Archive for Fiat Currency

Congress is losing its patience with the Fed

Posted in economic tyranny, Economy, Fiat Currency, International Bankers, New World Order, News, Shadow Government, Stupid Government Tricks, The Federal Reserve, Tyranny, Unconstitutional with tags , , , , , , on November 24, 2009 by truthwillrise

Lawmakers on both sides question power, handling of Wall Street bailouts

The Associated Press
WASHINGTON – Suddenly the Federal Reserve is everybody’s punching bag.

Strip the Fed of its bank regulation powers, some in Congress are demanding. Get probing audits of its behind-the-scenes operations, others say.

The chairman of the Federal Reserve Board is always fair game for criticism and second-guessing, usually over interest rate actions. But this year the criticism is much broader as Congress responds to widespread public anger that the Fed bailed out Wall Street but not ordinary Americans, and with unemployment in double digits.

Former Fed Chairman William McChesney Martin Jr. famously said that the central bank’s job was to yank away the punchbowl just when everybody is starting to party. And while Fed Chairman Ben Bernanke has signaled the Fed will keep interest rates low for now, a round of higher rates inevitably will come.

The Fed finds itself both the punchbowl keeper and the punching bag. Imagine the outcry when it does begin to crank up rates — perhaps just ahead of next year’s midterm elections.

Fireworks seem likely at Senate confirmation hearings early next month on President Barack Obama’s nomination of Bernanke to a second four-year term as chairman.

Many economists and Fed watchers say congressional efforts to rein in the Fed’s powers could interfere with the central bank’s ability to help guide the fragile economy to recovery.

The Fed’s very independence and its unique ability among U.S. institutions to create money out of thin air enabled it to act quickly to stabilize the nation’s financial system after it froze up last September after the bankruptcy of the Lehman Brothers investment house, Fed backers say.

“It might have been the Fed’s finest moment when it had to jump into the market,” said David M. Jones, a former Fed economist and president of DMJ Advisors, a Denver-based consulting firm. “We still have to wait to see how effective the Fed is in its exit strategy and whether it can keep inflation in check. But this badgering by Congress, even if there is populist sentiment, is inappropriate.”

The Fed’s aggressive intervention also set the stage for the current criticism. Many lawmakers question whether the Fed’s money machine has mainly benefited financial markets and not the broader economy. Lawmakers are also peeved that the central bank acted without congressional involvement when it brokered the 2008 sale of failed investment bank Bear Stearns and engineered the rescue of insurer American International Group.

Bernanke, first appointed by President George W. Bush, has worked closely with both Treasury Secretary Timothy Geithner and Bush Treasury Secretary Henry Paulson in confronting the worst financial crisis in decades. Geithner also has gotten his share of congressional wrath, mainly for his administering of the $700 billion bank bailout fund.

“In the past, the Federal Reserve was held in very high esteem,” said Rep. Ron Paul of Texas, a libertarian-leaning Republican who twice ran for president and remains a darling of skeptics of Washington. Now, it’s “the source of our problem,” suggests Paul, author of the best-seller “End the Fed.”

Usually an outlier, Paul suddenly has found an army of at least 307 House colleagues and 30 senators marching behind his legislation to subject the Fed to intense scrutiny by Congress’ Government Accountability Office. The House Financial Services Committee endorsed Paul’s approach 43-26 last week over objections from its chairman, Rep. Barney Frank, D-Mass.

The bill would authorize Congress to audit not only the Fed’s lending programs but its basic decisions to set monetary policy by raising or lowering interest rates. Paul has been introducing a version every year since the early 1980s, but this is the first time it has garnered any serious attention.

Senate Banking Committee Chairman Chris Dodd, D-Conn., who will preside over Bernanke’s confirmation hearings, has proposed legislation that would strip the Fed of its bank-regulation authority and give the Senate a role in selecting the 12 regional Federal Reserve bank presidents.

Dodd says his measure would return the Fed to its core mission of setting monetary policy, claiming it proved itself “an abysmal failure” by not cracking down on risky lending practices that led to the financial meltdown.

Dodd is in an extremely tight battle for re-election, even though he has served in Congress for 35 years.

“I don’t think it ever hurts to have a member of Congress stand up and denounce the Fed. There is a lot of anger out there, and this is basically a therapeutic gesture,” said Ross Baker, a political scientist at Rutgers University.

Still, Baker said, it probably isn’t wise to tamper with the formula that makes the Fed “very much an anomaly in American government. It’s independent, it has to be. You don’t want the Fed to be under the control of the president. And it kind of sits out there — not in the executive branch, not in the legislative branch, not in the judicial branch. Sort of its own little element in the separation-of-powers constellation.”

