So did you miss the other bailout? US$1Tn and change

Who's the clown now?
We've all debated the famed US$700Bn bailout ad nauseam, but unbeknownst to us another larger one has slipped under our radar. Maybe we're too tired after McCain/Obama to care. But let's plough on regardless.

Emergency loans spread over 11 programs have allowed the Federal Reserve to funnel enormous amounts of cash to Wall Street in almost total secrecy. No-one seems to know the terms of the loans. Simple questions, such as who's getting what in return for what, are going unanswered.

“The collateral is not being adequately disclosed, and that’s a big problem,” said Dan Fuss, vice chairman of Boston-based Loomis Sayles & Co., where he co-manages $17 billion in bonds. “In a liquid market, this wouldn’t matter, but we’re not. The market is very nervous and very thin.”

Let's ignore the opaque marketspeak and see what's actually happening here. Mismanaged private companies are being compensated for their own massive failures, while the people who's lives they've ruined (through shoddy loans and pension management) get nothing.

This means the market is 'thin' and 'nervous,' i.e. people with actual money aren't spreading it around so much any more. Maybe the real source of Wall Street's cash is drying up? It's a reverse trickle system, with income taxes, insurance, interest fees, 401Ks and inflation tax funnelling the money upwards to the power elite (and I don't mean that in an Illuminati kind of way, Bock!).

Perhaps Joe Sixpack and Sally Homemaker, despite their television's relentless consumer programming and their government's exhortations to spend patriotically, have been finally squeezed dry. The private purse is empty.

Add to this Treasury Secretary Paulson's illegal change in a tax law (originally created to plug a scam loophole) which will now allow/encourage corporations to buy up failing companies as tax-shelter write-offs, and you have an officially sanctioned looting of the public purse.

Thank goodness it could never happen here (guffaw!).

Link: Federal Reserve refuses to identify recipients of cash