herculean collective policy effort to restore growth in the next decade to the average of the previous one.” 

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The Leviticus 25 Plan.

Again, from the World Bank: “But this decline is reversible. The global economy’s speed limit can be raised—through policies that incentivize work, increase productivity, and accelerate investment.”

There is currently one U.S. economic acceleration plan up and ready to launch, that will accomplish these crucial policy initiatives.

The Leviticus 25 Plan will: 1) incentivize work; 2) increase productivity; 3) accelerate investment; and 4) stabilize the banking system – reversing the damaging effects of ‘duration risk’ and bringing distressed loans to ‘current status’; 5) rejuvenate long-term economic growth and insulate the economy from random economic shocks; 6) generate $619.5 billion federal budget surpluses for the coming 5 years; 7) restore economic liberty.

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 – An Economic Acceleration Plan for America

$90,000 per U.S. citizen – Leviticus 25 Plan 2023 (5963 downloads)

Distressed Debt Soars By 29%, Or $66 Billion, In One Week Amid Surge In Bankruptcies

ZeroHedge, Mar 23, 2023 – Excerpt:

The cascade of defaulted regional US banks is blowing out the circulating inventory of distressed debt which expanded by about $65.9 billion last week as US insolvency courts saw six new, large bankruptcy filings, according to data compiled by Bloomberg.

The heap of dollar-denominated corporate bonds and loans in the Americas trading at distressed levels rose to $295.4 billion in the week ended Friday, a 28.7% increase from $229.5 billion a week earlier, Bloomberg-compiled data show.

Source: Bloomberg

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In total, there were 48 large bankruptcy filings – those related to at least $50 million of liabilities – this year through March 20. That’s the highest since 2009, which saw 88 large cases through March 20, per Bloomberg-compiled data.

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The U.S. business economy is, in many ways, limping along in a liquidity-starved environment….

America’s business world and millions of America’s hard-working, tax-paying families need properly targeted liquidity – of the type which flows directly to credit-worthy qualifying U.S. citizens, and then on up to U.S. banks (to reduce / bring current distressed household debt) and to large and small corporations (to relieve mounting corporate debt pressures).

The Leviticus 25 Plan – An Economic Acceleration Plan for America

$90,000 per U.S. citizen – Leviticus 25 Plan 2023 (5949 downloads)

“Debt And Inflation Threaten U.S. Security” – Wall Street Journal Feb 22, 2022.

The U.S. national debt is plowing higher and the interest expense on that debt is mushrooming.. Our elected leaders in Washington have absolutely no politically feasible plan on the table to set America back on course.

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Annual Interest Rate Payment on Government Debt: $850 Billion and Rising Fast

At the current pace, interest on US government debt will soon hit one trillion dollars.

Mish – Feb 5, 2023 – Excerpt:

BEA Chart (h/t Mish) – Annualized interest on US national debt

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Interest Payments On Treasury Debt Up 29% YoY

ZeroHedge, Mar 22, 2023 – Excerpts:

Via Global Macro Monitor,

Here is a follow-up on last week’s chart with some excellent granular detail.   

Interest payments on the national debt during the current fiscal year (October to February) are up 29 percent y/y, one of the fastest-growing expenditure components of the Federal budget (see table below). 

Revenues are down, especially individual income taxes, which may reflect the slowing economy.  

Theory dictates (ceteris paribus) that government tax revenues should be rising with inflation, however.  Hmmm. 

The overall deficit is exploding, btw, up 50 percent.  

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America’s national security is on the line. And our Republican and Democrat representatives in Washington, D.C. have no politically-feasible, economically responsible plan to get America’s massive debt back under control.

America’s Main Street Republicans do have a plan: 

The Leviticus 25 Plan – An Economic Acceleration Plan for America 2024

Economic Scoring links:

·    The Leviticus 25 Plan – 2024 Generates $619.5 billion Federal Budget Surpluses (2024-2028) Part 1: Overview, Deficit Projection

·    The Leviticus 25 Plan Generates $619.5 Billion Federal Budget Surpluses Annually (2024-2028). Part 2: Federal Income Tax Recapture; Economic Security / Means-Tested Welfare Recapture.