While the Fed is subject to some congressional oversight, its decisions don’t have to be ratified by the president or Congress. Fed officials are not paid with money appropriated by Congress.

Should Bernanke be worried?

“Not only should be worried, he’s clearly ratcheted up his game in terms of his communications with Congress,” said Norman Ornstein, a senior fellow at the American Enterprise Institute.

Ornstein said the Fed bashing this time is different from before, with “a broader base of support. And it’s coming from people who in the past would not have hit the Fed. There’s a lot of populist anger out there — on the left, in the center and on the right. And politicians are responsive to that.”

Government Is Trying to Make Bailouts for the Giant Banks PERMANENT

Posted in Attack on Freedom, economic tyranny, Economy, Fiat Currency, New World Order, News, Shadow Government, The Federal Reserve, Tyranny, Unconstitutional with tags , , , , , , , on October 29, 2009 by truthwillrise

Washington’s Blog
October 29, 2009

 

 

 

 

 

Congressman Brad Sherman: “I’m not looking for a TARP on steroids with oversight. I’m looking for an end of TARP.”

featured stories   Government Is Trying to Make Bailouts for the Giant Banks PERMANENT  
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On September 25th, I wrote:

Paul Volcker and senior Harvard economist Jeffrey Miron both testified to Congress this week that the government is trying to make bailouts for the giant banks permanent.

 

 

 

 

 

 

 

 

 

 

 

Writing Wednesday in The Hill, Congressman Brad Sherman pointed out that :

In my opinion, Geithner’s proposal is “TARP on steroids.” Section 1204 of the proposal [the proposal being the “Resolution Authority for Large, Interconnected Financial Companies Act of 2009”] allows the executive branch to use taxpayer money to make loans to, or invest in, the largest financial institutions to avoid a systemic risk to the economy.

Geithner’s proposal reminds me of the Troubled Asset Relief Program (TARP), the $700 billion Wall Street bailout adopted last year, but the TARP was limited to two years, and to a maximum of $700 billion. Section 1204 is unlimited in dollar amount and is a permanent grant of power to the executive branch. TARP contained some limits on executive compensation and an array of special oversight authorities. Section 1204 contains absolutely no limits on executive compensation and no special oversight.

When I asked Geithner whether he would accept a $1 trillion limit on the new bailout authority (if the executive branch wanted to spend more, it would have to come back to Congress), he rejected a $1 trillion limit, insisting that the executive branch be able to respond without coming back to Congress.

Both TARP and the Treasury proposal have vague provisions under which taxpayers might possibly recover any money lost through a special tax on the financial services industry. Under the Treasury proposal, only the very largest institutions could benefit from a bailout, but the special tax, if ever collected, would fall chiefly on medium-sized institutions.

Thus, the medium-sized institutions will be at a competitive disadvantage for two reasons. First, the largest institutions will be able to borrow money more cheaply because their creditors will believe that if the institution is unable to pay, the taxpayers will. Second, if there ever is a bailout benefitting a very large financial institution, the tax will be imposed on the medium-sized institutions.

Sherman is a senior member of the House Financial Services Committee and a certified public accountant, so he has a good nose for analyzing proposed financial regulations.

Last week, Sherman made the following comments to the Washington Independent regarding Congress’ proposed bill on the too big to fails:

That is a huge gravy train to the top 20 [financial institutions] because it allows them to borrow money at a lower rate. Think of what this does to moral hazard.

I’m not looking for a TARP on steroids with oversight. I’m looking for an end of TARP.

The House Committee on Financial Services will hold a hearing on the bill tomorrow, with Tim Geithner, Sheila Bair, John C. Dugan (Comptroller of the Currency), Daniel K. Tarullo (Governor, Board of Governors of the Federal Reserve System), John E. Bowman (Acting Director, Office of Thrift Supervision), Richard Trumka (President, AFLCIO), and others as witnesses.

As the Washington Independent points out, Sherman is going to try to take Tarp off of steroids:

Sherman said he intends to offer a series of amendments addressing the issue during the Financial Services panel’s markup of the bill, which has yet to be scheduled. Included will be a provision to cap the president’s bailout authority at $1 trillion, and another to strip out the resolution authority language entirely. A potential third proposal — to create an oversight panel like that monitoring TARP funds — is one he’s leaning against.

Ron Paul: Wall Street’s Banker Bailout Fraud

Posted in economic tyranny, Fiat Currency, International Bankers, New World Order, News, Shadow Government, The Federal Reserve with tags , , , , , , on October 21, 2009 by truthwillrise

Infowars
October 20, 2009

Wall Street has the strings on Washington.

