BernieHund: The Political Watchdog

It was alluded to all day, but at last it is confirmed.  The Fed will open the windows with another $100 billion up for grabs on April 7th, a few days after fool’s day.  And, that’s no April Fool’s joke.

The Federal Reserve announced Friday it will auction an additional $100 billion in April to cash-strapped banks as it continues to combat the effects of a credit crisis.

The central bank said it would make $50 billion available at each of two auctions, on April 7 and April 21.

Through the end of March, the Fed has provided $260 billion in short-term loans to commercial banks through the innovative auction process. It also has employed Depression-era provisions to provide money to investment banks.

Still these investment banks are borrowing without regulation. 

The auctions are just one of a series of unorthodox steps the Fed has taken to battle the current crisis. The biggest of those moves was an announcement that it was allowing investment banks to borrow directly from the Fed. Previously, only commercial banks, which face tighter regulations, had that privilege.

I would suggest that the only thing more “unorthodox” would be to help all of us on Main Street who are packing to leave our homes.  But, as the president said today, we will be getting our checks in a couple of months.  I’m holding my breath.  No… guess not.

Well, everyone on Wall Street is heralding these “unorthodox” moves as “magic”.  Magic?  Hell, there is nothing magic about a printing press.  They have been around for centuries.  It’s the magic wand that intrigues me.  Who is going to get stuck with the bill?  Ah… Wall Street?  Nope… Main Street.  Of course with all the foreclosures, there may be no one on Main Street when the bill arrives.

I’m not opposed to keeping the economy afloat.  I have trouble understanding why the Fed announces these little quirks on Friday evening… or after the fact, on Monday morning.  It seems that “they” wait until the doors are closed and everyone has gone home, before they sneak into the printing press rooms like a thief in the night.  Light bulb!  Maybe, because they are thieves in the night, creeping around as the antithesis of Robin Hood.

Maybe Ben Bernanke will have some answers when he testifies before the Joint Economic Committee on Wednesday.  And, yeah… Main Street will be watching.