Posted on 09/25/2009 10:45:34 AM PDT by Palin Republic
House lawmakers want to pry open the books of the famously secretive Federal Reserve with legislation that would subject the central bank to a sweeping congressional audit.
The effort is overwhelmingly bipartisan. Hardline conservatives and liberal Democrats have banded together in their criticism of the Fed as a major power broker in the financial system that doesn't answer to Congress.
Friday's debate comes as lawmakers consider a proposal by President Barack Obama that would give the Fed new powers to prevent another economic crisis.
"Nobody in my district thinks that the Fed has done such a wonderful job of running the economy that we should continue to cloak them with secrecy for the purpose of protecting them from second-guessing criticism," said Rep. Brad Sherman, a California Democrat.
The Fed is pushing back, warning that its ability to stabilize prices and monitor interest rates would be compromised if it knew politicians were looking over its shoulder.
The House proposal would "cause the markets and the to public to lose confidence in the independence and the judgments of the Federal Reserve," Scott Alvarez, the board's top lawyer, told the House Financial Services Committee in testimony.
The legislation is championed by Rep. Ron Paul, a Texas Republican whose extreme libertarian bent usually doesn't generate consensus in Congress. But as of Friday, Paul's legislation had attracted 295 co-sponsors with a range of political philosophies, including Hawaii liberal Rep. Neil Abercrombie and Rep. Jeb Hensarling, an outspoken conservative from Texas.
(Excerpt) Read more at google.com ...
Yes indeed. Let’s keep letting Wall Street run unfettered. It’s working so well.
Sarbanes Oxley did a bunch of good. For lawyers.
They are trying to fix(or blame) the fed in these particular hearings, but they are also trying to fix Wall Street. I think the two go hand in hand what with the personnel swaps.
I also kinda think we are closing the barn door after the horse got out, but since there will be more horses int he future, the barn still needs to be secured.
I also have this sinking little feeling, that if Wall Street gets some hobbles put on it, and derivatives forced onto exchanges with std’ized paper, and rampant speculation slowed down some, there is going to be some places in the world that don’t sign on. The gov’t will probably not follow thru, and there will be another big blow up, assuming the collapse of civilization as we know it doesn’t happen first.
parsy, the pessimistic optimist
>Wait until the threats start....
Fed’s Alvarez Says Audits Could Lead to Higher Rates (Update1)
http://www.bloomberg.com/apps/news?pid=20601087&sid=adDANopNzewM
That didn’t take long!
Oh wait, can't do that, they are part of the criminal enterprise.
Are you going to talk specifics here, or just throw out drive-by sneers?
If Barney Frank and Dodd get power over monetary policy, I think rates could soar.
Do you disagree?
Exactly! And didn't fix the underlying problem, fraud, which was already illegal before Enron.
Whatever Fed problem you think this audit will fix will instead only benefit the real trouble makers, Congress.
Rates have been artificially held down by manipulation for decades.
That’s one of the biggest reasons we’re in this mess.
Let the market set the rates.
Capitalism requires creative destruction to burn off the deadwood. Otherwise the entire forest dies of suffocation.
That's pretty much the attitude.
And "the Federal Reserve's independence" is supposed to matter more to us than our own independence -- yeah right.
I emailed my Senators Feinstein and Boxer about this bill. Boxer never answered me (she never does). Feinstein, however, sent this below (at least she's polite):
Thank you for contacting me to express support for legislation to increase transparency at the Federal Reserve. I appreciate your interest in monetary policy and welcome the opportunity to respond.
The Federal Reserve was originally established in response to the country's need for a sound and independent central bank to manage decisions relating to U.S. monetary policy. I understand your concern with some of the unprecedented steps that the Federal Reserve has taken recently to ease the flow of credit and stabilize financial markets.
On March 16, 2009, Senator Bernard Sanders (I-VT) introduced the "Federal Reserve Sunshine Act of 2009" (S. 604), which would require the U.S. Comptroller General to audit the Federal Reserve System before the end of 2010. This bill has been referred to the Senate Banking, Housing, and Urban Affairs Committee. Representative Ron Paul (R-TX) has introduced a similar bill (H.R. 1207) in the House of Representatives. Please know that I will keep your support for this legislation in mind should it come before the full Senate.
While I recognize the importance of accountability in the operations of the Federal Reserve, I strongly believe that monetary decisions should be made independent of political influence or motives. You may be interested to learn that I supported an amendment to the Congressional Budget Resolution (S. Con. Res. 13) offered by Senator Sanders requiring the Federal Reserve to disclose how it has disbursed emergency economic assistance to financial institutions during this severe economic crisis. Be assured that I am carefully monitoring the actions taken by the Federal Reserve to help stimulate our economy and unfreeze credit for businesses and homeowners.
Once again, thank you for writing. I hope that you will continue to share your views with me. If I can be of any further assistance, please contact my Washington, D.C. office at (202) 224-3841. Best regards.
Sincerely yours,
Dianne Feinstein
United States Senator
Which rates?
Capitalism requires creative destruction to burn off the deadwood.
Bear Stearns, Lehman, Merrill, Countrywide, Wamu, IndyMac.....I could go on and on.
Investigate Dodd and Frank first
AMEN!
Only problem is, the socialist government is trying to takeover the market, about halfway there...don't you think? We are going from one type of fascism to another.
Just because some (or maybe even most) regulation accomplishes little, it doesn’t mean that it isn’t necessary. Reinstating Glass-Steagall is probably a good step.
As far as fraud, legally there is fraud, and then there is fraud. Fraud usually has to be alleged with specificity. This makes ignorance of fraud a good defense. “I didn’t know the books were a POS. I hired a CPA firm, and heck the audit report is like 90 pages and I don’t understand all this accounting gobbledy-gook.”
Oxley/Sorbanes, to my recollection, was an attempt to cut down some on the ignorance defense. I will double check.
parsy, who will look that back up
What, you think they’d hit back with some kind of financial nuke?
After saying that “Barbara Boxer never answers my emails”, I just got an email response from her highness. Hell has definitely frozen over because Boxer just signed on to co-sponsor “Audit the Fed”!
Possibly ...or this could change the national debate in a way that the Democrats, RINOS, and other congress critters can’t foresee.
Excellent proof that the bill is bad for America and good for the clowns in Congress.
Excellent proof that the bill is bad for America and good for the clowns in Congress.
So, does the fact that you agree with Diane Feinstein on this issue mean that you are a flaming liberal?
Real correlations require something more solid than happenstance as "evidence".
It's a lot more likely that Boxer saw this freight train of a bill coming at her (just before an election year) and decided that if she didn't jump onboard, she was going to get run down.
Boxer has managed to stay in the Senate for so long, not because she is a genius, but rather because she has the political cunning of a cockroach who knows that she better run when the lights come on, lest she get taken out by something as silly as a bedroom slipper.
I don’t know. I’ll have to see if I can find anything on a de-regulated Wall Street running amok and bringing us to the brink of financial meltdown. I seem to recall something like that recently.
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