independent and unofficial
Prince fan community site
Thu 22nd Aug 2019 7:23am
Welcome! Sign up or enter username and password to remember me
Forum jump
Forums > Politics & Religion > End The Fed by Ron Paul
« Previous topic  Next topic »
Page 1 of 2 12>
  New topic   Printable     (Log in to 'subscribe' to this topic)
Author

Tweet     Share

Message
Thread started 10/24/11 4:43pm

V10LETBLUES

End The Fed by Ron Paul

Mainstream media, as far as I know has not delved too deeply into this matter. I myself know very little about this movement. I am posting this as a refresher for those of us not well versed in the ideology behind this.

You're welcome.

Those of you better versed in this issue, please feel free to help us out this.

End the Fed

by Ron Paul

Madame Speaker, I rise to introduce legislation to restore financial stability to America's economy by abolishing the Federal Reserve. Since the creation of the Federal Reserve, middle and working-class Americans have been victimized by a boom-and-bust monetary policy. In addition, most Americans have suffered a steadily eroding purchasing power because of the Federal Reserve's inflationary policies. This represents a real, if hidden, tax imposed on the American people.

From the Great Depression, to the stagflation of the seventies, to the current economic crisis caused by the housing bubble, every economic downturn suffered by this country over the past century can be traced to Federal Reserve policy. The Fed has followed a consistent policy of flooding the economy with easy money, leading to a misallocation of resources and an artificial "boom" followed by a recession or depression when the Fed-created bubble bursts.

With a stable currency, American exporters will no longer be held hostage to an erratic monetary policy. Stabilizing the currency will also give Americans new incentives to save as they will no longer have to fear inflation eroding their savings. Those members concerned about increasing America's exports or the low rate of savings should be enthusiastic supporters of this legislation.

Though the Federal Reserve policy harms the average American, it benefits those in a position to take advantage of the cycles in monetary policy. The main beneficiaries are those who receive access to artificially inflated money and/or credit before the inflationary effects of the policy impact the entire economy. Federal Reserve policies also benefit big spending politicians who use the inflated currency created by the Fed to hide the true costs of the welfare-warfare state. It is time for Congress to put the interests of the American people ahead of special interests and their own appetite for big government.

Abolishing the Federal Reserve will allow Congress to reassert its constitutional authority over monetary policy. The United States Constitution grants to Congress the authority to coin money and regulate the value of the currency. The Constitution does not give Congress the authority to delegate control over monetary policy to a central bank. Furthermore, the Constitution certainly does not empower the federal government to erode the American standard of living via an inflationary monetary policy.

In fact, Congress' constitutional mandate regarding monetary policy should only permit currency backed by stable commodities such as silver and gold to be used as legal tender. Therefore, abolishing the Federal Reserve and returning to a constitutional system will enable America to return to the type of monetary system envisioned by our nation's founders: one where the value of money is consistent because it is tied to a commodity such as gold. Such a monetary system is the basis of a true free-market economy.

In conclusion, Mr. Speaker, I urge my colleagues to stand up for working Americans by putting an end to the manipulation of the money supply which erodes Americans' standard of living, enlarges big government, and enriches well-connected elites, by cosponsoring my legislation to abolish the Federal Reserve.

  - E-mail - orgNote - Report post to moderator
Reply #1 posted 10/24/11 4:54pm

V10LETBLUES

Here is the link to Ron's book on Amazon

8 new from $8.28 23 used from $6.93

http://www.amazon.com/End...amp;sr=8-4

From Publishers Weekly

At first glance, abolishing the Federal Reserve and returning to the gold standard seems a quaintly eccentric idea, but Texas congressman Paul presents a plan to eliminate our country's central bank, and return to a private banking system, that's both serious and plausible. The questionable aspects involve Paul's predicted results: not only will ending the Fed eliminate inflation (the government cannot print more money than it has gold reserves), but also business booms and busts, wars, income inequality, trade imbalances and the growth of government. Further, and perhaps most important, it would "disempower the secretive cartel of powerful money managers who exercise disproportionate influence over the conduct of public policy." Paul tends to gloss over those periods in history, including the Panic of 1907, in which private banking and the gold standard were law: "the bad reputation of nineteenth century American banking... is largely the result of... propaganda agitating for the creation of the Fed." With respect to "secretive cartels," Paul takes up the interesting question of whether J.P. Morgan is in fact preferable to Ben Bernanke. An engaging response to big-government solutions for the financial crisis, this knowledgeable and opinionated look at U.S. economics, from a firebrand public servant, should provoke much thought.
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.

Review

"Rarely has a single book not only challenged, but decisively changed my mind. "
--Arlo Guthrie

"Everyone must read this book--Congressmen and college students, Democrats and Republicans--all Americans."
--Vince Vaughn

You're welcome!

