Do You Realize That The Government Is Still Paying Banks Not To Lend…?
By Henry Blodget
One of the most outrageous “open secrets” of U.S. government policy these days is that the Federal Reserve is still paying big banks not to lend money.
And it’s doing that while screwing average Americans who have been responsible and lived within their means.
The Federal Reserve is quietly continuing with one of the many outrageous bank-bailout programs it initiated during the financial crisis–the one in which it pays big banks interest on their “excess reserves.”
What are “excess reserves”?
Money that the banks have but aren’t lending out–money that banks are just keeping on deposit at the Fed.
The Fed is paying banks 0.25% interest on this money.