Author Topic: US Exposure to EU Bailout: $50 Billion and Counting - TORCH & PICTHFORK TIME  (Read 1245 times)

Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
US Exposure to EU Bailout: $50 Billion and Counting
Posted By: Jeff Cox | CNBC.com
CNBC.com | 11 May 2010 | 04:26 PM ET

________________________ ________________________ _____

US taxpayers could be on the hook for $50 billion or more as part of the European debt bailout, which is likely to be a close cousin to the strategy used to rescue the American financial system.

Determining the exact exposure at this point is nearly impossible until governments start stepping up to the window created by the European Union and the International Monetary Fund to stem the crisis in Greece and elsewhere on the continent.

But one rule-of-thumb formula puts potential US exposure at $54 billion should the entire IMF loan fund be tapped.

And that doesn't count the added exposure created by the Federal Reserve's decision over the weekend to participate in currency swaps to provide liquidity to jittery European banks. The swaps move resembles the Term Auction Facility the Fed instituted when the worst of the US financial crisis hit in 2007-08.

And the entire bailout package has been nicknamed "Le Tarp" by some for its similarity to the Troubled Asset Relief Program that bailed out US companies with taxpayer-backed loans.

US involvement in the European crisis already has drawn critics from Congress and economists who think the domestic financial issues should be cleared up first.

"Inflation and debt is not the answer to a problem caused by inflation and debt," said Michael Pento, chief economist at Delta Global Advisors and a critic of both the European plan and the Fed's approach to US fiscal stability. "It's a European problem that should have been dealt with by Europeans."

In Washington, Senior administration officials said taxpayers will not be liable for the European bailout. (See video)

But the US is a participant in the International Monetary Fund, which has agreed to work with the European Union to help countries that come under debt duress.

The IMF has pledged a one-third share of the 750 billion-euro ($952 billion) rescue package—typical of the fund's arrangements with central banks in such cases.

That would come to 250 billion euros, though that is only a rough figure and dependent on a variety of circumstances, according to an IMF official who spoke on condition of anonymity because of the uncertainty still involved.

The US would be responsible for 17.09 percent, or $54 billion, of the cost using a quota contribution system the IMF uses in such instances. The US is the leading contributor under the quota setup.

But pinpointing the exact figure is difficult because all loans are not created equal, and will depend on the currencies in which they are issued and the arrangements between the parties.

Also, the basis of the loans won't be solely on the quota calculation, which accounts for only half the formula. The other half is a pro-rated basis for which the US does not currently have an agreement but is likely to in the future. That pool comes from wealthier countries with "useable resources," with the typical arrangement for the US being higher than the 17 percent for the quota share.

"How the fund actually raises the resources for the specific loan depend on a number of different criteria, one of which is currency that the country is borrowing in," the IMF official said. "Those details are somewhat complex."

The situation regarding the currency swaps is a different story.

The US has virtually unlimited exposure in that situation as it loans dollars to foreign banks in exchange for euros, which it then holds for a period that can range from overnight to three months. The currency is sent to central banks such as the European Central Bank as well as those in Japan, Switzerland and Canada, which in turn then direct the money to banks seeking the safety of the world's primary reserve currency.

That arrangement, too, has drawn criticism in part because of the danger of default and worries over the rapidly devaluing euro.

Defenders, though, say the swap trades are virtually without risk as the ECB is the entity responsible for backing up the swaps. The ECB is responsible for returning the money to the US along with a slight interest appreciation on the loan.

"These (swaps) operations will be a net positive for fiscal conditions," said Zach Pandl, economist at Nomura Securities International in New York. "They contain no credit risks whatsoever. The counterparty is the foreign central bank. There's basically no debt. The European Central Bank is going to pay back the loan."

The swaps, though, will make the Fed's balance sheet grow to perhaps $2.5 trillion from its current $2.3 trillion, said Delta's Pento.

Putting more US money into circulation at a time when the central bank is trying to shrink its balance sheet will only add to inflationary pressures down the road, he said.

"With an over-$2 trillion monetary base, the damage is already there," Pento said. "You've lit fire to a building that is already burned down."

