Karl Denninger reports that Representative Cummings, along with a half-dozen other Representatives, have had enough of The Fed’s games. They are now calling for a full congressional review of the entire Federal Reserve system, including a full public audit.
Here are the Fed’s origins.
Here are its owners.
Try The Ascent of Money [hat tip Wolfie]
Sonus on the Fed:
Try this vid for an explanation of how it came about and operates.
Here is a website that looks at the prices of housing from 1890, to present, and adjusts them for inflation. It shows vividly the vast over valuation of housing currently, so let’s say the land valuation could drop to £75,000, that is still a vast devaluation of the £ from the £2,500 purchase price.
The mistake that MOST thinkers make is to consider the currency as fixed and commodity prices as increasing. Such thinking is particularly useful to Fiat governments. It disguises their theft of the savings of the populace, and their reneging on their future liabilities, eg, for pensions.
A Fiat system cannot be deflationary without ultimately imploding. It struggles to exist profitably in near zero inflation (equilibrium). It can best exist in a “growth” situation, that is, where increasing levels of credit/debt are being created, – the classical western “growth model” of western economies.
Here is an excellent summary of the above issues.
Towards the end of a Fiat currency life-span, when debt levels are becoming difficult to repay, the tendency on the part of the authorities to cheat, to hide the facts from the voters, increases.
As the cheating persists, the studied avoidance of tough decisions is evaded by repeated bubble blowing that creates the illusion of economic well-being, but is merely an increase in private, and public Debt levels There has been no REAL increase in GDP for the previous decade, despite political spin.
Today inflation statistics are grossly manipulated, as are unemployment statistics, as are GDP statistics, together with most global commodities.
The Working Group on Financial Markets (also known as the President’s Working Group on Financial Markets, the Working Group, and colloquially the Plunge Protection Team) was created by Executive Order 12631, signed on March 18th, 1988, by United States President Ronald Reagan.
Parts of the Executive were now free, and instructed to, manipulate “free” markets, in order to help create the illusion of financial stability. The Fiat system, and the excessive use of debt, was beginning to show signs of stress.
Safe Haven explains that the working group has recently become far more pro-active in the markets, using money from the Fed, and linking it to the cessation in the publishing by the Fed, of M3, as increases in M3 were predictive of future market manipulations.
In other words, Fed created money was being used for market manipulation. Was there a legal mandate for that?
Then came Markopolos ad the UK dodgy business. The revolving door of UK regulation was exposed by English bloggers.
On Feb 14th 2008, Elliot Spitzer, US Attorney General penned an article for the Washington Post, “Predatory Lenders Partner in Crime”, explaining Federal corruption in the support for predatory bank lending practices, and explaining that EVERY US state had joined him in seeking curtailment of these practices, but had been prevented from doing so by legal actions of the Federal Gov’t. The Federal Government was complicit in the sub-prime lending that is part of today’s market problems, and was active in defending the practices.
Here is a link explaining it.
Spitzer was crucified.
Ted Butler, an excellent writer, and campaigner for honesty, on the precious metal Silver, a monetary metal, has been pushing the CFTC for over a decade for an investigation of the clear and visible manipulation of the Silver Price, contained in figures published by the CFTC! At times the ounces short have approached the global annual output of Silver, yet in a decade of complaints, no action has been taken. The membership of the head of the CFTC on the Presidential Working Group on Financial Markets, explains the lack of action.
Eddie George and Gold:
“We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore, at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The U.S. Fed was very active in getting the gold price down. So was the U.K.”
Eddie George, Bank of England, September 1999.
Denninger called for:
- The CDS casino must be closed today. The AIG revelations are an outrage – we are sending tens of billions of dollars into AIG to prop up US and foreign banks as a consequence of these swaps? This can be stopped with the stroke of a pen and must happen now. Let the ISDA and bankers scream – suspend all CDS contracts until they are on an exchange with a central counterparty and margin has been established and proved. Those for which margin can’t be established or proved are void as fraudulent upon issue; the money never existed to pay them off. This charade called CDS must end.
- You must pledge to send the FBI after everyone involved in the embezzlement during the previous ten and more years, whether they be borrowers, lenders, bankers or otherwise. Liars on mortgage applications, liars in marketing these securities, liars all around – all must be prosecuted.
- We must separate investment and commercial banking services. Banking is a utility function and it must be safe. We had it right with Glass-Steagall. Make it a priority to reinstate that law and force the breakup of the monsters that have led us to this cliff. If an investment bank wants to play “hedge fund” or “proprietary trading”, fine – but if they blow up they must not be allowed to sink our economy and banking system.
- The Fed must be directed to open their kimono and disclose everything they are doing, daily, including what they’re taking in, from whom, how it is being valued and how it is being “haircut” or margined. Equity investments made by The Fed are clearly unlawful under The Federal Reserve Act and must be immediately disgorged. If The Fed doesn’t like living within the law, then Treasury must go around them and issue Treasury Notes itself; their franchise exists at our pleasure, not the other way around.
- The ongoing charade in our housing market must end. The FHA’s rate of “first payment defaults” has tripled in the last year. Safe mortgages require a significant down payment – at least 10% and more commonly 20% – which means no seller-funded down payment assistance and the end of the 3% FHA down payment. Keep the VA program for our service people but the rest must be scrapped. FHA insured mortgages are a good thing but we must drive the fraudsters out of the mortgage system and prosecute them – we’re not doing it, and it is dramatically exacerbating this crisis.
- Insist that every firm that is traded on a public exchange in The United States produce a consolidated balance sheet and financials without exception – no off-balance sheet games and no BS or tricks. ALL “assets” must be disclosed along with their pricing models. Any firm that refuses is delisted immediately.
“… we conclude that the [Federal] Reserve Banks are not federal … but are independent privately owned and locally controlled corporations… without day to day direction from the federal government.”
Quote by: 9th Circuit Court : Source: Lewis vs United States, June 24, 1982
Prior to 9/11, J P Morgan had sold $2.2 Trillion Treasury Bonds in excess of authorisation by the US Treasury. Those records were in building No 3 of the World Trade Centre.
And here was the face-off.
People, it goes on and on and on and on. And now, only now, has the call come to investigate, not just the smaller banks and other fallguys but the arch criminal of them all – the privately owned Morgan Fed which has held the U.S. to ransom since 1913.
Finally, so many years after Louis McFadden mysteriously died, doe someone stand up and call for this. Keep your eye on the health of Cummings and colleagues two years down the track, with special reference to any aircraft they happen to be travelling on.