Geithner, Kohn, (barf) Kneale, Banking and More

Kohn’s "stuff" is here….

However, he did caution that the increase in the balance sheet was not without risks, and warned that if this led to credit losses at the Fed, it could force the Fed to go hat in hand to the U.S. government, compromising its policy independence.

Uhhhhh…. wait a second – I thought everything The Fed "loaned" against was money good, and the purchased securities were "guaranteed" by the government (or were government securities themselves!)

Did I just read "credit risk"?

CREDIT RISK?

Are these "MBS" that are being bought by The Fed worth less (or worse, worthless)?  That could be bad, considering that The Fed doesn’t seem to have much in the way of actual hard assets, right?

We need HR 1207 (audit The Fed – all of it) and we need it now.

Someone’s lying and I think Kohn just said something he shouldn’t have.