Fed News Friday: The Greatest Secret Loan Scandal in US History

December 2nd, 2011

It took two years of legal battles against the Federal Reserve, but a Freedom of Information Act request filed by Bloomberg News has unearthed 29,000 pages of central bank records of more than 21,000 transactions during the financial crisis between 2007 and 2009. The report appeared in Bloomberg Markets magazine’s January issue. 

The documents revealed Federal Reserve secrets that Ohio Democratic Senator Sherrod Brown said should, “unite the Tea Party and Occupy Wall Street” which we’ve been calling for since the early days of Occupy Movement.

It seems that during the height of the economic crisis the Federal Reserve was secretly lending almost $8 trillion in virtually interest free loans to various major banks. To give you some idea, that’s about half the GDP of the entire country. Compare that to the TARP bailouts that ruffled everybody’s feathers which were only $700 billion. And unlike TARP these secret loans came with no conditions and no bogus pretext of any larger public good.

In this instance “secret” doesn’t just mean that the American people were kept in the dark. It means no one, not even congress, knew except a select few officials at the Federal Reserve and the US Treasury. The six largest US banks (JPMorgan, Bank of America, Citibank, Wells Fargo, Goldman Sachs, and Morgan Stanley) alone accepted $460 billion of the loans. In fact, while the largest bailouts in American history (maybe world history) were going on behind closed doors, the CEOs of those major banks were making public statements to their own shareholders that they were in good financial shape.

If ever there was a smoking gun implicating the Federal Reserve in a broad financial conspiracy to defraud the American people this is it, and it seems that Wall Street was defrauded just like everyone else. But it should come as no surprise. From it’s inception the nefarious details of the inner workings of the Federal Reserve have been shrouded in secrecy. The Federal Reserve has only been lending money in secret since 1913. What’s astounding is the depth of arrogance it must take to escalate this hoax to unprecedented levels at the same time that both public scrutiny of the Federal Reserve and the consequences of the Federal Reserve are at an all time high.

So, either the nation’s financial institutions are in deeper crisis than they’re admitting and require half the wealth of the entire country to stay afloat, or they are now fully complicit in the systematic fleecing of the American public that the Federal Reserve has spent 100 years perfecting. Until you grasp exactly why the financial powers in this country hate the free market and constantly work to circumvent market forces you will never understand the economic crisis.

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About the Author: Davi Barker

In grade school Davi refused to recite the pledge of allegiance because he didn't understand what it meant. He was ordered to do as he was told. In college he spent hours scouring through the congressional record trying to understand this strange machine. That's where he discovered Dr. Ron Paul. In 2007 he joined the End The Fed movement and found a political home with the libertarians. The Declaration of Independence claims that the government derives its power “from the consent of the governed." He does not consent.

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