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The Economy is a Lie, too

Posted in Attack on Freedom, economic tyranny, Economy, Fiat Currency, International Bankers, New World Order with tags , , , , , , on September 29, 2009 by truthwillrise

Paul Craig Roberts
Infowars
September 22, 2009

Americans cannot get any truth out of their government about anything, the economy included. Americans are being driven into the ground economically, with one million school children now homeless, while Federal Reserve chairman Ben Bernanke announces that the recession is over.

At the urging of Larry Summers and Goldman Sachs’ CEO Henry Paulson, the Securities and Exchange Commission and the Bush administration went along with removing restrictions on debt leverage.

economic crisis   The Economy is a Lie, too  
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The spin that masquerades as news is becoming more delusional. Consumer spending is 70% of the US economy. It is the driving force, and it has been shut down. Except for the super rich, there has been no growth in consumer incomes in the 21st century. Statistician John Williams of shadowstats.com reports that real household income has never recovered its pre-2001 peak. 

The US economy has been kept going by substituting growth in consumer debt for growth in consumer income. Federal Reserve chairman Alan Greenspan encouraged consumer debt with low interest rates. The low interest rates pushed up home prices, enabling Americans to refinance their homes and spend the equity. Credit cards were maxed out in expectations of rising real estate and equity values to pay the accumulated debt. The binge was halted when the real estate and equity bubbles burst.

As consumers no longer can expand their indebtedness and their incomes are not rising, there is no basis for a growing consumer economy. Indeed, statistics indicate that consumers are paying down debt in their efforts to survive financially. In an economy in which the consumer is the driving force, that is bad news.

The banks, now investment banks thanks to greed-driven deregulation that repealed the learned lessons of the past, were even more reckless than consumers and took speculative leverage to new heights. At the urging of Larry Summers and Goldman Sachs’ CEO Henry Paulson, the Securities and Exchange Commission and the Bush administration went along with removing restrictions on debt leverage.

When the bubble burst, the extraordinary leverage threatened the financial system with collapse. The US Treasury and the Federal Reserve stepped forward with no one knows how many trillions of dollars to “save the financial system,” which, of course, meant to save the greed-driven financial institutions that had caused the economic crisis that dispossessed ordinary Americans of half of their life savings.

The consumer has been chastened, but not the banks. Refreshed with the TARP $700 billion and the Federal Reserve’s expanded balance sheet, banks are again behaving like hedge funds. Leveraged speculation is producing another bubble with the current stock market rally, which is not a sign of economic recovery but is the final savaging of Americans’ wealth by a few investment banks and their Washington friends. Goldman Sachs, rolling in profits, announced six figure bonuses to employees.

The rest of America is suffering terribly. 

The unemployment rate, as reported, is a fiction and has been since the Clinton administration. The unemployment rate does not include jobless Americans who have been unemployed for more than a year and have given up on finding work. The reported 10% unemployment rate is understated by the millions of Americans who are suffering long-term unemployment and are no longer counted as unemployed. As each month passes, unemployed Americans drop off the unemployment role due to nothing except the passing of time.

The inflation rate, especially “core inflation,” is another fiction. “Core inflation” does not include food and energy, two of Americans’ biggest budget items. The Consumer Price Index (CPI) assumes, ever since the Boskin Commission during the Clinton administration, that if prices of items go up consumers substitute cheaper items. This is certainly the case, but this way of measuring inflation means that the CPI is no longer comparable to past years, because the basket of goods in the index is variable.

The Boskin Commission’s CPI, by lowering the measured rate of inflation, raises the real GDP growth rate. The result of the statistical manipulation is an understated inflation rate, thus eroding the real value of Social Security income, and an overstated growth rate. Statistical manipulation cloaks a declining standard of living.

 

  • A d v e r t i s e m e n t
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In bygone days of American prosperity, American incomes rose with productivity. It was the real growth in American incomes that propelled the US economy. 

In today’s America, the only incomes that rise are in the financial sector that risks the country’s future on excessive leverage and in the corporate world that substitutes foreign for American labor. Under the compensation rules and emphasis on shareholder earnings that hold sway in the US today, corporate executives maximize earnings and their compensation by minimizing the employment of Americans.

Try to find some acknowledgement of this in the “mainstream media,” or among economists, who suck up to the offshoring corporations for grants.

The worst part of the decline is yet to come. Bank failures and home foreclosures are yet to peak. The commercial real estate bust is yet to hit. The dollar crisis is building.

