Global Research, July 9, 2009
The Telegraph – 2008-01-31

Simon Linnett, Executive Vice-Chairman of Rothschild, has called for a new international body, the World Environment Agency, to regulate carbon trading.

In a recently published paper, Trading Emissions, for the Social Market Foundation, Mr Linnett argues that the International problem of climate change demands an international solution.

Unless governments cede some of their sovereignty to a new world body, he says, a global carbon trading scheme cannot be enforced and regulated.

“An urgent global response.” This was how Nicolas Stern described the problem of carbon dioxide emissions, in his recent review of the economics of climate change. The sense of an impending crisis infuses our all debates on this issue.

The human causes of climate change are now well established. The overall measures we must take – a reduction of our emissions – is painfully obvious.

But like a group of rabbits caught in the headlights, our actual means of escape remain unclear. We know what our end goals are, but how do we get there? How can governments achieve delivery?

The first step must be to recognise the scope of the problem. Unlike other pollutants, such as litter or nuclear waste, CO2 emissions have impact on a global level – and only on a global level.

This means we have to deal with the issue internationally. The problem is literally too big for any one country to handle. Old alliances, divisions and ’special relationships’ are a meaningless hindrance.

I believe it is essential that governments and the private sector work together to solve the problem. As a banker, I suppose I would say that, but only such a partnership will we be able to harness what Al Gore called the multitude of little solutions, which all add up to a better outcome.

Only the private sector can successfully develop those solutions, but only governments can provide a framework for them to be applied internationally.

As a banker, I also welcome the fact that the ‘cap-and-trade’ system is becoming the dominant methodology for CO2 control. Unlike taxation, or plain regulation, cap-and-trade offers the greatest scope for private sector involvement and innovation.

Furthermore, taxation and regulation can only be levied at local or national levels, whereas cap-and-trade can operate on a global level. And remember, the problem is global.

But for the private sector to participate enthusiastically in a global carbon trading market, governments must collectively establish a robust framework within which trading can occur. It must be long, loud and legal:

• Long: it is going to be around for a long time;

• Loud: it will be the dominant mechanism for sponsoring changes in behaviour and we are going to make this perfectly clear to the world’s people; and

• Legal: we will enforce it through law.

A key implication of creating a legal yet global system of trading, is the loss of sovereignty it implies. Governments must be prepared to allow some subordination of national interests to this world initiative, on the issue of emissions. This need not mean a new system of government, above individual nations.

But it would mean a change to the way treaties are agreed and worded. Instead of saying “we will cut emissions by x per cent by date y” (pledges which are inevitably broken), such statements will have to morph to “we will make our contribution to a scheme which cuts, across certain industries and gases, emissions by x per cent by date y.”

The European nations already do this, on certain issues, yielding sovereignty to the EU. And in time, the EU itself will eventually have to yield to a larger body – one which includes the economic powerhouses of India and China.

The cynicism that greets such programmes is well known, since the Asian economies seem bent on rapid expansion. However, I believe that both India and China will soon recognise the benefits of joining a global carbon trading scheme.

First, a properly constituted, one-member-one-vote system would mean that they have a proper ’say’. More importantly, since the allocation of the emissions cap might trend towards recognising world populations rather than current levels of emission, both countries would stand to gain a great deal.

If emissions trading could expand into different areas of economic activity, so too could its message. When an individual receives an electricity bill, they will come to know what the cost of turning on the gas or a light was to the environment.

Perhaps they will gain a new appreciation of their burden on the broader world. Similarly, if the scheme were to expand geographically to include India, China and, ultimately, the US, so too could the prospect be realised of such allowances becoming the reserve currency of the world, taking over that role held for most of the 20th century by gold.

So emissions trading could establish a new world order for a sustainable planet, one based on the sharing of the earth’s ability to absorb harmful emissions. To allocate that ‘resource’ fully and properly will, in turn, require resourcefulness and imagination across the globe.