Pandl said the swaps transactions could total as much as $100 billion, "which is nothing to sneeze at. But compared to the Fed's balance sheet, it's still a relatively modest sum."

© 2010 CNBC.com
URL: http://www.cnbc.com/id/37084075/


--------------------------------------------------------------------------------

.
© 2010 CNBC.com

________________________ ________

Can we impeach and try Obama for Treason yet? 

And before you clowns jump on me, he spent the weekend pushing Merkel to go along with this. 


Option D

  • Getbig V
  • *****
  • Posts: 17367
  • Kelly the Con Way
Treason...because you dont agree with him? HMMM...What is he doing that makes him eligible to be marked as a treasonist president?

Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
Treason...because you dont agree with him? HMMM...What is he doing that makes him eligible to be marked as a treasonist president?

How about his stealing our money and giving it to greek socialists who refuse to cut thweir spending and reckeless ways? 

MuscleMcMannus

  • Getbig V
  • *****
  • Posts: 6236
Torch and Pitchforks?  HAHA yeah right!  Americans are some of the most pacified people in the world.  Sure we can send our young men and women off to war to fight battles and topple armies and countries...........but when it comes to putting up some semblance of a domestic battle against our government at home.............we fail miserably.  America is busy toppling other countries and fighting enemies abroad yet our country is imploding from the inside.  

The rich in government and in corporate America don't give a shit about the average American.  When this country collapses their companies in which they have stock in will control even more of the world.  The banks the financial institutions will reap huge profits once America collapses.  The US government is a corporation.  And the people running it are hyperglobalists.  44% of Congress are millionaires and many people in US society have no problem with that.  Yet they bitch and complain about why things are the way they are and continue to believe in this myth that we have a capitalistic free market economy.  While you and I will be licking our wounds when America collapses our politicians and corporate tyrants will be sipping martinis in their South American enclaves and million dollar ranches.  The war that needs to happen isn't between the government and the people........it's between the haves and the have nots.  The middle class and the rich........because it's the rich who make up a majority of the government.  Remember that when you speak of Pitch forks and torches!  

Option D

  • Getbig V
  • *****
  • Posts: 17367
  • Kelly the Con Way
How about his stealing our money and giving it to greek socialists who refuse to cut thweir spending and reckeless ways? 

Oh i didnt know that this was reguarded as treasonist activities...let me check...and ill check the news and see if the word treason has come up

Option D

  • Getbig V
  • *****
  • Posts: 17367
  • Kelly the Con Way
The Constitution of the United States, Art. III, defines treason against the United States to consist only in levying war against them, or in adhering to their enemies, giving them aid or comfort. This offence is punished with death. By the same article of the Constitution, no person shall be convicted of treason, unless on the testimony of two witnesses to the same overt act, or on confession in open court.

hmm...looking for something that says giving money to europe

240 is Back

  • Getbig V
  • *****
  • Posts: 102387
  • Complete website for only $300- www.300website.com
So... um....

Where is evreyone suuposed to take their torches and pitchforks?  I guarantee, if you walk to the white house with some noise like that, you'll be pinkmisted before you can blink.  

If you're using some creative angry metaphor for "Get out and vote in 2010!", then that's cool... but why not just say that?

in this day and age of advanced technology, any kind of physical revolt would be pointless.  If you don't like how things are, vote for a candidate who will do it differently.  If there are none, then you should make a run for office yourself.  

So please tell us... are you encouraging illegal, law breaking in the forms of uprising?  Or just telling people to vote?  

MuscleMcMannus

  • Getbig V
  • *****
  • Posts: 6236
The Constitution of the United States, Art. III, defines treason against the United States to consist only in levying war against them, or in adhering to their enemies, giving them aid or comfort. This offence is punished with death. By the same article of the Constitution, no person shall be convicted of treason, unless on the testimony of two witnesses to the same overt act, or on confession in open court.

hmm...looking for something that says giving money to europe

LOL........as much as I hate Obama what he does financially hardly qualifies as "treason".  Even debating his birth origins is a better arguemnt than him committing financial treason.  Republicans and Democrats.......liberals vs. conservatives........... .3336686 is just caught in a paradigm like those he argues against.  

