Best of the Week
Most Popular
1.BrExit Looks Set to Win EU Referendum, Final Opinion Polls Give LEAVE Lead Over REMAIN - Nadeem_Walayat
2.BrExit Morning - New Dawn for Britain, Independence Day! - Nadeem_Walayat
3.LEAVE Wins EU Referendum - Sterling and FTSE Hit Hard, Pollsters, Bookies and Markets All WRONG! - Nadeem_Walayat
4.BrExit to Save Europe from Climate Change Refugee Migration Apocalypse - Nadeem_Walayat
5.Trading BrExit - Stocks, Bonds, Sterling, Opinion Polls, Bookmaker Odds and My Forecast - Nadeem_Walayat
6.EU Referendum Latest Opinion Polls Show LEAVE Halting REMAINs Surge - Nadeem_Walayat
7.Gold And Silver – Insanity Is World “Norm.” Keep Stacking! - Michael_Noonan
8.Trading BrExit - British Pound Plunges, FTSE Stock Futures Slump on LEAVE Shock Referendum Win - Nadeem_Walayat
9.Gold And Silver: Security, And BREXIT - Michael_Noonan
10.BrExit Vote - "The Trend is Set" -- And What You Should Pay Attention to Next - EWI
Free Silver
Last 7 days
UK Interest Rate Cut to 0.25% Imminent and More QE Money Printing - 1st July 16
Michael 'Little Finger' Gove Slays Boris 'Baratheon' Johnson in Game of Thrones for Next Tory PM - 30th June 16
Gold, Silver, Bonds and Stocks Path Towards Inflation - 30th June 16
Stock Market SPX Rally Nearing its End as DB Gets Slammed - 30th June 16
Brexit & The Precipice - 30th June 16
Gold and Silver Precious Metals Bull Market Update - 30th June 16
14 Signs the World Is on the Verge of Generational Chaos - 30th June 16
BrExit Stock Market Upwards Crash as FTSE Recovers 100% of Friday Plunge - 30th June 16
Stock Market Rally Runs Out of Steam - 29th June 16
Rapid Growth:The Financial Trends Of Online Gaming - 29th June 16
FTSE and Sterling Brexit Trading, Deconstruction of the EU Referendum Result - 29th June 16
Stock Market Bounce May be Over - 28th June 16
Stock Market Meltdown Likely to Drive Gold Towards $1,500 - 28th June 16
Brexit Victory over the EU Globalists - 28th June 16
Brexit Psyop: Greenspan Falsely Blames the Brits for the Crash and Chaos to Follow - 28th June 16
Greenspan Calls Brexit a ‘Terrible Outcome’ as Euro Area Tested - 27th June 16
Stock Market SPX Below Mid-Cycle Support - 27th June 16
Best Holidays for Summer 2016 - 27th June 16
Another Stocks Bear Market? - 27th June 16
BBC EU Referendum Result Highlights - YouGov, Markets, Bookmakers, Pollsters ALL WRONG! - 26th June 16
Investors Map Post-Brexit Strategies Amid Global Market Upheaval - 26th June 16
Gold Price Weekly COT Update - 26th June 16
First the UK, then Scotland ... then Texas? - 26th June 16
Stocks Bear Market Resumes or Just More Noise - 26th June 16
Gold And Silver: Security, And BREXIT - 25th June 16
Dow, Euro & Brexit Recap - 25th June 16
Resistance Holding Gold Stocks after Brexit - 25th June 16
Venezuela vs. Ecuador (Chavismo vs. Chavismo Dollarized) - 25th June 16
Gold, Silver And PM Stocks Summer Doldrums Risk - 24th June 16
Here’s Why China “Economic Hard-Landing” Worries Are Overblown - 24th June 16
Jubilee Jolt: Markets Crash, Gold Skyrockets as Britain Takes Brexit - 24th June 16
BrExit Morning - New Dawn for Britain, Independence Day! - 24th June 16
LEAVE Wins EU Referendum - Sterling and FTSE Hit Hard, Pollsters, Bookies and Markets All WRONG! - 24th June 16
Trading BrExit - British Pound Plunges, FTSE Stock Futures Slump on LEAVE Shock Referendum Win - 24th June 16
EU Referendum Shock Results Putting BrExit LEAVE in the Lead Hitting Sterling Hard - 24th June 16
Final Opinion Poll Gives REMAIN 52% Lead, Bookmakers, Markets and Pollsters ALL Back REMAIN Win - 23rd June 16
Does BREXIT Matter? Outlook for Sterling - 23rd June 16
Keep Calm and Vote BrExit - Last Chance to Break Free of EU Superstate - 23rd June 16
Here’s the Foreign Policy Trump and Clinton Really Want - 23rd June 16
Details Behind Semiconductor Stocks Leadership - 23rd June 16
Trading BrExit - Stocks, Bonds, Sterling, Opinion Polls, Bookmaker Odds and My Forecast - 23rd June 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Market Volaility

