marți, 15 iulie 2008

the wizard of Oz and the free lunch - part II

so the wizard of Oz got his free lunch by stealing taxpayer's platinum credit card and paying with it for unlimited goodies...

now we all can see the downside for the poor taxpayer at a first sight. somebody's stealing from his hard earned money (call it taxes paid to the state budget). but there are other risks here, even to the wizard himself...

indeed by opening the Fed's balance sheet to Fannie & Fred, there's a clear risk that the $478 bio of remaining treasuries get quickly used away to no much avail. see here -> the estimate for backing the current $1,540 bn of the two GSEs combined is some $230 bn...

and that is only a small part of the issue that's been put through authorities and the FED in the hands of the taxpayer. cause there's plenty of trouble brewing round the next corner for various banks that are on the bankruptcy list... by some estimates the FDIC has already used a large portion of its available funds for the rescue of IndyMac (10% of the available funds already) and will soon need to be re-capitalized...

you might rightfully ask yourself where would one get the funds to do it? still from the same platinum card stole from the taxpayer? what would happen when the FED starts to print money from the presses just to cover more and more losses? what would happen if you used more than the allowed credit limit and loose confidence of the "bank"? you would go bankrupt...and that "you" is the US itself, with the rest of the world loosing confidence in the dollar and the whole American financial system. they'll stop supplying unlimited credit and investments in that currency that was turned into a worthless piece of paper.

the indigestion would be fatal to the wizard of Oz...

if there ever was such a thing as a wizard of Oz... but of course there is no such thing.

just who do you think rigged the stock markets so as banks $ FIs rebounded today with no good news in sight? unless there are some more sleight of hand tricks in the making, to divert the public's attention from the ongoing fraud...

of course the poor taxpayer would still pay the ultimate bill...

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