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Former Wells Fargo CEO: The FED forced us to take TARP money when we didn't want or need it

Former Wells Fargo Chairman and CEO Richard Kovacevich talks about how the FED forced them and other solvent banks to take TARP money and the effect of this on the banking industry (first 15 min).


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We all know no bank is

We all know no bank is perfect. But WF is a good bank. They didnt make horrible bets like many others and their mortgage lending didnt go bottom feeding. They pulled Wach out of the fire for doing just that.

"Any fool can criticize, condemn and complain and most fools do." -Benjamin Franklin

Little Elm, Tx

Forced Loan

Let's not forget how money enters the market: through loans.

If you know about fractional banking, You know that a loan is given from a fractional of the reserve - that's right counterfeit/fake money.

Now if the US Govt. "Loaned" money under force to banks that didn't want it. What do you think the Govt was doing? Helping Banks?

The facts of fractional Banking tell the real story. Govt needed help. Force Lent fake money to all banks - and got back real money. It wasn't the banks at all that were in trouble. It was the Govt that needed the money. Notice how it didn't take long for banks to "pay-back" the loan. Banks don't like to spend money on interest, let alone give away real money to loans.

I don't recall any bank groveling for money from the Govt. US Govt Called the Banks. It held the meetings. Then Used the banks as the fall guy; not that I support their evil factional Banking Scams. Now you see how lies are built on lies are built on lies.

Fractional Banking - Quick Explanation: http://en.wikipedia.org/wiki/Fractional_reserve_banking

Stay Educated my Friends....

Number 2's picture

Excellent point

There is so much phony language around the Fed 'injecting' money into the financial system. The Fed can do no such thing. It can only offer loans. And if there are no takers, well, in this case, they forced the loan to get the money into the system.

But banks still aren't lending. Mortgage rates are at all time lows, and it is nearly impossible for most people to get on. Banks are holding tight, even redepositing that money back with the Fed.

The Fed is in a pickle. If banks do not keep lending, the whole system goes into reverse, and the collapse picks up steam in a deflationary spiral.

Obama Care Tax

It really starts adding up when you put brain grease on it. Always follow the money.

You know that nice new TAX the Govt levied against all of us recently? You think a Conservative Judge just rulled to save the economy system by brining in new income? You Think the banks will take fake money in trade for real money again? Is that air your breathing now?

It's obviously clear to me that this Govt is in deep finical trouble, not the banks. The banks since 1913 have been able to create free money out of thin air.. why would they be broke?

With all the govt "loans" that the banks hold. Banks have a steady income stream.

Always follow the money. We're watching an addicted junkie of power disintegrate: US Government.

44 minute mark

hilarious, A+

He says Wells took it because...

i) Paulson threatened him that they would declare their bank insolvent otherwise
ii) They were going to acquire Wachovia in the next few months and needed to be on good terms with the FED

This is all in the first 15min.

Wonder How The Health Of That Relationship Is Today


"Bipartisan: both parties acting in concert to put both of their hands in your pocket."-Rothbard

And from the FED's point of view,

since everyone took their money, they now were able to add 1000 pages worth of new banking regulations

For Those Saying It Could Just Refuse

Think. Can a company expect to survive if it passes up a government handout that it knows its competition is being offered as well?

"Bipartisan: both parties acting in concert to put both of their hands in your pocket."-Rothbard

What was the FED going to do? Arrest him for refusing?

Kill him?


Did they threaten such?

If not, then he is complicit.

He could have said, "No!" anyway. What would the consequence have been?

Evil triumphs when good men do nothing, but then again, if they do nothing, they aren't "good men" now are they?


I don't know if anyone would argue that the guy isn't a scumbag. He comes off just as an opportunist to me.

It's just nice to see one scumbag pointing out the other scumbags.

Eric Hoffer

reedr3v's picture

It's good to hear people in the

private sector speak up against arrogant, inept federal bullies.

Were the bankers forced to take bonuses, expense accounts.......

.....and large salaries also?

My heart bleeds for the elite, who are doomed to suffer the effects of too much wealth!

We all knew this from the

We all knew this from the movie "Too Big to Fail"

“Let it not be said that no one cared, that no one objected once it’s realized that our liberties and wealth are in jeopardy.”
― Ron Paul

but i thought all people knew how to type was "banksters

bankster bankster bankster.. '99%'"..

maybe change your slogan to the Fed for once in a while?

but of course.. if offered to walk away scot-free and get your house for nothing, nobody would blame the fed. you would just take your bribe and shut up about the banks and forget about the fed. we already knew that. not a coincidence you focus so much on banks instead of the fed, as most liberals do.

We already knew this. Surely

We already knew this. Surely I'm not the only one who remembers the heads of the banks being called to Washington and being threatened to take the government's "hush money". I distinctly remember the reporting on this. I'll have to find the articles now...

You're right

in fact, i even remember reading back then that he was particularly vociferous in his objections to taking the money...

nothing new

But he still took it didn't he?

If they needed his signature and his agreement to take it, that means they really couldn't force him to.

He had the power to refuse and he did not.

He is responsible as well.

I believe they were

I believe they were threatened with prison if they didn't take the bailouts. If the alternative to not signing something that was "morally abhorrent" was prison, I daresay everyone here would sign. And I simply don't believe those who say they would've done otherwise.

I HATE IT when people try to give me free money. Thats why I

sew all my pockets shut to keep people from trying to shove it in my wallet.

It doesn't matter if its millions or billions to have or just to invest. I feel so sorry for Wells Fargo.

People who try to give you free cash are such pests.

Let me make you an offer you cant refuse

You take this money.

if you don't your getting locked up and were throwing away the key.

if you try to run or hide we'll find you and kill you.

Sounds like the God Father?

nope its the Mob FED bestowed the power of Force.

His name is Edward Snowden

What is Capitalism?


Did he ever make the claim they threatened him with death or arrest?


Then he WILLINGLY (regardless if he liked it or not) played along.

What was the consequence for refusing?

If they needed his agreement, then they couldn't really force him to take the money. He had to AGREE to take the money.

He could have still refused.

yeah were

currently working on getting that right now, Make sure you call your reps today and tell them to Support HR. 459 Audit the Fed bill, if it passes and signed into law you'll find all the proof you'll need.

His name is Edward Snowden

What is Capitalism?

I thought this was already

I thought this was already known?

The government almost threatened bank seizure by FDIC.

Complete with Shiela Bair in the room along with Paulson, Bernanke and Geithner.

I wrote my reaction before

I wrote my reaction before reading yours. You remember it too, right?

Yes, although the video is

Yes, although the video is still worth watching to hear his perspective. He explains in more detail exactly how Paulson threatened his bank.

Ah, yes. It was Paulson. I

Ah, yes. It was Paulson. I was thinking it was Geithner who threatened them... I'm going to watch the video now.

This is true. I have a close

This is true. I have a close friend who is a Wells Fargo higher up and back in '08 at the time of the bail outs, she told me that Wells Fargo told the Fed they did not need help and that they were told they must take the stimulus...

If my need to be RIGHT is greater than my desire for TRUTH, then I will not recognize it when it arrives ~ Libertybelle

And what did the government back that "must" up with?

That's the key.

If there really was no teeth to the statement, then Wells could have still refused the money.

good point, I wish I had

good point, I wish I had thought of that to ask her at the time...

If my need to be RIGHT is greater than my desire for TRUTH, then I will not recognize it when it arrives ~ Libertybelle