Auditing The Fed is Like Auditing a Mafia Counterfeiting Operation

Politics / Central Banks Jul 28, 2012 - 03:56 PM GMT

By: Jeff_Berwick

Politics

Best Financial Markets Analysis ArticleRon Paul’s Federal Reserve Transparency Act (H.R. 459), or “Audit the Fed,” passed Wednesday July 25, 2012 in the U.S. House of Representatives by a wide margin of 327-98, exceeding the two-thirds majority needed. It had 274 cosponsors. But, by the evening of the same day, mainstream press around the country was already preparing the people for the bill’s fate in the Democrat-controlled Senate. As the Chicago Tribune and others reported, it had little chance of passing in the Senate, let alone being signed into law by the President. In fact, Senate Majority Leader Harry Reid has already said that the Senate will not even consider the bill, because, as Ron Paul told CSPAN, he didn’t have the “guts.” With this in mind, as well as their own reputations, Romney, Boehner and Cantor backed it.  Even Harry Reid backed it… in 1987 and 2010, but now he has changed his mind on a Fed audit for some reason.


But, here is the plain fact of the matter.  We already know what the Federal Reserve is doing.  Sure we may not know exactly which banks get exactly which graft, which may be of some interest.  But for the most part we know exactly what they are doing.  They are artificially price-fixing/manipulating interest rates at 0% through to 2014… which will be six years of ZIRP.  And they are counterfeiting as much money as is necessary to support the massive trillion+ dollar deficits that the US Government has been doing for the last five years and with no end in sight in an unprecedented amount of money printing that has never been surpassed in Federal Reserve history.

And, any audit that uncovers these two facts will do nothing to change anything.  The western world’s propaganda campaign to teach only Keynesian economics, which are pro-money printing and deficit spending, have enveloped all levels of society now.  It is all that is taught in the economics department of almost every university in the west including Harvard and Oxford.  So, will auditing the Fed change anything?  Of course not. 

Not to mention, even if the bill did pass Senate and mass murderer Barack Obomber signed the bill into law it is unlikely that the regulators assigned to the task of auditing the fed would really have the “guts” to properly audit the public-private institution. The Fed is above-and-beyond the rest of the financial industry insofar as it submits to no regulatory oversight. But, this regulatory oversight of the financial industry has done nothing to stem the moral hazard and abuses of power that plagues the sector. The same would be true of the Federal Reserve. With two sets of books, a bribe and a threat here-and-there, the malfeasance can be made to disappear. We’ve seen it before and we will see it again.

This would lead to an audit of the forged set of books the Fed keeps which supports the evidence that the Fed is doing what it can do to achieve the objectives of its “light”, impossible mandate – maximum employment, stable prices, and moderate long-term interest rates – as enunciated by the Federal Reserve Act. The set of books which support the evidence that the Fed is doing what it can do to achieve the objectives of its “dark” mandate – pillaging the planet of its every last vestige of wealth -  would be safely kept far away from the Fed’s auditors.

That means that the real success of the bill, as even Ron Paul has argued, has been the light it has shone on the secretive Federal Reserve. As Paul said on the floor on Tuesday, the American people are “sick and tired of what happened in the bailout and where the wealthy got bailed out and the poor lost their jobs and they lost their homes.” Since the crisis, Fed asset purchases have swollen the bank’s balance sheet to $2.8 trillion from around $800 billion. For three-and-a-half years it has kept interest rates at nearly zero, as well as pledged to keep them at these levels at least until late 2014.

Among Federal Reserve policies that would be scrutinized under the bill are monetary policy, deliberations and decisions, agreements with foreign central banks, foreign governments, finance capital and international organizations like the International Monetary Fund.  These are areas of the Federal Reserve that were made illegal to audit in the 1970s. Paul’s bill would remove these prohibitions. 