Greece a socialist state?  Haha America is as much socialist as Greece is.  In fact I would argue America hasn't seen capitalism since its inception.  What he have now is socialism for the rich.  Where as in Greek it's socialism for the workers.  What's the difference?  Both of our countries are in debt...............debt that neither of us will ever pay off.  

MuscleMcMannus

  • Getbig V
  • *****
  • Posts: 6236
So... um....

Where is evreyone suuposed to take their torches and pitchforks?  I guarantee, if you walk to the white house with some noise like that, you'll be pinkmisted before you can blink.  

If you're using some creative angry metaphor for "Get out and vote in 2010!", then that's cool... but why not just say that?

in this day and age of advanced technology, any kind of physical revolt would be pointless.  If you don't like how things are, vote for a candidate who will do it differently.  If there are none, then you should make a run for office yourself.  

So please tell us... are you encouraging illegal, law breaking in the forms of uprising?  Or just telling people to vote?  

Voting is absolutely worthless.  Moreover, who are you going to vote for when both parties have the monopoly and Americans are too stupid to vote anyone else into office.  I voted for Ron Paul..............so what's the point? 

What's going to happen in my lifetime is terrorism.  Mark my words.  because you are right...............The US government is extremlely powerful and would squash any domestic uprising with exxtreme brute force.  But they are powerless to stop some crazy domestic terrorist who would blow himself up in a crowd of politicians.  Like that guy that flew his plane into the IRS building.  You're going to see more and more shit like that in the next 50 years.  Except much more of it will be targeted at government. 

Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
Obama phoned Merkel on euro bail-out
VALENTINA POP

Today @ 09:48 CET


EUOBSERVER / BRUSSELS – US President Barack Obama telephoned German Chancellor Angela Merkel over the weekend to persuade her to agree to the €750 billion bailout package for the eurozone.

Mr Obama made two phone calls to German Chancellor Angela Merkel in the last three days and also spoke to French President Nicolas Sarkozy as EU leaders and then their finance ministers were struggling to pin down the deal, White House spokesman Robert Gibbs said Monday.

 
Barack Obama had a long phone conversation with Angela Merkel (Photo: White House)
Print
Comment article

"The president and his economic team have been following and engaged in this situation for quite some time," he said, noting Mr Obama had spoken about the need for "strong action" to give confidence to the markets. "We are pleased thus far with that result," he added.

According to the New York Times, Mr Obama was on the phone with the German chancellor on Friday "offering urgent advice" and "some not so subtle prodding" that Europe needed an overwhelming rescue package of the sort Washington came up with in 2008.

"He was trying to convey that he knew these were politically difficult steps that the leaders there had to take, that he had gone through them as well. And that, from his experience, trying to get out ahead as much as possible was the right way to go," one senior administration official familiar with the conversation told the US newspaper.

His administration also offered concrete help: the Federal Reserve would swap euros for dollars, easing pressure on European central banks.

Europeans "waited too long" with the Greek bailout and fueled speculation about the fragility of the entire eurozone, another US official told the New York Times.

"Had they acted sooner," he said, "They might have gotten away with less."

Ms Merkel is seen as responsible for dragging out the European response to the Greek crisis and systematically opposing moves for greater economic integration.

The Social-Democratic opposition has accused her of concealing the real proportions of the euro-crisis, for political reasons. There were regional elections North Rhine-Westphalia on 9 May, which in the end were lost by her party and with it the majority in the upper house.

Social Democrat MP Thomas Oppermann, one of the leaders of the party in the Bundestag, told Die Welt newspaper Ms Merkel was now standing in front of "the wreckage of her own delaying tactic."

"Now Ms Merkel is at the mercy of the unleashed financial markets," he said.

The SPD will be instrumental in approving the German contribution to the bail-out, as it holds the majority in the upper chamber, which has to approve it.

