Financial Crisis Tab Already In The Trillions

When this sort of information goes mainstream (CNBC), it's time to batten down the hatches.

Given the speed at which the federal government is throwing money at the financial crisis, the average taxpayer, never mind member of Congress, might not be faulted for losing track.

CNBC, however, has been paying very close attention and keeping a running tally of actual spending as well as the commitments involved.

Try $4.28 trillion dollars. That's $4,284,500,000,000 and more than what was spent on WW II, if adjusted for inflation, based on our computations from a variety of estimates and sources*.

Not only is it a astronomical amount of money, its' a complicated cocktail of budgeted dollars, actual spending, guarantees, loans, swaps and other market mechanisms by the Federal Reserve, the Treasury and other offices of government taken over roughly the last year, based on government data and news releases. Strictly speaking, not every cent is a direct result of what's called the financial crisis, but it is arguably related to it.

Some 68-percent of the sum falls under the Federal Reserve's umbrella, while another 16 percent is the under the Troubled Asset Relief Program, TARP, as defined under the Emergency Economic Stabilization Act, signed into law in early October.

Note: 4284.5 billion = $4.2845 trillion. Or a stack of thousand dollar bills 299 miles high. If you were on the space shuttle you'd still have 100 miles of thousand dollar bills towering above your head.

This is a companion discussion topic for the original entry at

Should we just stop counting now?

I think it is the matter of days before everything goes to hell

"The Great Bear Marathon’
By a guy from Facebook.
Joe likes to run. In the World Race 2: All-Stars, he stunned the world by outperforming his arch-rivals from Germany, Italy and Japan… Joe had some rough times with his Vietnamese girlfriend, but he made a comeback in the 1990 I-Rock Marathon.
Joe is confident Alpha Male. He brags his ever ‘bullish’ power whenever he gets his chance. Perhaps this is why Joe has decided to run again, despite warnings from his brothers like Peter Schiff and Ron Paul… Joe signed up for the challenge.
“You are either with me or against me. I am the champ. I’m the Alpha.” Joe said…
Everyone thought Joe was nuts.
“This race is unlike all the other races that you’ve ran, you haven’t trained your body for the last few years. You are in no condition to run! If you so wish to run, at least build your body while you still have a chance…” Brother Ron said.
Joe ignored the advice, calling him crazy, and weak.
But Joe had other motives… Joe has been spending like crazy by loaning money from his associate, Hu. Joe’s exceptional performance gave confidence to Hu that Joe can continue to win marathons and make decent money. Recently, Joe’s pocket has been getting slimmer… Joe needed money… He already has ‘I-Ran Marathon’ in mind. He needed the latest Abraham shoes and Patriot pants. Joe had to win, no matter the cost.
“The Race of Death”
When the race began, he felt something unusual. His heart was beating faster than usual. His muscles tight… Joe ran only 1/10 the way into the marathon, and Joe was falling behind… he was dehydrating. Joe’s coach ‘Ben’ decided to shoot him up with morphine to ease the pain, rather than giving Joe the much needed water. “Water will only slow you down, this drug is certified by Cox and Paulson Inc., the safest drug makers in the world! Now, don’t think, don’t question, just run as I told you!” Ben said.
Joe ran for another 1/10, and the drug started to wear off…
Ben frantically injected another load of goodies into Joe.
His muscles were now breaking apart, his foot was cracking and bleeding, his eyes were getting dry…
Ben’s friend Aso, Hu and Brown were concerned about Joe’s conditions… warning Ben that continued drug use will knockdown Joe, even to near death. Spectators, who bet their money on Joe’s win, were furious on Joe’s performance. Spectators felt they were cheated, and their anger grew as minutes passed. Hu, too, was spooked. Hu, now wanted Ben to sign a document allowing Hu to sell Joe’s organs in case of Joe’s unfortunate death in the race.

Joe was failing…
His vision was getting dimmer.
His legs… tiring…
Each step, his foot felt like walking the field of broken glass.
Joe was longer the champion he was once was… shaken and stirred. Joe wasn’t even nearing the halfway point. His steps were beginning to shake.

Ben readied yet another round of morphine.
Shocked, Joe’s brother Ron asked Ben to stop the madness…
Ben replied with a smirk, “I’m the doctor. The Game must go on…"

Couple of questions for us non americans. I assume CNBC is the Canadian National Broadcasting Corporation right?

and how much is that each for you adult americans?



Try $4.28 trillion dollars. That’s $4,284,500,000,000 and more than what was spent on WW II, if adjusted for inflation, based on our computations from a variety of estimates and sources*.


This is truly amazing… Even why they are obviously trying to make the point that this is a lot of money, they report it as "4.28 trillion dollars" when the actual figure is $4,284,500,000,000. So we’ve actually come to the point where four and a half BILLION DOLLARS is just a trivial rounding error unworthy of mention. That’s more than Ted Turner’s net worth!



Bush, Bernanke, et. al., are laying the dynamite and Obama is going to detonate it.

CNBC is a cable business news network that is owned by NBC.
So far Paulsen & gang have spent $14,016 per American, assuming a population of 305,000,000. If they would have asked me, I certainly wouldn’t have given them $14k to bail out their rich buddies.

dear dr. martenson

if i were on the space shuttle i would not come back. please havemy mail forwarded.


That puts into perspective the insanity of buying Treasuries as a safe haven. Think about it. The federal government is the largest debtor in the world - no contest - and they have an AAA rating. The rating companies are either delusional or too shit scared to drop the fed’s bond rating.

