Should the Federal Reserve borrow money to the BIG 3 Auto Manufacturers? (bankrupt, loan)
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Now that the BIG 3 American Auto Manufacturers have been turned down by Congress, there is talk that the Federal Reserve Bank will step in and use their own power to print and borrow money to go ahead and give Detroit the funds it needs to survive.
The Federal Reserve has already given banks billions without the approval of Congress, how about some more billions for the Auto Companies. The XXX with Congress!
Is this a good alternative due to the bailout not passing Congress?
The attached article says the Federal Reserve is reluctant to give money to Detroit but may have to step in due to the National Emergency.
I don't know why we elect these people, who half the time don't do what the people want. And then like last night, the bailout fails.
And the automakers can still go to the fed and the pres and get their money?
What gives?
Why put them on life support?
And yes, the stock market (should) tank today, but that's just a correction of all the happy fuzzy increases we saw last week "in hopes of the automaker bailout". Also, last night's events are an indication of bailout-burnout. So yeah, now struggling companies aren't feeling quite as secure that Uncle Sugar will fix all their problems.
These companies need to stand on their own feet. Is this not America?
If the company can't survive it needs to fail.
We must bite the bullet on this economy and take our lumps. We can't keep piling up debt for our descendants to pay.
...there is talk that the Federal Reserve Bank will step in and use their own power to print and borrow money to go ahead and give Detroit the funds it needs to survive.
The Federal Reserve doesn't "borrow" anything, from anybody.
The Federal Reserve doesn't "borrow" anything, from anybody.
The Fed PRINTS, period.
If you think about it, the Fed is technically borrowing the dollars in your wallet with the promise of never paying it back... so in essence everytime the Fed prints money, they are stealing your money... now people will say the Fed helps to stabilize the economy by preventing Big Business from going bankrupt... and then points to history where deflation hurt the economy if you didn't protect Big Business... but it never ceases to amaze me that the money "stolen" from you is never returned... especially when times are good... shouldn't the opposite also occur? That during "good" times, the Fed would seek to remove money from Big Business (and thus lessen its influence on the government) that benefitted when times are bad... There is no counter-balance... that reeks of corruption to me... when times are bad, don't worry the Taxpayers will pay your bills... when times are good, don't worry cause the Taxpayers will STILL pay your bills? Eh?
If you think about it, the Fed is technically borrowing the dollars in your wallet with the promise of never paying it back... so in essence everytime the Fed prints money, they are stealing your money... now people will say the Fed helps to stabilize the economy by preventing Big Business from going bankrupt... and then points to history where deflation hurt the economy if you didn't protect Big Business... but it never ceases to amaze me that the money "stolen" from you is never returned... especially when times are good... shouldn't the opposite also occur? That during "good" times, the Fed would seek to remove money from Big Business (and thus lessen its influence on the government) that benefitted when times are bad... There is no counter-balance... that reeks of corruption to me... when times are bad, don't worry the Taxpayers will pay your bills... when times are good, don't worry cause the Taxpayers will STILL pay your bills? Eh?
Hi evilnewbie,
There is more than one way to steal. Its not just when government creates more money but when banks do it. Most of our money is commercial credit. That means banks have stolen more than the government ever has and since it is at interest they keep stealing more. At least government debt stops stealing at the time its printed. Since we cannot take on anymore debt they are going directly to the Fed to steal.
What is also tragic is the the way out of it, besides stopping the direct stealing of funds, is to create government debt which will create hard money. This should be done to replace commercial debt until it is gone. However this money should be given to the citizens directly.
If I were running the system(and I survived the assassination attempts), I would end all income taxes and offer monetary grants to every household say $5,000 per to start. Following that looking at the activity would be important. The goal would be for people to pay off their debt. Any debt retired would directly replace commercial credit at interest. Reserve requirements would also rise. Banks would start to die but I would nationalize those thieving institutions anyway. As I push hard money into the system more commercial debt should be retired. At any point people stop retiring debt and spending and we see inflationary pressure, then excise taxes would be implemented to suck the money back in. The end game is no more commercially created fractional reserves where all money would be essentially treasury notes.
Banks could then loan money but could not be demand deposits. Any demand deposits must be full reserve.
Our choice of money supply is really quite simple. We have government debt and fractional reserve created commercial debt. At least 4/5 of the money supply is commercial debt, all taking in interest that can only be paid with more debt. The society at large is renting most of its money. Banks did not just print it and steal its wealth, they charge us for its use. We owe them for using our own federal reserve notes that back it. Taxes back treasury notes and treasury notes back dollars. That any one bank is at risk is not relevant. The banking system as a whole is what is in view and it is nothing but usury on a grand scale.
The Federal Reserve doesn't "borrow" anything, from anybody.
The Fed PRINTS, period.
Hi Nor'Eastah,
It is still just a fraction of what the banks print.
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