Simon Linnett is an Executive Vice Chairman of Rothschild. He has enjoyed 25 years of privatisation and PPP experience with the Bank, leading that effort for the majority of that time.

For the last 10 years, Simon has been in dialogue with both UK and, more recently, EU administrations about the future evolution of emissions trading of which he has long been a proponent. This paper represents his personal views only.

http://www.globalresearch.ca/index.php?context=va&aid=14294

The prime architect of the Federal Reserve was German immigrant Paul Warburg. Arriving in America in 1902 with brother Max, he married into the family controlling Kuhn, Loeb and Company, America’s prime international banking firm. By 1907, he was earning $500,000 annually, an enormously generous salary at a time when there was no income tax and inflation had not begun eroding the value of the dollar.

Already conversant with the power possessed by European central banks, Warburg insisted for the next few years that America needed a similar banking establishment. He teamed up with Rhode Island’s Senator Nelson Aldrich and, in 1910, the two were among the seven who met secretly at Jekyll Island, Georgia, to plot creation of the Federal Reserve. Enacted by Congress supposedly to curtail the power of the “money trust,” the Fed did exactly the opposite. And when Paul Warburg left Kuhn, Loeb and Company to accept a post on the first Federal Reserve Board, he would earn only $12,000 yearly.

Warburg’s willingness to take such a huge cut in salary is only one clue to the most important purpose of the Fed. From its inception, the acquisition of power, not wealth, was the goal of its creators, even though many opponents of the Fed down through the years have indicated otherwise. When Mayer Amschel Rothschild of the European banking empire bearing his name stated, “Let me issue and control a nation’s money and I care not who writes the laws,” he indicated that a nation’s political leaders would do the bidding of those who controlled money. No one has ever proved him wrong.

Professor Carroll Quigley’s 1966 opus Tragedy and Hope contains many important revelations. He bared the existence of a secret society that planned to rule the world, even naming the Council on Foreign Relations as its American branch. He labeled this secret group’s remarkably ambitious project a “network” rather than a conspiracy because he had no aversion to any of its goals. He further admitted gaining permission to examine “its papers and secret records” for several years. (Where he went to do such examining has never been revealed.) But early in his 1,350-page book, the Georgetown University historian pointed to the “far-reaching goal” of the “network” he so admired. He wrote that the “powers of financial capitalism” sought “nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole.”

That squares exactly with the goal of power mentioned years before by Rothschild. Quigley then offered: “This system was to be controlled in a feudalistic fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences.”

Central banks of other nations would act “in concert.” Didn’t the Fed rescue some European banks when the economic crisis hit? As for the “secret agreements “arrived at in frequent private meetings and conferences,” isn’t this what goes on at the Bilderberg conferences; Council on Foreign Relations and Trilateral Commission meetings; annual sessions in Davos, Switzerland; and elsewhere? While no participant at these closed-door powwows is poor, the goal of the movements into which they have immersed themselves has always been power more than personal wealth.

John Birch Society founder Robert Welch knew well the true purpose of the Federal Reserve. In a statement he wrote in 1972, he scornfully dismissed the attitude held by some that the goal of the conspirators who foisted the Fed on America was simply money. “What all of these Insiders were after was not money but power,” he insisted. And he continued, “They were even careful to plan the whole arrangement so that the bulk of any commercial profit made by the Federal Reserve would go to the federal government as a coverup for their nefarious intentions.”

Congressman Ron Paul (picture, above left) has earned the thanks of all true Americans with his efforts to combat the Fed — not only to have it audited but also eventually to have it abolished. His “Audit the Fed” proposal in the current Congress has been inserted into a measure calling for broad new financial regulatory powers. Because he strongly disapproves of this addition to the federal government’s meddling where it doesn’t belong, he has indicated he won’t vote for the measure. “I will not vote for something that’s a disaster because one or two or five percent of it is an improvement,” he stated. It may yet pass, and there may be some movement toward an audit.