Ms Merkel has called for a cabinet meeting today (11 May) to sketch out a legislative bill to this end. The Social Democrats estimate that the total bill for Berlin will be around €150 billion, higher than the estimated €123 billion as not all of the eurozone countries will have the cash to pay for it.

Ms Merkel's own coalition partner, the Liberal Free Democratic Party, has expressed dissatisfaction at the "firefighting" action agreed over the weekend, especially at having the European Central Bank buy up government bonds – so far a taboo for Berlin.

"Such actions need to be taken with consideration of the independence of the ECB," Liberal leader Wolfgang Gerhard said, according to Spiegel Online

http://euobserver.com/9/30054
________________________ _________________

You guys are incredibile.  you are ok with Obama literally placing us on the hook for part of the EU bailout? 

240 is Back

  • Getbig V
  • *****
  • Posts: 102387
  • Complete website for only $300- www.300website.com
Yea, but when a lone nutjob does something like that - it only gives the govt MORE power.  It's kinda self-defeating.  How much of a green light did McVeigh give Clinton for dismantling militias?  How much did Columbine help create anti-gun legislation?

the system is what it is.  Period.  You have the freedom to move, vote, or run for office if you disagree with it.

And chances are, the crazy domestic nut blowing himself up is probably hurting people who believe the same things he does.  

So this is why I never understand this "civil war 2" talk.  It'll never happen.  Does anyone here want to see a complete destruction of our dollar, our retirement, our schools, our sewers, our utilities, our police, etc?  Just so some other dictator with a similar system could come in and run the place?  I have a feeling too many of them have a romantic view of the founding fathers, with some peace loving utopia.  Hell, 20 years after we were finally free from Great Britain, we were in Tripoli Africa stealing oil and rubber resources.  

The game is the game.  Either move to a place that doesn't work like this (good luck finding one) or just accept it and have a great life within the restraints of the system.  There is no utopia where every man works and lives based upon it.  The lazy and smart of society will always find ways to elude work and still get paid.  

End rant.  :)  I used to be all gung ho about the shit hitting the fan, 10 years ago.  Now I pray our nation doesn't return to living in mud huts because "the old way sucked!"

Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
240 - its going to happen in our lifetimes, count on it. 

And for anyone to be ok with this: really fuck you and rot in hell. 

 

Option D

  • Getbig V
  • *****
  • Posts: 17367
  • Kelly the Con Way
Obama phoned Merkel on euro bail-out
VALENTINA POP

Today @ 09:48 CET


EUOBSERVER / BRUSSELS – US President Barack Obama telephoned German Chancellor Angela Merkel over the weekend to persuade her to agree to the €750 billion bailout package for the eurozone.

Mr Obama made two phone calls to German Chancellor Angela Merkel in the last three days and also spoke to French President Nicolas Sarkozy as EU leaders and then their finance ministers were struggling to pin down the deal, White House spokesman Robert Gibbs said Monday.

 
Barack Obama had a long phone conversation with Angela Merkel (Photo: White House)
Print
Comment article

"The president and his economic team have been following and engaged in this situation for quite some time," he said, noting Mr Obama had spoken about the need for "strong action" to give confidence to the markets. "We are pleased thus far with that result," he added.

According to the New York Times, Mr Obama was on the phone with the German chancellor on Friday "offering urgent advice" and "some not so subtle prodding" that Europe needed an overwhelming rescue package of the sort Washington came up with in 2008.

"He was trying to convey that he knew these were politically difficult steps that the leaders there had to take, that he had gone through them as well. And that, from his experience, trying to get out ahead as much as possible was the right way to go," one senior administration official familiar with the conversation told the US newspaper.

His administration also offered concrete help: the Federal Reserve would swap euros for dollars, easing pressure on European central banks.

Europeans "waited too long" with the Greek bailout and fueled speculation about the fragility of the entire eurozone, another US official told the New York Times.

"Had they acted sooner," he said, "They might have gotten away with less."

Ms Merkel is seen as responsible for dragging out the European response to the Greek crisis and systematically opposing moves for greater economic integration.

