TARP REPAID = More Silly games

The latest Wall Street fad is to insist that TARP has been repaid with interest by the largest Wall Street Banks.

Is this possible?

As with everything that comes out of Wall Street, it depends entirely on what one wants to believe. Sure, why not? The fact is the Fed's balance sheet is entirely opaque. Nobody's allowed to see it. So maybe it could be true if you want to believe it. Do you?

Maybe the banks technically have given some funds back to the Fed. Maybe technically you can count those funds towards "repayment of Tarp."

But here's the question: Where did the Banks get those funds?

From a myriad of other Fed sponsored programs perhaps? From TALF? From the Primary Dealer Credit Facility? From the Commercial Paper Funding Facility? From the Term Auction Facility? From the Small Business Lending Facility?

Did they get if from selling hundreds of billions of dollars of crap agency paper (Think Fannie and Freddie) at fantasy mark to model values to the Fed?

Did they get it from selling hundreds of billions of dollars of other crap paper at fantasy mark to model values to the Fed?

Or maybe they got it from borrowing money at Zero percent from the Fed and then using it to cheat everyone else in the markets with High Frequency front-running trading programs?

What do you think? Do you think the banks earned the money the good old fashioned way: by making smart loans? Or do you think the paid back the TARP money by essentially borrowing - or just plain getting - the money from the FED? Or cheating you in the markets?

The funny thing is that nobody will ever know. Because the Fed isn't obliged to tell anybody. And also, because the balance sheets of the banks are technically available but all but indecipherable even to industry analysts.

The other really funny thing is that even if not one person in a million understands any of this, nine out of ten people just assume the Fed and the banks are lying. That's the really funny part. Because when you lie long enough people catch on, and after a while it doesn't matter anymore what you're saying. As long as your lips are moving people assume you're lying.

That's not good for your run of the mill con man. Or your run of the mill politician. But when it becomes true within and throughout the Banking System the economy is past the point of no return. Are we there? What do you think?