  - E-mail - orgNote - Report post to moderator
Reply #2 posted 10/24/11 5:00pm

V10LETBLUES

Occupy Wall ST. protester sums it up.

  - E-mail - orgNote - Report post to moderator
Reply #3 posted 10/24/11 5:00pm

lezama

avatar

While I applaud his efforts to abolish this institution, he's not building momentum for this to ever take place. What needs to happen for something of that magnitude to take hold is for significant efforts at the level of the think tanks and lobbies in washington, and thats just not happening. He needs to take a number from the book of Ralph Nader and start establishing some public advocacy 501c4 organizations to get people to see this in concrete actionable terms.

Change it one more time..
  - E-mail - orgNote - Report post to moderator
Reply #4 posted 10/26/11 7:31am

DarlingDiana

lezama said:

While I applaud his efforts to abolish this institution, he's not building momentum for this to ever take place. What needs to happen for something of that magnitude to take hold is for significant efforts at the level of the think tanks and lobbies in washington, and thats just not happening. He needs to take a number from the book of Ralph Nader and start establishing some public advocacy 501c4 organizations to get people to see this in concrete actionable terms.

He went from getting almost no support for auditing the Fed when he first tried it, to getting 319 co-sponsors. Now some of of his fellow Republican candidates are talking about it (Newt Gingrich, Rick Perry) and these are establishment guys who don't usually buck the system. There are a lot of people talking about it in the mainstream media. Judge Napolitano, John Stossel, Dylan Ratigan, all talk about the issue often and are all on major cable news networks. Polls show that anywhere from 60%-80% of the public want full audits of the Fed on a regular basis.

Ralph Nader should take a page out of his own book. He's 100% on Ron Paul's side on this issue too. So is Denis Kucinich and Bernie Sanders. There are a few national politicals who speak about this issue often. And not just auditing the Fed either. Actually ending the Fed. And there are think tanks doing good work on this issue, such as the Cato institute. Just Google "Cato Institute" and "Federal Reserve" for a bunch of reports they've released about either doing away with the Federal Reserve, or making it more transparent.

A lot more work has been done on this issue, and a lot more progress has been made, then you might think at first. Positive change doesn't happen over night.

  - E-mail - orgNote - Report post to moderator
Reply #5 posted 10/29/11 1:08pm

EmbattledWarri
or

I'm actually for regular Audits of the FED, I never liked the fact that they answered to no one. Disrupts the system of checks and balances.

It should be more transperent and I think they should have to go to congress, in order to pass their monetary polcies.

I am a Rail Road, Track Abandoned
With the Sunset forgetting, i ever Happened
http://www.myspace.com/stolenmorning
  - E-mail - orgNote - Report post to moderator
Reply #6 posted 10/29/11 1:23pm

V10LETBLUES

EmbattledWarrior said:

I'm actually for regular Audits of the FED, I never liked the fact that they answered to no one. Disrupts the system of checks and balances.

It should be more transperent and I think they should have to go to congress, in order to pass their monetary polcies.

Yikes!

I agree that there should be regular audits, but doesn't taking Fed policy to congress just make it guaranteed it will end up being further corrupted and bogged down in the swamp and gridlock of today's dysfunctional congress?

  - E-mail - orgNote - Report post to moderator
Reply #7 posted 10/29/11 3:00pm

DarlingDiana

V10LETBLUES said:

EmbattledWarrior said:

I'm actually for regular Audits of the FED, I never liked the fact that they answered to no one. Disrupts the system of checks and balances.

It should be more transperent and I think they should have to go to congress, in order to pass their monetary polcies.

Yikes!

I agree that there should be regular audits, but doesn't taking Fed policy to congress just make it guaranteed it will end up being further corrupted and bogged down in the swamp and gridlock of today's dysfunctional congress?

God forbid we might bog down the government. wink

Don't give me yet another reason to want to end the Fed. lol

  - E-mail - orgNote - Report post to moderator
Reply #8 posted 10/29/11 3:21pm

V10LETBLUES

DarlingDiana said:

V10LETBLUES said:

Yikes!

I agree that there should be regular audits, but doesn't taking Fed policy to congress just make it guaranteed it will end up being further corrupted and bogged down in the swamp and gridlock of today's dysfunctional congress?

God forbid we might bog down the government. wink

Don't give me yet another reason to want to end the Fed. lol

lol

  - E-mail - orgNote - Report post to moderator
Reply #9 posted 10/29/11 3:47pm

V10LETBLUES

Federal Reserve FAQ

Doug Tillett of the Federal Reserve Bank of New York and David Humphrey of Florida State University. For more on the Fed, see their Web site.

Originally posted Friday, March 23, 2001, at 11:25 AM ET

What is the job of the Federal Reserve System?

The Fed's main job is to keep the economy strong through monetary policy--that is, managing the amount of money and credit available throughout the economy. When the president and Congress make decisions on taxes and government spending, they are affecting fiscal policy.

How exactly does the Fed move interest rates?

First a little background. Rules that govern the banking system dictate that banks cannot loan out all their money but have to keep a required amount in reserve. That money does not earn interest, but banks that find themselves with an excess of reserves can loan that money to banks that are short on reserves. The amount one bank charges to another for those loans is called the federal funds rate. When the Fed met on March 20 and cut its target for a key interest rate by half a percentage point to 5 percent, it was the federal funds rate that they were cutting. So, why should some technical transaction between banks affect average Americans? Because the target that the Fed sets--in particular whether they have raised or lowered interest rates--is the rate on which most other rates of credit are based. When the Fed acts, banks immediately adjust their prime lending rate, which affects mortgage rates, credit card rates, car loan rates, etc.

What is the mechanism by which the Fed changes the federal funds rate?

Eight times a year the Fed holds a meeting of the Federal Open Market Committee. The committee consists of the Board of Governors of the Fed--the chairman is Alan Greenspan--and the presidents of five of the 12 regional Federal Reserve banks. At this meeting they decide whether or not to loosen or tighten credit--that is, whether they want to lower or raise the federal funds rate. If they want to loosen credit, as was the case on March 20, because they feel the economy is slumping, the Fed will buy government securities on the open market. The mechanism through which these securities are purchased ends up injecting money into the banking system, making available more money to loan to businesses and consumers. If the Fed wants to head off an inflation threat by tightening credit, it will sell government securities, which takes money out of the banking system.

It seems like Alan Greenspan has been chairman forever. Isn't there some limit on how long anyone can serve?

Yes. Members of the Fed's Board of Governors are appointed by the president and confirmed by the Senate to a single 14-year term. However, someone appointed to fill an unexpired term can subsequently serve an additional full term. That is what happened with Greenspan. He first took office in 1987 and will end his full term in June 2006. He is now serving his fourth four-year term as chairman, which expires in 2004, the longest serving chairman since the Fed was founded in 1913. During his presidential campaign, Sen. John McCain suggested that in the event of Greenspan's untimely demise, he would simply prop him up, put some sunglasses on him and keep him in office.

How many members of the Board of Governors are there?

There are supposed to be seven, but there are currently two vacancies. President Clinton proposed a replacement, but the Republican-led Senate refused to proceed with confirmation. Four members are required for a quorum.

Can anyone tell the Fed what to do about interest rates?

Neither the executive or legislative branch can change or veto a Fed decision. But Congress does have oversight of the Fed and can pass legislation to add to or modify its duties.

Let's say the president really, really hates the Fed chairman. Can he fire him?

The president does have the power to remove a member of the Board of Governors, but only for cause. Cause in this case would mean something like the chairman got the keys to the vault and was found stuffing his pockets with bullion.




[Edited 10/29/11 15:49pm]

  - E-mail - orgNote - Report post to moderator
Reply #10 posted 10/29/11 6:07pm

EmbattledWarri
or

V10LETBLUES said:

EmbattledWarrior said:

I'm actually for regular Audits of the FED, I never liked the fact that they answered to no one. Disrupts the system of checks and balances.

It should be more transperent and I think they should have to go to congress, in order to pass their monetary polcies.

Yikes!

I agree that there should be regular audits, but doesn't taking Fed policy to congress just make it guaranteed it will end up being further corrupted and bogged down in the swamp and gridlock of today's dysfunctional congress?

Well just because our current congress is dysfunctional, doesn't mean it shouldn't go through it.

If congress was truly seperated from the private sector, it would be good idea.

It restors some form of checks and balances.

I don't like the idea of one body making monetary policy without some type of supervision.

I am a Rail Road, Track Abandoned
With the Sunset forgetting, i ever Happened
http://www.myspace.com/stolenmorning
  - E-mail - orgNote - Report post to moderator
Reply #11 posted 10/29/11 6:22pm

DarlingDiana

EmbattledWarrior said:

V10LETBLUES said:

Yikes!

I agree that there should be regular audits, but doesn't taking Fed policy to congress just make it guaranteed it will end up being further corrupted and bogged down in the swamp and gridlock of today's dysfunctional congress?

Well just because our current congress is dysfunctional, doesn't mean it shouldn't go through it.

If congress was truly seperated from the private sector, it would be good idea.

It restors some form of checks and balances.

I don't like the idea of one body making monetary policy without some type of supervision.

That is a great idea. Congress should be separated from the private sector. Right on!

