{"id":2062,"date":"2011-08-08T20:31:17","date_gmt":"2011-08-09T00:31:17","guid":{"rendered":"http:\/\/streamingradioguide.com\/startingover\/?p=2062"},"modified":"2011-08-08T20:31:17","modified_gmt":"2011-08-09T00:31:17","slug":"the-credit-freeze","status":"publish","type":"post","link":"https:\/\/streamingradioguide.com\/startingover\/?p=2062","title":{"rendered":"The Credit Freeze"},"content":{"rendered":"

Here is Bank of New York \/ Mellon’s latest financial report:<\/a>\u00a0(as of June 30)<\/p>\n

It’s pretty stunning and shows just how sick things are in the banking business.\u00a0\u00a0 If you missed it, BoNY Mellon was the first lender to say it is going to start charging large corporate customers for\u00a0“parking cash” with them.<\/p>\n

A big deal was made last week by the EchoMedia(tm) repeating the factoid that “Apple has more cash than the Federal Government”.\u00a0\u00a0 Mellon had a total of $197 billion on deposit by its customers\u00a0 (that’s money it has to give back to its customers eventually).\u00a0\u00a0\u00a0 What is it doing with that money?<\/p>\n

– $56 billion is sitting in the Federal Reserve account
\n– $60 billion is loaned out to other banks
\n– $5 billion is loaned on very short term Fed Funds<\/p>\n

So well over half of the money they’ve taken in, they can’t do anything with – they’re just parking it at the Fed earning nothing – or loaning to other banks.\u00a0\u00a0\u00a0 They aren’t exactly loaning out money to GM to build new car factories…\u00a0\u00a0 They made about $1.5 billion in the 2nd quarter.<\/p>\n

Let’s compare that to Bank of America <\/a>– they lost over $7 billion in the 2nd quarter\u00a0(BoA lost 20% of its value today)<\/p>\n

Bank of America has about $1 trillion in assets on deposit.\u00a0\u00a0 It has $119 billion in cash parked doing nothing.\u00a0\u00a0\u00a0 It has another $235 billion in the short term fed funds market\u00a0but also has borrowed $239\u00a0billion, so it is a net short term borrower.\u00a0It has $200 billion sitting in its “Trading Account”..\u00a0\u00a0(See: Glass Stegall) \u00a0BoA is sitting on a $trillion of other liabilities beyond the deposits of its customers, including $429 billion in long term debt.\u00a0\u00a0\u00a0<\/p>\n

Banks are supposed to accumulate money by attracting customers with money, not borrowing it in the bond market.\u00a0 This is one sick bank.\u00a0 And the FDIC doesn’t have the cash to save it.\u00a0\u00a0 No other rational bank would want to acquire it.\u00a0\u00a0 The clock’s ticking<\/p>\n","protected":false},"excerpt":{"rendered":"

Here is Bank of New York \/ Mellon’s latest financial report:\u00a0(as of June 30) It’s pretty stunning and shows just how sick things are in the banking business.\u00a0\u00a0 If you missed it, BoNY Mellon was the first lender to say … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-2062","post","type-post","status-publish","format-standard","hentry","category-american-politics"],"_links":{"self":[{"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=\/wp\/v2\/posts\/2062","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2062"}],"version-history":[{"count":1,"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=\/wp\/v2\/posts\/2062\/revisions"}],"predecessor-version":[{"id":2063,"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=\/wp\/v2\/posts\/2062\/revisions\/2063"}],"wp:attachment":[{"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2062"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2062"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/streamingradioguide.com\/startingover\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2062"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}