July 24, 2009 03:01 PM
Dude, Where's My $500,000,000,000?
From an emailer:
This is Democrat Alan Grayson asking Chairman Ben Bernanke where the Federal Reserve sent $500,000,000,000 last year. And Chairman Bernanke doesn't know. He says it went to foreign central banks, but beyond that, he has no idea what those banks did with the money.
Whatever, it's only a half a trillion.
It would be nice to know where our money is going one would think. And with these "beyond Monopoly money" figures that went out to the world---why isn't there any form of accountability? I'll take a page from Bernanke's playbook. I don't know.
Rock Of Ages
The money comes in on pallets and leaves in duffle bags. Everybody is a sherpa when there's money to be carried.
saw it earlier. Probably went to the Rothchild's and Bank of England to pay past due interest fee's for the past 8 years.
what an eight long years it was !
"why isn't there any form of accountability?"
...the anwer is, The Federal Reserve Corporation is not a part of govt. Burnbanke doesnt want or have to answer. (I say audit the fucker)
If you want to learn more, google the federal reserve act of 1913...
...even Ron Paul, who is Burnbanke's "arch enemy" can only chastise him. ...until maybe the audit the fed act is passed.
audit-prosecute-incarcerate
the LoveRevoltShun was on its way.
OK, I don't know if peoplehere enjoy Dylan Ratiger (sp?) on the Morning Meeting, but he and Eliot Spitzer and another guy had a nice role play about this.
Yeah, the Fed is not part of govt, but they were playing with tax dollars. auditing is a good idea.
I wish i had a link to the vid. I'll go look.
here is a link to the video:
http://www.msnbc.msn.com/id/22425001/vp/32124...
is a hybrid public-private charter.
Theoretically, if there was political will, the house could subpoena the board of directors and get all the info on the Fed they want. Key word being "political will."
The main reason why congress/senate don't want to rattle the Fed too much, is that the Fed is one of the main contributors to the treasury. It is obviously questionable the latitude of freedom allowed to the Fed charters, but there seem to be a lot of misconceptions by some of the critics of the Fed. Which is a shame, because their heart is probably in the right place, even though they are waaaaay off kilt in the reality of where things stand regarding the mechanism of operation behind the Fed.
are busy watering down Ron Paul's Federal Reserve Audit bill so by the time it comes up for a vote it will have NO teeth.
Wonder why the Congress wouldn't really want to have transparency within the Fed???
"The US has an army of 90,000 soldiers in Afghanistan and is spending $100bn a year, but has still been unable to defeat 20,000-25,000 Taliban who receive no pay at all." - Patrick Cockburn
senate-blocks-attempt-to-audit-federal-reserve/
Interesting.
Thanks Brad for providing the link to the Senate blocking important legislation to find out where our money is going.
Please Support and demand the Senate Democrats stop blocking this!
S604 - Federal Reserve Sunshine Act to audit the Federal Reserve
http://www.scribd.com/doc/17172196/S-604-Fede...
You can see Senator Bernie Sanders question Bernanke here. http://www.youtube.com/watch?v=vFE8RO2oO0E
Aren't you sick and tired of the financial institutions jerking us around?
The counter-argument (heard on Britain's "The Economist") is that once the congress can audit the Federal reserve, what was supposed to be a non-partisan body suddenly becomes intensely political, and can no longer make unpopular but necessary monetary decisions.
Just sayin'.
W
Some counter argument for an entity that was supposedly created to stabilize the economy and put an end to chaotic banking thus protect the people. This is what Congress was sold at the time of its passing. Since the Federal Reserve System was created, lets examine its effectiveness.
- presided over Stock Market Crashes of 1921 and 1929
- Great Depression 1929-1939
- Recessions in the years '53, '57, '69, '75, and '81
- Stock Market black Monday in '87
- Business and Corporate bankruptcies are at all time high
- Banks and Savings and Loans have failed in larger numbers than ever before
- Interest on the National Debt is consuming over half of our tax dollars
- National Industry has been replaced by oversees industry and we are facing a Nation Trade Deficit now
So, please tell me what "necessary monetary decisions" were made to have such great success?