  - E-mail - orgNote - Report post to moderator
Reply #12 posted 10/29/11 6:33pm

V10LETBLUES

EmbattledWarrior said:

V10LETBLUES said:

Yikes!

I agree that there should be regular audits, but doesn't taking Fed policy to congress just make it guaranteed it will end up being further corrupted and bogged down in the swamp and gridlock of today's dysfunctional congress?

Well just because our current congress is dysfunctional, doesn't mean it shouldn't go through it.

If congress was truly seperated from the private sector, it would be good idea.

It restors some form of checks and balances.

I don't like the idea of one body making monetary policy without some type of supervision.

I completely agree.

  - E-mail - orgNote - Report post to moderator
Reply #13 posted 10/30/11 6:22am

Graycap23

The Fed system is and was corrupt from DAY 1.

  - E-mail - orgNote - Report post to moderator
Reply #14 posted 10/30/11 11:36am

2freaky4church
1

avatar

Why not just change the Fed?

All you others say Hell Yea!! woot!
  - E-mail - orgNote - Report post to moderator
Reply #15 posted 10/30/11 5:05pm

V10LETBLUES

http://en.wikipedia.org/wiki/The_Fed

Purpose

The primary motivation for creating the Federal Reserve System was to address banking panics. Other purposes are stated in the Federal Reserve Act, such as "to furnish an elastic currency, to afford means of rediscounting commercial paper, to establish a more effective supervision of banking in the United States, and for other purposes". Before the founding of the Federal Reserve, the United States underwent several financial crises. A particularly severe crisis in 1907 led Congress to enact the Federal Reserve Act in 1913. Today the Federal Reserve System has broader responsibilities than only ensuring the stability of the financial system.

Current functions of the Federal Reserve System include:

  • To address the problem of banking panics
  • To serve as the central bank for the United States
  • To strike a balance between private interests of banks and the centralized responsibility of government
    • To supervise and regulate banking institutions
    • To protect the credit rights of consumers
  • To manage the nation's money supply through monetary policy to achieve the sometimes-conflicting goals of
    • maximum employment
    • stable prices, including prevention of either inflation or deflation
    • moderate long-term interest rates
  • To maintain the stability of the financial system and contain systemic risk in financial markets
  • To provide financial services to depository institutions, the U.S. government, and foreign official institutions, including playing a major role in operating the nation's payments system
    • To facilitate the exchange of payments among regions
    • To respond to local liquidity needs
  • To strengthen U.S. standing in the world economy

[Edited 10/30/11 17:07pm]

  - E-mail - orgNote - Report post to moderator
Reply #16 posted 10/30/11 7:56pm

DarlingDiana

There were crashes before 1907 and there were crashes, huge crashes like the stock market crash of 1929 that led to a 15 year Great Depression. So the Fed sure did a fucking fantastic job of stabalizing markets. If that was indeed the purpose of creating the Fed. But that was not the purpose of creating the Fed. Come on. Don't be so naive. I understand that any pro-government ideology, whether it's progressivism, democratic-socialism, or what have you, is predicated on the unrestrained vision that government is a collection of well-meaning, selfless, upstanding citizens who we have elected to represent us. But there's that and there's reality. We're seeing that reality in the faces of the hundreds and thousands of people who are occupying the cities because they know their government is corrupt and they're mad as hell. So to think that the government of 1913 was any more of a body of angels than the government of 2011 is naive at best. Let alone to think the bankers of 1913 were any less corrupt than they are in 2011. You know better.

http://en.wikipedia.org/w...al_Reserve

There's a little history into the creation of the Fed. The Federal Reserve Act was drafted in secret, in a private exclusive club, by the most powerful bankers in the world. But of course they did it out of benevolence, not self interest. There's no way they were setting up a system which would give them more power. It was just to make sure a panic like we experienced in 1907 didn't happen again. Until 1929 that is. A Great Depression many economists say the Federal Reserve created. Many economists will say the Federal Reserve caused the recent recession to by keeping interest rates too low leading to speculative trading. So they haven't exactly lived up to their stated purpose. What they have done a good job doing though is making the banks more powerful. Hmm, I wonder if that might have been more along the lines of the real motivation for setting up the Fed. No, can't be.

