FT: Banks stole $1.1 trillion from depositors when the Fed hiked interest rates. pic.twitter.com/RghhkeI8zq
— Peter St Onge, Ph.D. (@profstonge) October 24, 2024
- When rates were low, banks were lending at 4% but paying you 0.2%. Then, when the Fed finally upped rates, banks kept 70% of the gain. We bail them out, they rip us off. – Wall Street Apes
- Turns out banks stole most of the Fed’s interest rate hikes — $1.1 trillion worth – FX Hedge
The scandal is not just that the banks did not pass on to their depositors the high interest rates they were getting from the Fed to let money sit idle in cash accounts. It is that the Fed was paying them to keep that money from being loaned to the real economy. The Fed created the liquidity to bail out government deficit spending, then paid banks not to lend out what they received from selling Treasury debt to the Fed. That is the source of those windfall profits to banks and it came out of future remittances to Treasury, i.e., taxpayer funds. Since March 2022, the Fed has paid banks a half trillion dollars to prevent financial resources from supporting private sector economic activity. This is disgusting. Congress should get involved as the Constitution gives them the authority to regulate money, which they outsourced to the Federal Reserve as an independent agency. It’s time to have a hearing on this matter and bring this situation to light. The Fed’s practice of paying interest on the reserve balances of commercial banks should end. Fed’s high-rates era handed $1tn windfall to US banks – Judy Shelton
More to check out today 10/24/2024:
- CNN’s Dana Bash revealed insider comments regarding the current political landscape in Washington, D.C.
- Urgent communication calling on sheriffs, attorneys general, and other law enforcement officials across the U.S. to take immediate action
- FBI Director Chris Wray and former CISA Director Chris Krebs are accused of lying to the American public about election security
CLICK HERE FOR COMMENTS