But his calling attention to the power of the Fed, and his successful gathering of 317 cosponsors of his audit measure in the House, has already created a huge awakening about the Fed among millions of Americans. All freedom-loving Americans should continue to alert fellow citizens about the power and overall purpose of the Fed so that it will soon be properly audited and eventually abolished. Stressing that power is its goal, not money, should help to stimulate many to make this extremely important campaign succeed.

http://thenewamerican.com/index.php/economy/commentary-mainmenu-43/2608-fed-backers-seek-power-more-than-wealth

The Federal Reserve Bank only creates the Principal – not the usury or interest that it lends to the U.S. government. Therefore the usury can NEVER be repaid and the end result is foreclosure and bankruptcy.

In 1765, the Bank of England demanded that the American Colonies pay taxes in British specie or coins which the people did not possess. If they had borrowed from the Bank of England to pay the tax, the end result would have been the same: foreclosure and bankruptcy with the Bank owning everything!!

The “Federal” Reserve Bank loans the U.S. government their own “money” at usury or interest!!
The perfect monetary system of free coinage of silver and gold was destroyed in 1873

Under regulations of the Comptroller General, the Comptroller General shall audit an agency, but may carry out an onsite examination of an open insured bank or bank holding company only if the appropriate agency has consented in writing.

Audits of the Federal Reserve Board and Federal reserve banks may not include – (1) transactions for or with a foreign central bank, government of a foreign country, or nonprivate international financing organization; (2) deliberations, decisions, or actions on monetary policy matters, including discount window operations, reserves of member banks, securities credit, interest on deposits, and open market operations; (3) transactions made under the direction of the Federal Open Market Committee; or (4) a part of a discussion or communication among or between members of the Board of Governors and officers and employees of the Federal Reserve System related to clauses (1)-(3) of this subsection. (c)(1) Except as provided in this subsection, an officer or employee of the General Accounting Office may not disclose information identifying an open bank, an open bank holding company, or a customer of an open or closed bank or bank holding company.

The Comptroller General may disclose information related to the affairs of a closed bank or closed bank holding company identifying a customer of the closed bank or closed bank holding company only if the Comptroller General believes the customer had a controlling influence in the management of the closed bank or closed bank holding company or was related to or affiliated with a person or group having a controlling influence. (2) An officer or employee of the Office may discuss a customer, bank, or bank holding company with an official of an agency and may report an apparent criminal violation to an appropriate law enforcement authority of the United States Government or a State. (3) This subsection does not authorize an officer or employee of an agency to withhold information from a committee of Congress authorized to have the information. (d)(1) To carry out this section, all records and property of or used by an agency, including samples of reports of examinations of a bank or bank holding company the Comptroller General considers statistically meaningful and workpapers and correspondence related to the reports shall be made available to the Comptroller General.

The Comptroller General shall give an agency a current list of officers and employees to whom, with proper identification, records and property may be made available, and who may make notes or copies necessary to carry out an audit. (2) The Comptroller General shall prevent unauthorized access to records or property of or used by an agency that the Comptroller General obtains during an audit.

Watch the Video
Jim Rogers: Audit the Fed, Then Abolish It

Count famed investor Jim Rogers as an ardent support of Congressman Ron Paul’s effort to audit the Fed.
The Fed is “the only institution in the world I know of that doesn’t expect to be audited,” Rogers says in the accompanying video. “It’s incomprehensible to me these people are saying they have no reason to be audited — they must have done something wrong, must have something to hide.”

A longtime critic of Ben Bernanke and his predecessor, Rogers goes a (big) step further than merely auditing the Fed, suggesting we get rid of the central bank altogether.

“We don’t need the Fed. The Fed is making our lives miserable,” the famed financier says. “The Fed is printing huge amounts of money, which we’ll have to pay for sometime. The Fed is borrowing gigantic amounts of money on their balance sheet…the numbers are so staggering that this is going to have ramifications before too much longer.”