The creators of the Federal Reserve System set out to accomplish 3 main things:
1) Stop the erosion of the BIG banks' power from shifting away from New York. Hmmm...sounds like setting up conditions that only the larger banks could handle thus forcing others to go down or swallowed up
2) Reverse the trend of private capital formation. In other words, to stop people or small businesses from using their own savings for things. There was a growing trend of businesses doing this instead of getting loans from the bank. *Federal Reserve lowered interest rates to lure businesses back to borrow money.
3) Pass on the inevitable losses from the banks and pass them onto the taxpayers all in the name of protecting the people
*We know this term, BAILOUT!
We cannot continue to allow the Federal Reserve to create money out of nothing. Money essentially equals debt through this practice.
There some people in congress who are good people, but, most of them are in on the scaming of America. Just see who kills this bill and look to see who getting the money.
http://www.**************.com/
http://video.google.com/videoplay?docid=39324...
http://video.google.com/videoplay?docid=70652...
This will NEVER get on TV,ever.
And the moral is, don't touch green backs, the green is poison.
Ratigan has a show that shows clips on on MSNBC tv's website. He was on the morning Joe show basically calling the events of the last 6 or 7 months the largest robbery in history. Pretty interesting for a wall street guy. I figured they all close ranks and not speak truth to outsiders.
he has Eliot Spitzer on regularly. i bet he knows where the bodies are buried...so to speak.
... Mr. Spitzer compromised himself by giving these vermin the ammo they needed to neutralize him with all that whoring nonsense. Sad.
http://www.msnbc.msn.com/id/21134540/vp/32124...
And a planeload worth $8 BILLION simply went missing? And that was on top of about $10 BILLION in known contractor fraud. They didn't even ask questions at the time, and J. Paul Bremer created a legal black hole where the contractors were accountable to no-one. I think if some action had been taken (including a few hangings, IMO) then, the much greater abuses we're seeing now may not have occurred. As it is, now the American taxpayer can look back on being blatantly ripped off for 'merely' $18 BILLION or so as the good old days.
"In theory theory and practice are alike. In practice they are very different."
Enlightening? Yeah. Infuriating? Yeah. Is Mr. Grayson informed and articulate? Yeah. Did Bernanke fail to adequately address the issue? Depends on who you ask.
These shocking revelations by the head of the Federal Reserve and Congressman Grayson's effective grilling are both meaningless unless someone, somewhere, somehow is able to change the way things are allowed to happen. Very little is even attempted to be hidden any longer. Who's gonna stop them?
A Swiss bank needs US dollars; that would require them to go to the US 'market' and buy dollars. We did not want that driving up the exchange rate. With credit on flash-freeze, dollars were becoming scarce.
So the Fed did a currency swap. They created a bunch of dollars 'out of thin air', and lent them to a bunch of foreign banks for an equivalent amount of their cash created 'out of thin air', at the current exchange rate. The foreign central banks could then provide dollar loans to their banks who were in need of dollars, and do this all without driving up the US exchange rate further.
Of course Bernake doesn't know who those other central banks loaned those dollars to in turn. Why would he need to know that? We already have 'collateral' on these loans in their money.
This isn't a bailout of foreign banks or anything like that. It's a fairly common thing central banks do to influence the interest rate.
Take a look at the dollar-euro exchange rate in September last year and you'll see what was going on.
That's my understanding of it. Nothing to see here, move along..
Grayson didn't look like he knew what he was talking about.
If you think the Fed's money comes out of the Treasury.. Well that's just ignorant.
Just to clarify I meant 'exchange rate' not 'interest rate' there, but it wasn't just about the exchange rate but also to avoid a run on US banks for dollar loans, exacerbating the situation.
Anyway, I dug up the conditions for the loans made on these currency swaps, in this particular case from the Swedish Riksbank (central bank), right
here (this particular auction was for 10 billion USD)
Note that these loans mature in 84 days, and that:
So unless they had different loan durations with different central banks, (I don't know why they would) the answer to where the $500 billion that was swapped last fall, is that those loans matured long ago, and the $500 billion that was created 'out of thin air', has since been returned to the void from which they came.
