The Federal Reserve, the unelected central bank of the U.S., enjoys a monopoly over the flow of our nation’s money and credit but has never been completely transparent and accountable to Congress since its creation in 1913. Over its nearly 100 year history, the Federal Reserve has presided over the near-complete destruction of the United States dollar while Congress has kept its hands off and its eyes closed. Since 1913, the dollar has lost over 95% of its purchasing power, aided and abetted by the Federal Reserve’s loose monetary policy.
Earlier this year a limited audit of the Fed was finally achieved. The results were disgusting; the Fed’s actions put us on the hook for over $16 trillion in bailouts and loans during the 2008 economic crisis. This is in addition to our $15 trillion public national debt. The investigation’s key findings include:
- The Fed unilaterally provided trillions of dollars in financial assistance to foreign banks and corporations from South Korea to Scotland, according to the GAO report. That’s correct, we bailed out the world.
- The CEO of JP Morgan Chase served on the New York Fed’s board of directors at the same time that his bank received more than $390 billion in financial assistance from the Fed. Moreover, JP Morgan Chase served as one of the clearing banks for the Fed’s emergency lending programs.
- On Sept. 19, 2008, William Dudley, who is the New York Fed president, was granted a waiver to let him keep investments in AIG and General Electric at the same time AIG and GE were given bailout funds.
- The Fed outsourced virtually all of the operations of their emergency lending programs to private contractors like JP Morgan Chase, Morgan Stanley, and Wells Fargo. The same firms also received trillions of dollars in Fed loans at near-zero interest rates. Altogether some two-thirds of the contracts that the Fed awarded to manage its emergency lending programs were no-bid contracts. Morgan Stanley was given the largest no-bid contract worth $108.4 million to help manage the Fed bailout of AIG.
This audit is a great victory for the American people. Although it was no where close to comprehensive, it provided a glimpse into the deep, dark ties of the Fed. Until this point, the Fed revealed nothing to those who questioned it’s authority. When asked before Congress in 2009, Fed Chairman Ben Bernanke refused to disclose which institutions received trillions of dollars in these bailouts and loans or to give our representatives details about what deals are being made with foreign banks.
The crucial issue of Federal Reserve transparency requires an analysis of 31 USC 714, the section of US Code which establishes that the Federal Reserve may be audited by the Government Accountability Office (GAO) but which simultaneously severely restricts what the GAO may in fact audit. Essentially, the GAO is only allowed to audit check-processing, currency storage and shipments, credit facilities (limited) and some regulatory and bank examination functions, etc. The most important matters, which directly affect the strength of the dollar and the health of the financial system, are immune from oversight.
Currently, the GAO is prohibited from auditing:
1. transactions for or with a foreign central bank, government of a foreign country, or nonprivate international financing organization;
2. deliberations, decisions, or actions on monetary policy matters, including discount window operations, reserves of member banks, securities credit, interest on deposits, and open market operations
3. transactions made under the direction of the Federal Open Market Committee; or
4. a part of a discussion or communication among or between members of the Board of Governors and officers and employees of the Federal Reserve System related to clauses (1)-(3) of this subsection of US Code.
The GAO is also prevented from conducting on-site examinations of banks or bank holding companies without the written consent of the appropriate regulatory agency.
HR 459 and S 202, The Federal Reserve Transparency Act, would eliminate these restrictions and mandate a thorough GAO audit of the Fed, finally delivering answers to the American people about how our money is being spent. Demand knowledge and change!
Sign the petition and read more here: http://www.auditthefed.com/