JackRiddler wrote:compared2what? wrote:It was those Fed-held mortgage securities I was really trying to check, though. I didn't want to have been harder on her than she deserved in the event that they weren't agency-backed. But that's exactly what they are -- straight-up Fannie Mae/Freddie Mac issue, implicitly guaranteed by the government ever since the New Deal brought it into being.
Fannie/Freddie, which operated as private shareholder companies prior to their failure, and the Fed have both taken over prodigious quantities of MBS paper originally issued by Wall Street banks (i.e., not originated by Fannie/Freddie). While these represent assets, it is unclear what their real value is and in cases of mortgage default realizing that value means foreclosure and eviction -- with potentials for unintended consequences such as depressing the market and further dropping the value, as well as spreading poverty and desperation with its impact on the economy. Can you check those numbers -- how much of current "Fannie/Freddie" and "Fed" holdings is actually originally Wall Street MBS?
In a way, that's not an easy question to answer simply. Briefly, their exposure to toxic, hopeless, subprime stuff was both time- and regulation-limited, however imperfectly on the latter score. So "prodigious" would always have been....Well. I guess it depends. It's kind of a relative term. But I'm not so sure it would ever really have been justified.
More to the point, though...
...
Okay. I give up for now. The whole issue is complicated by the Fannie/Freddie (Bush-era) government bail-out, which actually wasn't fundamentally at all a bad thing for ordinary citizens, despite (a) being Bush-era; (b) representing a huge and costly-to-taxpayers increase in federal debt; and (c) providing unmerited relief to evil banksters and Wall-Street types. It just wasn't a good one.
More later elsewhere, at some point.
Technically, that is debt. But I'd hate to see how she characterized the Social Security program if she thinks it's either fair or accurate to call the Fed's holding of them a public liability that benefits banksters and just leave it at that.
Well she hasn't done that yet. [/quote]
Effectively, I'd say she has.
The Fed didn't fucking set the interest rate at zero as a matter of monetary policy in order to create jobs. It's at zero because it can't go lower. And they're desperately trying to raise it. That's why they're buying shit.
It's at zero to stabilize the banking system, in part by allowing them to borrow at zero and buy bonds (such as Treasuries) at higher-than zero. Essentially a publicly subsidized arbitrage for Wall Street. Also, technically it is untrue that it can't go lower. One possibility (not currently in view) is in fact to set negative interest rates on select debt instruments held by public institutions, gradually relieving and reducing the debt burden on the people.
Why don't you repost all this on the Wall Street thread, and I'll follow suit? Since it's not quite in the right monster thread any more, I hope you'll agree. Pretty please.
Absolutely. I suspect we pretty much agree, though. Because it's not like I wouldn't say that there were enormous problems with what they're doing, how they're doing it, and why. To say the least.
What I mostly object to is....I guess the extent to which that article suggests that all government debt is always unambiguously morally evil and bad for citizens. And the extent to which it's decoupled the subject from taxation issues.
FWIW, I'm actually not trying to be antagonistic or combative by disputing it. It's just that those are the exact same kinds of omissions and oversimplifications that the MSM uses to construct the dangerous falsehoods with which it prefers to beguile the public. And ultimately, they're just as destructive. Predatory, even.
Anyway. Sure! Later.