No wonder Obama is trying to force banks to lend

http://www.businessinsider.com/henry-blodget-how-to-make-the-worlds-easiest-10-billion-2009-12

You would think that they would be greatful for the hefty profits from the taxpayer and therefore lend to the taxpayer.

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2 Responses to “No wonder Obama is trying to force banks to lend”

  1. urstupidnourstupid Says:

    STEP 4: Borrow $9 billion from the Fed at an annual cost of 0.25%.

    STEP 5: Buy $10 billion of 30-year Treasuries paying 4.45%

    Is this right? Is it common that the rates are backwards? Obviously not…makes no sense.

  2. urstupidnourstupid Says:

    I don’t know the real #s of the banks but I know that the banks can borrow from the Fed for .25%. I know that banks are holding alot of cash as opposed to lending (I’m sure you have heard about the administration prodding the banks to lend.) I also know that they will hold various government bonds with their cash rather than just sitting there. It’s a risk free way of making money rather than risking it in the market right now.

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