[quote=ucodegen]Sounds like you don’t understand fractional reserve banking and how it might relate to market cap. Remember that for a bank to make a loan, it often has to borrow money itself. In some cases that money may be your own bank account. In order to pay you interest, it has to generate money from it somehow. It does this by lending the money out. When things went south, the money that the bank borrowed had to be paid back.. Basically the market cap is related to Assets – Liabilities (it is not pure assets). The Fed money was to help plump up the Assets because house values (or effectively the loans face value) dropped like a stone.[/quote]
I’m not surprised that you are a supporter of one of the two major parties (Republican), because you are clearly clueless. JPM didn’t lend out that $390 billion. They just turned around and put it in Treasuries risk-free. Fractional-reserve lending has nothing to do with the massive bailouts the criminal banksters received.
A 3% risk-free spread on $390 billion is almost $12 billion. No wonder the U.S. government borrowing rates are staying so low. The Fed is giving $16 trillion in bailout money at near zero rates to the criminal bankster elites who are turning around and buying government debt with it in order to turn a risk-free profit.
What homeowner wouldn’t love to earn a risk-free return on 3 times the amount of his home? Too bad this level of criminality can only be played by the elites.