With an eye on history, Rogers notes the current Fed is America’s third central bank: the First Bank of the U.S. was created in 1791 with a 20-year charter. The Second Bank was created in 1816 with the same term. The current Fed was chartered in 1913. Arguably, the current Fed is the nation’s fourth central bank if you count the National Banking Act of 1863-64, but Rogers’ point remains the same: America survived and prospered without a central bank for long periods and can do so again.

If Rogers is right, this won’t be an academic discussion for much longer.

“The Fed is going to abolish itself,” he predicts. “Between Bernanke and Greenspan they’ve made so many mistakes [that] within the next few years the Fed will disappear.”

I didn’t get the sense Rogers was joking or speaking metaphorically, so I asked what the practical ramifications of abolishing the Fed would be:

“Yes it would be complicated and painful for a while,” Rogers responded. “But I’d rather find out they’re bankrupt today than to find out in five or 10 years — when they’ve had another 10 years of this madness where they’re printing even more money [and] taking out even more debts in our name.”

http://finance.yahoo.com/tech-ticker/jim-rogers-audit-the-fed-then-abolish-it-387907.html?tickers=GLD,TIP,TBT,%5Edji,%5EGSPC,FNM,FRE

Despite Wall Street having crashed the economy, nothing has changed on Capitol Hill. Wall Street continues to invest heavily in politics and wield enormous influence. More than 900 former federal employees, including 70 former members of Congress, are working as lobbyists for the financial services sector this year. Wall Street has spent more than $40 million on campaign contributions since November 2008.

One in four homeowners with a mortgage are “underwater,” meaning they owe more on the home than it’s worth. The administration’s $75 billion foreclosure-prevention effort does virtually nothing to help those homeowners, consumer advocates and economists argue.

Furthermore, since the program’s launch in March, less than 32,000 troubled homeowners have received permanent relief through the government’s mortgage modification plan. It’s supposed to help three to four million homeowners avoid foreclosure.

Candidate Obama supported the idea of allowing judges to modify mortgages in bankruptcy en route to the White House. He even expressed public support in February when outlining his plan to stem foreclosures. But it wasn’t in his detailed plan released the next month. Since then, the White House has largely been silent.

Contact the White House, your Congressmen and Senators!

Tell our elected representatives in Washington DC to stop spending our future away liking drunken sailors!

Tell them we want Full Accountability from the Federal Reserve, Where have trillions of our tax dollars gone and why?

Tell Them we are done paying billions of dollars per year to the Federal Reserve banking cartel in interest on our own damn money!!!

Bernanke is President Obama’s nominee for Fed chairman. Why are you voting against him?

It really goes back to Dr. Bernanke’s involvement over the course of the development of the economic bubble and really in his roles with the Council of Economic Advisers and his role as a member of the Fed board and then as chair. He was very supportive while many things were unfolding that paved the way to this economic collapse. Essentially that was a philosophy that looked to the health of Wall Street as a key to a successful economy rather than looking to the health of the American family finances.

Don’t you think Congress and many other policymakers also deserve some blame for what led to this, rather than putting it on Bernanke’s shoulders?

I don’t think in anything I’ve said or written, that I would give him all the responsibility. But I think it’s important to keep in mind that it was during the time that he was serving in these capacities, that derivatives had an exponential growth, that the practice of kickbacks to mortgage brokers to pay them to trap people into subprime loans developed. It was during this period proprietary trading expanded significantly. It was during this period that the securitization and the resecuritization of mortgage packages that involved loans that had not been documented and were not found proceeded to basically create a profound weakness in financial institutions throughout the world. It was in this period that the leverage ratios were lifted on the five largest banks in America. All of these things were factors that essentially Bernanke was either supportive of or failed to advocate and express concerns about. He really had a front-row seat on the factors that led to this bubble. There’s plenty of responsibility to be allocated elsewhere, but other parties are not being nominated. This is Bernanke’s nomination.

Who would you want instead as Fed chairman?

The president nominates. The Senate advises and consents. If his nomination should fail, which is unlikely, I would leave it to the administration to choose. I would certainly advocate to the administration that they bring someone who is not only superb in monetary policy, but also understands that the goal of the economy is not wealth on Wall Street, it’s wealth for working families in America.

