The Big Shakedown By Mike Whitney

http://www.informationclearinghouse.info/article27963.htm

The banks were given $700 billion when the TARP bailout was enacted. Then they were given $1.25 trillion more in the first round of quantitative easing (QE) where the Fed purchased the banks toxic mortgage-backed securities (MBS) and agency debt. They were given another $900 billion in QE2, in which the Fed exchanged $600 bil in reserves for US treasuries and another $300 bil in recycled proceeds from maturing MBS. So, altogether the banks have been given roughly $3 trillion, not a penny of which has benefited US taxpayers, increased demand, or strengthened the recovery. In fact--as we pointed out earlier--the money has not even increased lending which was the stated objective. (along with lowering unemployment)

So, we've been fleeced, right?
Imagine if that same $3 trillion had been given to smaller banks with the proviso that they temporarily drop interest rates on credit cards to 5 percent for (let's say) two years. Of course, the banks would still make boatloads of money because they borrow from the Fed at zero. (0.25%). But think of how much activity that would create if people could borrow at 5% instead of 18%. Most likely, it would lead to another credit expansion.