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« Goldman Sachs Regularly Borrowed From 2 Different FED Emergency Loan Programs, Topping $35 Billion, Yet It Was NEVER Disclosed In Quarterly SEC Filings | Main | CHART: Federal Reserve FOIA Timeline »
Friday
Apr012011

Money For Nothing: Goldman Sachs Borrowed $24 Billion From Fed At 0.0078 Percent

Editor's Note:  In light of the Goldman theft detailed in today's report, we are reposting this story from last month.

Bernanke is not a loan shark to those he loves...

So if Goldman was getting free cash from The Ben Ber-Nank, the situation at 85 Broad must have been really dicey later on when Blankfein turned to Buffett.

---

Fed names recipients of $3.3 trillion in crisis aid

Source - Bloomberg

  • At Goldman Sachs Group Inc., Wall Street’s most profitable securities firm, borrowing from the Primary Dealer Credit Facility peaked at $24 billion in October 2008.  “Without question, direct government support was critical in stabilizing the financial system, and we benefitted from it,” Chief Executive Officer Lloyd Blankfein said in January 2010.

---

Source - AP

NEW YORK -- For the lucky few on Wall Street, the Federal Reserve sure was sweet.  Nine firms -- five of them foreign -- were able to borrow between $5.2 billion and $6.2 billion in U.S. government securities, which effectively act like cash on Wall Street, for four-week intervals while paying one-time fees that amounted to the minuscule rate of 0.0078 percent.

That is not a typo.

On 33 separate transactions, the lucky nine were able to borrow billions as part of a crisis-era Fed program that lent the securities, known as Treasuries, for 28-day chunks to the now-18 firms known as primary dealers that are empowered to trade with the Federal Reserve Bank of New York. The program, called the Term Securities Lending Facility, ensured that the firms had cash on hand to lend, invest and trade.  The market was freezing up.  Effectively free money, courtesy of Uncle Sam, helped it thaw.

The European firms -- Credit Suisse (Switzerland), Deutsche Bank (Germany), Royal Bank of Scotland (U.K.), Barclays (U.K.), and BNP Paribas (France) -- borrowed $5.2-6.2 billion in Treasuries 20 different times. The one-time fees they paid on each transaction ranged from $403,277.78 to $481,110. Deutsche led the way with seven such deals.

On each transaction, the fee paid for the 28-day loan is equal to a rate of just 0.0078%.

The first of these sweetheart deals began April 17, 2008. They ended nearly a year later on March 5. On that day, Goldman Sachs borrowed about $5.8 billion and paid just $450,000 for the privilege.

Goldman was one of four American firms that also paid that rock-bottom rate. Citigroup, defunct investment bank Lehman Brothers, and Merrill Lynch, which was gobbled up by Bank of America in a government-pushed transaction, benefited from the save-Wall-Street-at-all-costs approach. Goldman and Citi got the 0.0078 percent rate on five separate occasions, tops among U.S. banks.

Continue reading at the Huffington Post...

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Goldman Sachs doing God's work...

Video - Ratigan with Nomi Prins

Nomi is a former managing director at Goldman.

---

 

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Reader Comments (19)

Dec 8, 2010 at 7:05 PM | Registered CommenterDailyBail
Representative Traficant Reports On The Bankruptcy Of The United States, United States Congressional Record, March 17, 1993 VOL. 33, page H-1303

The Speaker - Rep. James Traficant, Jr. (Ohio) addressing the House.

Mr. Speaker, we are here now in chapter 11. Members of Congress are official trustees presiding over the greatest reorganization of any bankrupt entity in world history, the U.S. Government. We are setting forth, hopefully, a blueprint for our future. There are some who say it is a coroner’s report that will lead to our demise.

http://dailybail.com/live-beat/us-default-flashback-rep-james-traficant-discusses-the-feder.html
Dec 8, 2010 at 7:06 PM | Registered CommenterDailyBail
« Lloyd Blankfein Took Home $425 Million In Goldman Stock & Cash Bonuses Over The Last 10 Years, While Shareholders Made Less Than 3% Per Year »

http://dailybail.com/home/lloyd-blankfein-took-home-425-million-in-goldman-stock-cash.html
Dec 8, 2010 at 7:08 PM | Registered CommenterDailyBail
That Trafficant speech is one of the best ones I ever heard, I remember it well from when it was spoken, and was amazed as the herds continued to graze repeating the mantra "they will think of something" over and over again.