How do you think Chairman Bernanke will fare in the committee and full Senate?

I imagine he has plenty of support. But my responsibility is to make my decision.

You have a bill with Sen. Corker on auditing the Fed’s emergency facilities. You do not support auditing the monetary policy decision-making of the Fed [as the audit legislation by Sen. Bernie Sanders would do]. Why not?

Quite frankly, the Fed made the case that auditing at least in the context of disclosing the parties that were coming to the Fed windows during an emergency would make it very unlikely that those financial parties would come to those windows and would undermine their ability to do monetary policy. I support very robust auditing. I simply am trying to make sure that we do not compromise the ability of the Fed to conduct monetary policy in the process. I keep asking in these conversations with other senators and folks in other offices, are there ways we can go further without compromising that ability. So that is the key. We don’t want to cripple the Fed’s monetary role but I want to have maximum disclosure for the citizens of this country.

http://blogs.wsj.com/economics/2009/12/16/qa-sen-merkley-on-bernanke-confirmation-vote/

Right now, you and I are seeing the worst plundering of a country’s wealth in the history of civilization, led by an out of control Federal Reserve.

But together you and I CAN put a stop to it all.

With your help (including submitting the petition linked below to your Congressman and Senators) today, Representative Ron Paul, Senator Jim DeMint and Campaign for Liberty are ready to fight back, by taking the battle straight to the heart of the problem – the Federal Reserve itself.

Just think about the scope of the problem for a minute: The massive, outrageous amount of dollars committed to the economic bailouts in recent months totals:

More than the socialist New Deal … More than the entire Iraq debacle … More than the 1980’s savings and loan mess … More than the Korean War …

COMBINED.

When will it all end?

It’s time you and I put a stop to a renegade Federal Reserve by exposing the Fed’s out of control actions to the American people. And Congressman Ron Paul and Senator Jim DeMint have a bill before Congress to do just that, known as the “Audit the Fed” Bill (HR 1207 and S 604).

That’s why it’s vital you click here to submit your “Audit the Fed” petition in support of Congressman Paul’s bill.

You see, Audit the Fed already has over 300 cosponsors!

Now is the time to make sure your Congressman and Senators feel the heat to support the Audit the Fed bill!

If you and I don’t act today, I’m afraid this crisis will end with the economic ruin of every man, woman and child in America.

Today, nearly 13 TRILLION in taxpayer dollars in bailouts and loans has been agreed to by Congress, the Bush and Obama Treasury Departments, and the out of control Fed.

So is it really any wonder more and more folks are starting to realize the Washington, D.C. establishment is hurtling us toward complete economic disaster?

Whether it’s watching a phony “stimulus” package get rammed into law or watching Congress pass a $700 BILLION bank “bailout” under threat of martial law, the American people are agitated and increasingly angry.

That means it’s a perfect time to unleash the pressure of MILLIONS of outraged Americans on the out of control Fed!

So please click here to sign the petition linked below urging your Congressman and Senators to cosponsor and seek roll call votes to pass the Audit the Fed Bill!

As I know you’re aware, the Federal Reserve is shrouded in secrecy. Their meetings are off-limits to the public. Their inner workings are off-limits to the public.

And just recently, the Federal Reserve told Congress “NO WAY” when asked to account for $2 TRILLION in taxpayer-backed loans!

Well, why do you think they refused?

They know coming clean with Congress and the American people on how they doled out that two TRILLION dollars would result in an anti-Fed firestorm.

So can you imagine the impact of a full-scale audit? You and I will finally be able to show the American people that the Federal Reserve System leads to:
*** Constant economic crises — the housing crisis and the resulting chaos is just one example of an economic bubble created by centrally-planned interest rates and money manipulation;

*** The destruction of the middle class — as fuel, food, housing, medical care and education costs soar, everyone who is NOT on the government dole is forced to make do with less as the value of their money slowly decreases;

*** Currency destruction — history shows us that riots, violence and full-scale police states can result when people finally realize our money isn’t worth the paper it’s printed on and REFUSE to accept it.
And unless you and I do end the madness in Washington, D.C., we may be closer than we’d like to think to learning that history lesson firsthand — right here in our own streets.

