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Blame the Fed for the Financial Crisis
The Wall Street Journal ^ | 2011-10-20 | Ron Paul

Posted on 10/21/2011 10:17:02 AM PDT by rabscuttle385

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To: RepRivFarm

The Fed is NOT a private bank. Unlike other private banks, for example, it can legally create money out of thin air and has extensive regulatory powers over actual private banks. It is best described as coercive corporatist/fascist government-business monopoly cartel.


21 posted on 10/21/2011 11:53:36 AM PDT by Captain Kirk
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To: ph12321
Haven't you heard? Anyone who goes to OWS to specifically protest the Federal Reserve gets labeled "Paulies for Larger Government"?

God Help me, because there are some days when I really think that this generation of Americans may just be too stupid to govern themselves!

22 posted on 10/21/2011 12:01:44 PM PDT by Bokababe (Save Christian Kosovo! http://www.savekosovo.org)
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To: Captain Kirk
Agree that the Fed is not your ordinary bank....it has some "superpowers" because of the US Federal Reserve Act AND the fact that the dollar is the world's reserve currency per Bretton Woods. (sp?)

However, it is not owned by the US government. It is owned by private parties.

23 posted on 10/21/2011 12:20:53 PM PDT by RepRivFarm ("During times of universal deceit, telling the truth becomes a revolutionary act." -George Orwell)
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To: Captain Kirk
... It is best described as coercive corporatist/fascist government-business monopoly cartel.

or the embodiment or the fifth plank of the communist manifesto.

Technically it is owned by member banks. Member banks must subscribe to stock in their regional Federal Reserve Bank in an amount equal to 6 percent of their capital and surplus, half of which must be paid in while the other half is subject to call by the Board of Governors.

The stock may not be sold, traded, or pledged as security for a loan; dividends are, by law, 6 percent per year.

current listing of large commercial banks
24 posted on 10/21/2011 1:10:46 PM PDT by algernonpj (He who pays the piper . . .)
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To: rabscuttle385
Most people just don't understand what the Federal Reserve does, has done and is about to do to all of us --if they did, the candidates in the debates would be talking about nothing else.

Henry Ford's quote has never been truer:

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."

25 posted on 10/21/2011 1:38:08 PM PDT by Bokababe (Save Christian Kosovo! http://www.savekosovo.org)
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To: RepRivFarm

Ownership in what sense? Can they sell or transfer this ownership to someone else? Can they file for bankruptcy? If not, ownership is a fiction, even more so that the head of state powers of Queen Elizabeth II.


26 posted on 10/21/2011 1:43:56 PM PDT by Captain Kirk
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To: Captain Kirk
Ownership in what sense?

In the sense that they get to take the profits home with them.

Can they sell or transfer this ownership to someone else?

Yes, through sale of stock in member banks. See post 24, above

Can they file for bankruptcy?

Non Sequitor. Why would you declare bankruptcy when you can create the worlds reserve currency out of thin air?

This does not sound like fictional ownership to me. If you're still struggling with the concept, go ask Mr. Spock!

27 posted on 10/21/2011 2:08:01 PM PDT by RepRivFarm ("During times of universal deceit, telling the truth becomes a revolutionary act." -George Orwell)
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To: mulligan
"..Ron Paul is part of that government."

Ron paul is one of a very few who actually stand up to the "establishment" when questioning the Fed and others.

He votes against the establishment so often, his nickname on Capitol Hill is "Dr. No".

28 posted on 10/21/2011 2:40:33 PM PDT by Designer (Nit-pickin' and chagrinin')
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To: ph12321
"They are a bunch of wussies.."

Correction: the are a bunch of IGNORANT wussies.

29 posted on 10/21/2011 2:45:20 PM PDT by Designer (Nit-pickin' and chagrinin')
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To: Lorianne
Expect more of this in other states as the underground economy heats up and tax revenues dry up, and not just on second hand purchases. What are they going to do about barter?

I believe we are witnessing the first stage of the End Times nightmare outlined in the Book of Revelation, where cash is outlawed worldwide, and everyone must submit to a world system (electronic or other means).

30 posted on 10/21/2011 2:58:27 PM PDT by SkyPilot
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To: SkyPilot
"I believe we are witnessing the first stage of the End Times nightmare outlined in the Book of Revelation..."

Perhaps but:

"But of that day and that hour knoweth no man, no, not the angels which are in heaven, neither the Son, but the Father."

-- so if they don't know, then I don't know -- and will do all in my power to prevent the beginnings of that scenario.

