1 Trillion Euros to be released in The EU by ECB
Has anybody wondered or connected how The Big Banks got The USA Congress to back derivatives with taxpayers money this month?
Well now you know why!
serf
http://www.bloomberg.com/news/2015-01-21/ecb-said-to-propose-qe-of-50-billion-euros-a-month-through-2016.html
The ECB president and his Executive Board proposed spending 50 billion euros a month through December 2016, two euro-area central-bank officials said. The plan still faces a tense debate in the Governing Council and may change before the final decision on Thursday, the people said, asking not to be identified as the talks are private. An ECB spokesman declined to comment.
By urging Fed-style quantitative easing, Draghi is remodeling the ECB as an aggressive central bank that will take risks even against the wishes of Germany, the region's biggest economy. Bundesbank President Jens Weidmann and Executive Board member Sabine Lautenschlaeger have argued QE isn't needed and reduces the incentive of governments to make structural reforms.
http://www.politifact.com/wisconsin/statements/2015/jan/07/mark-pocan/new-law-means-taxpayers-must-back-banks-incredibly/
In other words, banks could continue to hold derivatives, but in special subsidiaries that didn't benefit from government backing in the form of FDIC insurance.
Since Dodd-Frank took effect, banks have sought to change that rule so they can once again use their deposits to underwrite some more complex derivative trades. And the cromnibus bill rolls back that Dodd-Frank provision.
The libertarian Reason Foundation worried about the rollback:
"The Dodd-Frank rule prevented traditional banks from betting on financial derivatives with federally insured deposits. The banks could still trade in such exotic securities, but they had to do so with their own capital stock, through non-bank affiliates unsecured by FDIC backing. The idea was to prevent future bailouts like the ones that took place" in 2008.
Well now you know why!
serf
http://www.bloomberg.com/news/2015-01-21/ecb-said-to-propose-qe-of-50-billion-euros-a-month-through-2016.html
The ECB president and his Executive Board proposed spending 50 billion euros a month through December 2016, two euro-area central-bank officials said. The plan still faces a tense debate in the Governing Council and may change before the final decision on Thursday, the people said, asking not to be identified as the talks are private. An ECB spokesman declined to comment.
By urging Fed-style quantitative easing, Draghi is remodeling the ECB as an aggressive central bank that will take risks even against the wishes of Germany, the region's biggest economy. Bundesbank President Jens Weidmann and Executive Board member Sabine Lautenschlaeger have argued QE isn't needed and reduces the incentive of governments to make structural reforms.
http://www.politifact.com/wisconsin/statements/2015/jan/07/mark-pocan/new-law-means-taxpayers-must-back-banks-incredibly/
In other words, banks could continue to hold derivatives, but in special subsidiaries that didn't benefit from government backing in the form of FDIC insurance.
Since Dodd-Frank took effect, banks have sought to change that rule so they can once again use their deposits to underwrite some more complex derivative trades. And the cromnibus bill rolls back that Dodd-Frank provision.
The libertarian Reason Foundation worried about the rollback:
"The Dodd-Frank rule prevented traditional banks from betting on financial derivatives with federally insured deposits. The banks could still trade in such exotic securities, but they had to do so with their own capital stock, through non-bank affiliates unsecured by FDIC backing. The idea was to prevent future bailouts like the ones that took place" in 2008.
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Nothing like doubling down on failure. 0
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