Auditing the Fed is Economic Suicide?

The Provocateur ^ | 08/31/2009 | Mike Volpe

[fiscon1]

That's the view from this particular blog.

The free market understands that auditing the fed is a very dangerous line to cross. If crossed, U.S. inflation will likely skyrocket over the next decade to unseen levels. U.S. economy tanks. Bond investors lose money as interest rates rise. Stock investors earn negative real return as equity risk premium rises and aggregate PE ratio tank. The US Dollar erodes due to higher domestic inflation relative to foreign inflation. Gold and commodity prices rise.

[Shermy]

“The free market understands that auditing the fed is a very dangerous line to cross.”

Who is this “the free market” and how does he “understand?”

[fiscon1]

it’s propaganda. There is no free market that says this.

[ctdonath2]

If auditing the Treasury (of which the Fed is a part of for all practical purposes) results in an economic catastrophe, then there is something very wrong therein which needs to be resolved.

Ignoring problems does not make them go away in a viable fashion.

[KarlInOhio]

If we check you for cancer you could grow horrible tumors and die.

Or to paraphrase Ghostbusters:

Dr. Egon Spengler: There's something very important I forgot to tell you.
Dr. Peter Venkman: What?
Dr. Egon Spengler: Don't audit the Fed.
Dr. Peter Venkman: Why?
Dr. Egon Spengler: It would be bad.
Dr. Peter Venkman: I'm fuzzy on the whole good/bad thing. What do you mean, "bad"?
Dr. Egon Spengler: Try to imagine all life as you know it stopping instantaneously and every molecule in your body exploding at the speed of light.

[ClearCase_guy]

To me, this is a lot like a man over 50 who decides not to go see his doctor for annual check-ups because — you know — they might find something.

[fiscon1]

that’s an excellent point.

[ctyankee00]

“...U.S. inflation will likely skyrocket over the next decade to unseen levels. U.S. economy tanks. Bond investors lose money as interest rates rise. Stock investors earn negative real return as equity risk premium rises and aggregate PE ratio tank. The US Dollar erodes due to higher domestic inflation relative to foreign inflation. Gold and commodity prices rise.”

um, this is already going to happen due to the Federal Reserve’s actions so an audit couldn’t possible make it any worse. Just my opinion.

[InterceptPoint]

I can add to this list.

Audit the Fed and the Yankees won't win the World Series for decades, Hollywood blockbusters will be a thing of the past, Jay Leno will no longer be funny, Rush Limbaugh's rating will soar (say what?), Free Republic will replace Google as the place to go on the net, China will buy GM and Chrysler and rename the new company Glysler, and ... I could go on but you get the idea.

[ArtyFO]

Yeah, let’s see how much gold resides in Fort Knox. Geraldo should be there when they open the door.

[InterceptPoint]

Here is the key point made by the referenced blog:

While it may not be the intent of the lawmakers, Ron Paul’s Federal Reserve Transparency Act (H.R. 1207) will enable the congress to influence the outcomes of monetary policy through an audit of the Federal Reserve’s day-to-day operations, thus severely compromising the independence of the U.S. central bank from political influences.

That could be true of course. When you have an organization (the Fed and the associated banks) that has been structured for the purpose of legalizing the looting of the wealth of the American people you are bound to have Congress wanting to get in on the action. They do that now in a general way (just spend more than you take in and let the Fed inflate the debt away) but the idea that Congress could "help" the Fed with it's day to day decision making might turn out to be simply irresistible to the Congress Critters. Could they do worse that the Fed? I doubt it.

Leisler posted the following chart on a recent FR Fed Thread (I like the ring of that) and it tells the sorry history of our savings and the value of the dollar that is direct result of this corrupt gangster organization stealing your money right out from under your bed.

[E. Pluribus Unum]

The whole concept of money is smoke and mirrors.

Pull back the curtain, and the whole thing might collapse.

Audit the Fed, and this time next year we could all be trading mackerel cans or Marlboros instead of dollars.

:^D

[Colvin]

If this is so then the whole system is bankrupt. I think these people figure the US economy has 10 years left, and then the they would rather suck the carcass dry.
Lets take our pain sooner rather then later, and the big money boys can find another cadaver to drink from.