[Edited 10/30/11 20:16pm]

  - E-mail - orgNote - Report post to moderator
Reply #17 posted 10/30/11 8:14pm

V10LETBLUES

DarlingDiana said:

That was not the purpose of creating the Fed. Come on. Don't be so naive. I understand the any pro-government ideology, whether it's progressivism, democratic-socialism, or what have you, is predicated on the unrestrained vision that government is a collection of well-meaning, selfless, upstanding citizens who we have elected to represent us. But there's that and there's reality. We're seeing that reality in the faces of the hundreds and thousands of people who are occupying the cities because they know their government is corrupt and they're mad as hell. So to think that the government of 1913 was any more of a body of angels than the government of 2011 is naive at best. Let alone to think the bankers of 1913 were any less corrupt than they are in 2011. You know better.

http://en.wikipedia.org/w...al_Reserve

There's a little history into the creation of the Fed. The Federal Reserve Act was drafted in secret, in a private exclusive club, by the most powerful bankers in the world. But of course they did it out of benevolence, not self interest. There's no way they were setting up a system which would give them more power.

[Edited 10/30/11 20:01pm]

Are you doubting the credibility of Wikipedia?

....by the way I made changes to your Wikipedia link.

  - E-mail - orgNote - Report post to moderator
Reply #18 posted 10/30/11 8:22pm

DarlingDiana

V10LETBLUES said:

DarlingDiana said:

That was not the purpose of creating the Fed. Come on. Don't be so naive. I understand the any pro-government ideology, whether it's progressivism, democratic-socialism, or what have you, is predicated on the unrestrained vision that government is a collection of well-meaning, selfless, upstanding citizens who we have elected to represent us. But there's that and there's reality. We're seeing that reality in the faces of the hundreds and thousands of people who are occupying the cities because they know their government is corrupt and they're mad as hell. So to think that the government of 1913 was any more of a body of angels than the government of 2011 is naive at best. Let alone to think the bankers of 1913 were any less corrupt than they are in 2011. You know better.

http://en.wikipedia.org/w...al_Reserve

There's a little history into the creation of the Fed. The Federal Reserve Act was drafted in secret, in a private exclusive club, by the most powerful bankers in the world. But of course they did it out of benevolence, not self interest. There's no way they were setting up a system which would give them more power.

[Edited 10/30/11 20:01pm]

Are you doubting the credibility of Wikipedia?

....by the way I made changes to your Wikipedia link.

I'm doubting that you'd be so naive to believe an institution created in secret by banksters, that caused two of the worst economic recessions/depressions in US history, was created to stop exactly what it later caused.

Wikipedia can't exactly say that the Federal Reserve was created to make banks more powerful. That's a conclusion you have to draw from the information it gives you. I actually am a fan of Wikipedia for all its criticism for being open to editing by anyone. I like that model. It's kind of anarchic which you know tickles my libertarian fancy.

[Edited 10/30/11 20:22pm]

  - E-mail - orgNote - Report post to moderator
Reply #19 posted 10/31/11 4:34am

Tremolina

V10LETBLUES said:

EmbattledWarrior said:

Well just because our current congress is dysfunctional, doesn't mean it shouldn't go through it.

If congress was truly seperated from the private sector, it would be good idea.

It restors some form of checks and balances.

I don't like the idea of one body making monetary policy without some type of supervision.

I completely agree.

Firstly, congress "truly seperated from the private sector" is an illusion. Secondly, putting the power of monetary policy in the hands of politicians is even more dangerous than putting it in the hands of banks. Congress cannot even be expected to have a fiscal policy that is in the interest of the entire nation, guess what they would do when they would have the monetary power too?

  - E-mail - orgNote - Report post to moderator
Reply #20 posted 10/31/11 4:36am

Tremolina

DarlingDiana said:

an institution created in secret by banksters, that caused two of the worst economic recessions/depressions in US history, was created to stop exactly what it later caused.

Perhabs you and Ron need to make your case first that the Fed was responsible for that.

So far it's just an empty talking point meant to manipulate opinion.

  - E-mail - orgNote - Report post to moderator
Reply #21 posted 10/31/11 4:54am

Tremolina

V10LETBLUES said:

EmbattledWarrior said:

I'm actually for regular Audits of the FED, I never liked the fact that they answered to no one. Disrupts the system of checks and balances.

It should be more transperent and I think they should have to go to congress, in order to pass their monetary polcies.

Yikes!

I agree that there should be regular audits, but doesn't taking Fed policy to congress just make it guaranteed it will end up being further corrupted and bogged down in the swamp and gridlock of today's dysfunctional congress?

There are audits of the Fed, just not an audit of everything,which is what Paul wants. But you can't audit every decision they make, because some of their decision making has to stay secret. Tthis is the case with all central banks in the world, since bringing everything out in the open completely or too soon, could very negatively effect markets and the economy, or play into the advantage of adversaries.

Going through Congress ensures a limp dick monetary policy. Central banks need to be able to decide over matters like setting the interest rate, independently and quickly, without political approval, that could change any day, and that is vulnerable to conflicts of interests and corruption. In fact, letting Congress decide it all, doesn't only mean that, it also means that people with no real knowledge of monetary affairs will be making the decicions. That will sooner lead to new crises than any central bank system.

