Chris wrote the other day about how a new analysis showed that too-big-to-fail banks are getting a $83 billion per year taxpayer subside, equal to the amount of their supposed profits.
Well, a new analysis shows that the amount of the subsidy is nearly ten times that – more than $780 billion a year.
What's particularly interesting about that figure, $780 billion, and something no one has yet noticed, is that it's almost the exact size of the fiscal stimulus that was passed in early 2009 to save the economy: $787 billion. Except that the bankers' stimulus is being spent every single year again and again and again. The Republicans, and some Democrats, never cease to talk about "how much money" we "wasted" on the supposedly "failed" stimulus. But you never hear them talking about the same amount of money that's been actually wasted on their bankster friends.
The analysis is done by Chris Whalen, who is a top banking analyst. Washingtonsblog, that looked at Whalen's analysis and did a great job translating it into basic English, notes that Whalen has been praised by Nouriel Roubini, so he's the real deal.
Whalen's analysis shows that the big banks are actually getting the equivalent of at least $780 billion a year from the feds. Per Washingtonsblog, the subsidies include:
- #360 billion in Federal Reserve subsidies;
- $120 billion in federal deposit insurance;
- $100 billion in government-guaranteed loans;
- "At least $100 billion in monopolistic advantages in the secondary market for home mortgages."
- More than $100 billion in fees in the over-the-counter (OTC) derivative market.
The total? More than $780 billion a year.
At only $83 billion, the earlier estimate, banks were only breaking even without the subsidy – imagine how badly they'd be doing without the newer larger figure. Here's from our earlier post:
The top five banks — JPMorgan, Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and Goldman Sachs Group Inc…. with almost $9 trillion in assets, more than half the size of the U.S. economy — would just about break even in the absence of [the $83bn in] corporate welfare. In large part, the profits they report are essentially transfers from taxpayers to their shareholders.
Elizabeth Warren got into this subsidy with Fed Chair Bernanke the other day at a Senate hearing, where Bernanke agreed with her that we ought to get rid of the subsidy. And this was just the $83 billion estimate that they were talking about, not the newer, nearly ten times larger, $780 billion.
rest http://americablog.com/2013/03/big-banks-subsidy-780bn-warren.html
No comments:
Post a Comment