The Social-Democratic opposition has accused her of concealing the real proportions of the euro-crisis, for political reasons. There were regional elections North Rhine-Westphalia on 9 May, which in the end were lost by her party and with it the majority in the upper house.

Social Democrat MP Thomas Oppermann, one of the leaders of the party in the Bundestag, told Die Welt newspaper Ms Merkel was now standing in front of "the wreckage of her own delaying tactic."

"Now Ms Merkel is at the mercy of the unleashed financial markets," he said.

The SPD will be instrumental in approving the German contribution to the bail-out, as it holds the majority in the upper chamber, which has to approve it.

Ms Merkel has called for a cabinet meeting today (11 May) to sketch out a legislative bill to this end. The Social Democrats estimate that the total bill for Berlin will be around €150 billion, higher than the estimated €123 billion as not all of the eurozone countries will have the cash to pay for it.

Ms Merkel's own coalition partner, the Liberal Free Democratic Party, has expressed dissatisfaction at the "firefighting" action agreed over the weekend, especially at having the European Central Bank buy up government bonds – so far a taboo for Berlin.

"Such actions need to be taken with consideration of the independence of the ECB," Liberal leader Wolfgang Gerhard said, according to Spiegel Online

http://euobserver.com/9/30054
________________________ _________________

You guys are incredibile.  you are ok with Obama literally placing us on the hook for part of the EU bailout? 


I didnt say anything about what he is doing..im gonna read about it...im just asking if his actions are punishable under the charge of treason...then i got the defination...so you tell me..Is he punishable under the treason charge.. also the punishment for treason is not impeachment.. its death.

Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
Its not the same as giving nuke codes to the USSR or NK, but what do you call placing us on the hook for the EU bailout without a vote fo the congress or Senate? 

Whether its treason, and I probably should not have used that language, it definately is worthy of an investigation and impeachment discussions since he is literally placing our entire system even more at risk than it already is.   

BM OUT

  • Getbig V
  • *****
  • Posts: 8229
  • Getbig!
Torch and Pitchforks?  HAHA yeah right!  Americans are some of the most pacified people in the world.  Sure we can send our young men and women off to war to fight battles and topple armies and countries...........but when it comes to putting up some semblance of a domestic battle against our government at home.............we fail miserably.  America is busy toppling other countries and fighting enemies abroad yet our country is imploding from the inside.  

The rich in government and in corporate America don't give a shit about the average American.  When this country collapses their companies in which they have stock in will control even more of the world.  The banks the financial institutions will reap huge profits once America collapses.  The US government is a corporation.  And the people running it are hyperglobalists.  44% of Congress are millionaires and many people in US society have no problem with that.  Yet they bitch and complain about why things are the way they are and continue to believe in this myth that we have a capitalistic free market economy.  While you and I will be licking our wounds when America collapses our politicians and corporate tyrants will be sipping martinis in their South American enclaves and million dollar ranches.  The war that needs to happen isn't between the government and the people........it's between the haves and the have nots.  The middle class and the rich........because it's the rich who make up a majority of the government.  Remember that when you speak of Pitch forks and torches!  

Absolutely right!!Americans get more angry over their cable going out during a football game then the country going brolke and being destroyed in front of our eyes.

Option D

  • Getbig V
  • *****
  • Posts: 17367
  • Kelly the Con Way
Its not the same as giving nuke codes to the USSR or NK, but what do you call placing us on the hook for the EU bailout without a vote fo the congress or Senate? 

Whether its treason, and I probably should not have used that language, it definately is worthy of an investigation and impeachment discussions since he is literally placing our entire system even more at risk than it already is.   


All of what you just said sounds a lot better than PResident Obama is Treasonist...kill him...

I actually read what you have to say when it isnt sensationalized...
Dude im a scientist, i dont suscribe to the headlines and buzz words...
Just give me information and let me dx it for my self

240 is Back

  • Getbig V
  • *****
  • Posts: 102387
  • Complete website for only $300- www.300website.com
33 and BILLY,

Of course this move is indefensible.

However, aside from getting angry, and voting for candidates who won't do this or will repeal it (improbable).........what else can we do?


