"This book truly
is a must read."
-- Congressman Ron Paul
A FEW MORE SUCH VICTORIES AND WE SHALL BE UNDONE!
HEADLINING THE FINANCIAL NEWS THIS MORNING, REPORTS SUCH AS THIS:
"The Federal Reserve has made $14 billion in profits on loans made in the last two years..."
Charles wants to know: Does the media flim-flam us on purpose, or do its editors, reporters, and writers not know better?
Let's go to MarketTicker.org, where Karl Denninger has reacted to a New York Times story of this sort:
The problem is that this "accounting" is terribly misleading. It ignores the more than $100 billion passed through AIG to Goldman Sachs and others, for example - money that is almost certain to never be recovered.
The government still faces potentially huge long-term losses from its bailouts of the insurance giant American International Group, the mortgage finance companies Fannie Mae and Freddie Mac, and the automakers General Motors and Chrysler. The Treasury Department could also take a hit from its guarantees on billions of dollars of toxic mortgages.
No really? Fannie and Freddie are a potential five trillion dollar bomb that the government has refused to take on its balance sheet for fear it may detonate on the US credit rating (yes, the rating of the NATION, not of a company.) This fear is not unfounded; with some 13% of all mortgages currently "non-performing" (either in default or foreclosure), a record, and a "cure rate" down from the 40% range to 6% for prime mortgages, there is every reason to believe that many of these losses will become realized.
“The taxpayers want their money back and they want the government out of our banking system,” Representative Jeb Hensarling, a Texas Republican and a member of the Congressional Oversight Panel examining the relief program, said in an interview.
The taxpayers aren't going to get their money back, and the government has done exactly nothing to force the disclosure of losses that are currently being hidden by accounting games and even outright fraud. Indeed, if anything, the government has encouraged and made possible even more games.
... This sort of misleading "reporting" is an outrage. It is one thing to be hopeful, but it is entirely different to publish things that you either know or should have known are absolutely false in an attempt to burnish the patina of a fraud-laced pair of Administrations in Washington DC along with the agencies that are their handmaidens.