·    The Leviticus 25 Plan Generates $619.5 Billion Federal Budget Surpluses Annually (2024-2028). Part 3: Medicaid, Medicare, VA, TRICARE, FEHB, SSDI Recapture.

·    The Leviticus 25 Plan Generates $619.5 Billion Federal Budget Surpluses Annually (2024-2028). Part 4: Interest Expense Recapture, Totals Summary

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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 – An Economic Acceleration Plan for America

$90,000 per U.S. citizen – Leviticus 25 Plan 2023 (5892 downloads)

The U.S. contributes 17.46% of the International Monetary Fund (IMF) quota. The recently agreed to Sri Lanka bailout agreement means, in effect, that U.S. taxpayers will contribute $52.38 billion of the $3 billion package – which will go, in large part, to help Sri Lanka pay off debts to its largest single creditor, China.

Our Washington-based Republicans and Democrats apparently to not have a problem with this….

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IMF Approves $3 Billion Bailout for Sri Lanka – WSJ

Colombo has been in talks to receive financial assistance from the IMF since last spring

By Philip Wen and Alexander Saeedy

March 20, 2023 – Excerpts:

The International Monetary Fund approved a $3 billion financial bailout for Sri Lanka, a key milestone in the cash-strapped country’s efforts to recover from its worst economic crisis in decades.

Sri Lanka will receive approximately $333 million in a first disbursement from the fund following the signoff on Monday from its executive board of directors, the IMF said. The country will receive the remainder of its bailout package over the next four years as it makes progress on fiscal policy reforms and debt-restructuring talks with its sovereign and commercial creditors.

The $3 billion financial package, the IMF said, aims to restore Sri Lanka’s debt sustainability and mitigate the economic impact of a continuing recession on the poor and vulnerable.

Sri Lanka has been racked by turmoil after its foreign reserves dwindled last year to the point that it could no longer pay for imports such as fuel, cooking gas and medicines. It approached the IMF for a financial bailout after suspending repayments on its external debt in April….

…To receive final approval, Sri Lanka needed to show it had made enough progress on negotiations for debt relief with its creditors, including with bilateral creditors like China, Japan and India. China is Sri Lanka’s single largest creditor, having lent billions to the country through a number of its state-owned policy banks.

In January, the state-controlled Export-Import Bank of China provided a letter offering a two-year moratorium on debt repayments for some $3.8 billion in outstanding loans that Sri Lanka owes. The letter didn’t meet IMF requirements and the approval process didn’t move forward, Sri Lankan officials said.

The Chinese lender this month provided a second letter promising to restructure its debt in line with the IMF’s framework for public debt sustainability in Sri Lanka. India and Japan, as well as commercial bondholders, have also said earlier they will help Sri Lanka ease its debt burden, paving the way for the IMF to green-light a first disbursement under the bailout.

Economists said the IMF’s approval represents a crucial but early step toward Sri Lanka restoring its economic credibility and regaining access to international capital markets. The country needs to complete debt-restructuring negotiations with lenders, which could take months.

“Until that happens, Sri Lanka remains in a state of stress,” said Nishan de Mel, executive director of Verité Research, a Colombo-based think tank.

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Sri Lanka is in a “state of stress” …(?)

U.S. taxpayers are also in a ‘state of stress’… And it is high time to stop transferring U.S citizens’ hard-earned tax dollars, through proxies, to our arch enemies.

These insane policies perpetuate misguided foreign policy initiatives, provide aid and comfort to our enemies, and add to our already massive debt loada, and make our country weaker.

It is time to end transfer payments to America’s enemies. Period.

It is also time to ‘de-stress’ America with a bold new economic acceleration plan – to rebuild our economic power base, eliminate debt, generate massive budget surpluses, and restore economic liberty for all U.S. citizens.

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 – An Economic Acceleration Plan for America

$90,000 per U.S. citizen – Leviticus 25 Plan 2023 (5889 downloads)