Soon after COVID hit the U.S., the Federal Reserve spent BILLIONS trying to keep certain banks — ones they deemed too important to fail — afloat. But the Fed’s loans didn’t just go to American banks. They went to foreign ones as well. In fact, Credit Suisse received more than 7 PERCENT of the entire amount the Fed loaned out. So, it must’ve worked, right? All these banks are doing great now, right?! WRONG. In this clip, Glenn shares the disastrous results of the Fed’s big, and until recently, secretive payday…
Below is a rush transcript that may contain errors
GLENN: Now let me talk to you a little bit about something that came up over the weekend, and I have been trying to figure it out.
And talked to some experts, took me a couple of days, to get to a place to where I could really explain it to you.
One of the things that's happening in the market is you've got two big banks, Deutchse Bank and Credit Suisse that are about to default, or at least it looks like it.
Let me take you back in history. Back in March 2020, right at the dawn of the covid-19 panic, some interesting things happened on Wall Street.
March 9th, the Dow Jones Industrial Average lost 2,000 points. That's more than a 10 percent crash in a single day.
At the time, it was one of the largest single day declines in the US history of stocks. More than $1.8 trillion was wiped out from US the pension and retirement funds in a single day. March 10th, the very next day, the Federal Reserve began making emergency loans to what were considered to be systematically important banks. That are banks that are just too big to fail. Now, it's important to remember, that we didn't learn about these emergency loans made during March of 2020, just as the WHO and the CDC were declaring a pandemic. We didn't learn about those loans, until two years later. Because the fed isn't -- they're no longer required to tell you who they're making loans to or for how much, until two full years after it makes the loans.
So they say, that's not make sure that nobody is panicking. Well, investors, if they knew in realtime, these banks needed cash, it would cause a run on the banks. So, for example, on March 9th, the Dow lost 2,000 points, and more than ten percent of its value.
So on March 10th -- and we know this now, because two years have passed, the U.S. Federal Reserve made $112 billion in emergency loans, to 24 banks.
Stocks rebounded slightly. But then the first death started being reported from covid at retirement homes. Trump canceled the international travel. And within a couple of days, stocks were down another 1500 points, she got $4 trillion in wealth from the portfolios of Americans in just a couple of days. For its part, the fed continued lending. Distributing a total of $1 trillion, $1 trillion in emergency loans to banks in just a six-day period. Remember, this is two weeks into the pandemic. Well before businesses were shut down.
At this point, all that had really happened to the economy, was that stocks, you know, the forward-looking investment vehicle, were declining. But this was enough for the fed to print $1 trillion in new currency and loan it out to the banks, considered too big to fail. Not just our banks. No, no, no. Not just the U.S. banks. Some of the largest borrowers in the past 20 years from emergency loans from our Federal Reserve, have been foreign banks, and investment firms.
Nomura Securities out of Japan. BNC Paribas, the French Bank, Barclays Bank out of the UK.
All of these are the largest borrowers from the fed. So was the largest Swiss bank Credit Suisse?
The largest Swiss bank, Credit Suisse, were they on that list?
Oh, yeah. Just in six days, from March 10th to March 16th, 2020, Credit Suisse requested and was granted $50 billion in emergency loans, more than 7 percent of the total that the fed had loaned to 24 banks.
That was covid, right? Now, it may seem odd, that the central bank of the United States, needed to loan the largest Swiss bank, $50 billion in just a few days. Don't they have their own central bank?
But let's just chalk it up, to yet another covid emergency. We had to do something. We had to bail out the largest banks in Japan, Switzerland, France, UK, I mean, it was a pandemic. So now, fast forward to 2022.
All those banks got their covid bailout. In January 2022, the Dow Jones Industrial Average, hit a new all-time high. So clearly, the bailouts worked. And the banks made all this money. The banks were able to recover and get past the pandemic, right?
I mean, those trillions in loans to banks, skyrocketed inflation. And, you know, added to the currency circulation. And inflation is twined by, you know, too much currency. Too much money, chasing too few goods. But we saved the banks, right?
We restored the stock market, and set ourselves out to a record recovery. Well, yesterday, Credit Suisse, flagged as the too big to fail bank, by the U.S. Federal Reserve, their stock hit an all-time low.
They shed more than 65 percent of its value, losing 20 percent of its value, in one day.
Worse, investors are effectively betting now, that Credit Suisse. That Credit Suisse, will go belly-up next year.
We know this, because of -- I hate to bring this word up, credit default swaps. Not going to get, you know -- I'm not going to get all big short on you.
But this is, when you have the bonds, and you think, uh-oh. I think we might lose the -- the bank might go out. I buy an insurance policy.
Credit default. And I swap. I swap, what I'm holding, I give it to you, and I get the insurance money. Okay?
Credit default swaps. It's a way to bet on the down. It's horrible. But now, 30 percent -- it went up. The price to insure went up, 25 percent yesterday. Yesterday.
30 percent of people are now betting that Credit Suisse is going to collapse.
So what's going on?
Why would it collapse? Again, I'm not going to go into all of this stuff.
I just need you to understand the big points, and you will understand.
This will take your breath away.
Again, remember we all talked about credit default swaps, and derivatives. Oh, derivatives. Oh, that's horrible.
Without if we go to into all of that, remember when we said, that the global delivery -- derivatives market, after 2008, started going back up again.
And it surpassed what happened in 2008. And the global derivatives marketed was about $100 trillion. And we were like $100 trillion. That's horrible.
And we raised the alarm. They haven't learned anything. In fact, it's gotten worse.
Then it rose to $500 trillion, just a couple of years ago. And we raised the alarm again. Any idea, where the derivatives market is right now.
After two years of pandemic. Two years of Bidenflation. And after stocks have lost 20 persuasive of their value since January, where is the derivative market?
One quadrillion dollars.
No way out.
$1 quadrillion. That's one thousand trillion dollars.
That's what's held by the 24 largest banks in the world. $1,000 trillion.
You haven't even begun to feel the pain of what these people have done. Derivatives have been around since the 1920s. But we have gone insane. Now, last year, when a private wealth fund defaulted, it cost the global banks more than $11 billion in derivative losses. More than 5 billion was absorbed by Credit Suisse bank.
That's nearly half the global losses. Of one firm. That just had 11 billion.
We're -- we have one quadrille John.
Now, if I'm you, I could easily say, it's a -- you know, German bank. Or Swiss bank. And it's not my problem.
But it is your problem. Because it is your dollar. Your currency provided by your Federal Reserve. Why are there not people standing in front of the Federal Reserve, demanding answers, and holding signs up, $1 quadrillion?
Where does inflation come from?
You think it's all government spending?
Collectively, since the fed started emergency lending operations in September of 2019.
And note for you conspiracy theorists out there. September 2019 was five full months, before there was a single positive covid case in the US. And we were talking about it in September of 2019.
The foreign banks have collectively borrowed 6 trillion dollars, from the Federal Reserve.
Now, here's the funny thing: $6 trillion has already gone out.
If the Federal Reserve decides to lend Credit Suisse another $500 billion today or tomorrow to bail itself out of whatever mess it's in. You, the one who is actually paying for this, you won't know for another two years.
Because under Dodd-Frank, you know, the one that was going to fix everything, the fed's reporting requirements now allow for a two-year delay.
So if we are bailing out Germany and Switzerland today, make sure you tune in to this show on October 4th, 2024. To find out what it costs you.