31 posted on 10/21/2011 4:09:38 PM PDT by Bokababe (Save Christian Kosovo! http://www.savekosovo.org)
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To: rabscuttle385
There's more than enough blame to spread around.

The fed is to blame for making credit too easy.

The govt is to blame for over burdensome regulations, to the point of the ridiculous, that competing countries don't have to pay for.

Companies are to blame for being so short-sited to chase the quick buck and off-shore all of our jobs over seas.

Company/govt partnership is to blame for bringing so many foreign H1B and other visa types into this country to take American jobs.

The govt, at ALL levels, is to blame for not only not enforcing the immigration laws, but actually encouraging this invasion of foreigners into this country to take "the jobs American's won't do."

States and cities are to blame for their idiotic 'sanctuary city' and idiotic no illegal check during traffic stops.

States are to blame for offering such lucrative inducements to illegals such as hospital care, welfare, in-state college tuition and on and on.

The fed govt is to blame for running the richest, most productive country the world's ever known, STRAIGHT INTO THE GROUND WITH THEIR RECKLESS SPENDING!!!

Yeah, plenty of blame to go around.

32 posted on 10/21/2011 5:16:57 PM PDT by HeartlandOfAmerica (Geithner: Taxes on 'Small Business' Must Rise So Government Doesn't 'Shrink')
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To: HeartlandOfAmerica
Oh yeah. Dems are to blame for the idiotic Community Reinvestment act and their nonsensical enviro-nut anti-energy stands.

And Republicans are to blame for being a bunch of stupid, spineless pu$$ies and not stopping some of this garbage when they had 12 or whatever years of power.

33 posted on 10/21/2011 5:20:12 PM PDT by HeartlandOfAmerica (Geithner: Taxes on 'Small Business' Must Rise So Government Doesn't 'Shrink')
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To: rabscuttle385

“The Fed’s quantitative easing programs increased the national debt by trillions of dollars”

Since only Congress gets to vote on the size of the debt I’m curious to know how Ron Paul thinks the Fed accomplished this feat.


34 posted on 10/21/2011 6:16:21 PM PDT by Pelham (Immigrating America into just one more Latin American country.)
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To: RepRivFarm
The Federal Reserve is neither Federal, nor a Reserve.

It is Federal. It was created by Congress. It has trillions in reserves.

It is a privately held bank.

No it isn't.

35 posted on 10/21/2011 6:17:39 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: rabscuttle385

F A C T !


36 posted on 10/21/2011 6:26:37 PM PDT by stephenjohnbanker (God, family, country, mom, apple pie, the girl next door and a Ford F250 to pull my boat.)
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To: RepRivFarm; rabscuttle385

“It is a privately held bank”

The Fed is an aggregate. The Fed’s Board of Governors is appointed by the President of the United States. The staff at the Fed are government employees.

The member banks are not part of the government, they are privately owned.

“In 1913, via the Federal Reserve Act, we turned control of our money supply over to the Federal Reserve. “

Private banks had a major role in determining the money supply long before the Fed. Prior to the Federal Reserve Act, American banks were free to print their own currency.

The money supply was the collective money issuance of America’s banks plus what the Treasury issued.

And before the FR Act JP Morgan’s bank operated as our defacto central bank. Before the Fed the economy was already dominated by private banking.


37 posted on 10/21/2011 6:39:34 PM PDT by Pelham (Immigrating America into just one more Latin American country.)
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To: mulligan; rabscuttle385
Ron Paul: Blame the Fed for the Financial Crisis

You can always count on Johnny-One-Note "End the Fed, the root of all evil" Ron Paul to provide a stupid cover to Obama and the Democrats.

The Federal Reserve, like most other central banks (e.g., Bank of Canada, Bank of England, Bank of Japan, Reserve Bank of Australia, Swiss National Bank, European Central Bank / ECB) are set up as [and supposed to be] independent of political influence and should not be subject to political blame-shifting finger-pointing.

The Fed didn't create FHA. The Fed didn't create Fannie Mae and its later spinoff Freddie Mac, to provide mortgage financing for FHA loans (in effect, creating original MBS market). The Fed didn't create HUD. The Fed didn't create Community Reinvestment Act (CRA) which mandated that banks must make unqualified loans to unqualified applicants if they intended to stay in business. The Fed didn't threaten the banks to make even more egregious loans under Clinton administration's (Janet Reno's DOJ and Andrew Cuomo's HUD) onerous enforcement of "minority community ownership" under additional CRA mandates. The Fed also didn't make the Bush administration's appeals for "ownership society."

