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How the Federal Reserve Is Manipulating Our Kids Into Loving Wall Street

A Fed-sponsored competition brainwashes teens into putting the capitalist titans of Wall Street on a pedestal.

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  • Jamie Dimon, the chairman and CEO of JP Morgan Chase, has served on the Board of Directors at the Federal Reserve Bank of New York since 2007. During the financial crisis, the Fed provided JP Morgan Chase with $391 billion in total financial assistance. JP Morgan Chase was also used by the Fed as a clearinghouse for the Fed's emergency lending programs.

    In March of 2008, the Fed provided JP Morgan Chase with $29 billion in financing to acquire Bear Stearns. During the financial crisis, the Fed provided JP Morgan Chase with an 18-month exemption from the capital requirements that were supposed to make its bets less risky for American taxpayers. The Fed also agreed to take bad mortgage-related assets off of Bear Stearns balance sheet before JP Morgan Chase acquired the troubled investment bank.

  • Jeffrey Immelt, the CEO of General Electric, served on the New York Fed's Board of Directors from 2006-2011. General Electric received $16 billion in low-interest financing from the Federal Reserve’s Commercial Paper Funding Facility during this time period.

  • Then there's Stephen Friedman. In 2008, the New York Fed approved an application from Goldman Sachs to become a bank holding company, which gave it access to cheap Fed loans. During the same period, Friedman, who was chairman of the New York Fed at the time, sat on the Goldman Sachs board of directors and owned Goldman stock, something the Fed’s rules prohibited. He received a waiver in late 2008 that wasn't made public. After Friedman received the waiver, he continued to purchase stock in Goldman from November 2008 through January 2009 unbeknownst to the Fed, according to the GAO. During the financial crisis, Goldman Sachs received $814 billion in total financial assistance from the Fed.

  • Sanford Weill, the former CEO of Citigroup, served on the Fed's Board of Directors in New York in 2006. During the financial crisis, Citigroup received over $2.5 trillion in total financial assistance from the Fed.

  • Richard Fuld, Jr, the former CEO of Lehman Brothers, served on the Fed's Board of Directors in New York from 2006 to 2008. During the financial crisis, the Fed provided $183 billion in total financial assistance to Lehman before it collapsed.

  • James M. Wells, the chairman and CEO of SunTrust Banks, has served on the Board of Directors at the Federal Reserve Bank in Atlanta since 2008. During the financial crisis, SunTrust received $7.5 billion in total financial assistance from the Fed.

And to really counter the neoliberal indoctrination from the Fed, here are a few more questions from our proposed Sanders Fed Challenge :

  • What happens to our economy when the top 10 banks own 77 percent of our nation’s banking assets? What best describes this arrangement? An oligopoly? A financial aristocracy? Free markets run wild? (Feel free to use your own terms.)

  • How did the Federal Reserve miss the housing bubble? Why did it let the banks create and use new financial instruments that turned Wall Street into the largest and most destructive casino in history?

  • Part of the Federal Reserve’s mandate is to deal with consumer mortgage fraud. Why didn’t it follow up on reports showing massive predatory lending at key mortgage companies? After hearing about massive mortgage fraud, why didn’t the Fed act?

  • Why didn’t Federal Reserve find ways to bail out homeowners and the unemployed instead of the very banks that crashed the economy?

  • Since the 2008 crash, what is the net impact of Federal Reserve policies on stock market prices, housing prices and unemployment? Who benefits most and least as a result of these impacts?

 
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