Fed to Geithner: Piss Off
I love the way Bloomberg begins this article:
“Federal Reserve Board has rejected a request by U.S. Treasury Secretary Timothy Geithner for a public review of the central bank’s structure and governance, three people familiar with the matter said.
The Obama administration proposed on June 17 a financial- regulatory overhaul including a “comprehensive review” of the Fed’s “ability to accomplish its existing and proposed functions” and the role of its regional banks. The Fed was to lead the study and enlist the Treasury and “a wide range of external experts.”
The Fed needs to be VERY concerned with maintaining their independence.
Regardless of your views about Ron Paul (his new book is called End the Fed), its the rest of the crowd of that scares me. Imagine what the dolts who run congress would do if they had access to the Fed’s authority.
The key to intelligent central banking is a clear charge (i.e., fighting inflation), a pragmatic (more Bernanke, less Greenspan) approach, and the willingness to make the unpopular necessary steps (Volcker).
Imagine what the giveaways would be like if the idiots in Congress were in charge . . .
>
Source:
Fed Rejects Geithner Request for Study of Governance, Structure
Craig Torres and Robert Schmidt
Bloomberg, Sept. 21 2009
http://www.bloomberg.com/apps/news?pid=20601109&sid=adjvXg1zP.zY
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September 21st, 2009 at 1:07 pm
Good points. One can certainly find reasons to criticize Bernanke.
But I’ll take Bernanke any day over the likes of Barney Frank and Chris Dodd.
September 21st, 2009 at 1:20 pm
“The key to intelligent central banking is a clear charge (i.e., fighting inflation), a pragmatic (more Bernanke, less Greenspan) approach, and the willingness to make the unpopular necessary steps (Volcker).”
We part ways on this one, BR. The belief in the efficacy of a central bank to do anything more than provide a stable medium of exchange and store of value such that real economic decisions can be properly made is what got us here to start with. The cult of Greenspan began it. It has flowered to fruition with the accolades being showered on Bernanke about now. Yet, he’s only just returned the flawed status quo. We are back on the primrose path to hell.
As it stands now, with the Fed’s dual mandate, and its ability to print money, i.e., impose taxation without input from the taxees, at will and with practically no oversight, we effectively have abandoned the republican form of governance for governance by a central economic bureaucracy. Economists, being as they are still fallible humans subject to all the same impulses they ascribe to homo economicus, will find any number of insidious ways to repress and defeat the freedoms that form the foundation of our greatness. I’d rather be ruled by the first 1,000 names in the Boston phone book.
September 21st, 2009 at 1:21 pm
Yep, that’s the point the critics often miss. If you believe the problem with the Fed is that it’s too inflationary, then the *last* thing you want is Congress in charge of it.
Some of them admittedly see this as a short-term strategy. Give monetary policy to Congress. Let Congress destroy the currency, switch to the gold standard or something, and then vindicate what geniuses they are for having bought gold at $1,000.
September 21st, 2009 at 1:22 pm
Barry — my criticism with the Fed independence preference is twofold. 1) If we look at the history of the US economy/financial system since the Fed’s inception in 1913 we find that we’ve had the worst and longest economic crisis in this nation’s history (the Great Depression), perhaps the most severe financial crisis (the Great Recession), and a loss of 95% of the dollar’s purchasing power. Has an “independent” Federal Reserve done the job it was created to do? And 2) The Fed wields an enormous amount of power, and that power has only been enhanced by Bernanke’s actions. Who does the Fed answer to? We live in a democracy. Do they answer to the people? To the president? To Congress? If none of the above, aren’t they an institution with unchecked power?
An institution with unchecked power that hasn’t done a very good job is a recipe for disaster.
September 21st, 2009 at 1:22 pm
Yes, but…
The ability to spend other people’s money without accountability is not acceptable in this country or any other.
Bernanke’s whole strategy thus far was motivated by the sheer terror of a disaster caused by his lack of vision and understanding. He jumped into that strategy with utterly no idea of how to exit. That’s where we stand today. We don’t know yet how it will turn out, but we will see.
September 21st, 2009 at 1:37 pm
If Congress gets that control then buy gold. LOTS OF GOLD. Although I do believe the worldwide banking establishment will ruin a country before losing control of the money supply.
September 21st, 2009 at 1:38 pm
You are so right Barry. The Fed must remain independent. Disaster would happen very quickly if Pelosi, Reid, Dodd, Frank or any one sitting in the White House or Congress got their hands on the Fed’s power button. And I pray that the economy doesn’t get too much worse. For it it does, B.O. and his crew in Washington will use the chaos from the worse economy as an excuse to get their hands on the Fed power button.
September 21st, 2009 at 1:39 pm
Yes, but the IRS still loves Timmmmaayyy…I notice they have extended another helping hand to tax cheats today…
…Can’t we just let Tim feel the love? Does it always have to be reduced to legal/illegal? Geeezzzzz, Louise….
September 21st, 2009 at 1:41 pm
>>Imagine what the giveaways would be like if the idiots in Congress were in charge . . .
