$80 Billion Secretive Loans to Banks for only 0.01%

Monopoly money well not exactly but the Federal Reserve certainly never consider about the ordinary residents of the US when they process Secretive Loans to Banks for only 0.01%. Outrageous but true!

$80 Billion Secretive Loans to Banks for only 0.01%

Federal Reserve – quote – The $80 billion initiative, called single-tranche open- market operations, or ST OMO, made 28-day loans from March through December 2008, a period in which confidence in global credit markets collapsed after the Sept. 15 bankruptcy of Lehman Brothers Holdings Inc.

Units of 20 banks were required to bid at auctions for the cash. They paid interest rates as low as 0.01 percent that December, when the Fed’s main lending facility charged 0.5 percent.

“This was a pure subsidy,” said Robert A. Eisenbeis, former head of research at the Federal Reserve Bank of Atlanta and now chief monetary economist at Sarasota, Florida-based Cumberland Advisors Inc. “The Fed hasn’t been forthcoming with disclosures overall. Why should this be any different?”

More on this report
Fed Gave Banks Crisis Gains on $80 Billion Secretive Loans as Low as 0.01%

http://www.bloomberg.com/news/2011-05-26/fed-gave-banks-crisis-gains-on-secretive-loans-as-low-as-0-01-.html

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