Federal Reserve May Be ‘Central Bank of the World’ After UBS, Barclays Aid

Federal Reserve data showing UBS AG and Barclays Plc ranked among the top users of $3.3 trillion from emergency programs is stoking debate on whether U.S. regulators bear responsibility for aiding other nations’ banks.

UBS was the biggest borrower under the Commercial Paper Funding Facility, with $74.5 billion overall, more than twice as much as Citigroup Inc., the top U.S. bank recipient, according to the data released yesterday. London-based Barclays Plc took the biggest single amount under another program that made overnight loans, when it got $47.9 billion on Sept. 18, 2008.

“We’re talking about huge sums of money going to bail out large foreign banks,” said Senator Bernard Sanders, the Vermont independent who wrote the provision in the Dodd-Frank Act that required the Fed disclosures. “Has the Federal Reserve become the central bank of the world? I think that is a question that needs to be examined.”

The first detailed accounting of U.S. efforts to spare European banks may add to scrutiny of the central bank, already at its most intense in three decades. The Fed, which released data on 21,000 transactions, said in a statement that its 11 emergency programs helped stabilize markets and support economic recovery. The Fed said there have been no credit losses on rescue programs that have been closed.

The growth of the U.S. mortgage-backed securities market and the dollar’s status as the world’s reserve currency enticed overseas banks such as Zurich-based UBS to buy assets in the country before 2008. They paid for the holdings with U.S. dollars, and when funding seized up, the Federal Reserve refused to take the risk that European firms would unload the assets and further depress markets for housing-related investments.

  • Share/Bookmark

Leave a Reply

You must be logged in to post a comment.

Radio Archives

Fundraising with GoGetFunding
Fundraising with GoGetFunding

Give Your Support

The Global Reality represents a tireless effort to search, gather, and present information that even some alternative media channels refuse to discuss, let alone the mainstream. This effort is provided with no advertisements, no selling of products or services that are irrelevant and useless. There is only one sponsor: YOU!

Support the information that's in your right to know, that "they" dare not want you to know.

Notice: We can now take manual credit card entries for DVD's or donations. Those who do not want to use Paypal can now send your credit card number, expiration date, 3 digit security code and zip code to globalrealityshow@gmail.com along with the amount of purchase and we can process your order into our Paypal account without you having to use Paypal at all.

One-Time Donation

Donation Subscription

Monthly Recurring Donations
Your Own Amount: $

Join Us on FedBook