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article imageUS Federal Reserve Bank secretly funding European Sovereign Debt

By Daniel Lick     Dec 12, 2011 in Business
A currency swap program created back in 2008 -2009 by the US Federal Reserve Bank to bail out American banks has been converted to provide much needed funds to European banks.
In spite of efforts by the Federal Reserve Bank to hide the flow of funds to Europe, it has been revealed that 50.7 billion dollars found its way last month to undisclosed European beneficiaries.
The Fed doesn’t track where the dollars ultimately end up, and European officials don’t share borrowers’ identities outside the continent.
Under the freedom of information act, Bloomberg reporters Scott Lanman and Bradley Keoun found that programs initially set up to support American banks during the 2008 - 2009 financial crisis are now being utilized to support European banks. These banks are desperate for cash, having been ordered by the European Banking Authority to raise 115 billion euros by June.
Ben Bernanke of the Ferderal Reserve Bank has refuted that secret loans are being made, stating in a letter to the Committee on Banking, Housing and Urban Affairs that the aggregate amounts have been reported correctly. He does admit, however, that the names of recipients are not reported. Bernake goes on to imply that loans to European banks fall within the Federal Reserve's responsibility to protect the economy.
"Markets are shedding risks into the North American open as it becomes increasingly clear that any solution to Europe will not be an easy fix," said Scotia Capital's senior currency strategist Camilla Sutton.
More about Euro, federal reserve bank, Debt, Social Credit, european sovereign debt
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