Paul’s bill would require the Government Accountability Office to conduct a full Fed audit. Paul’s son, Republican Senator Rand Paul, has introduced a companion bill in the Senate, but, as Reid has said, Democrats in control of the Senate will most likely not bring this to a vote. Rand Paul was expected to try to force a vote on it as an amendment to other legislation. There are hints that the bill could resurface in 2013 if Republicans win control of the Senate this November, as Rand Paul is set to succeed his father as Congress’ top Federal Reserve critic. But, it is clear that Rand Paul has not been as stalwart as his father when it comes to libertarian and constitutional principles, which leaves the bill prone to a further watering down under Rand’s watch.

Nonetheless, Ron Paul has once again been successful– and no, not in the sense that his bill passed. But, instead, in the sense that the headlines across the nation yesterday were swirling with news of the bill’s passing, bringing the Federal Reserve once again into the limelight for all to see. With the paramount help of Ron Paul and the financial crisis, the Federal Reserve has gone from a mystery to the American people to an entity that 75% of Americans are in favor of publicly auditing. As Paul says, “I like to think of it more as verifying my approach is a little bit different than just becoming a powerful player and having influence, versus really changing people’s minds.”

Nevertheless, that we do not know certain things about the Fed is not the problem, it’s the fact that central banking at its core is criminal and does nothing but impoverish people and economies. Auditing the Fed is like auditing GOSPLAN, the Soviet State Planning Commission, a very important institution in Soviet Russia. Throughout numerous “reformations” of the soviet economy, GOSPLAN maintained its central role in determining production and investment decisions until the disintegration of the USSR in 1991. No matter how many more left shoes were made than right shoes, GOSPLAN endured.

 The mentality in US politics towards the Fed is similar to the mentality towards GOSPLAN in the Soviet Union: economic central planning is not up for debate – we just would maybe like to tinker with it a bit.

But the reality is that auditing the Fed is akin to auditing a mafia counterfeiting operation.  We know they are doing it and the great majority of people approve of them doing it.

Auditing the Fed, while maybe a small step for mankind, does nothing to really end the crime of central banking.  All auditing does is ask the man who robbed your house what he did with the proceeds and then letting him go on about his business.

Until people realize that nothing will change for the better.  Unfortunately, very few in the world have any critical thinking abilities, again thanks to the government indoctrination centers and fascist media propaganda.  Therefore, central banking, like Soviet style central planning, will only end once they destroy themselves because all artificial, criminal systems are unsustainable.

As dollar vigilantes we await their demise with great pleasure.  But it won’t come at the hand of a government auditor.

The Federal Reserve will only end when it ends in the tears of a hyperinflation within 3-5 years.  Protect yourself now.  Subscribe to The Dollar Vigilante, the only newsletter whose express focus is info, news, analysis and advice on how to survive The End Of The Monetary System As We Know It (TEOTMSAWKI).

The Dollar Vigilante is a free-market financial newsletter focused on covering all aspects of the ongoing financial collapse. The newsletter has news, information and analysis on investments for safety and for profit during the collapse including investments in gold, silver, energy and agriculture commodities and publicly traded stocks. As well, the newsletter covers other aspects including expatriation, both financially and physically and news and info on health, safety and other ways to survive the coming collapse of the US Dollar safely and comfortably. The Dollar Vigilante offers a free newsletter at DollarVigilante.com.

© 2012 Copyright Jeff Berwick - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

1776Again
29 Jul 12, 03:23
Hyperinflation Coming ? Housewife's index

Mr. Bernanke says we have little inflation, but I have developed an inflation index, which has proven pretty accurate. In the last 3.5 years, you might have noticed a trend which you might not have noticed before; you will have to take a measurement of the length of your toilet paper roll. Then keep a mental record of any more decreases in length, and thus decreases in the little squares that make up the total of the roll.

Having noticed this continuing process meant to disguise the fact of inflation, the result of my calculations is this: Decrease in length over 3.5 years is 1.75 inches' when divided by 3.5 years results in 0.5 inches per year on average.

Maybe we will know when those little square have reached the size of a postage stamp, we then have hyperinflation, and the toilet paper will have literally reached the useless the value of the US Federal Reserve Note.


The Cliff
31 Jul 12, 10:21
Run Away Train.....

Whether we audit the fed or not we are far to late to stop this run away train. Soon as China and Japan figure out were never gonna pay them back and the rest of the world switches to a basket of currencies instead of the petrodollar... That will be the end of this charade that the central bank is looking out for the people.. No different than what happened in Greece except times a thousand and nobody is coming to bail us out...


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife