http://blog.lawsonforcongress.com/2007/08/29/what-cnn-doesnt-understand-fractional-reserve-banking/ Peace, Prosperity, and Liberty Mon, 13 Oct 2008 08:15:52 +0000 http://wordpress.org/?v=2.5.1 http://blog.lawsonforcongress.com/2007/08/29/what-cnn-doesnt-understand-fractional-reserve-banking/#comment-7104 Susan Smith Fri, 03 Oct 2008 01:19:52 +0000 http://blog.lawsonforcongress.com/?p=29#comment-7104 Actually, our functioning reserve requirements are much, much less right now. One, the larger banks all created SIV's (remember them from Enron), which acted as short-term money markets making income on, securitized mortgages - which started losing money last year, and had to be brought back on banks balances sheets this year because they were created by the bank's commerical paper. They were never included in reserve requirements. Secondly, and what will be the larger problems, all the banks, especially the banks owning investment houses sold many derivatives, which are also kept off book, and not included in reserve requirements. The most dangerous of these is the CDS, or Credit Default Swaps. Bear had 60 trillion notional, AIG sold 562 million, and there were more that a trillions dollars of CDS contracts that would have triggered on Fanny and Freddy bonds. Actually, our functioning reserve requirements are much, much less right now. One, the larger banks all created SIV’s (remember them from Enron), which acted as short-term money markets making income on, securitized mortgages - which started losing money last year, and had to be brought back on banks balances sheets this year because they were created by the bank’s commerical paper. They were never included in reserve requirements. Secondly, and what will be the larger problems, all the banks, especially the banks owning investment houses sold many derivatives, which are also kept off book, and not included in reserve requirements. The most dangerous of these is the CDS, or Credit Default Swaps. Bear had 60 trillion notional, AIG sold 562 million, and there were more that a trillions dollars of CDS contracts that would have triggered on Fanny and Freddy bonds.

]]> http://blog.lawsonforcongress.com/2007/08/29/what-cnn-doesnt-understand-fractional-reserve-banking/#comment-2785 Lawson for Congress Blog » Blog Archive » Subprime Sat, 21 Jun 2008 04:51:24 +0000 http://blog.lawsonforcongress.com/?p=29#comment-2785 [...] last year, Barack Obama proposed a solution for the subprime crisis, perfectly following the “bubble script“. Nine months later, we’re still on schedule — right up to high-profile [...] [...] last year, Barack Obama proposed a solution for the subprime crisis, perfectly following the “bubble script“. Nine months later, we’re still on schedule — right up to high-profile [...]

]]> http://blog.lawsonforcongress.com/2007/08/29/what-cnn-doesnt-understand-fractional-reserve-banking/#comment-2691 Lawson for Congress Blog » Blog Archive » Fisher v. Greenspan: The Fed, Our Government, and Our Dollar Fri, 13 Jun 2008 06:26:00 +0000 http://blog.lawsonforcongress.com/?p=29#comment-2691 [...] money, and don’t understand the link with rising prices, this system is tolerated. Even the mainstream media is widely ignorant of how this system [...] [...] money, and don’t understand the link with rising prices, this system is tolerated. Even the mainstream media is widely ignorant of how this system [...]

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