(And looking at the other posts around here, damn - this is starting to look like a conspiracy theory site. Doesn't anyone bother to go looking for the facts?)
Someone walks up to you and says: "give me 3 trillion dollars or else the whole world will explode". You say: "will there be any way to audit the money to make sure it's going to the right places so that the world doesn't explode"? He says: "nope, and I don't have to tell you who's going to get the money". You say: "well, in that case, sure, here's your 3 trillion. Will you be needing any more?"
If that was on Saturday Night Live or Mad TV, you'd scoff and say that's totally ridiculous. The largest theft in the history of the world, done right in front of our eyes and hardly a whisper of outrage. I guess it's true, we are sheep.
It's interesting how nervous Bernanke is in answering some straight forward questions. You get the feeling he's not being completely honest and hiding some mechanisms of the fed and central bank system.
Politics is for the present, but an equation is for eternity. Albert Einstein
I worked on his campaign. He won because he actually took war to court profiteers to court - and won! He isn't afraid to take on the big guys.
Where are the officers and handcuffs? Anyone?
NOBODY 2012
Bernanke didn't even have the decency to look ashamed. If anything, he was defiant and disdainful.
I was waiting for him to ask Rep Grayson, "Yeah, so what are you gonna do about it?".
Unbelievable!
fraud is happening in broad daylight, while the average American is distracted with the hopes of Healthcare Reform (insurance company bailout fraud) after experiencing the massive Stimulus (state bailout) and of course the TARP (bank and corporate bailout)....one has to wonder, what entity is next to get bailed out since the Bush and Obama administrations seem to have them all covered.
I sure hope Alan Grayson has some really good security guys and that he doesn't have any plans to fly in small planes.
We are being robbed.....
"Egotism is the anesthetic that dulls the pain of Stupidity" - Frank Leahy
Who and why Bernanke seems to be paying people off with US Government money.
The 2.3 trillion Rumsfeld said the pentagon couldn't account for on 9/10/01.
forward instead of to the past./snark
These time limits are a joke. It would have been nice if could have had time to ask him about the change in value of the currencies during the timeframe of these swaps. Ben says that these were money makers or didn't cost us anything, but I doubt that. If the dollar goes up (which it did) and the foreign currency goes down (which it did) during this swap, then we loose (which we did). He says we get interest on these swaps, but aren't we paying interest on this money also?
Watching pigface Ben Nelson in that video blocking the FED audit bill makes me sick. I hate Demint, but he kicked Ben's ass and even brought up 200k in pork Ben slipped into that bill for a stupid project in Nebraska.
Hey, I live in New Zealand, and I can tell you catagorically no one has sent ME a cheque for $3,000!
So if it's not going here, either, where IS it??
(*snark off*)
He lost his position on CNBC as one of the rising stars in financial land because he wasn’t afraid to speak truth to power. Today on his new show over at MSNBC Dylan Ratigan let lose with the help of Eliot Spitzer. This is the best answer as to where the TARP funds have gone and why both the Federal Reserve as well as the Obama administration don’t want you to know where the money has gone.
http://www.huffingtonpost.com/.....44617.html
If you want to know why all that money was lent to European Banks and why the FED should be dissolved, start your education here.
http://www.youtube.com/watch?v=_dmPchuXIXQ
Ben Bernanke knows exactly where the funds have gone and so do the higher ups in the administration. Over ten years ago the US government created the FINCEN system using PROMIS software. This network can trace any amount of money in any currency anywhere in the world 24/7 365 days a year. To say that he doesn't know where the funds have gone is a blad face lie. That's why Grayson was laughing. Grayson is a pit bull and I found it unusual that Barney Frank hung around while Grayson questioned the bearded wonder at the end of the day. Frank was probably there to make sure his buddy Ben wasn't roughed up to much.
