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June 23, 2009
fed
A friend recently posted an item about the HR 1207. So, I've been reading up on this bill. Basically, it is an one time audit of the federal reserve board of governors and the banks. It also repeals the ability for a federal regulatory body to consent to an audit of any American bank. GAO will have the ability to audit any bank. Basically, putting the bank auditing power in Congress's hands. Does anyone else see a problem with this?
Keep in mind that GAO already does audit the Fed.
Alexander Hamilton is rolling in his grave. Hamilton is the Fed's true father though Woodrow Wilson signed the bill.
Let's give oversight over banks to Congress who is so good about taking care of its own spending.
Why was the Fed created? - "However, after various financial panics, particularly a severe one in 1907, there was a growing consensus in the American financial community that some sort of banking and currency reform was needed which could provide a ready reserve of liquid assets in case of financial panics and would also provide for a currency that could expand and contract as the seasonal U.S. economy dictated."
Why was the Fed designed this way? - In the current system, private banks are for-profit businesses but government regulation places restrictions on what they can do.
What is the current controversy truly? - Controversy about the Federal Reserve Act and the establishment of the Federal Reserve System have existed since prior to its passage, and include whether Congress has the Constitutional power to delegate its power to coin money or issue paper money, whether the Federal Reserve is a banking cartel established to protect large banks, or whether the Federal Reserves' mistakes increase the frequency and severity of boom-bust economic cycles such as the Great Depression of the 1930s.
Concerning the Fed's role in the Great Depression, I agree that the Fed didn't do anything. To Henry Paulson's and Ben Bernanke's credit, they moved very strongly and quickly during the current economic crisis that was caused by uncontrolled greed from the banker to the man on the street. How otherwise can an idea like "let's making housing affordable" become "I need to live better than my neighbor".
Love of money is the root of all evil. Will handing more auditing control to Congress help? It's strange that nobody in Congress calls an audit for congressional spending. Curious.
Posted by azileretsis at June 23, 2009 06:40 PM
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