As such there are only two reasonable explanations for The NY Fed's behavior:
They didn't actuallyhavecollateral for those loans, in which case Bernanke is a damned liar, The Fed has been handing out money in violation of the law requiring proper collateral and haircuts, and the next question becomes "how many other times has The Fed done this and are they still doing it?"
The collateral they took was insufficient to cover the loan(s) balance, in which case Bernanke isalsoa damned liar, in that The Fed,contrary to The Federal Reserve Act and thus the lawwas effectively issuingunsecured loans. (Was that "collateral" worthless CDOs, as just one possibility?)
Lawlessness, or even the appearance of lawlessness, is unacceptable in any government-linked agency, and we the people have a right to know what is happening with our money.
Audit The Fed!
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