The Levy Institute has issued a report that the Fed has committed some $29 trillion in the form of loans and asset purchasing to prop up the global financial system and it still has not worked.
In a system that depends on lies and the credulity of the citizenry, the greatest lie is that the Federal Reserve’s “quantitative easing” bailouts of the banks somehow help our citizens and communities.
To clarify this, ask yourself this question: what else could we have bought with the $29 trillion the Fed loaned or backstopped to the banks?
If you enjoy quibbling about the total sum of Fed support, be my guest; the Levy Institute came up with $29 trillion after poring over all the data, while the Government Accountability Office’s (GAO) tally topped $16 trillion. That’s 100% of the nation’s GDP and roughly 100% of the $16 trillion national debt.
While we’re asking about opportunity costs, let’s ask what else we could have bought with the $10 trillion that the Federal government has borrowed and blown in the past 11.7 years. The national debt was $5.727 trillion when G.W. Bush was sworn into office on January 20, 2001. It had risen to $10.626 trillion when President Obama was sworn into office in January, 2009. It is now $16.016 trillion, an increase of $5 trillion in less than four years in “debt held by the public” (i.e. the Chinese central bank, the Japanese central bank, the Federal Reserve, etc.)
Charles Hugh Smith (OfTwoMinds) has worked out that everyone in the US could have free electricity for a fraction of the debt that has been created. What would this have done for the economy. The question remains what did the US get for $16 trillion of debt?
$500 billion is roughly 3% of $16 trillion. That is rather astounding, isn’t it? We could have switched to a (largely) solar-powered electrical grid for a mere 3% of what the Fed squandered to save the “too big to fail” banks. Yes, yes, I know we need a massive energy storage system for any solar-powered grid; shall we throw $1.1 trillion at the problem? That would total a mere 10% of what the Fed has provided to “save” crony-capitalist financial feudalism.