When it hits, interest rates will rise dramatically as the US struggles to finance its massive budget and trade deficits while the rest of the world tries to escape a depreciating dollar. 

Since the spring of this year, the value of the US dollar has collapsed against every currency except those pegged to it. The Swiss franc has risen 14% against the dollar. Every hard currency from the Canadian dollar to the Euro and UK pound has risen at least 13 % against the US dollar since April 2009. The Japanese yen is not far behind, and the Brazilian real has risen 25% against the almighty US dollar. Even the Russian ruble has risen 13% against the US dollar.

What sort of recovery is it when the safest investment is to bet against the US dollar?

The American household of my day, in which the husband worked and the wife provided household services and raised the children, scarcely exists today. Most, if not all, members of a household have to work in order to pay the bills. However, the jobs are disappearing, even the part-time ones.

If measured according to the methodology used when I was Assistant Secretary of the Treasury, the unemployment rate today in the US is above 20%. Moreover, there is no obvious way of reducing it. There are no factories, with work forces temporarily laid off by high interest rates, waiting for a lower interest rate policy to call their workforces back into production. 

The work has been moved abroad. In the bygone days of American prosperity, CEOs were inculcated with the view that they had equal responsibilities to customers, employees, and shareholders. This view has been exterminated. Pushed by Wall Street and the threat of takeovers promising “enhanced shareholder value,” and incentivized by “performance pay,” CEOs use every means to substitute cheaper foreign employees for Americans [How Well-Educated, Hard-Working Americans are Treated in America, By Rennie Sawade, WashTech News, September 14, 2009 ]. Despite 20% unemployment and cum laude engineering graduates who cannot find jobs or even job interviews, Congress continues to support 65,000 annual H-1B work visas for foreigners.

In the midst of the highest unemployment since the Great Depression what kind of a fool do you need to be to think that there is a shortage of qualified US workers?

Trailer – Fall of the Republic: The Presidency of Barack Obama

Posted in Alex Jones, Attack on Freedom, economic tyranny, Fiat Currency, International Bankers, New World Order, Police State/Martial Law, Secret Societies, Shadow Government, The Federal Reserve with tags , , , , , , , , , , on September 11, 2009 by truthwillrise

Trailer – ‘Fall of the Republic: The Presidency of Barack Obama’ –
An Alex Jones Film –

COMING TO THE INFOWAR OCTOBER 21st, 2009
Here is a first glimpse of Alex Jones most powerful film yet, to be titled Fall of the Republic: The Presidency of Barack Obama. The globalists want the Republic to fall, and they are trying to use their newest, and slickest ever puppet to destroy the last vestiges of Americas freedom, Constitution and economy, all while helping the bankers loot the country clean. But this film shows how we can turn it around, and restore all that was good and right in our nation.

Get the best-selling first installment, The Obama Deception on DVD now!!
http://infowars-shop.stores.yahoo.net…

Invisible Empire Official Trailer

Posted in Alex Jones, Attack on Freedom, economic tyranny, False Flag Terror, Fiat Currency, International Bankers, New World Order, Police State/Martial Law, Secret Societies, Shadow Government, The Constitution, The Federal Reserve, Truth/Freedom, Tyranny with tags , , , , , , , , , , , on September 11, 2009 by truthwillrise

The official trailer for Invisible Empire, written and directed by Jason Bermas, and produced by Alex Jones.

This film will be released February 12, 2010 and available on DVD at http://infowars.com/ and online in High-Quality at http://prisonplanet.tv/

‘Invisible Empire’ will be more than just a film– it is the culmination of years of research by Jason Bermas into the inner-workings and most revealing public statements by the New World Order and the most trusted stewards of their dark vision. ‘Invisible Empire’ promises to unveil the long-term agenda for world control, just as ‘Fabled Enemies’ (http://infowars-shop.stores.yahoo.net/e nemies.html) and ‘Loose Change’ (http://infowars-shop.stores.yahoo.net/l ochficut.html) forever stripped away the facade of the official story of 9/11 and exposed the dark truth that lies behind.

Jason Bermas joins with Alex Jones, producer of The Obama Deception (http://infowars-shop.stores.yahoo.net/o bdedvd.html), Endgame: Blueprint for Global Enslavement (http://infowars-shop.stores.yahoo.net/e ndgamedvd.html), Terrorstorm (http://infowars-shop.stores.yahoo.net/t esped.html) and more than 20 other key titles for your understanding of the real world, all available on DVD at http://infowars-shop.stores.yahoo.net/ or for download in High-Quality at http://prisonplanet.tv/

SEE OTHER TITLES: http://infowars-shop.stores.yahoo.net…