“The US plan has done nothing at all about the debt crisis itself. It’s bailed out the creditors, but not a penny of the actual debts, the subprime mortgage debts, are addressed. Without any of the media knowing, the Federal Reserve over the last few months has given $850 billion of cash for trash already. This is what the $700 billion discussion in Congress was supposed to be about, but the Fed, without anyone knowing, has already been exchanging these securities. And the securities essentially have been swapped by the US bankers to their pals and not done anything at all to write down the actual subprime debts. There’s a big attempt to blame the victim now. And if you add up all of the subprime bad loans and defaults, that’s altogether $1 trillion. So far, the government has given away $6 trillion already to Wall Street. That’s much more than any of the subprime debt. And the volume of derivative trade has been estimated at $450 trillion, an unbelievable amount. So nobody has any idea about how much money is at stake.“
Source: Michael Hudson on Democracy Now
If this isn’t the biggest scam in history I will eat my own leg!
For more and real interesting comments on the financial crisis go to this site:
http://elainemeinelsupkis.typepad.com/
Regards
“And the next day, Lehman used the money that it took from London to pay its closest associates to redeem the derivative trades that it had done.”
Interesting to see that the counterparty to Lehman’s money-losing swaps was a cabal comprised of senior associates from the firm. These are the same people who arranged these derivative trades on behalf of Lehman Brothers.