Monday, May 10, 2010

All for One...

Denninger (among others) notes:
Since the US is "required" to contribute 17% of the IMF's funding, this means you, the taxpayer, have just been hit for $48.6 billion to cover the debts of nations who spend more than they make - and no, they're not the United States (or the states IN The United States.)

It gets better. The Fed's "swaplines" that have been reopened this evening could conceivably pay for part or all of the ECB's foreign bond buying.

What this means is that the U.S. has just saw fit loan money to Europe. On what planet does that make sense? As well the Fed is going to swap countless dollars for EU debt and Euros, ensuring that if Europe blows up so do we and, hopefully vice-versa.

The term 'punting' is usually used in reference to pushing these problems off into the future, but a better sports analogy would be extending the playing time of the game in the hopes that your team can somehow come up with a way to overcome it's seventy point deficit, never minding the fact that the other team is going to keep racking up points the longer the game goes.

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