That’s why your commitment to helping pass the Audit the Fed Bill –- and helping Campaign for Liberty fight this battle — is so vital.

Just a few months ago, there was no chance of passing any legislation like the Audit the Fed Bill. So I guess there has been one “CHANGE.”

You see, with the piling up of trillions of dollars in out of control “bailouts” of Wall Street and international bankers, even many politicians in Washington want to show you they’re “being responsible.”

What better way for Congress to do this than by auditing the Federal Reserve to account for the trillions stolen from the U.S. taxpayers?

More and more Congressmen are already feeling the pressure and are signing up to support this bill. I’ve even received word this bill could move in the next few weeks in the U.S. House.

When that happens, you and I must be ready to fight.

And, it’s both a bill we CAN pass, and one that is vital to exposing the massive corruption and dollar manipulation at the Federal Reserve.

You see, after regulating, taxing, spending, borrowing and printing us into what looks like the worst recession in decades, establishment politicians and power brokers are assuring us they’re working hard to “fix” our economic woes. What is their solution? You guessed it. More of the same!

And even if the Audit the Fed Bill is defeated this time, just forcing a vote is a win/win situation.

Can you imagine how many politicians will pay the price at the ballot box in 2010 when you and I tell the American people their Congressman somehow lost trillions of taxpayer dollars and refused to even LOOK for it?

Now we just need to show Congress the American people demand action on the Audit the Fed Bill. Here’s how we plan to do that.

First, we’re already busy contacting up to five million activists nationwide through mail, phones and email to generate petitions to the U.S. Congress demanding action on Ron Paul’s Audit the Fed Bill.

But that’s just the beginning. We’ll work the talk radio stations and grant local media interviews to ratchet up the pressure even further on Congress.

And a few days before the vote, if we have the resources, we’d also like to run hard-hitting targeted radio, TV and newspaper ads.

This entire program is designed to send this one, CLEAR message to Congress: Any politician who votes against the Federal Reserve Audit should look for another job.

But such a massive effort won’t be easy — or cheap.

So in addition to submitting your petition, I also hope you’ll agree to make a contribution of $1000, $500, $250, or $100 to Campaign for Liberty.

If $100 is too much to ask right now, please make a contribution of $50 or even $25 today. Every dollar will help, and every dollar will go to this vital fight.

I know times are hard, but if we don’t take action, the America we see in just a few years could look far worse than even the one we see today.

Can I count on you to join the fight to AUDIT THE FED by clicking here to sign the petition, and by making a generous contribution of $1000, $500, $250, $100, $50 — or whatever you can afford — to Ron Paul’s Campaign for Liberty?

Sincerely,

John F. Tate
President

P.S. Please submit the petition urging your Congressman and Senators to cosponsor and seek roll call votes on Rep. Ron Paul’s Audit the Fed Bill TODAY!

http://www.chooseliberty.org/auditfed2.aspx?pid=n04

With Congress spending like never before, and TRILLIONS of new dollars being created out of thin air, it’s never been more important the Federal Reserve’s abuses are exposed to the American people once and for all.

By Annie Lowrey | Newsweek Web Exclusive
Dec 16, 2009

On Thursday, the Senate Banking Committee will vote on Ben Bernanke’s nomination to be reappointed as the head of the Federal Reserve. Expect fireworks, because the accusations against Bernanke are serious: that he failed to recognize last year’s financial crisis before it took hold, underestimated it when it first hit, and has pushed the Fed far outside its traditional purview without allowing sufficient governmental oversight. His critics are bipartisan, ranging from conservative Republican Sens. Jim Bunning of Kentucky and Jim DeMint of South Carolina (Bunning says he considers Bernanke the “definition of moral hazard”) to Vermont independent Bernie Sanders, a self-declared socialist, who has promised to place a hold on Bernanke’s confirmation once it hits the floor, forcing Democrats to round up 60 votes to reapprove him. Meanwhile, after 26 years of trying, libertarian Texas Rep. Ron Paul finally succeeded in placing a public audit of the opaque Federal Reserve into a financial regulations bill. His Federal Reserve Transparency Act—better known as “Audit the Fed”—won passage on Friday with more than 300 cosponsors. Its Senate equivalent, sponsored by Sanders, has gathered 30 cosponsors so far.