I don't see anything us Joe Lunchboxes can do.  I really do not.  "Pitchforks"?  No thanks.  if you have a solution that doesn't lead to HH6 dropping bombs on our heads, we're all ears :)

Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
I think it is going to take national strikes or something like that.  Tax revolts, marches, etc, are good, but they really are not listening anymore and one day you are going to wake up and this nation will be shut down.  banks wont open, etc cause the system is collapsed.     

240 is Back

  • Getbig V
  • *****
  • Posts: 102387
  • Complete website for only $300- www.300website.com
okay, now you are talking options that are legal, or at least don't involve national guard getting all kent state up in this place :)


Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
No, but we could use symbolic torches like Pat Buchanan did.  Nothing wrong with that. 

MuscleMcMannus

  • Getbig V
  • *****
  • Posts: 6236
Yea, but when a lone nutjob does something like that - it only gives the govt MORE power.  It's kinda self-defeating.  How much of a green light did McVeigh give Clinton for dismantling militias?  How much did Columbine help create anti-gun legislation?

the system is what it is.  Period.  You have the freedom to move, vote, or run for office if you disagree with it.

And chances are, the crazy domestic nut blowing himself up is probably hurting people who believe the same things he does.  

So this is why I never understand this "civil war 2" talk.  It'll never happen.  Does anyone here want to see a complete destruction of our dollar, our retirement, our schools, our sewers, our utilities, our police, etc?  Just so some other dictator with a similar system could come in and run the place?  I have a feeling too many of them have a romantic view of the founding fathers, with some peace loving utopia.  Hell, 20 years after we were finally free from Great Britain, we were in Tripoli Africa stealing oil and rubber resources.  

The game is the game.  Either move to a place that doesn't work like this (good luck finding one) or just accept it and have a great life within the restraints of the system.  There is no utopia where every man works and lives based upon it.  The lazy and smart of society will always find ways to elude work and still get paid.  

End rant.  :)  I used to be all gung ho about the shit hitting the fan, 10 years ago.  Now I pray our nation doesn't return to living in mud huts because "the old way sucked!"

The system is what it is so we should just all accept our fate as Americans and as human beings.  We are the metaphorical frog being brought to a slow boil and we just go with it?  LMAO!  It is that attitude that is the reason our government is so out of control.  No revolution least of all our American one ever came about peacefully.  Ghandi, MLK.......really didn't change shit.  Civil rights was nothing without violent riots.  I'll live in reality and you can live in your "let's vote, move, pacifist" mindset.  Because that's what it is.  People back in the day believed so strongly in freedom they were willing to die for it.  No one is willing to sacrifice anything......let alone their life....for change.  Hence the government and the direction of the world into tyranny remains on course.....unchanged.  To answer your question......at this point yes America will have to collapse and it won't be pretty, many people could die and starve and blah blah blah.  but like you say the smart and crafty will survive and rebuild right?

Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
I see only a civil war or violent revolution or massive and total economic collapse as really being able to change the disastrous course we are on. 

Right now I see the massive economic collapse as most likely to occur.

MuscleMcMannus

  • Getbig V
  • *****
  • Posts: 6236
I see only a civil war or violent revolution or massive and total economic collapse as really being able to change the disastrous course we are on. 

Right now I see the massive economic collapse as most likely to occur.

And more often than not the threat or possibility of a massive economic collapse is usually followed by war.

Soul Crusher

  • Competitors
  • Getbig V
  • *****
  • Posts: 41760
  • Doesnt lie about lifting.
Glen Beck is talking about this on the radio show.  we are intentionally being placed on the road to ruin and complete total collapse so that Obama and his puppet masters can usher in worldwide communism and global govt.   

Celente is saying the same thing BTW as far as war goes. 


phreak

  • Getbig V
  • *****
  • Posts: 5084
  • Food is amazing
Watch all of this: Peter Schiff on the EU problem. He is right: if the US can't bail out Greece, then the US also shouldn't accept the bailout it is already getting from China.

[ Invalid YouTube link ]