END THE FED

GoldSeek

WASHINGTON, DC -  Yesterday Congressman Ron Paul’s bill to complete a full audit of the Federal Reserve for the first time in 96-year history has narrowly avoided total defeat. The Federal Reserve is a quasi-private banking cartel owned by the banks with its Chairman nominated by the President that controls interest rates and the money supply. HR 1207, a very short 342-word bill, has a majority in the House with 313 co-sponsors. Its companion bill in the Senate, S 604, has 30 co-sponsors. HR 1207 has been blocked from a full House vote by the Chairman of the House Committee on Financial Services, Barney Frank.

Instead Paul and Congressman Alan Grayson successfully added in the FED audit as amendment 69B to Frank’s monstrous HR 3996, the Financial Stability Improvement Act of 2009. (Draft text here and PDF.) While Frank proclaims the bill supposedly protects the taxpayer from bailing out Wall Street, the truth is Congress intends to grant the Federal Reserve even more powers to mishandle and crash the economy as they did with their money-printing, excess credit, and low interests rates to cause the last bubbles, residential and commercial real estate, to form and then collapse.

Possibly the worst part of the bill is what I term the “Emergency Bailout Authorization,” or per Section 1109, officially known as the Emergency Financial Stabilization.

“Upon the written approval of the Board of Governors of the Federal Reserve System… and the Board of Directors of the Corporation [Author's Note: This the FDIC.]… and with the written consent of the Secretary of the Treasury (after consulting with the President), the Corporation may extend credit to or guarantee obligations of solvent insured depository institutions or other solvent companies that are predominantly engaged in activities that are financial in nature, if necessary to prevent financial instability during times of severe economic distress. There shall be available to the Corporation to carry out this section amounts in the Treasury not otherwise appropriated, including for the payment of reasonable administrative expenses.” (pages 43-44/253)

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