This anti-Bernanke sentiment resonates outside of Washington. Polls show that nearly four in five Americans support auditing the Fed. There’s much to audit; over the course of the past year, the central bank has done much more than simply set interest rates and regulate banks. Bernanke helped to engineer the Federal Reserve’s multi-trillion-dollar financial rescue and has pushed back on oversight. The Fed has refused requests to reveal the recipients of $2 trillion in emergency loans. Now, politicians and a whole lot of others are calling for his head.

The debate about Bernanke is a diversion from the important conversation about macro-economic policy: how can the Fed ease unemployment, and to what extent should it risk inflation to do so? Instead, it is Fed economists, and their increasingly vocal critics, who are in the process of hashing out how to best help the fragile economy within the Federal Reserve’s mandate of keeping prices stable, inflation reasonable, and employment high.

The tools are limited. With the federal funds rate close to zero, the Fed cannot lower it to further stimulate the economy. At some point, the central bank will need to raise interest rates, to rein in inflation and have room to maneuver in case the economy worsens. For now the bank is keeping the cost of money low for fear of panicking businesses and bond markets.

At the same time, unemployment is in double digits. Over the course of the recession, America has shed more than 8 million jobs. Normally, Congress might combat this problem through stimulus: spending the government’s money to hire America’s workers. But the government has already written a large number of checks to Wall Street institutions, and even if there is more money available, the White House and congressional leaders may lack the political juice to force through another big bill. That leaves the Fed keeping rates low, and risking inflation, in the hopes that a loose money supply will encourage more businesses to hire.

http://www.newsweek.com/id/227080

Why George Will fears Fed Audit?

By Greg Hunter
This week nationally syndicated columnist George Will wrote a piece called “Playing Politics with the Fed.” Mr. Will is squarely against Congressional legislation called the Federal Reserve Transparency Act of 2009. This bill will force the Federal Reserve to open its books for an audit. The bill, also known as “Audit the Fed,” has 317 co-sponsors in the House of Representatives alone, a more than two-thirds majority.

There are 137 Democrats and 180 Republicans backing an audit, so it is very serious bi-partisan legislation. Mr. Will tries to make the case for objecting to an audit by saying, “Let such people begin managing the Fed and they will mandate low interest rates, regardless of circumstances. The currency will fail as a store of value. Is the Fed’s independence (de facto, not de jure) “undemocratic”? Somewhat. So what?” (For George Will’s complete commentary click here)

“So what?” Mr. Will, if you do not understand the significance of why there is a movement to “Audit the Fed,” you should give back your Pulitzer Prize and retire. Take, for example, Citibank: According to Congressman Alan Grayson, Citibank had $230 billion of toxic assets removed from its books and transferred to the Fed.

Now, the bailed out bank wants to pay back its TARP funds (a mere $45 billion) and go on its merry way. Mr. Will, can’t you see the reason taxpayers should know why the Fed gave Citibank, just one company, this deal? After all, taxpayers will be on the hook for $230 billion worth of bad decision making. On top of that, no one in the bank is being held accountable for it. For that matter, not a single bailed out banker lost his job for bankrupting his institution.

