Robert Murphy may think Ben Bernanke is a joke, but Mr. Bernanke’s outfit busted out an almost $82 billion in profits last year. All that paper the Fed sucked up onto its balance sheet during the financial crisis is now throwing off bookoo bucks. Under Bernanke’s guidance central banking is suddenly a growth industry, with Ben’s balance sheet now at $2.43 trillion, up $193 billion from ’09. Three years ago the Fed’s footings were less than $900 million.
Amongst the assets Mr. Bernanke and Co. are shepherding include sub-prime mortgage bonds that once belonged to American International Group (AIG). The Wall Street Journal reports that AIG would like to repurchase these bonds as a part of its attempt to break free from government control through a public stock offering. “Ahead of that, AIG wants to be able to show investors it is putting its cash to work and boosting investment income in its insurance units,” reports the WSJ‘s Serena Ng.
The rub is that AIG is offering 53 cents on the dollar for the mortgage bonds. Maybe the Fed can do better in the marketplace. After all, AIG projects the “Maiden Lane II” assets to yield from 8% to 10%. That’s pretty rich at a time the 10-year Treasury is throwing off 3.34%. But this isn’t the free market and achieving the best price is not always the goal. The “central bank will need to show it is doing well by the taxpayers,” writes Ng.
Well yeah, but don’t the taxpayers own AIG? Of course, but it’s complicated. The Fed is worried that if these bonds are thrown into the marketplace it could sink the price of similar securities, “an outcome that could hurt banks holding such securities.” That’s because these banks are holding the sub-prime mortgage bonds on their balance sheets at values similar to what the Fed bought the Maiden Lane paper for–more than 53 cents on the dollar.
So, despite his organization earning record profits, his growing his business beyond what anyone thought was possible, and having to make decisions where logic or market prices are not applicable, Chairman Bernanke only makes around $200,000 a year. I’ll bet he thinks that a joke.
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6 Responses
beaucoup bucks.
The bio did not mention anything about his counterfeiting hobby!
“The Wall Street Journal reports that AIG would like to repurchase these bonds as a part of its attempt to break free from government control through a public stock offering.”
I’ll gladly fork over some cash to break free from government control. I don’t remember getting a bailout, but let’s pretend I did and I’ll pay it back and “break free.”
Please feel free to correct my misapprehensions, but I call BS on this article.
My point is – firstly : it would appear academic Mr French is writing to an audience surprised to learn central banksters are buccaneering profiteers. Secondly : I believe Mr French has grossly under-estimatedthe true profit margins of central and other banksters generally.
I do not see how it could be possible anyone on this planet could be so obtusely stupified to imagine central or national banksters, are more benevolent philanthoropists than monarchs, fascist dictators, demopublicans, Republicats, libertarians, tea partiers, national or private mercenary armies.
The last time I looked at the Debt Clock, it was wizzing along at U$14+ Trillion, and picking-up speed – yielding U$2.173 Trillion as a return on investment. http://www.usdebtclock.org/
$2T interest on $14T principle = 13% ROI
My interpretation of this data is : private U$ Federal Reserve Banksters BOUGHT THE U$A FOR $14T of fiat digital currency – which did not even cost 5 cents per sheet to print.
The additional U$ 23T distributed by Fed to other central banksters and corporations (including Harley Davidson) – was to encumber American taxpayers as chattles to provide additional security for digital investments to take ownership and control of economies and businesses in many other countries, also paid for in zero-cost digital fiat currency.
Unless I am completely mistaken – the sole purpose of all banksters is : control, power and profit – at any cost – as long as somebody else is paying the ultimate price.
Even better, Banksters use taxpayer money to exploit control and power over all public institutions, utilities, and private autonomous self regulating and captively self insured professional associations in every society they infest – regardless whether : police, legal, accoUnting and taxation authorities they instituted and control – using national or private mercenary armies – banksters take total control of host/parasite relationships, enabling forced liquidations at pennies per dollar, yen, euro et al.
Any notion the U$ Fed only made $87B in 2010 is completely absured – multiple TRILLIONS EVERY YEAR.
In 1984 I read articles about profiteering of 6 chartered banks of canaDUH?
RBC was at the top with 178%, and Banksters of Nova Scotia 126% – NET PER QUARTER.
In other words – AFTER paying all costs of liquidations, golden parachutes to directors, dividends and cost to expand operations – RBC made 750% net profit on assets per annum, and BNS made 500%.
Maybe I am completely in err, however by my calculations – the U$ Federal Reserve is creating trillions of dollars in profits by liquidating TRILLIONS OF real property- at 53 PENNIES perdollar – based on 2010 liquidation values !!
Think about it in purely mathematic terms of profit and loss, with short term costs, and longer term objectives accomplished by skillful investment and management of investments.
Psychopathic bankstering directors have only 3 mandates – power, contol and profit – regardless of sacrifice, compromise or longevity of anyone, or anything else on this planet. Banksters look at people and this planet as “accounting externalities”, the cost of business paid in bloodshed, painful suffering, loss of limbs, being KIA, battlefield or civilian suicides, environmental disasters et al, weighed in the balance of cost/benefit ratios to expand powers, control and profit at others expense.
It would appear moot – banksters ultimate goal is to reduce populations – no different than managing any other corporation, by reducing overheads – which is easily accomplished by reducing employees.
Banksters control all the best lands, pristine waters, pure air and security for their private personal enjoyment – living in gated community’s where mercenary police officers gaurd them 24/7/365 – ALWAYS at common taxpayers expense.
This reminds me of debates about deregulation.
Good rules exist – BUT NEVER APPLIEDTO PROFESSIONALS, POLICE, MONACHS, PRIESTS, POLITICIANS, GENERALS, JURISTS OR BANKSTERING PSYCHOPATHS – BECAUSE THEY CONTROL THE SHOW.
Peter Carson
[email protected]
Quote from the article: ‘The Fed is worried that if these bonds are thrown into the marketplace it could sink the price of similar securities, “an outcome that could hurt banks holding such securities.” ‘.
So in other words, the Fed’s function is to prevent assets from being priced the only honest way there is …. in a market with willing buyers and willing sellers.
I’ll blow your mind:
None of this would be possible without…
(drumroll)
(wait for it)
Legal tender laws