[Edited 10/31/11 4:56am]

  - E-mail - orgNote - Report post to moderator
Reply #22 posted 10/31/11 10:14am

angel345

Tremolina said:

V10LETBLUES said:

Yikes!

I agree that there should be regular audits, but doesn't taking Fed policy to congress just make it guaranteed it will end up being further corrupted and bogged down in the swamp and gridlock of today's dysfunctional congress?

There are audits of the Fed, just not an audit of everything,which is what Paul wants. But you can't audit every decision they make, because some of their decision making has to stay secret. Tthis is the case with all central banks in the world, since bringing everything out in the open completely or too soon, could very negatively effect markets and the economy, or play into the advantage of adversaries.

Going through Congress ensures a limp dick monetary policy. Central banks need to be able to decide over matters like setting the interest rate, independently and quickly, without political approval, that could change any day, and that is vulnerable to conflicts of interests and corruption. In fact, letting Congress decide it all, doesn't only mean that, it also means that people with no real knowledge of monetary affairs will be making the decicions. That will sooner lead to new crises than any central bank system.

[Edited 10/31/11 4:56am]

Alan Greenspan says the Federal Reserve is not audited. They're above the law.

  - E-mail - orgNote - Report post to moderator
Reply #23 posted 10/31/11 10:38am

Graycap23

Read this:

http://www.commondreams.org/headline/2011/08/28-3

  - E-mail - orgNote - Report post to moderator
Reply #24 posted 10/31/11 10:53am

Tremolina

angel345 said:

Tremolina said:

There are audits of the Fed, just not an audit of everything,which is what Paul wants. But you can't audit every decision they make, because some of their decision making has to stay secret. Tthis is the case with all central banks in the world, since bringing everything out in the open completely or too soon, could very negatively effect markets and the economy, or play into the advantage of adversaries.

Going through Congress ensures a limp dick monetary policy. Central banks need to be able to decide over matters like setting the interest rate, independently and quickly, without political approval, that could change any day, and that is vulnerable to conflicts of interests and corruption. In fact, letting Congress decide it all, doesn't only mean that, it also means that people with no real knowledge of monetary affairs will be making the decicions. That will sooner lead to new crises than any central bank system.

[Edited 10/31/11 4:56am]

Alan Greenspan says the Federal Reserve is not audited. They're above the law.

No, they are not. Like I said they ARE audited, by law, but there are not audits of everything. You may feel that is not enough, like Paul and many others, including yours truly, but that doesn't mean they aren't audited at all. Let alone "above the law". For example we may know the total balance of what goes in and out of the fed, but not what their exact motivations for their monetary policy were. This particularity is not exclusive to the Fed but to all central banks. Like I explained before, this is necessary to prevent abuse of foreknowledge and economic disruptions. It's why you always see the heads of central banks talk very carefully, so they not so too much, nor too little.

Read up on it

http://en.wikipedia.org/w...untability

[Edited 10/31/11 10:54am]

  - E-mail - orgNote - Report post to moderator
Reply #25 posted 10/31/11 11:22am

Tremolina

Graycap23 said:

Read this:

http://www.commondreams.org/headline/2011/08/28-3

Seriously, that was known before already and most politicians in congress agreed with it. Better yet, it was EXPECTED from the Fed to do this. Because without the help of the fed lending many trillions more to (crucial) banks and other financial institutions, all those institutions would have fallen, letting the economy 'crash' much, much worse than so far is the case with this 'crunch'. Worse yet, without the help of the fed, lending the US government also many trillions in dollars, the US government itself would have defaulted many, many times already.

  - E-mail - orgNote - Report post to moderator
Reply #26 posted 10/31/11 12:19pm

angel345

Tremolina said:

angel345 said:

Alan Greenspan says the Federal Reserve is not audited. They're above the law.

No, they are not. Like I said they ARE audited, by law, but there are not audits of everything. You may feel that is not enough, like Paul and many others, including yours truly, but that doesn't mean they aren't audited at all. Let alone "above the law". For example we may know the total balance of what goes in and out of the fed, but not what their exact motivations for their monetary policy were. This particularity is not exclusive to the Fed but to all central banks. Like I explained before, this is necessary to prevent abuse of foreknowledge and economic disruptions. It's why you always see the heads of central banks talk very carefully, so they not so too much, nor too little.

Read up on it

http://en.wikipedia.org/w...untability

[Edited 10/31/11 10:54am]

I meant in so many words, this is what Greenspan stated:

http://www.youtube.com/wa...l3mEe8TH7w I didn't know the Federal Reserve has its first audit, since this interview. He also stated in another one that he's not responsible for the economic crisis, and he is still part of Obama's administration which is predominately bankers, though Bernake is current chairman. Why was Congress forced to sign approval on the funds to bailout banks? I saw something on that. Also, if Greenspan claims he's not responsible for this economic crisis, and Congress was forced to sign that bill, exactly who is really pulling the strings of government? Bernake is not taking the blame for this.