The case for owning gold and silver gets stronger by the day. All hell is going to break loose when the bond market crashes. This stock market swoon is a wart by comparison.



This is a great read for those thinking about backwards relationship of the US dollar and our debt

could it be…deflation, continued consumer spender (while weaker), monetization of debt AND a strong dollar??

The bigger they are, the harder they fall.

Congressman Joe Knollenberg says it’s not our money. You can’t make this stuff up

and the job of informing the public so that we can get a true forum of educated debaters together to form a solution is imperative but that’s just it… the end game to all of this is to form possible solutions. To throw up our hands and give up is not a solution. To armchair quarterback is Not a solution. To board yourself up and stock up on ammunition and food is NOT a solution.
I’ve posted several times for people to come up with credible solutions so that everyone on this site can do their part and send them to the appropriate policy makers. God knows that they don’t have all the answers and very well might accept the help. How many people have taken up the challenge to writing up a good solution? None… that’s right… None. Maybe I’ve missed some posts so I’ll take it all back when we see some good suggestions.
Now what makes a good suggestion? Great question! If it stands the test of this board and the scrutiny of all those who spend so much effort criticizing those who are trying to fix things, then damn… that’s good enough for me and it should be passed on to your representative of government. What’s the acid test? Well another great question… if you can recite your solution to your spouse, neighbour, friend, kids… and their eyes don’t gloss over or they don’t puke on you or tell you that you’re crazy … well then that’s a pretty good start. Throw your suggestions on the board, but be forewarned… if it’s something like “Laissez-faire rules, let capitalism at its pure form envelop those money losing, union strapped companies and fold them all into the ground - to hell with them, if they can’t make money, they don’t deserve to live” well then be prepared to explain to all those who are disrupted by your purist ideals and their kids …
“that the world is such a mess because of some greedy bastards on Wall Street… Oh and by the way, sorry for your luck, it sucks to be you”.

So are you angry yet??? Maybe this will help.


I’ve posted several times for people to come up with credible solutions so that everyone on this site can do their part and send them to the appropriate policy makers. God knows that they don’t have all the answers and very well might accept the help. How many people have taken up the challenge to writing up a good solution?


There is only one solution but don’t bother sending it to your congressman, senator or incoming president. It will not be implemented because neither they nor the average Joe American will support it. The solution? Implement a sound monetary system based on gold &/or silver and eliminate the Fed. In other words, obey the constitution. Why won’t it fly? Because everyone expects something for nothing and this cannot happen within a sound monetary system.

I think that if they wanted to "stimulate the economy" they could have given US citizens even half of that 14k (as per #4 switters) and told them to spend it or put it down on their failing morgate. Create a giftmas shopping spree just before the collapse? Everyone could stock up on ammo and water filters!

Joking aside. What happens when no other countries want to deal in USD? I certainly don’t want anything to do with it anymore.

What exactly would (or more likely will) happen when the USD is devalued?

What exactly happens to eveyone’s debt or savings?

Take a hint from the Chinese and spend the stimulus on developing infrastructure and investing in our manufacturing capacity, which we need badly to make the transition to renewable energy. Develop an electrical grid that is capable of storing and transmitting electricity generated by wind and solar. Subsidize the development of PHEVs. Rebuild the rail system and modernize it to run on electricity. Etcetera.
I can think of any number of better uses for the money than funneling it into the pockets of the corrupt bankers and CEOs that caused this mess in the first place.
The UN has estimated that it would only take a couple hundred billion to end world hunger, for crying out loud.


Nice to have you back…


There isn’t much I’d add at the moment that switters hasn’t said (#16) besides to check out The Venus Project. Sure it sounds a tad too utopian but I think we can get some sound ideas there.


And they were worried that Kyoto was going to hurt the economy!?!

Switters and many others seem well informed and willing to share their views… this is exactly the type of post I like to read but just a few points to your suggestion…

I trade physical natural gas and understand the power markets pretty well. The main problem with your suggestion is that it is impossible for any large power grid like the one in the US to rely heavily on wind. In fact, a few years ago when the Brits were facing brown outs, one of the first things they did was eliminate wind from their system. Why would they give up a source of power? Quite simply that wind is too volatile to depend on so to build a contingency or a system around such volatility would have been impossible and inefficient. Wind is a valuable source of energy when it is used only in part of the overall power supply. Wind can never be a substantial amount of the overall power supply. The problem with solar is in its efficiency and current technology not to mention the rare earths required to create the new thin-film solar panels needed to paint the tops of every roof top.

Another problem is the time it takes to implement some of these large infrastructure changes. While overall spending can induce stimulus, it doesn’t solve the current financial crisis we face today. Is a bandaid fix required to bridge us over? Maybe… quite likely. Will it be the perfect long term solution? Nope, probably not but time buys many things including the opportunity to implement some of the longer term projects like infrastructure. I would throw out that one of the first things you could do that would have an immediate impact is to swallow the bullet and create a carbon tax credit or a version of a cap and trade system. This would increase spending in the areas that need it including the increase of natural gas power generation. The electric car would also go a long way to reducing power volatility and reducing the overall cost of transportation. This summer the oil/gas ratio hit a record high of almost 16:1 when the energy equivalent ratio is around 6:1. Cars that are powered by electricity produced by natural gas power generation will bridge the gap giving the country the ability to arbitrage this oil/gas ratio imbalance. There are, of course, problems to this and it is in battery availability and technology but there is currently technology out there that will charge up a battery in less than an hour and allow the car to run 150km on a single charge which is more than most people drive during a day.

Anyways, let’s see more suggestions, critique them and get a plan going… time is of the essence.