It's something any bank would demand to know before handing out a loan: Where's the money going?And:But after receiving billions in aid from U.S. taxpayers, the nation's largest banks say they can't track exactly how they're spending the money or they simply refuse to discuss it.
"We've lent some of it. We've not lent some of it. We've not given any accounting of, 'Here's how we're doing it,"' said Thomas Kelly, a spokesman for JPMorgan Chase , which received $25 billion in emergency bailout money. "We have not disclosed that to the public. We're declining to.">>>MORE
I noted recently the massive increase in the amount of excess reserves held at Federal Reserve banks by the nation's banks, money that basically is just sitting there, earning practically nothing.Excess reserves are monies held at the Fed in excess of the banking sector's reserve requirements. In the week ended December 17th, banks had $774 billion in excess reserves, gigantically more than the customary total of just a few billion dollars.
The money is the result of the Federal Reserve's massive liquidity injections. Another way to gauge excess reserves is to look at the cash balances of commercial banks, which can be found in the Federal Reserve's H.8 release, the Fed's weekly report on the assets and liabilities of commercial banks. In Friday's release, cash balances held by commercial banks topped $1 trillion for the first time, reflecting cash balances held at the Fed. Pre-Lehman, cash balances tended to hover around $300 billion, with an annual growth rate of less than 1% per year....MORE