  - E-mail - orgNote - Report post to moderator
Reply #27 posted 10/31/11 12:21pm

angel345

Graycap23 said:

Read this:

http://www.commondreams.org/headline/2011/08/28-3

Thank you, Graycap.

  - E-mail - orgNote - Report post to moderator
Reply #28 posted 10/31/11 12:23pm

DarlingDiana

Tremolina said:

DarlingDiana said:

Perhabs you and Ron need to make your case first that the Fed was responsible for that.

So far it's just an empty talking point meant to manipulate opinion.

Here's how Friedman summed up his views on the Fed and the Depression in an Oct. 1, 2000, interview with PBS:

PBS:
You've written that what really caused the Depression was mistakes by the government. Looking back now, what in your view was the actual cause?

Friedman: Well, we have to distinguish between the recession of 1929, the early stages, and the conversion of that recession into a major catastrophe.

The recession was an ordinary business cycle. We had repeated recessions over hundreds of years, but what converted [this one] into a major depression was bad monetary policy.

The Federal Reserve System had been established to prevent what actually happened. It was set up to avoid a situation in which you would have to close down banks, in which you would have a banking crisis. And yet, under the Federal Reserve System, you had the worst banking crisis in the history of the United States. There's no other example I can think of, of a government measure which produced so clearly the opposite of the results that were intended.

And what happened is that [the Federal Reserve] followed policies which led to a decline in the quantity of money by a third. For every $100 in paper money, in deposits, in cash, in currency, in existence in 1929, by the time you got to 1933 there was only about $65, $66 left. And that extraordinary collapse in the banking system, with about a third of the banks failing from beginning to end, with millions of people having their savings essentially washed out, that decline was utterly unnecessary.

At all times, the Federal Reserve had the power and the knowledge to have stopped that. And there were people at the time who were all the time urging them to do that. So it was, in my opinion, clearly a mistake of policy that led to the Great Depression.



Read more:Bernanke: Federal Reserve...Depressionhttp://www.wnd.com/?pageI...z1cOA4Jcoq

At a Nov. 8, 2002, conference to honor Friedman's 90th birthday, Bernanke, then a Federal Reserve governor, gave a speech at Friedman's old home base, the University of Chicago. Here's a bit of what Bernanke, the man who now runs the Fed – and thus, one of the most powerful people in the world – had to say that day:

I can think of no greater honor than being invited to speak on the occasion of Milton Friedman's ninetieth birthday. Among economic scholars, Friedman has no peer. …

Today I'd like to honor Milton Friedman by talking about one of his greatest contributions to economics, made in close collaboration with his distinguished coauthor, Anna J. Schwartz. This achievement is nothing less than to provide what has become the leading and most persuasive explanation of the worst economic disaster in American history, the onset of the Great Depression – or, as Friedman and Schwartz dubbed it, the Great Contraction of 1929-33.

… As everyone here knows, in their "Monetary History" Friedman and Schwartz made the case that the economic collapse of 1929-33 was the product of the nation's monetary mechanism gone wrong. Contradicting the received wisdom at the time that they wrote, which held that money was a passive player in the events of the 1930s, Friedman and Schwartz argued that "the contraction is in fact a tragic testimonial to the importance of monetary forces."

After citing how Friedman and Schwartz documented the Fed's continual contraction of the money supply during the Depression and its aftermath – and the subsequent abandonment of the gold standard by many nations in order to stop the devastating monetary contraction – Bernanke adds:

Before the creation of the Federal Reserve, Friedman and Schwartz noted, bank panics were typically handled by banks themselves – for example, through urban consortiums of private banks called clearinghouses. If a run on one or more banks in a city began, the clearinghouse might declare a suspension of payments, meaning that, temporarily, deposits would not be convertible into cash. Larger, stronger banks would then take the lead, first, in determining that the banks under attack were in fact fundamentally solvent, and second, in lending cash to those banks that needed to meet withdrawals. Though not an entirely satisfactory solution – the suspension of payments for several weeks was a significant hardship for the public – the system of suspension of payments usually prevented local banking panics from spreading or persisting. Large, solvent banks had an incentive to participate in curing panics because they knew that an unchecked panic might ultimately threaten their own deposits.
It was in large part to improve the management of banking panics that the Federal Reserve was created in 1913. However, as Friedman and Schwartz discuss in some detail, in the early 1930s the Federal Reserve did not serve that function. The problem within the Fed was largely doctrinal: Fed officials appeared to subscribe to Treasury Secretary Andrew Mellon's infamous 'liquidationist' thesis, that weeding out "weak" banks was a harsh but necessary prerequisite to the recovery of the banking system. Moreover, most of the failing banks were small banks (as opposed to what we would now call money-center banks) and not members of the Federal Reserve System. Thus the Fed saw no particular need to try to stem the panics. At the same time, the large banks – which would have intervened before the founding of the Fed – felt that protecting their smaller brethren was no longer their responsibility. Indeed, since the large banks felt confident that the Fed would protect them if necessary, the weeding out of small competitors was a positive good, from their point of view.