Well it has been almost 20 years, SURPRISE!!!. Keep chanting...
Dec 8, 2010 at 9:01 PM | Unregistered CommenterS. Gompers
Sir, my concern is not whether God is on our side; my greatest concern is to be on God's side, for God is always right.
Abraham Lincoln
Dec 8, 2010 at 11:15 PM | Unregistered CommenterJohn Patmos
@GOMP...yes it's a great speech..i rememeber it from c-span i think...
Dec 9, 2010 at 12:23 AM | Registered CommenterDailyBail
So where is God's side John Patmos?
Dec 9, 2010 at 12:53 AM | Unregistered CommenterS. Gompers
GS said they were on God's side, doing His work. That's why they got that great rate.
Dec 9, 2010 at 7:10 PM | Unregistered CommenterG Street
Well, according to Al Gore and GS, the world is warming. So much for that and a shout out to Eric at the wine tasting at N. Pembroke......... It wasn't so bad stepping outside after sampling some of that "ethanol"........ Next time it will be scotch!
Dec 9, 2010 at 9:22 PM | Unregistered Commenterjohn
Look, I'm just gonna bust out and say it: if you're not buying physical silver now, you're stupid. EOM.
Dec 9, 2010 at 10:10 PM | Unregistered CommenterCheyenne
AND I'M PAYING 6.25% INTEREST ON AN FHA LOAN THAT IS NOW UNDERWATER. WHERE'S MY PITCHFORK?!!!
Dec 10, 2010 at 12:22 AM | Unregistered CommenterX
To: DB
cc: Jesus Christ

Re: recent developments

Your website is the fucking best one. Goddamn shit, I just blew an entirely pregnant bowl on zh and then keiser. I love both those sites, hit 'em 10+ each per day. They publish mucho shit. They also publish that one 305-1 long shot often enough to make one's every-10-minute check-in worth it. DB is as fast, but gives one that Sunday morning newspaper feel.

What is more, the comments--particularly the random entries of so many erudite authors--are so astoudingly thought-provoking I can't... I'm addicted. Suspicious, sure, but for sure gonna jones without.

Congrats, DB. It's gotta be harder than it looks.
Dec 10, 2010 at 1:33 AM | Unregistered CommenterCheyenne
thanks cheyenne...i bust my ass trying...the difficulty is in doing what i'm trying to do alone...keeping up with comments, emails, content, posting, screening, advertising, the whole deal...zh has several writers...mish, yves, and CR go it alone but they publish 4 or 5 stories per day...i'm always aiming for 10-15 stories, which is not easy...thanks for the kind words...
Dec 10, 2010 at 2:45 AM | Registered CommenterDailyBail
cc: jesus christ...that made me laugh...

@gstreet...nice one-liner...
Dec 10, 2010 at 2:48 AM | Registered CommenterDailyBail
A quick followup to yesterday's post noting that the Federal Reserve is increasingly being drawn into political debates from which it had once been able to remain aloof — potentially compromising its independence.
It looks like that process is only going to speed up. Two top Republicans, Sen. Bob Corker of Tennessee and Rep. Mike Pence of Indiana, now want to change the Fed's mission, so that it focuses only on controlling inflation, and not on reducing unemployment. That's in spite of the fact that unemployment is at a whopping 9.6 percent, while inflation remains low.

http://news.yahoo.com/s/yblog_thelookout/20101117/bs_yblog_thelookout/gopers-fed-focuses-too-much-on-unemployment
Dec 10, 2010 at 5:14 AM | Registered CommenterDailyBail
Global bond rout deepens on US fiscal worries
Agreement in Washington on a fresh fiscal package has set off dramatic rise in yields of US Treasuries and bonds across the world, threatening to short-circuit any benefits of stimulus. The bond rout raises concerns that the US authorities may be losing control over events.

http://www.telegraph.co.uk/finance/economics/8190059/Global-bond-rout-deepens-on-US-fiscal-worries.html

ambrose evans
Dec 10, 2010 at 5:16 AM | Registered CommenterDailyBail
Dec 10, 2010 at 5:18 AM | Registered CommenterDailyBail
Crash JP Morgan - Buy Silver
http://www.youtube.com/watch?v=wN0rcNJXFfI
Jan 27, 2011 at 7:19 PM | Unregistered CommenterAnonymous
I wonder what the Egyptians could do with the likes of Blankfein(d) and Dimon? You know what would be funny? In a couple of years (or months if things are expedited) to inhabit the homes/palaces of Blankfien and Dimon just like the solders did with S. Husseins palaces. Now that would be justice!
Jan 27, 2011 at 11:07 PM | Unregistered Commenterdogismyth

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