“The Bailout”: The US Administration is Financing its Own Indebtedness Ironically, the Wall Street banks –which are the recipients of the bailout money– are also the brokers and underwriters of the US public debt. Although the banks hold only a portion of the public debt, they transact and trade in US dollar denominated public debt instruments Worldwide. In a bitter twist, the banks are the recipients of a 700+ billion dollar handout and at the same time they act as creditors of the US government. We are dealing with an absurd circular relationship: To finance the bailout, Washington must borrow from the banks, which are the recipients of the bailout. The US administration is financing its own indebtedness. Federal, State and municipal governments are increasingly in a straightjacket, under the tight control of the global financial conglomerates. Increasingly, the creditors call the shots on government reform. The bailout is conducive to the consolidation and centralization of banking power, which in turn backlashes on real economic activity, leading to a string of bankruptcies and mass unemployment.
Posted on: Tue, 23 Jul 2013 21:26:00 +0000
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