2008 TARP bailout was prompted by fears of a $5 trillion dollar “bank run”

Meltdown2011 reports on what you weren't told on 9/11/2008.

(emphasis mine)

What You Weren't Told on 9/11/2008
Posted on by Scott Gallup

Courtesy of CSPAN on Feb 6, 2009 a congressman from Pennsylvania reveals new info about what really happened last Sept 11, 2008.

This info has been kept from you until now.

Timeframe:
9/11/2008 was four days AFTER the gov't bailed out Fannie Mae and Freddie Mac AND five days BEFORE the collapse of Lehman Bros and AIG [See History of the Meltdown...].

What Happened:
Rep. Paul Kanjorski of Pennsylvania explains how the Federal Reserve told Congress members about a "tremendous draw-down of money market accounts in the United States, to the tune of $550 billion dollars." According to Kanjorski, this electronic transfer occurred over the period of an hour or two starting at 11:00am.

The Fed intervened, closing access to the markets. They explained if they HAD NOT stepped would have been a $5 trillion "bank run" by 2:00pm that day. Bernanke and Paulsen claimed this would have collapsed the US economy that same day, a new "financial" 9/11.




My reaction:
Have you ever wondered why lawmakers passed last year's VERY unpopular TARP bailout one month before the elections? What were lawmakers told in private to get them to vote "YES"?

Well, now we know: Lawmakers were told of a $550 billion draw-down in money market accounts, which might have turned into a $5 trillion dollar "bank run".

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8 Responses to 2008 TARP bailout was prompted by fears of a $5 trillion dollar “bank run”

  1. Anonymous says:

    Who was doin da runnin? I mean 5T dollars is a lot of cabbage. Who had that kind of juice to withdraw that much money so quickly and where were they going to put it, under their mattress?

    Was this a cause of Wall street bankers yellin "fire" or was it a valid run?

    I don't trust politicians because you have to believe they know what they're doin. I think this is more a story of incompetence than of well calculated organisation, if there was a crisis or not, we'll never know because all the info resides in the clutches of the self interested (the "tarpees").

  2. Anonymous said...
    Was this a cause of Wall street bankers yellin "fire" or was it a valid run?

    The TARP bailout was increadibly unpopular. Politicians wouldn't have passed it two months before the election unless they were genuinely scared. This threat, imaginary or not, of a $5 trillion dollar "bank run" is what scared them.

  3. Anonymous says:

    in the end won't we think 5 trillion is chump change compared to what has been or will be stolen?

  4. Anonymous says:

    Does anyone else think that the higher ups actual understand and study Austrian Economics? I mean I understand it and it pretty much explains everything going on almost exactly. There's got to be people smarter than me up there...

  5. Anonymous says:

    Real question is.. where did the 550 Billion go? Can't just park it in a mattress, esecially if it was electronic. What market did it go into and where was the concomitant rise in deposits there? Whole thing sounds fishy.

  6. Anonymous says:

    "The TARP bailout was increadibly unpopular. Politicians wouldn't have passed it two months before the election unless they were genuinely scared."

    I am not denying they were scared. But were they being fed the right info? Did Paulson know whats going on or did he rely on the "whispers of wallstreet bankers?"

    The wall street bankers would love for everyone to believe that they're indispensable to our economy. The fact is, there other bankers and investors out there RIGHT NOW who don't need TARP and would be willing to buy these banks distressed assets for pennies on the dollar.

    It should be the time of the prudent and savy. New banks/investment pools would buy these assets and manage them RIGHT. Our "new" system therefore would be built on these prudent bankers who didn't drink the kool aid, this should be THERE time to prosper.

    Instead with the government buyout, you have the ironic situation where the prudent bankers are paying these MORON bankers to stay in business while still being MORONS.

    The final stage will be when the GOVERNMENT manages these banks and you have a "DMV" banking system. Boy they came to Washington as lawyers and they'll leave as bankers.

  7. Anonymous says:

    how can this story be believed if we have no evidence? Have we suddenly decided to trust a politician? Who did the drawdown? Wouldn't it be easy to find out?

  8. Anonymous says:

    Who was "doin da runnin"? Intelligent investors that immediately went to Treasury Bills by moving money out of money market funds. It is as simplae as that. Try to buy a trasury money market find in any mutual fund company. Guess what - They are all closed.

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