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| Economy |
| US taxpayers could be on hook for Europe bailout |
| 2011-09-18 |
| Via InstaPundit.com The U.S. is coming to Europe's financial rescue. So far, America's role is fairly limited. But if the crisis continues to grow and the U.S. takes on a wider role, U.S. consumers and taxpayers could feel a bigger impact. The biggest exposure could come from America's status as the single largest source of money for the International Monetary Fund. The latest round of American financial assistance came Thursday with a promise by the Federal Reserve to swap as many dollars for euros as European bankers need. In the short run, those transactions won't have much impact because the central banks are simply swapping currencies of equal value. If the move helps avert a wider crisis, it could help spare the global economy from another recession. But over the long term, consumers could feel the impact of central bankers flooding the financial system with cash, according to John Ryding, chief economist at RDQ Economics. "This is a lender of last resort function," he told CNBC. "With the dollar injections that the Fed has done, it's like giving a patient medicine with really bad side effects." Ryding said the bad side effect in the U.S. has been inflation, which has picked up to 3.8 percent year over year. Actually this is round 2. Much of the taxpayer funded AIG bailout and bankruptcy went to European banks. German and French banks got $36 billion from AIG Bailout In a press release with several attachments, the struggling insurer detailed which counterparties had gotten about $100 billion of the bailout funds. I added up the various lists provided by AIG by country (see below), and the results were quite revealing. About $44 billion went to counterparties headquartered in the U.S., such as Goldman Sachs and states such as California and Virginia. But as I expected, the majority of the funds--$58 billion--went to banks headquartered outside the U.S. The big winners were French and German banks, which pulled in $19 billion and $17 billion respectively. That was the first $100 billion of the $182 billion AIG taxpayer gift. |
| Posted by:Eohippus Phater7165 |
| #5 Tomorrow the pitch is in for taxes. Geither failed in his efforts overseas so they will come to USA to foot the bill. In some way we will. The stock market has already moved up because of it. Germany is preparing for Greece to default. Many of the European banks are at the bottom also. The next two weeks are going to be interesting. The market should drop and gold should go up again. Remember, Ben hung tough on QE3. People will beg him to "pump up the volume" of money printed. Then we have October surprise month. I think Germany has it right. They have started Oktoberfest already I believe. |
| Posted by: Dale 2011-09-18 22:03 |
| #4 Pun intended? stringable Chinese cash |
| Posted by: James 2011-09-18 16:08 |
| #3 China has been printing money. Let them offer their wealth of expertise, including the cash and strings. |
| Posted by: Dale 2011-09-18 15:39 |
| #2 No worries our smartest president evah and his wicked-educated advisers have doubtless put in the proper firewalls to protect our economy "that's growing at a slower pace than we would like" from this Bush-inspired European implosion that no one could have foreseen. |
| Posted by: regular joe 2011-09-18 09:24 |
| #1 Could be? |
| Posted by: g(r)omgoru 2011-09-18 02:59 |