Tag Archives: treasury

Business/Economics, International, U.S.

What Economic Recovery? Foreign banks dumping U.S. Treasury Bonds

Late on December 30, the U.S. Treasury announced that the dumping of U.S. bonds, by foreign banks, continues and is accelerating.

Back in September the Treasury revealed a $56 billion drop in U.S. Treasury holdings by foreign banks, resulting in a 10 year yield of only 1.67%, the lowest yield since 1945!

Now, for December, an even bigger drop, by $69 billion!!! The result is that the 10 year yield on U.S. Treasuries ended 2011 below 1.9%.

Treasury Department officials also admitted that if it wasn’t for Japan buying up U.S. dollars and other Treasury securities (in August and October), the drop in 2011 foreign holdings would be even bigger!

And this despite the Treasury’s attempt to increase sales through their Operation Twist.  Operation Twist basically exchanges long term bonds for shorter term bonds.

Business/Economics, U.S.

Government Incompetence equals What Economic Recovery? Small Business loan program a big FAIL!

In 2010 the U.S. Treasury Department set up the Small Business Lending Fund.  U.S.$30 billion was intended to be used to help small businesses expand and hire more people, it didn’t happen.

That Small Business Lending Fund ended, September 30, 2011.  Only $4 billion of the $30 billion was loaned out!

As usual everyone is blaming everyone else!  The banks, that were supposed to get the money to loan to small businesses, said the application process was too difficult and had too many restrictions.  The Treasury Department says hardly any bank applied.  Both the banks and the Treasury Department say hardly any small businesses applied.  Small businesses say it wasn’t worth the attempt because the banks put too many restrictions on the loans.

Some analysts say the Obama administration really thought that the economy would be much better in 2011, which is why they made it so tough to qualify for the loans.  In other words, there was no real effort to help small businesses in the United States.   Another example of how out of touch, with main street U.S.A., our political leaders in Washington DC are.

 

Business/Economics, Opinion, U.S.

TARP a TRAP for taxpayers: Treasury Dept. scamming taxpayers, banks paying off loans with loans, is there any real money left in the U.S.?

An organization called Project on Government Oversight discovered the U.S. Treasury Department is letting big banks, and corporations, pay off their taxpayer funded loans with new taxpayer funded loans meant for small banks.

On paper it looks like big banks who took out TARP bailout loans are paying those loans off.  It turns out that many of those payoffs came from new loans also offered through the Treasury Department.

The new loans are being made with a program that was meant for smaller banks, to lend money to small businesses.  The program is called Small Business Lending Fund.

What this means is the U.S. Treasury is not really getting the taxpayer funded TARP bailout money back.  Instead the Treasury is allowing the big banks to rob Peter to pay Paul.  The problem here is that both Peter and Paul are one in the same, the U.S. taxpayer!

This isn’t the first time claims were made that TARP money was being paid back with loans.  In April 2010, Senator Charles Grassley, of Iowa, claimed that General Motors paid back their TARP loan, with another TARP loan: “It looks like [GM’s] announcement is really just an elaborate TARP money shuffle. The repayment dollars haven’t come from GM selling cars but, instead, from a TARP [escrow] account at the Treasury Department.”

Now the question is why can’t the big banks, and other corporations, pay back their taxpayer TRAP (I mean TARP) loans?  After all many have reported big profits. Is this a case of no real money left in the United States?



Opinion, U.S.

U.S. government now using employee retirement money to pay debts

“…timely action to increase the debt limit in order to protect the full faith and credit of the United States and avoid catastrophic economic consequences for citizens.”-Timothy Geithner, Treasury Secretary

U.S. Treasury Secretary Timothy Geithner, will now use government employee retirement money to pay U.S. government debts.  He pointed out that he’s not the first Treasury Secretary to do so.

Even with using retirement money, it’s estimated the government will run out of debt payment options within 11 weeks.  The Federal government has spent its way to the legal debt limit of $14.3 trillion.

What Geithner, and Ben Bernanke of the Federal Reserve (a private bank), want is for Congress to raise the debt limit.  But, that would only mean that our elected officials could get us even deeper in the hole.

The problem is that our Federal government is running solely on loans.  Geithner wants to be able to keep borrowing money.  There is a fear that no matter how drastic government spending cuts are, they might not be enough.   This is a really really really bad sign.

The Treasury Department has already stopped issuing state and local governments special securities to manage their debts.  Where does that leave them?

History shows that Congress loves to raise its debt limit, so it can spend more of YOUR money, and it’s partly the cause of our current situation.  Some members of Congress say it’s time to pay the piper.