The Fed is employing quantitative easing to bail out the economy. The "risks" section in the wikipedia link advises
"Some economists argue that there is less risk of such an outcome when a central bank employs quantitative easing strictly to ease credit markets (e.g. by buying commercial paper), whereas hyperinflation is more likely to be triggered when money is created for the purpose of buying up government debts (i.e. treasury securities)"
Meanwhile China "has warned a top member of the US Federal Reserve that it is increasingly disturbed by the Fed's direct purchase of US Treasury bonds."
I always thought that the prior bubbles were being picked up by a federal borrowing bubble, and that bubble would burst when treasuries no longer sold at auction without a significant discount to par (at high interest). But, it seems from the anecdotal evidence that the Fed is bypassing the auctions and buying securities directly. Some economists thing that Bernanke is smart enough to avoid it, but this is similar to Weimar Republic economics.
this has been going on for quite a while because foreign governments especially China know that the dollar is going to crash this fall and many think as soon as September.
The Fed is using make believe dollars to buy US debt because no one else wants it. This is also why China, Brazil and many other countries are no longer using the dollar to settle trade. I little know fact is that Iran, Iraq as well as well as countries in South America no longer accept the dollar for oil.
Iran and Venezuela have an agenda against us, (because we've had an agenda against them). so they don't want the dollar.
But there are the BRIC nations (BRIC = Brazil, Russia, India & China) that have held discussions on adapting a new reserve currency. I don't think that there is an immediate rush towards doing so, because there isn't an immediate replacement.
My opinion is that our economy has been criminally operated (with the derivatives ponzi scheme and the grading of the mortgage backed securities as "AAA"), with the acquiescence of our banana republic government of influence peddlers. Who wants a reserve currency under this kind of management? So, I look for world pressure to abandon the dollar to increase.
I think Obama and the Congress is somewhat in dreamland. They think it's a liquidity crises, and if they can get the credit unfrozen, then we can resume borrowing to consume more than we produce (thanks to free trade). I think that there are multiple crises, and that the liquidity crises served to expose this unsustainable borrowing bubble. We need health "reform" that required PAYING more money instead of SAVING money like we need a hole in the head.
when are people going to refuse to pay their taxes?
You mean other than the tea party tinhats?
Man , the last eight and a half years have been like a science fiction movie in this country , the twilight zone or something , unbelievable . If I could take my family and split this country I would , in a heart beat .
We need to remember that little factoid every time those retentive bean-counters try to tell us we can't afford universal healthcare.
The money people set this up a long time ago and any one who gets in there way, lets say don't don't do any flying.
http://video.google.com/videoplay?docid=39324...
It hasn't been "change we can believe in", it been more like "meet the new boss, same as the old boss'.This will all end VERY badly if we stand by and do nothing.
I'm sorry to rain on everyone's parade, but this clip isn't evidence of Grayson catching Bernanke in anything the least bit wrong. It's evidence that he doesn't know what he's talking about.
The irony is that currency swap lines are in place to do EXACTLY the opposite of what Grayson suggested it would do. The idea is that you don't want your exchange rates to skyrocket. Other countries and people in other countries have assets in USD basis. In addition, US companies have assets and liabilities in foreign currencies. So because US banks weren't lending, the demand for USD in other country was sky rocketting... The swap line alleviates that.
Also, Grayson didn't understand the BASIC concept of a swap. Swap is exchanging one thing for another with a reversal at a later point in time. What Grayson didn't understand was that ... Fed Reserve gave out USD in exchange for a foreign currency... and at a later date.. they will exchange back. So the system is net even.
In layman's terms... Grayson was effectively arguing that the airport money changers are giving tourist a bail out when they exchange their foreign currency for USD.
In addition, the example that Grayson used "New Zealand" never drew on their swap line. So it was a non-story there.
Here's a good explanation: http://macroblog.typepad.com/macroblog/2008/0...
So there's really nothing to be upset about, except for the fact that we have congressmen regulating things they don't even have basic understanding of. I'm sure Grayson's heart is in the right place, but this isn't a gotcha moment.
Though the demand for US dollars is going down as they are becoming more and more valueless, all the US is trying to do here is swap some of it's US dollar debt for currencies around the world that will hold their value.
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