Best of the Week
Most Popular
1.The Greatest Stock Market Crash Of Your Life Is Just Ahead… – Warns Harry Dent - GoldCore
2.Budget 2016: Borrowing, Lifetime ISA, House Prices, Economy, Syria, Brexit and Stocks - Nadeem_Walayat
3.Gold Price Intermediate Top - Clive_Maund
4.Brussels Terror Attacks, Death of the European Union, BrExit Wake up Call - Nadeem_Walayat
5.Stock Market Maybe This Time is Different? - Tony_Caldaro
6.UK House Asking Prices Break Above £300k! Housing Market Paralysis - Nadeem_Walayat
7.A Big Reason Why Silver Price Is Set To Soar - Hubert_Moolman
8.The Financial Crisis Has Just Begun; Is The American Dream Is Over? - Chris_Vermeulen
9.Gold Stocks Spring Rally - Zeal_LLC
10.GLX, GLDX, Baby Gold Bull Market Stillborn? - Rambus_Chartology
Last 7 days
Save the Environment and Your Retirement: Sell Tesla - 4th May 16
Silver Bullion Has Key New Player – China Replaces JP Morgan - 4th May 16
Gold Stock Picks Up Over 400%, What's Next ? - 4th May 16
U.S. Treasury Secretary Jack Lew: Puerto Rico Needs Urgent Action - 4th May 16
Technical Trading Mastery for Traders & Investors - 4th May 16
Derivatives Crisis Of Banks…Worldwide - 3rd May 16
Bank of North Dakota Soars Despite Oil Bust: A Blueprint for California? - 3rd May 16
Stock Market Technical Analysis - 3rd May 16
Central Banks Need a Higher Gold Price : Hello GATA - 3rd May 16
A Currency War Battle That Europe and Japan Can’t Afford To Lose - 3rd May 16
When the Truth is Found to be Lies, Confidence in Currency Dies - 2nd May 16
How Brexit Could Help All of Europe - 2nd May 16
US House Prices Outpacing Official Inflation Rate, Household Income - 2nd May 16
USD Still Declining... - 2nd May 16
Gold & Silver Rally Huge as Central Bankers & Analysts Flub - 2nd May 16
Stock Market Bounce Day - 2nd May 16
Stock Market Uncertainty Following Two-Month Long Rally - Will It Continue? - 2nd May 16
Stock Market Correction Underway "Upside Objective Reached" - 2nd May 16
USD, Yen and an ‘Inflation Trade’ Update - 2nd May 16
Gold Commitments of Traders and More - 1st May 16
The Magic of Gold Ratio Charts - 1st May 16
Consensus Forming: China Heading Back Into Financial Crisis - 30th Apr 16
The Next Technical Price Targets for Gold & Silver - 30th Apr 16
Stock Market Downtrend Should be Underway - 30th Apr 16
Gold And Silver – A Clarion Alarm Call For All Paper Assets - 30th Apr 16
US Economic Statistics LIES, LIES AND OMG, MORE LIES - 30th Apr 16
Stock Market Strong Elliott Wave Relationship is Developing - 29th Apr 16
Fed's Kaplan: Brexit to Factor in US June Interest Rate Decision - 29th Apr 16
Silver Miners Strong in Grim Q4 - 29th Apr 16
Is Silver a better bet than Gold in the Near Future? - 29th Apr 16
How to Use the CoT Report in Gold Investing? - 29th Apr 16
Sri Lanka is Intriguing: Areas to Consider for Value Investing - 29th Apr 16
Gold “Chart of The Decade” – Maths Suggest $10,000 Per Ounce Says Rickards - 29th Apr 16
Are We or Are We Not in a New Gold Bull Market? - 29th Apr 16
Silver: The “Five Year Plan” and the Great Leap Forward - 28th Apr 16
Michael Hudson: The Wall Street Economy Has Taken Over The Economy and Is Draining It! - 28th Apr 16
AUD/USD - Trend Reversal or Just a Bigger Pullback? - 28th Apr 16
A Gold Revaluation Could Transform Your Financial Status - Overnight - 28th Apr 16
Monetary Policies Misunderstood - 28th Apr 16
Gold Bullion vs Gold Miners - 28th Apr 16
OECD Suggests BrExit Would Cut Net Migration by 1.2 Million by 2030 - 28th Apr 16
MP Naz Shah Punished for Tweets Made During Israel's Genocide of Gaza Palestinian People - 28th Apr 16
Global Recession in 2016 and Beyond - The Obvious Evidence - 27th Apr 16
Why Gold Bugs Need to Stop Listening to The Fear Mongers and Start Thinking for a Change - 27th Apr 16
BlackRock’s Fink: Fed to Raise Interest Rates by Quarter Point ‘at Best’ - 27th Apr 16
Gold More Productive Than Cash?! - 27th Apr 16
Donald Trump Will Fire Janet Yellen and Be Trapped - 27th Apr 16
Money Saving Gardening by Propagating Roses From Cuttings - Propagating Rose Plants Over 2.5 Years - 27th Apr 16
Facebook Censors Pro Trump and Negative Hillary News - 27th Apr 16
This is the Era of the Democrats and Your Taxes are Going Up - 27th Apr 16
Long Awaited Gold Price Breakout - 26th Apr 16
Crude Oil Price Double Top or Further Rally? - 26th Apr 16
Madness in the Crimex Gold and Silver Trading Pits - 26th Apr 16
Britain's Prospects: GBP and BREXIT - MAP Wave Analysis - 26th Apr 16
CRB, Gold, Oil, Cotton, Coffee - 7 Must See Commodities Charts - 26th Apr 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Catching a Falling Financial Knife

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