Hmmm…firing up the one last neuron left in the imagination section….
- Stock-market bubble [x] Check
-Commodities bubble [x] Check
-Housing bubble [x] Check
-accompanied deval of USD [x] Check
….
I dunno Barry…pretty hard to imagine what the CONS in congress could’ve done what the bankers haven’t already!
~~~
BR: Take all of the above, then multiply X 10
September 21st, 2009 at 1:45 pm
One could extend this argument for the independence of the central bank to virtually any other function of government: the FDA could work better without congressional nagging, the FBI could catch more criminals without the president’s meddling, and so on. At some point, w must put our faith in the elected leaders of the republic, else we may as well dispense with this veneer of democracy altogether.
September 21st, 2009 at 1:45 pm
But who’s going to police the fed?
It’s true that I prefer Bernanke to Dodd or Frank, but that’s like saying I would rather die by suffocating than burning.
If we aren’t going to let the government investigate the Fed, how will it happen? Just trust Bernanke? Perhaps we can hire back Greenspan ..
September 21st, 2009 at 1:51 pm
BR says-
“The key to intelligent central banking is a clear charge (i.e., fighting inflation), a pragmatic (more Bernanke, less Greenspan) approach, and the willingness to make the unpopular necessary steps (Volcker) . . . Imagine what the giveaways would be like if the idiots in Congress were in charge . . .”
true- but last i checked the Treasury was suppose to be in charge of the issuance of money- and-
how do we know what the Fed is doing is in the interests of the people- and not just bankers- it isn’t as if we can throw them out if we’re dissatisfied- since they are not elected-
i’ll refrain from the idea that the Fed is some sacrosanct institution that operates for the benefit of the people- and because of these high ideals needs to remain secretive and untouchable- after all- they are not monks laboring at work for the common good- maybe their vision is not the majority’s opinion- maybe the majority of the people have a different vision of how this country should proceed-
that the Fed could evolve even further- so that many years from- they are the defacto government with zero accountablilty to the people- is not out of the realm of possibility- also-
idiots in congress???
say it ain’t so
September 21st, 2009 at 1:51 pm
“Imagine what the giveaways would be like if the idiots in Congress were in charge . . .”
If I recall, correctly, this ‘Issue’ was asked, answered, and, summarily, addressed..
Article 1 – The Legislative Branch
Section 8 – Powers of Congress
The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;
To borrow money on the credit of the United States;
To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;
To establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States;
To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;
To provide for the Punishment of counterfeiting the Securities and current Coin of the United States;
…
http://www.usconstitution.net/xconst_A1Sec8.html
~~
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
http://www.usconstitution.net/xconst_A1Sec10.html
barring the Constitutional arguments, briefly..
are We, really, to believe that, just, because it’s Old– the design of a Woman, the Heat from the Sun…– it isn’t Worthwhile?
We should remember: If Conservation didn’t work, We wouldn’t be here.
Maybe, instead of our slavish devotion to the FedRes, we should be wondering why ‘our’ Congress is shirking this, central, duty: To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;
and hiding from this one: To provide for the Punishment of counterfeiting the Securities and current Coin of the United States.
September 21st, 2009 at 1:51 pm
“The Fed needs to be VERY concerned with maintaining their independence.”
The Fed has played a central role in the creation of the massive credit bubble that lies at the center of all our problems! Being that Congress created the Fed in the first place, it’s their responsibility to take the needed corrective action. The fact that the Fed wants all it’s activities kept secret from the public should frighten us all. I want to know what they are hiding from the taxpayers.
September 21st, 2009 at 1:57 pm
The FED does not fight inflation, they cause inflation.
September 21st, 2009 at 1:58 pm
No one will be allowed a peek inside the box. BananAmerica. Banksters will have their way.
I would say the gov is doing quite nicely with giveaways aplenty without being inside the fed. Clunkers, first home credit, …. They can wreck it. Tax and spend got us here. Not the fed. The fed just makes sure the elites are in control of banking. And not all bankers are among the elites.
September 21st, 2009 at 1:59 pm
Hi The Curmudgeon,
Thanks so much for sharing a wonderful commentary!
September 21st, 2009 at 1:59 pm
BR fretted:
Imagine what the giveaways would be like if the idiots in Congress were in charge . . .
reply:
———-
I don’t things would be worse, just different. How can Congress top the Fed’s performance over the past decade? And, I bet we haven’t seen anything yet, given Ben the Bubble’s belief in the ability of free money and propped up markets as the cure for all ills.
During the next Republican majority in both houses and when they next have the Presidency, if their nuttiness continues on its projected course and continues to evolve as it has, I think we can expect to see Jesus on the $1 dollar bill and Reagan on the $100 if Congress runs the Fed.
September 21st, 2009 at 2:01 pm
I am surprised Timmy even asked for a peek.
Guess he’s still the fall guy for BS O, trying to appease the continuing anger over the TBTF. Then again, maybe the public outcry makes him think he has a public mandate. Isn’t that ironic.
September 21st, 2009 at 2:02 pm
I’d rather be ruled by the first 1,000 names in the Boston phone book.
Not sure how many Brahmin names beginning with “A” are in #s 1-1000, but the names of a few of your overlords may very well be in there, TC. ;)
I’m assuming you mean the white pages, because all bets are off if you’re talking yellow pages:
AAAAAAAAAA Best Limo
AAAAAAAAAA HVAC Repair
AAAAAAAAAA Towing Service
September 21st, 2009 at 2:05 pm
MEH,
“Maybe, instead of our slavish devotion to the FedRes, we should be wondering why ‘our’ Congress is shirking this, central, duty: To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures”
________
They no longer want to be the ones to declare war, either.
________
The Fed can’t be touched by the People — the Congress can. That alone is reason enough to do away with the Fed. Of course, we could give them strict performance goals with hellatious penalties (to the directors/officers personally) should those goals not be met.
We don’t need an untouchable, pseudo-governmental entity engaging in occult mendacious fiscal fuckery on our behalf.
September 21st, 2009 at 2:07 pm
The next few months will tell the story, but right now I suspect Ben the Bubble is facing a Hobsen’s Choice. He stops printing money and stops propping up markets and watches deflation take over … thus being known in history as the Failure Fed Chairman. Or, he throws an unending flood of Hail Marys and props up everything in sight hoping the economy eventually recovers so he can claim victory over this crisis, leaving all side effects to his successor to fix with a new bubble. I’m expecting to see choice 2 being tried out.
September 21st, 2009 at 2:10 pm
Barry, I’d agree with you except two things:
The Fed isn’t independent. The only thing worse than having banking policy made by the the “dolts who run Congress” is having banking policy made by the banks themselves.
The Fed isn’t democratic. The Constitution grants the power of the purse to Congress and Congress alone. I don’t think that Congress can constitutionally delegate the power to appropriate and hand out taxpayer money (or print money and hand it out). Federal agencies only have the power to distribute money as Congress directs. I don’t think there is such a thing as a constitutional blank check, although I’ve never seen anything authoritative written on the topic.
September 21st, 2009 at 2:10 pm
“The Fed needs to be VERY concerned with maintaining their independence.”
HAHAHAHA. The Fed isn’t independent, it’s a private corporation of Banksters, the very same ones feeding at the trough as we debate.
What a joke ! In the words of George Bush (according to Matt Latimer at least)it’s “a cruel hoax”
Here is some refreshing news for you;
“f|_|ck politics, I just want to burn shit down”, is becoming part of the new motto amongst the young.
http://www.topatoco.com/merchant.mvc?Screen=PROD&Store_Code=TO&Product_Code=ASW-FLAME&Category_Code=ALLSHIRTS
Hopefully sometimes soon folks will wake up to the swindle and act.
September 21st, 2009 at 2:11 pm
alfred e Says:
“Tax and spend got us here.”
_______
Borrow and spend got us here. We have some of the lowest taxes and highest deficits in the world.
September 21st, 2009 at 2:12 pm
@TZ,
Is there an entry for
AAAAAAAAAAAAAA Federal Reserve?
September 21st, 2009 at 2:12 pm
The Fed’s mandate is to protect the banking system, not the public. That is why they act the way they do in crisis. When push comes to shove, and they always make push come to shove, the fed will choose the best interests of the banking system over the public when there is a conflict of interest. I can’t remember where I read that but that is something that has stuck in my head for a very long time. It was one of those ‘hidden in plain sight’ utterances that are all over everywhere.
September 21st, 2009 at 2:13 pm
“f|_|ck politics, I just want to burn shit down”, is becoming part of the new motto amongst the young.
I’m not young, but it’s quickly becoming my motto as well…
September 21st, 2009 at 2:21 pm
It was taxcut and spend that got us here. If we had kept the taxes of the late 50′ies early 60′ies, we would have had a substantial surplus ready to stimulate us out of the current slump, without risking that the resulting debt could drag us right back in again.
September 21st, 2009 at 2:31 pm
“The key to intelligent central banking is a clear charge (i.e., fighting inflation), a pragmatic (more Bernanke, less Greenspan) approach, and the willingness to make the unpopular necessary steps (Volcker).”
So, in other words, the exact opposite of at least the last 8 years of Greenspan, during which Bernanke certainly played a critical part.
“Imagine what the giveaways would be like if the idiots in Congress were in charge . . .”
Um, Barry, Arthur Burns called. He says he can think of something worse than Congress being in charge. O:)
September 21st, 2009 at 2:34 pm
Could congress really do any worse?
At least congress is directly accountable to the public.
An organization that cannot forecast shit even with more and better information than everyone else should have the objectives of maximizing employment and maintaining price stability. They failed everywhere.
September 21st, 2009 at 2:41 pm
MA,
“They no longer want to be the ones to declare war, either.”
Yes, playing lapdog to the ‘Unitary Executive’ was/is one of their best Tricks.
further: Constitution, Article 6 – Debts, Supremacy, Oaths
The Senators and Representatives before mentioned, and the Members of the several State Legislatures, and all executive and judicial Officers, both of the United States and of the several States, shall be bound by Oath or Affirmation, to support this Constitution; but no religious Test shall ever be required as a Qualification to any Office or public Trust under the United States.
The first Congress developed this requirement into a simple, 14-word oath:
“I do solemnly swear (or affirm) that I will support the Constitution of the United States.”
…
The current oath was enacted in 1884:
I do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter: So help me God.
The public swearing-in ceremony consists of Representatives raising their right hands and repeating the oath of office. This ceremony is led by the Speaker of the House, and no religious texts are used. Some members of Congress later hold separate private ceremonies for photo ops.
http://uspolitics.about.com/od/usgovernment/a/oaths_of_office_4.htm
http://www.law.cornell.edu/uscode/uscode05/usc_sec_05_00003331—-000-.html
…for photo ops, yet We care not to wonder what Treason is..
Section 3. Treason against the United States, shall consist only in levying war against them, or in adhering to their enemies, giving them aid and comfort. No person shall be convicted of treason unless on the testimony of two witnesses to the same overt act, or on confession in open court.
The Congress shall have power to declare the punishment of treason, but no attainder of treason shall work corruption of blood, or forfeiture except during the life of the person attainted.
http://www.law.cornell.edu/constitution/constitution.articleiii.html
no wonder ‘self-regulatory’ bodies are so popular~ the Ballot, if We could, only, count them..
September 21st, 2009 at 2:45 pm
Must the Fed really guard its independence from Congress, presumably because Congress will manipulate and meddle to the long term detriment of the country? Are there that many idiots in Congress?
Perhaps an affirmative answer to either of those questions is our own fault. We elect people based on what they will do for us now or we don’t vote at all. Many Americans want and even expect the government to do more and more and more to save us or serve us far beyond its most effective and intended functions. We have long forgotten that the original design of the federal government was for it to be small and unobtrusive, for gridlock to be normal with only the most important matters with the most agreement passed into law.
“We have met the enemy, and they is us.”
September 21st, 2009 at 2:53 pm
Agree with BR, better to keep Bernanke. That’s one Summers we won’t have to swallow.
September 21st, 2009 at 2:54 pm
It is “spend” that has gotten us here. The government (Federal, State, Local)—whatever revenues they collect each year—is more than enough to manage for our “general welfare”. The should reduce spending to below expenses and run things from there.
State government hiring and expenses EXPLODED in the last decade…and now so many teeter on bankruptcy. Whoops.
September 21st, 2009 at 2:55 pm
“Intelligent central banking” is the most dubious oxymoron in modern society. It’s patently absurd to think that any cabal of so called “experts” is more effective at setting rates or regulating currency than the market itself. Don’t get me wrong, Congress scares me almost as much as the Fed. We simple have no need for a centrally planned currency or rates of interest. There’s no logic that can explain it–the only support is based in fear and a willingness to sacrifice freedom to be allowed the ignorance that accompanies a lack of personal responsibility.
September 21st, 2009 at 3:01 pm
Fed saving our economy is just a myth. They have done more harm to the economy than they have solved much. The fact they just denied the recession from the get go says a lot about their credibility.
September 21st, 2009 at 3:03 pm
U.S. Government Finds $20 Trillion Buried By Absentminded Reagan In 1987
http://www.theonion.com/content/news/u_s_government_finds_20_trillion?ref=patrick.net
WASHINGTON—In what government officials are calling a stirring testament to the leadership and foresight of late U.S. president Ronald Reagan, nearly $20 trillion in low denomination bills were discovered this week buried in the White House Rose Garden.
—————————————————————————————————————–
One form the Gipper….
Ciao
Econolicious
September 21st, 2009 at 3:19 pm
“I do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter: So help me God.”
I took that oath upon commissioning in the US Army. I ultimately found myself scratching around in the Iraqi dirt (first “war”), ostensibly protecting the rights of every American soccer mom to the free flow of cheap oil for gas-guzzling SUV’s. I searched and searched and searched in my copy of the Constitution and could nowhere find the right to cheap oil requiring my support and defense, not even in the many penumbras of the Bill of Rights, so I got out as soon as they’d let me.
The Constitution is one thing. The actual government is another thing entirely.
September 21st, 2009 at 3:24 pm
I’d choose a Fed run by Congress and at least therefore partially accountable to the people over a Fed run by bankers at the expense of the people any day of the week.
I also have gotten very tired of people thinking government can’t do anything right. Maybe right now that’s true with OUR government, but that’s because it’s been run the past couple of decades mostly by people out to prove that government doesn’t work. Self-fulfilling prophecy, that. And it speaks more about us as citizens and how we are failing at our civic duty than the ability of a government to address problems.
September 21st, 2009 at 3:30 pm
@Dogfish: Who was it that said something like “Democracy is the worst form of government except all the others”?
Choice: (a) elected democracy, or (b) banker oligarchy
September 21st, 2009 at 3:46 pm
How about having Congress pass the ZIRP Act of 2009 and we just do away with the Fed entirely?
September 21st, 2009 at 4:01 pm
Barry says:
“Imagine what the dolts who run congress would do if they had access to the Fed’s authority.”
It seems to me that you want your “representatives” to have authority. It’s sort of the entire purpose of our system of government. The fact that this system does not work very well is the fate of all systems, but to give this kind of power to a cabal of private banksters seems a bit imprudent. What’s the best you can hope for here?
September 21st, 2009 at 4:25 pm
Technical Note #534: Our country is a representative republic, not a democracy.
Makes the “spreading democracy” thing a little amusing. Kind of like the concept of foreigners hating us for our freedoms. Or all the hate against “Socialism” (We should immediately break ties with most of Europe).
Oh, the euphemistic hoops we will jump through to justify the bombing and reconstruction of foreign countries for the profit of our most well-connected private bankers and enterprises. Or the hoops the rich jump through to convince the poor that the raeping they are experiencing is good for them and the country.
The wars, the terror, the economic crisis, ownership of the media… it all boils down to class warfare. Loaded term, but it’s what I believe to be at the root, be intended actions or unintended consequences. To quote Buffett: “Sure there is class warfare. And my class is winning.”
September 21st, 2009 at 4:25 pm
Technical Note #534: Our country is a representative republic, not a democracy.
Makes the “spreading democracy” thing a little amusing. Kind of like the concept of foreigners hating us for our freedoms. Or all the hate against “Soci@lism” (We should immediately break ties with most of Europe).
Oh, the euphemistic hoops we will jump through to justify the bombing and reconstruction of foreign countries for the profit of our most well-connected private bankers and enterprises. Or the hoops the rich jump through to convince the poor that the raeping they are experiencing is good for them and the country.
The wars, the terror, the economic crisis, ownership of the media… it all boils down to class warfare. Loaded term, but it’s what I believe to be at the root, be intended actions or unintended consequences. To quote Buffett: “Sure there is class warfare. And my class is winning.”
September 21st, 2009 at 4:49 pm
What Seattle Chill said.
We could make crime prevention much more efficient and cost-effective if we eliminated the nuisance of constitutional rights, did away with those meddlesome jury trials, and appellate courts, and simply allowed the cops to execute suspected criminals right on the streets.
What do we need oversight for? It would just get in the way….
September 21st, 2009 at 4:59 pm
“Imagine what the giveaways would be like if the idiots in Congress were in charge . . .”
That’s only a reasonable argument because the US political system has become so thoroughly corrupt.
However, I would still prefer congress because while the odds of reforming politics may be slim, the odds of reforming private bankers are zero.
September 21st, 2009 at 5:22 pm
“However, I would still prefer congress because while the odds of reforming politics may be slim, the odds of reforming private bankers are zero.”
It’s getting very late here in Bananamerica. Someone needs to grow a spine, as Barry said, very very soon.
September 21st, 2009 at 5:24 pm
The fed needs to be very concerned about maintaining their independence…ok….
http://www.bloomberg.com/apps/news?pid=20601100&sid=aA8hVzxzQLkQ
EU Plans Regulators to Oversee Financial Industry
“The European Supervisory Authorities would have the power to overrule national regulators by asking the European Commission in Brussels, the EU’s executive arm, to rein in those that don’t comply with their recommendations. The three new authorities will cover the banking, securities and insurance and pensions industries, according to a copy of draft rules obtained by Bloomberg News.”
…or you could just give the fed enough power to veto what congress intends..apparently the Europeans are going to let the continental authorities overide the wishes of the individual state…
…maybe the fed tells Albany they need to sell more state bonds? or need to raise employee benefits?
…Maybe it isn’t technology that is changing….maybe it is government??
September 21st, 2009 at 5:32 pm
@Marc P:
There is no distinctly American criminal class except Congress.
..Mark Twain.
September 21st, 2009 at 5:40 pm
Independence?
HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAH
Where in Federal Reserve policy do you see independence? It’s more appropriate to use the word collusion to cite the policy of the Federal Reserve and the Congress. Collusion because Federal Reserve managed banks pay off our Congress to get whatever they want.
The banking system should be a public banking system to serve the common good. Not a bunch of crooks. Oversight and regulation written into stone, ie our Constitution, would keep Congress in check.
September 21st, 2009 at 5:47 pm
There is no distinctly American criminal class except Congress.
..Mark Twain
I guess this shows to go ya that nobody gets it right all the time.
September 21st, 2009 at 6:46 pm
b in t says-
“Maybe it isn’t technology that is changing….maybe it is government??”
i had the same observation on my 1:51 post-
just as the end of the Western Roman Empire transitioned to Feudal Europe maybe we are transitioning to a government that has elections to give the people the allusion of power but where all real power lies with unelected officials at the Fed and other “councils of wisdom”
September 21st, 2009 at 7:03 pm
Dolts who run congress? Really, Barry, please… How could our elected leaders F things up for average “dudes” in the street like us any more than those geniuses Greenspan and Bernanke and the rabble they preside over already have?
I’m not sure if we’d be any worse off suffering the slings and arrows of outrageous fortune with our supposedly democratically elected representatives blatantly bumbling with our money supply albeit ostensibly answerable to our democracy than we were with (what seems apparent now) the secretive manipulations of a defiant pack of banking elites of the “independent” Fed and administrative branch, who willfully sabotage the most vital mechanisms of our national prosperity in the name of failed ideology and personal gain.
At the end of the day, at least we can vote the assholes in congress out of their jobs which would at least render them somewhat accountable for their bad decisions.
September 21st, 2009 at 7:12 pm
@Dead Hobo @ September 21st, 2009 at 1:59 pm
that was the funniest thing i’ve read today…
September 21st, 2009 at 7:26 pm
Agree w/ Seattle Chill, Had Enough, 10cc and others.
September 21st, 2009 at 8:42 pm
I agree with the “idiots in congress” but what do you mean by independence for the FED?
If we are going into an absurd circle with the Fed stimulating the market by proxy and buying our national debt at the same time, then no, we can’t keep going like this.
The Feds record lately hasn’t been stellar, far from it, and giving credit to Bernanke for being able to create wealth out of nowhere isn’t deserved.
Hell Barry, you’d look like a genius and my 5 year old too if you guys could distribute free money.
No no no, take away the money printing device and look at the Bernanke’s decision making and his outlook before the crisis, totally off the mark.
Independence for the Fed means keeping the train rolling despite reality, the Fed is not independent, it prints out our nations money, We are lucky right now we have the reserve currency but wait until that changes and it isn’t too far off.
We have a much bigger problem, idiots bought and groomed by special interest in politics and thieves bought and groomed by a few bankers in finances.
We are in a deep hole.
September 21st, 2009 at 9:34 pm
“The Fed needs to be VERY concerned with maintaining their independence.”
Who is the Fed today? I mean who are the living breathing human beings who must be independent from the representatives of the people? I’m thinking that I don’t want these people to be so independent. I’m thinking I don’t believe that these Fed people care about the same things I care about. And I really don’t like giving a bunch of unelected bankers so much power. Power they wield in secret.
The Fed people obviously believe that they will lose independence if the public knew what they are doing. Isn’t this a sufficient reason to force their policy making to be out in the open? It’s stupid to believe that a small group of people tied to big finance, who want to make public policy in secret, don’t put the good of big finance before everything else. They either don’t give a f-ck or delude themselves into thinking what’s good for big finance is good for everybody. Either way I say turn the lights on and let’s see what they’ve been doing in the dark for all these years.
Barry, control of the wealth of the county is power. If the people don’t have this power through their own actions and through their representatives — imperfect as that balancing act may be — then our democracy is a sham. Do you want real democracy or a sham democracy?
September 21st, 2009 at 10:05 pm
Barry,
The Fed may be independent from Congress, but it is in the hands of the Big Banks.
Create a truly independent Central Bank, with career civil servants who knows their economy AND sociology; which jobs, pay and budget is NEITHER under the whim of Asshatery General Corporation, namely the Congress or the Banks.
September 21st, 2009 at 10:07 pm
“Imagine what the giveaways would be like if the idiots in Congress were in charge”
Give me a break.
You are allowed to vote “the dolts” out, after all.
But that would involve occasionally engaging your brain, wouldn’t it? Don’t blame the system, look in the mirror.
Unlike the technocrats running Central Banks, at least your elected officials have to face YOU from time-to-time.
September 21st, 2009 at 10:30 pm
What exactly does this mean in Section 31?
http://www.federalreserve.gov/aboutthefed/section31.htm
Section 31. Reservation of Right to Amend
1. Reservation of Right to Amend
The right to amend, alter, or repeal this Act is hereby expressly reserved.
September 21st, 2009 at 10:35 pm
@some_guy_in_a_cube
“You are allowed to vote “the dolts” out, after all.”
You mean the guy with corporate campaign financing or the other guy with corporate campaign financing?
Blame the system and look in their wallets.
We have seen and still see what face to face means, it comes down to what 24hour news wants to report.
Birthers, progressive fascists, communists…bla bla bla
anything to get away from money in politics.
September 21st, 2009 at 11:40 pm
scary that so many people seem to think congress should be in charge of the fed….congress….scary.
September 22nd, 2009 at 12:56 am
[...] Links Have No Clothes By HS on Sep 21, 2009 in News To Us Fed to Geithner: Piss Off – The Big Picture, Barry [...]
September 22nd, 2009 at 1:46 am
Beaufou,
“You mean the guy with corporate campaign financing or the other guy with corporate campaign financing?”
Those are not our only choices. We are still free to choose someone who is not a Republicrat, which could be someone from a minor party or a write-in. If the people who refuse to do their civic duty would instead vote by writing in their own name, this would send one hell of a message.
“Blame the system and look in their wallets.”
Let’s blame ourselves and look in the mirror. Then do something about it.
September 22nd, 2009 at 2:20 am
This thing is global, baby. Interesting pieces along the same vein regarding Japan
http://marketdepth.typepad.com/marketdepth/2009/09/winter-in-japan.html
and Canada
http://marketdepth.typepad.com/marketdepth/welcome-to-kanada.html
September 22nd, 2009 at 5:05 am
“Imagine what the dolts who run congress would do if they had access to the Fed’s authority.”
This statement made me think of several questions about the history of congressional expertise (or the lack thereof) in financial and banking matters:
1. has the level of knowledge (rather, expertise) by members of Congress of banking/financial matters always been poor?
2. if bankers/financiers always have a large expertise advantage over members of Congress (even over those members of Congress who “specialize” in this area with relevant committee assignments), has Congress _ever_ been able to effectively oversee and properly regulate banking and finance?
3. since Congress created the FedRes in 1913, has the general level of knowledge of banking/finance by Congress decreased substantially? (exacerbated by the increasing complexity of banking/financial matters)
4. do the leaders of Congress have sufficient knowledge/expertise of banking/finance to lead the rest of Congress in reforming the banking/financial system?
I found the following quote of Woodrow Wilson (while advocating the creation of the FedRes) to be remarkable. This corrupting characteristic of the banking system has long been recognized, but have the corrupters now completely undermined the real purposes of the FedRes? Could it possibly be any better if handled “directly” by Congress?
Woodrow Wilson:
“A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the Nation, therefore, and all our activities are in the hands of a few men… We have come to be one of the worst ruled, one of the most completely controlled and dominated, governments in the civilized world—no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and the duress of small groups of dominant men.”
September 22nd, 2009 at 9:33 am
1) How is Bernanke different from Greenspan? Bernanke was the #1 supporter of the ultra low rates that fueled the housing bubble when he was a governor.
2) The Fed doesn’t have a clear mandate. It has two conflicting mandates that its proven incompetent to manage. We’ve had tons of inflation over the last decade it merely showed up in assets instead of consumer goods so the Fed shrugged and pretended everything was fine (including Bernanke).
3) The Fed does not have the authority to engage in fiscal policy, but that is exactly what its doing. Its lending and swap programs amount to taxpayer funded bailouts that are unlikely to gross 100 cents on the dollar. The second the Fed started putting the US taxpayer on the line it crossed the fiscal policy line and gave up its independence.
Human beings are incapable of managing money supply soundly when they are given wide authority. I guess we learned nothing from the depression, stagflation, or the bubble age.
September 22nd, 2009 at 10:28 am
@John
Oh, I know, I get it man, but it’s so damn frustrating to see an immense majority of voters following the partisan 24hour news BS.
An estimated 5% of the population are actual free thinkers, we’re screwed.
Ending the flow of private interest money into campaign financing would go a long way to heal this broken system.
September 22nd, 2009 at 11:52 am
Let’s get over it..the FED is just another failed attempt at creating wealth out of nothing. Spain multiplied its monetary base by the theft of Gold and Silver from the Americas. The resulting growth unmatched by an real product earned by the original population destroyed them and gave the ball to Britain who tried the Opium War device to do the same with the Chinese. Gold is nothing but brake fluid. Gold as standard of allows an economy to stop but is of no importance per se, like the platinum meter stick in a controlled environment, but now a mathematical constant of a particular noble gas laser frequency. http://www.nist.gov/mel/ped/museum-length.cfm The Central Bank fails the essential test of any system in that it allows those placed in charge to make rules without authority or metric. It works as long as they can restrain their greed and edge. They blew it with false wealth from abusing securitization, plain and simple compounded by the CDS OTC experience each and every day they keep their thumbs where the sun don’t shine. If the latest powers in control are compromised, the mis-allocation of wealth continues. This banking system is profoundly over and headed by an academic who is a puppet master of the past; the perfect character set up by the top top or fewer member banks to continue what now is clearly an out of control Ponzi-Madoff scheme. Jefferson, Madison, Jackson, and Lincoln wouldn’t be surprised at all. The first two presidents did their absolute best to design the plan. We are failing them badly by not standing up, except for a handful in Congress today.
September 22nd, 2009 at 12:07 pm
One can make a case that a slightly benign Fed is more preferable to one ruddered soley by Congress. I think the process should be to do an audit of the Fed to see if they are operating within their governance parameters and authority, and to acceptable accounting standards. If so, then let them be; better to trust a Bernanke, then Congress. If they haven’t been playing by the rules, then they need to be subject to oversight by some type of governing body or committee that has voter exposure. Maybe something like the NEC or OMB which are Presidential advisory boards, or perhaps create a similar separate board comprised of monetary policy specialists. Have the board made up of 5 members, and give them veto power of 3/5 or 4/5 to override key Fed policy initiatives. Make sure all rulings and related documents are public. And for God’s sake don’t let Congress near it.
September 22nd, 2009 at 3:23 pm
maybe ron paul has it right – maybe no men should be in charge of such things.
i cannot understand how modern economists will state that they are unable to correctly and quickly set the price of milk, yet they are able to correctly and quickly influence the price of money.
September 23rd, 2009 at 12:39 pm
What would the free giveaways do?
Let’s see. 1st let’s not be afraid of new things okay? Just for the sake of acting like a terified five year old. That is the first step.
Now let’s look at the past. Before the federal reserve, we weren’t going around willy nilly throwing trillions of dollars around.
That took the REPUBLICANS to do. (which is funny since they always SAY they are fiscally conservative) – big yeah right.
But I understand, that if we have the power, we have the power to screw up. Yes. That could happen.
But as we have it now, we don’t have the power, and our economy has been screwed up, under complete secrecy, for the benefit of lets just say, I doubt any of them have ever even used the internet…their 50th butler (for only ONE of their houses) does the ‘internet’ for them.
If you like having British imperialism running our economy, because they will not spend as much on ‘real people’ is true. Just look at the history of the British monarcy, the british east india company, and all that has come from that. Look at how they MAKE you live. You’re right, we’ll get less with the federal reserve, and that is exactly WHY we have this economy about ready to crash worse than 1929 , 19333, and 2008 COMBINED.
The federal reserve inflates ALL of our money. Meaning,
What would the congress pay for with this power? Simple, the things the federal reserve WON”T LET US. Things like bridges, highways, mag lev, space program, power plants, waterways….basically infrastructure.
Also let’s not forget, even though I am a strong believer in paying taxes commensurate with what is needed for a just society (which is HIGHER than NOW)…..I fully realize that the ONLY reason we have a tax for ANYONE that is say, over 5 percent, (which is MUCH LOWER THAN NOW) is because the FEDERAL RESERVE sucks the wealth out of us….neccesitating a MUCH HIGHER TAX RATE.
Want lower taxes, but MORE SERVICES, with LESS INFLATION…..get rid of the federal reserve.
Some people are effen idiots. We could have the power to destroy ourselves. Yes we could, but under that SAME prinicple, maybe we should give London the ability to pick our congressmen as well, under the guise of protecting ourselves from ourselves.
You see how crooked these guys are? Geithner is basically in bed with them, would throw softball questions, and basically take one up the butt for the team, and guess what.. The fed won’t even allow a rigged commission to even look at it. Gee I wonder why.
So while lame-o up there seems to think we’d go overboard, he doesn’t realize that the federal reserve gave TRILLIONS……
….
…
NO actually TENS OF TRILLIONS
….with the possibility of HUNDREDS of TRILLIONS
to the very rich, who are about to send us off the cliff as a reward.
How much are the rothschilds worth thanks to them being in control of the federal reserve…anyone…anyone? 400-500 trillion dollars….wealth sucked out of our country, for the betterment of 1 family. Oh and others I’m sure benefitted fairly similar as well.
Yeah lets follow lame-0 up there and be afraid of what congress would write.
You do realize that all the propaganda you’ve listened to about welfare moms and liberal spending, has not only been the biggest bull (and shows how GULLIBLE you are), but ALSO the amount we’ve guaranteed to the banks is about 200 to 300 percent more than ALL OF WHAT CONGRESS HAS SPENT FROM 1787 to 2008.
That’s right, you’re we’ll spend to much on the poor angle, is complete bull. Except you’ll wake up one day, with a dollar that is worth a penny, and you’ll be poor, and have no one to blame but yourself, even if you are a hard worker, you looked the other way while someone who ‘is protecting you from yourself’, stole everything out from under you.
Yes, the congress, voted on by the people, and held accountable by the people surely will do a poorer job than those fools.
Idiocracy here we come. Starting with the abandonment of the belief that ONLY WE can govern ourselves effectively. But I guess I’m only an American, while people that hold your viewpoint, are ANTI-AMERICAN. Oh you may THINK you do the best for America, but you cut her off at the knees and the bow to the financial oligarchs who are out to destroy you to increase their wealth.
Wake up. We CAN govern ourselves the best, but only when dumba**es like you step aside, and let the grownups handle the wheel. Because this mickey mouse bs you believe is nothing but childish.
So lets talk about how health care will bankrupt us (1 trillion over 10 years) at the same time the federal reserve is screwing us over far more than you realize (25 trillion [AT LEAST] in 1 year). Yeah you really know your stuff, and know the correct aspects of a problem to focus on. What a retard.
September 23rd, 2009 at 1:14 pm
No doubt, a Central Bank as long as you think you need one, should be independent, but in private hands? Are you kidding? What a lunatic concept. An invitation to fraud and distortion.
Thomas Jefferson already knew this:
I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
That´s exactly what we see in the US right know.
September 23rd, 2009 at 9:06 pm
“Regardless of your views about Ron Paul (his new book is called End the Fed), its the rest of the crowd of that scares me. Imagine what the dolts who run congress would do if they had access to the Fed’s authority.”
Nowhere in Ron Paul’s book is it suggested that Congress take over the Fed’s authority. Did we read the same book?
The argument is that the Fed’s power should be destroyed completely, not transferred.
“The key to intelligent central banking is a clear charge (i.e., fighting inflation), a pragmatic (more Bernanke, less Greenspan) approach, and the willingness to make the unpopular necessary steps (Volcker).”
You mean like a gold standard would enforce? You almost validate the argument yourself with this statement. Humans are not capable of managing a central bank.