A Trillion Here, A Trillion There………

……And soon you are talking real money.  This paraphrases a famous line by Ronald Reagan regarding the US budget deficit, but in the intervening quarter of a century, the numbers of zeros involved has changed.  In a stunning revelation, and one that has so far just emerged into the outer limits of online news, details of exactly how much money the US Federal Reserve pumped into the financial system to stop it grinding to a halt after the collapse of Lehman has been confirmed.  That number is $16,000,000,000,000/$16 trillion – http://1.usa.gov/OKS0ws and http://bit.ly/OKQVEV.  That is 13% more than the entire US economy.  Now this is just the US Federal Reserve, so this excludes support given by the Bank of England, European Central Bank, Bank of Japan, etc., etc…  My favourite quote is from Senator Bernie Sanders(who is himself more interesting than most Senators – http://en.wikipedia.org/wiki/Bernie_Sanders) 

“This is a clear case of socialism for the rich and rugged, you’re-on-your-own individualism for everyone else.”

I could not have put it better myself.  The question that springs to my mind, is was this the most expensive piece of duct tape in history, and all it has masked the problem rather than solving it?

Nick

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