Thanks To QE Bernanke Has Injected Foreign Banks With Over $1 Trillion In Cash For First Time Ever

Two years ago, Zero Hedge first made the observation that the bulk of Fed reserves (also known simply as "cash created out of thin air" because money is first and foremost fungible no matter what textbook theoreticians may claim, and the only cash allocation preference is the capital allocation IRR analysis) had been parked not with US banks, but with foreign banks with US-based operations.

Source

I know I'm supposed to have something to say here...but all I can say is that if this isn't the Fed devouring the US from within, I don't know what it is.

**I did a search on this subject, and the title, and found nothing posted. Apologies if this topic already exists**

reply to post by BobM88


Dear BobM88,

Good to see people paying attention. About a year ago the Federal Reserve "lent" European Central Banks around $800 billion to give them more "liquidity". I may have written about it; but, it would not have been in the title. In return for the "loan", the Fed was given foreign currencies (Euros, pounds...). We also know that the Federal Reserve loaned money to foreign banks during the TARP bailout; but, they refuse to say how much.

The truth is, we have no idea how many dollars were loaned, given or traded to foreign banks. The next question you should ask yourself what happens if the dollar or the Euro collapses. Generally when you have a currency collapse (Mexico had one in the late 70s or early 80s) is that it only effects that countries currency in any significant manner. Because of the combining of the currencies in the banks and something the International Monetary Fund does called "Special Drawing Rights", if the dollar or euro collapses, they can all go down together.

Both the FDIC and the Bank of England believe that there is going to be a catastrophic bank failure and that there will have to be international cooperation to deal with this crisis. Here is a couple of links you might find interesting.

FDIC - Resolving Globally Active, Systemically Important, Financial Institutions

Counterpunch - The Confiscation Scheme Planned for US and UK Depositors

No conspiracy theory, not a dream, what the FDIC and Bank of England plan to do in their own words with the second link just summarizing it. What I found interesting was how the FDIC and Bank of England document mentions that this has already been told to and approved of by the G20. For a little more fun you can read what the International Monetary Fund wants to do after the currencies collapse in their own words. IMF - The Chicago Plan Revisited.

The assumptions underlying all three organizations are the same. They believe there is going to be a large banking failure due in part to currency wars and manipulation and after the banks fail they will be broken up, the depositors will receive stock in exchange for some of their lost dollars and in the future, an international body will regulate all currencies by basing valuations on a nations Gross Domestic Product. This will constructively result in a single currency for use worldwide.

reply to post by AQuestion


Thank you very much, clearly you've provided me with great information there. I'm almost afraid to read it for fear of what it says.

reply to post by BobM88


Dear BobM88,

I talk to people and write on my blog about it. I understand how it can look dreadful from the outside and I myself don't like where things are heading; but, not because of the coming change in and of itself. We live in a world of globalism, the intentional intertwining of economies and the freer exchange of goods and services amongst nations. The economic system has been manipulated the last 60 years or so to the benefit of the dollar. The western world has controlled the economic systems and is no longer the economic powerhouse that it was. The current system is completely corrupt and based on manipulation rather than value, it has to fail because it should.

Why should the BRIC nations allow us to control the currencies when they are making all the money? We could all go to war because of the money we constructively stole from China alone; but, then what? The BRIC nations could crash the world economy in an instant if they acted in concert; but, then what? This is simply a transition period and clearly the nations have gotten together and agreed on a transition plan and that is all that those documents are that I provided you.

The world has agreed to reboot the economic system and they have a plan in place for the transition period and most of the important things will happen so fast that you wont even notice it. If you read the IMF plan they also want to eliminate central banks and have only governments create money. For the past few years both the Tea Party people and the Occupy people have been calling for the elimination of the Federal Reserve, when it happens they will be thrilled.