The Fed might control short-term interest rates and (under then-Chairman Alan Greenspan) did correctly lower them during nascent recession after 2000 markets crash, and even further after 9/11 attacks and crash to prevent deeper recession, but ST Fed rates do not necessarily affect long term mortgage rates (though they often move in the same direction, yet not necessarily with the same velocity) and any downward move in rates is commonly described as "pushing on a string" because lower rates in and of themselves cannot be a primary cause of spending, though it may help spur buying decisions of any assets or wares - which is exactly its desired effect in recessions or slowing economy. If low interest rates were the primary cause of the bubble in one asset class (in this case, real estate) they would also create bubbles in other asset classes which didn't happen - for example, the rates weren't the primary reason for Internut bubble and stock market crash. To blame the Fed for doing what the Fed is supposed to do is silly and not worthy of any presidential candidate.

In addition to having nothing to do with the practically inevitable - in absence of reforming and downsizing Fannie and Freddie and sunsetting CRA - mortgage financing meltdown caused by the government laws, mandates, regulations, numerous agencies and especially GSEs (Government Sponsored Enterprises Fannie Mae and Freddie Mac) who went all out to facilitate the "ownership society" while having guarantees of playing with the taxpayers money, the Fed Chairman Ben Bernanke and Treasury Secretary Hank Paulson had to take truly exceptional and measures (TARP, TALF and other loan facility programmes) to provide necessary liquidity and forestall the run on the banks and other financial institutions to prevent collapse of the U.S. and probably worldwide financial system as we know it.

Extraordinary times call for extraordinary measures and the Fed and Treasury delivered while Congress dithered and financial system and the banks - and along with it, many companies who thought their "cash or equivalent" were safe, pensions and individual money market and savings accounts - were burning.

Even if Republican politicians can't understand this or do understand but feel that they have to pander to the "no bailout" pundits (who can't bring themselves admit they were wrong about so-called "bailout" because government apparently shouldn't do anything, even when it's something government is eminently responsible for like stability / security / safety of functioning financial and banking system) the attack on the Fed and Bernanke is politically naive.

If it is the Fed that is to blame for the financial crisis, then that leaves Barney Frank, Chris Dodd, Jamie Gorelick, Franklin Raines, Jim Johnson, Andrew Cuomo, Barack Obama, Bill Clinton, Jimmy Carter, Franklin D. Roosevelt and many other political "actors," off the hook for being a part of creating this slow-motion disaster-in-waiting that culminated in one of the worst world-wide financial crises.

Which means that Obama's and Democrats' mouthpieces can claim any bump in the economy is due to one of their many "stimulus" programmes while any problems, including stubborn unemployment, was due to "disastrous" decisions and actions of the Fed, and the Stupid Party would look just as dumbfounded as it usually does when Dems use their own statements to turn tables on them. As usual, misguided Republicans are their own worst enemies.

"We often give our enemies the means of our own destruction" - Aesop

If they can't say anything good about the Fed helping to save U.S. financial system from the run on the banks and the vicious deflation cycle, they'd better keep silent or evasive on the subject.

See more on this in my post Opponent Is Obama, Not Bernanke - FR post #15 / IBD, 2011 October 18

38 posted on 10/21/2011 8:49:16 PM PDT by CutePuppy (If you don't ask the right questions you may not get the right answers)
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To: Pelham
And before the FR Act JP Morgan's bank operated as our defacto central bank. Before the Fed the economy was already dominated by private banking.

Exactly. As, I am sure, you know, it was the financial panic of 1907 that J.P. Morgan himself handled by brow-beating the presidents of the largest banks to work in concert and/or pool resources and loan money to the banks which were rumored to be failing and were under or subject to imminent run-on-the-bank.

This staved off the chain reaction of failing banks and the panic was soon over, disaster was averted.

This also showed the weaknesses in the "banking system" and that it was pretty much dependent on one man - Jonathan Pierpont Morgan - for its survival, and thus the idea of having a central bank gained strength.

J.P. Morgan died in 1913, the year when Federal Reserve Act took place and the Fed was born. It accommodated concerns of both the government and the private banks.

39 posted on 10/21/2011 9:07:06 PM PDT by CutePuppy (If you don't ask the right questions you may not get the right answers)
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To: RepRivFarm

Since you are apparently arguing that ownership shares (and thus potential control if enough are owned) of the Federal Reserve can be purchased by private individuals, please tell me where I can buy them. Are they traded on the stock exchange? Again, please give me the contact information of the person or entity that sells them.


40 posted on 10/22/2011 3:45:19 PM PDT by Captain Kirk
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