Trade sitting at the comfort of home. Start with a mere 50$

Will goes on to say, “America is committed to democracy — and to circumscribing democracy’s scope in order to minimize the damage it can do by improvident responsiveness to untempered gusts of public passion.” In other words, we need the Fed to save us from ourselves. Boy, that’s rich, Mr. Will, considering the Fed secretly gave foreign central banks $500 billion dollars to bail them out! Why is the Fed saving foreign banks instead of the Americans that are footing the bill? According to George Will, we shouldn’t know what the Central Bank is doing because it will hurt the Fed’s independent decision making and thus hurt us. What a crock! George Will wraps himself in democracy while he champions the aristocracy. Simply put, Will’s commentary backs secret bailouts for the wealthy.

I am not a lone voice here! According to Elizabeth Warren, the chair of the Congressional Oversight Panel charged with monitoring the TARP bank bailout, we only rescued the people at the top. Warren, a Harvard law professor, said recently, “This is sort of how we went about the rescue — we rescued at the top and we left the bottom to kind of fend for itself — and that’s showing up in the unemployment numbers.” In Warren’s oversight capacity, she gets to examine the billions of dollars doled out by Congress to banks. But when it comes to Federal Reserve bailouts of financial institutions, there is no oversight. It has been reported the Fed is hiding at least $9 trillion of toxic assets in off-book accounting. The Fed lives in a secret world where it gets to play favorites and decide who lives and who dies. Just ask Lehman Brothers and Bear Stearns if they got a fair shake from the Fed.

A perfect example of playing favorites shows up in the treatment of Goldman Sachs. The former investment bank received a $13 billion payout in the AIG bailout. Goldman got all its money back. Why did the Fed pay Goldman 100 cents on the dollar when it forced other financial institutions to take big losses? Who else is the Fed giving favorable treatment? And why? Has the Fed taken toxic assets off the books of Goldman? I suspect all the big banks had hundreds of billions of dollars of toxic assets transferred off their books, compliments of the Fed. Sound far fetched, you might say? Just this week, Treasury Secretary Tim Geithner said, “None of them would have survived” if the government did not bail them out. When it comes to the Federal Reserve, taxpayers don’t get to know what banks received money and why they were bailed out. It is an appropriate secret according to the Fed and George Will.

George Will also says Fed Chief Ben Bernanke should be applauded for the job he is doing. Will writes, “If Time magazine has a lick of sense, Bernanke will be its Person of the Year because his leading role in stabilizing the financial system enabled the president to pursue other objectives. He did not do it perfectly, but he prevented paralysis.” You think Bernanke should be “Person of the Year?” Might I remind you Mr. Will, it was the Federal Reserve that was supposed to regulate the banks to control systemic risk. Instead, the Fed stood by and watched the banks take on massive risk and debt that caused the financial meltdown. I guess in your world of the privileged and wealthy Bernanke should also get some sort of medal for allowing Wall Street bankers to rake in huge bonuses while taking on insane risk!

Something else to consider Mr. Will, while you champion the cause of Federal Reserve secrecy, the Fed is not a federal institution at all, but a cartel of private banks. The Fed is simply a subcontractor for U.S. monetary policy operating for profit. With that in mind, we pay the Fed in Treasury Bills to print Federal Reserve Notes. Think about that for a moment, the U.S. gives the Fed interest bearing bonds and gets Federal Reserve Notes in return. Wouldn’t it be cheaper for Congress to allow the Treasury to print the money as the Constitution provides and save the interest payments to the Fed? Congress should be in control of the money supply and not a subcontractor.

Thomas Jefferson, one of our founding fathers and framer of the Constitution, despised the idea of money not strictly backed by gold or silver. Jefferson’s fear that banks could one day become too powerful is more relevant now than ever. “I sincerely believe… that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale.” –Thomas Jefferson to John Taylor, 1816.

In a modern way, I feel the country is being robbed by a Federal Reserve creating money without oversight or restriction. I talked about this phenomenon in a post called “Is The American Empire Being Looted?” Mr. Will, the “Audit the Fed” bill is not about playing politics. It is about the welfare of the common man. Millions will end up losing their homes in the foreclosure crisis sweeping the country while bankers receive secret bailouts that you support. That, Mr. Will, is wrong for the common man and wrong for America! I say, audit the Fed!

Courtesy: www.usawatchdog.com