Here’s a little bit of background re: what I tweeted about last night. The video is a 2009 Congressional hearing in which former Florida Representative Alan Grayson (D-FL) is quizzing a Vice Chair of the Federal Reserve on the specifics of the lending program. This brief entry by Matt Yglesias at Slate makes the point I made last night in greater detail. He looks at it as a failure of the government to take this same activist stance towards the rest of us. I, instead, go back to the point Yglesias also “Dubious” - which is the Fed’s not using “penalty” rates on these loans. In this program, the Fed loaned this money out - trillions of dollars - at rates so low they were practically zero. Banks could then, in turn, lend the money out at higher rates and, hence the $13B in profits. My question - for how long were these loans made? Are they still being made?
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