In short, according to Friedman and Schwartz, because of institutional changes and misguided doctrines, the banking panics of the Great Contraction were much more severe and widespread than would have normally occurred during a downturn. …

Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again.

Best wishes for your next ninety years.



Read more:Bernanke: Federal Reserve...Depressionhttp://www.wnd.com/?pageI...z1cOAhoBso

  - E-mail - orgNote - Report post to moderator
Reply #29 posted 10/31/11 3:04pm

Tremolina

^

Let's first assess that Milton Friedman changed his mind several times during his carreer. First he was for Keynesian monetary policy ("stimulance"), then he was very much against it for most of his carreer (classical "inflation control") and then in the end, he was more or less for it again. He may have been one of the most influential economists of the 20th century, but he certainly wasn't the most consistent.

Friedman's ideas moreover were very much adopted by the Reagan administration. And also Thatcher in the UK. It was under Reagan and Thatcher, in fact, that the US and UK governments started letting go of control over the financial markets and it was also under Reagan that the current US government debt crisis was born.

So there goes your point already about "an institution created in secret by banksters, that caused two of the worst economic recessions/depressions in US history, was created to stop exactly what it later caused". The Fed was not created "in secret" but was set up by LAW of CONGRESS. And it did NOT cause "two of the worst rercessions/depressions in US history".

It is correct, that it was set up to deal with those kind of economic cycles as best as possible for the nation's well being. And so you can disagree on whether they have done so, or not. But you cannot just talk sensational nonsense.

....

So at the end of his life, Friedman came back on some of his long time mistakes of focusing too much on classic inflation control and not also stimulance, to blame just the government for the Great Depression and not also the Fed, and to oppose other price control mechanisms like wages as "too much government", instead of also embracing those. Why do you think he did that?

When you read closely what he says, he says that the Fed initially did not actually cause that already deep economic recession, but that its monetary policies at the time were so bad, that it was turned into a severe depression.

Now what were those terrible policies by the Fed at the time? They were NOT Keynesian, like the current Fed and Obama's policies are now (but Congress blocks). The Fed back then did not want to lower interest rates much, did not want to bail out many of the failed banks and did not want to put more money into the economy to stimulate (job) growth and tackle the recession.

NOPE: not willing to help out (especially many smaller) banks and afraid of inflation going out of control, they did the OPPOSITE. They did not lower interest rates to make it much cheaper to borrow money and get the system rolling again, they did not bail out bad banks, but instead let them go down, including all the savings money they carried and thereby they also did not pump enormous amounts of money into the economy, but instead took an enormous amount out of it, leading to one the biggest downturns in the US economy, plus the world, ever. See also:

And what happened is that [the Federal Reserve] followed policies which led to a decline in the quantity of money by a third. For every $100 in paper money, in deposits, in cash, in currency, in existence in 1929, by the time you got to 1933 there was only about $65, $66 left. And that extraordinary collapse in the banking system, with about a third of the banks failing from beginning to end, with millions of people having their savings essentially washed out, that decline was utterly unnecessary.

THAT is what deepened that recession into a depression, but it wasn't the underlying cause. That was an already very weak economy, enormous unemplyment, terrible economic government policies and an unreliable banking and Fed system still leading to uncontrollable bank raids, many banks failing and thereby the loss of enormous amounts of money and wealth.

These days, what do we see the Obama administration and the Fed try to do (but the republicans oppose)? Like true Keynesians they try to stimulate the economy out of the recession.

So, no the Fed is not the cause of this crisis, nor of the great depression. It DOES play a very important part in both, true. In the first a bad and currently a more positive one. But they are not "the cause".

The true causes of the current crisis lie in RR's policies, that started the deregulation of the financial markets and that were completed under GWB II, as well as in institutionalised greed by many of the big financial players, as well as with many millions of ignorant and careless consumers.

[Edited 10/31/11 15:44pm]

  - E-mail - orgNote - Report post to moderator
Page 1 of 2 12>
  New topic   Printable     (Log in to 'subscribe' to this topic)
« Previous topic  Next topic »
Forums > Politics & Religion > End The Fed by Ron Paul