October 1, 2022

Apparently the Fed Needs More Money

Thumbnail image for PiggyBank_broken.jpgEditor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
I know, the headline stunned me when I read it the first time too. First via James Turk, I had to stop and look at that for a second. Don’t they make it? How could they possibly need it?
Initially, the Fed called this proposed deposit facility a component of its “exit strategy” (the existence of which, much like Sasquatch, is still up for debate), insisting that by creating an interest-bearing drain for banks’ funds held at the Fed, it could clear out some of the money sloshing around in the system.


Although they also believe asset sales to be an option, I’m still not sure who the hell they are expecting to buy these bonds (unless they’re willing to take a loss, and knowing the Fed that’s not too likely) so stay tuned.
I believed this whole interest-bearing deposit facility nonsense was really just a Bad Bank for Dirty Fed money but it’s actually the Fed begging for deposits, so I guess I was wrong. But why, then, would they paint this as an exit strategy?
From the Turk piece:

The US government needs ‘deposit currency’ – or ‘electronic’ currency, to put it into Mr. Bernanke’s terms – so that it can pay its bills by check or wire transfer. Payment for goods and services by deposit currency are made through the banking system, and nearly all commerce in the United States is conducted in this way. So where will the Federal Reserve get enough deposit currency to enable it to continue purchasing US government debt?

In 2008, “public debt” was considered to be $9.9 trillion dollars or 70.2% of GDP. By 2009, that number had ballooned to over $12.9 trillion dollars, nearly 91% of GDP. Even more disconcerting? This is using governmental accounting rules which — as any of you who have ever worked in government can attest to — don’t necessarily coincide with GAAP logic.
Let’s not forget that a large chunk of this debt is owed to the Fed itself (for some reason) perhaps because inflation isn’t bad enough and we somehow should pay them more for the convenience of having printed money and payment systems.
I’m not 100% on what’s going on here but it’s beginning to look awfully suspicious.

Thumbnail image for PiggyBank_broken.jpgEditor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
I know, the headline stunned me when I read it the first time too. First via James Turk, I had to stop and look at that for a second. Don’t they make it? How could they possibly need it?
Initially, the Fed called this proposed deposit facility a component of its “exit strategy” (the existence of which, much like Sasquatch, is still up for debate), insisting that by creating an interest-bearing drain for banks’ funds held at the Fed, it could clear out some of the money sloshing around in the system.


Although they also believe asset sales to be an option, I’m still not sure who the hell they are expecting to buy these bonds (unless they’re willing to take a loss, and knowing the Fed that’s not too likely) so stay tuned.
I believed this whole interest-bearing deposit facility nonsense was really just a Bad Bank for Dirty Fed money but it’s actually the Fed begging for deposits, so I guess I was wrong. But why, then, would they paint this as an exit strategy?
From the Turk piece:

The US government needs ‘deposit currency’ – or ‘electronic’ currency, to put it into Mr. Bernanke’s terms – so that it can pay its bills by check or wire transfer. Payment for goods and services by deposit currency are made through the banking system, and nearly all commerce in the United States is conducted in this way. So where will the Federal Reserve get enough deposit currency to enable it to continue purchasing US government debt?

In 2008, “public debt” was considered to be $9.9 trillion dollars or 70.2% of GDP. By 2009, that number had ballooned to over $12.9 trillion dollars, nearly 91% of GDP. Even more disconcerting? This is using governmental accounting rules which — as any of you who have ever worked in government can attest to — don’t necessarily coincide with GAAP logic.
Let’s not forget that a large chunk of this debt is owed to the Fed itself (for some reason) perhaps because inflation isn’t bad enough and we somehow should pay them more for the convenience of having printed money and payment systems.
I’m not 100% on what’s going on here but it’s beginning to look awfully suspicious.

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Are Today’s Accountants Already Occupying Wall Street?

Caleb and I had a talk last night and it made me think about this whole Occupy Wall Street thing. More importantly, it made me think about what I am and am not doing to support it. I haven’t been to a rally, even to take pictures (last time I tried to do that, I was the only one out in front of the Federal Reserve Board at 6 in the morning except for the lone Fed cop patrolling the perimeter).

I get that people are pissed off. I’m pissed off too. I’ve been pissed off, don’t tell me about being pissed off. I was lugging around aFed sign made on top of “Ron Paul ’08” acrylic three years ago, you don’t have to tell me about being pissed off. (Here I am in 2009 on SF Citizen in a “Bernanke 00%” t-shirt at an anti-Iraq war rally)

And I get that for some people, all there is to do is go downtown with a drum and some poorly-written signs on cardboard ripped from your mom’s Costco packages in the recycle bin. That’s totally fine, everyone has their own way of sticking it to the man.

For a lot of Going Concern readers, sticking it to the man means showing up every day in business casual pretending to give a fuck about COSO but actually knowing that it’s all a lie. They work you to the bone until you leave or submit and get promoted to manager. Partner if you’re lucky. Run on that hamster wheel, here have this bonus, keep going and one day you can beat your own subordinates into submission. Go, go, go… Many of you get that this is bullshit but keep showing up every day anyway, and to me, you are your own special kind of protester. Same as last year, motherfucker, it’s the ultimate form of rebellion.

Too much?


Point being, everyone has their own way of screwing the establishment. Francine does it railing against the Big 4. Bill Sheridan and Tom Hood do it at the MACPA with professionalism. Tom Selling does it by riling up fellow academics. Professor Dave Albrecht does it by being seen in public canoodling with known incendiaries like yours truly.

I do it by ripping on the IASB as often as I am allowed to, infiltrating the Hill to sniff out what’s the latest in CPA lobbying efforts and getting in as many F bombs as I can on the dry subject of accounting. That’s all I can do. I can’t abandon my day job to hang out in Manhattan eating vegan paninis. I can make and distribute offensive Bernanke fridge magnets.

I completely understand why people are attracted to Occupy Wall Street; the part I’m struggling with is why so many of the 99 Percenters seem obsessed with this thing called “fairness” that does not, in fact, exist. Is it fair that any of us have to drag our asses to work every day and do what we do? Is it fair that Becker costs $3,000 and doesn’t pass the CPA exam for you? Is it fair that many of you are drowning in student loan debt and seemingly forced to get Master’s degrees just to work in your field? Is it fair that Caleb gets listed in all the accounting publications and I’m stuck as the sidekick hack who always manages to piss people off? This world is unfair, sorry to be the bearer of bad news. I have to write about accounting every day of my life, it’s un-fucking-fair, we get it.

In my view (for whatever that is worth, which is probably not more than our company pays me to write this post), the ultimate rebellion is assimilating and infiltrating the establishment to enact real change from the inside. Are partners scared as shit of this website? Yes. If they’re threatening you with termination if you even dare to write us for advice, we’re doing something right. And I didn’t even have to not shave my armpits to accomplish that (but Caleb probably shaved his).

Are any of you going to independently revolutionize the accounting industry? Probably not. But collectively, you have scared the pants off of lazy ass recruiters and partners across this country who thought you didn’t have it in you. They read us because they feel like they have to or else they’ll lose touch with what you guys are thinking, and it scares the living shit out of them. In my mind, that’s a far more effective message to send the The Establishment, whoever the hell they are.

I fully support the fundamental sentiment of Occupy Wall Street but much prefer fulfilling my incendiary duties here trying to get accounting kids riled up and questioning why they put up with the shit they do. Working mothers in public accounting should be allowed to have children. Interns should be allowed to ask questions (even dumb ones). Auditors should be expected to question last year’s logic. It’s not complicated but it’s important work that a lot of you do, and I hope that you get that.

It is not your fault that we’re here. Many of you just followed the rules.

Thanks for letting me be a part of that. Beats standing around with a fucking sign, that’s for sure.

Earlier:
Wanted: Accountants for Large Protest; Organizational Skills and Experience with Anything Slightly Resembling a Expense Reimbursement Policy a Plus [GC]