by Pam Martens and Russ Martens
Wall Street on Parade
Beginning on September 17 of last year, months before the first COVID-19 case had been discovered anywhere in the world, the Federal Reserve – for the first time since the financial crisis of 2008 – jumped into the repo loan market, where financial firms borrow from each other overnight, and began making tens of billions of dollars in loans a week to the trading houses of Wall Street. The Fed calls these 24 trading houses its “primary dealers.”
For the vast majority of the Fed’s 107-year existence, it was limited to making loans to only commercial banks, which would assist the general U.S. economy by passing on those loans to businesses and consumers. Since the financial crisis of 2008, the Fed has become a money spigot to the Wall Street casino, based solely on its own interpretation of what it’s allowed to do.