Opinions & Editorials

The Fed’s books must be opened

The Federal Reserve Bank of San Francisco at 101 Market St. PHOTO BY GRACIE MALLEY THE GUARDSMAN

By Gary Jay
The Guardsman

In the wake of the financial collapse of 2008, the Federal Reserve Bank has been in the spotlight over allegations of unlawfully handing out taxpayer money to mega-corporations.

The Bank, which is supposed to monitor U.S. currency, has been rapidly losing credibility upon refusing to confirm to Congress what they’ve done with trillions of taxpayer dollars.

The recent confrontations have gotten so heated, Congress is now taking measures to audit the Bank, after many years of neglecting their monetary responsibilities granted in Article One, section 8 of the U.S. Constitution, which include the power to coin and regulate money without a central bank.

The Bank last year was forced to disclose a windfall of documents as a response to the overwhelming pressure by both Congress and Freedom of Information Act requests from the media.

Although the Bank tried to retain its secrecy through its notion of “independence,” criticism of them being more secretive than the CIA forced them to open up more of their books.

The disclosures revealed a series of transactions the Bank made with corporations without congressional authorization, as well as assets they bought up during the 2008 financial crisis.

The Bank bought toxic assets from Lehman Brothers, Bear Sterns, J.P. Morgan and other mega-corporations that were dumped for quick profits.

According to then-Congressman Alan Grayson, who lost his bid for re-election in 2010, the Bank called the assets they had bought up “notional value.”

“When you can make money, when you can create it, when you can just make it appear, everything is notional,” Grayson said to the House of Representatives on May 6, 2010. “That’s all there is.”

The most significant “notional value” was Maiden Lane LLC, which is a series of hotels and houses the Bank bought and labeled “mortgage-backed securities.”

Among them were the Red Roof Inn hotel chain and houses from undisclosed locations.

Grayson also revealed that there was no true oversight of the Federal Reserve when upon his questioning, the Bank’s Inspector General Elizabeth Coleman couldn’t account for $2 trillion that went missing.

The video in which he exposes the Bank’s lack of accountability has been seen on YouTube over 4 million times on the congressman’s channel.

Last year, Rep. Ron Paul almost got a full audit of the Federal Reserve with HR 1207.

Although it passed the House with 320 co-sponsors, the Senate threw it out, demonstrating the kind of influence the Bank still has in Congress.

Now the head of the U.S. House Financial Services Subcommittee on Domestic Monetary Policy and Technology, Paul is now in the process of opening more of the Bank’s books on their recent activities.

This past month the committee has had a few hearings with Federal Reserve officials over job losses, its partnership with Wall Street and its involvement in the manipulation of recent commodity prices, such as copper.

The Federal Reserve is not a government agency but a private bank created on Jekyll Island, Ga. in 1910. Congress entrusted this bank with monitoring the dollar through the passage of the Federal Reserve Act of 1913.

Since its passage, the bank has devalued the dollar by 90 percent through bank notations, derivatives and manipulations.

Those combined with the suspension of the gold and silver standards have been the underlying cause of why food and commodities prices have been rapidly rising.

Read Gary Jay’s complete analysis of the Federal Reserve on The Guardsman Blog Outside the Margins.


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