So which is it Joe? Biden refuses to call it a bailout but that’s exactly what feds new $25B loan program is amid banking collapse

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As fear and the growing fear of a mass contagion spreading to other banks continue tonight, Joe Biden is playing an epic game of word salad as to how the situation will be fixed. Over the weekend, as part of the government’s extraordinary effort to quell a major financial collapse a new loan programme was born. According to federal authorities, that loan programme is now the $25B fund for depositors to be guaranteed between SVB and Signature Bank. Biden refuses to call it a bailout critics are calling foul against the backdrop of an epic game of word salad.

According to information from federal officials, the programme is known as the Bank Term Funding Program.

So what’s the catch? While not entirely clear what is clear is that the feds intend to offer the program to banks ‘at par’ in exchange for what they’re calling ‘high-quality securities.’ In what may seem a genuine idea it in fact isn’t especially considering that if it goes haywire both the feds and American taxpayers will be on the hook in the end.

‘At Par’ simply means what they were purchased for, rather than what they’re worth today, which in most cases is much much less. This means in totality that if banks do tap into the program but for whatever reason can’t end up paying the debt back, you can guess who is on the hook. It is irresponsible for Joe Biden and his government to call this anything but a bailout.

That means if banks tap into the fund but can’t pay the debt, the Treasury (and the taxpayer) could be left with a huge shortfall.

Furthermore, the programme has no safeguards against executives collecting mighty juicy paydays and bonuses after all is said and done. That in itself is sure to rile the American public as the government has bailed out banks before on the backs of taxpayers.

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