Officials from the US Treasury Department are insisting tonight that absolutely no US taxpayer dollars will be put forward to bail out the increasingly unstable Kabul Bank, which has been struggling with a growing bank run over the past week.
“While we are providing technical assistance to the Afghan government, no American taxpayer funds will be used to support Kabul Bank,” insisted Deputy Treasury Secretary Neal Wolin. The Treasury Department dispatched a team to Kabul last week when the crisis first emerged.
A number of media rpeorts have emerged over the past several days alleging that certain highly placed leaders in the bank, including Afghan President Hamid Karzai’s brother Mahmoud, have been taking out questionable loans. Mahmoud Karzai is even alleged to have paid for his 7% stake in Kabul Bank with funds borrowed from Kabul Bank.
But the bank’s importance in the Afghan economy cannot be understated. Many contractors are paid through it, many key government figures have accounts there, and many Afghan military and police cash their checks at the bank. Its failure could be a disaster, and its failure due to corruption would probably damage what little credibility the Karzai government has left.
To that end there are reports emerging that the Afghan Central Bank is recalling hundreds of millions of dollars from the US and that President Karzai has ordered $380 million set aside to prop up the struggling bank. Though this is a comparatively small amount in the world of international finance, it would represent a major expense for the cash-poor Afghan government, and might leave the nation’s finances in even greater doubt than they already are.
That "officials" from the U.S. Treasury Department can be taken at "their word," is unlikely. U.S. government has proven itself to be riddled with bald-faced lying poltroons on a good day. If Treasury is maintaining there is "no bailout" well, there will be a bailout for Kabul Bank and that bailout will just be hidden inside some irrelevant legislation or 'executive order' and that will be that.
The bailout will come via the federal reserve. No one in elected positions have any ideas how many times the federal reserve used paper funds to clean up another financial mess created by
the US government …usually via the cia.
It is my hope, prayer and vote this coming election that the democrats will be crushed so much
that the incoming republicans, too, will fear the wrath of voters. Bigger the crush, the bigger
the fear. I just feel that the every day John Q is finally getting angry enough to vote the bums out.