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View Full Version : WSJ: Bernanke Warns Against Move to Audit Fed




lx43
05-06-2010, 12:29 PM
Come on Big Ben what you gotta hide? Only crooks don't want to be audited.


It will be interesting to see what the political ramifications will be should Obama veto a bill containing an audit the fed provision.




http://online.wsj.com/article/SB10001424052748704370704575228164133105390.html?m od=WSJ_hpp_MIDDLETopStories#articleTabs%3Dcomments

WASHINGTON—Federal Reserve Chairman Ben Bernanke sought Thursday to head off legislation that would subject the central bank's monetary policy decisions to congressional audits, warning it could stoke inflation and threaten economic stability.

With U.S. senators moving toward a possible vote later in the day on an amendment to the financial regulatory bill that would significantly increase congressional oversight of the Fed, Mr. Bernanke warned of the consequences in a letter to Senate Banking Committee Chairman Christopher Dodd (D., Conn.).

"Such amendments, if enacted, would seriously threaten monetary policy independence, increase inflation fears and market interest rates, and damage economic stability and job creation," Mr. Bernanke wrote.

In the past few days, Mr. Bernanke has reached out to about a half-dozen lawmakers to help make the Fed's case against the bill.

More
Letter: Bernanke Outlines His Opposition Letter: Volcker Outlines His Opposition If the amendment passes, it might be hard to strip from the broader legislation. The House's version of the bill, which passed late last year, contains a similar provision, which Mr. Bernanke also opposes. Passage would set up a dilemma for the White House, which would have to decide whether to veto a top domestic priority to duck the provision.

Senate Majority Leader Harry Reid (D., Nev.) said Thursday morning that the measure, from Sen. Bernie Sanders (I., Vt.), will be taken up once lawmakers consider two other amendments to the legislative package that overhauls regulation of U.S. financial markets.

"The American people overwhelmingly believe there should be transparency at the Fed," Mr. Sanders said Thursday. "The idea that trillions of dollars of their money was lent out and we don't know who received that money—nobody that I know of thinks that that makes any sense at all." The provision requires 60 votes, which Mr. Sanders called a "pretty high hurdle. But we hope to do it."

Central bank and administration officials have aggressively fought the proposal—one element of the broader revamp of finance rules—arguing it could politicize the central bank's decisions about inflation and interest rates. That could undermine the Fed's independence, a central component of its reputation among investors.

The amendment is one of the more controversial being considered, and enjoys backing from both sides of the aisle. Skepticism of the central bank has risen because of its central role in the major policy decisions made during the financial crisis.

At its heart, the Sanders provision would remove restrictions on Congress's ability to audit the central bank. Congress currently can't review the Fed's monetary-policy decisions, direct loans to commercial banks or transactions involving foreign central banks or governments. The provision would also require the central bank to disclose the low-interest loans and other financial assistance it gave financial companies during the recession.

The amendment says it shouldn't be "construed as interference in or dictation of monetary policy." Critics say the prospect of Congressional auditors interviewing Fed policy makers and staffers about monetary-policy decisions would weaken investors' confidence that decisions are free from political influence.

Separately, President Barack Obama on Thursday urged the Senate to vote against a Republican amendment to a financial overhaul package that he said would weaken consumer protections.

"Today, the Senate is considering a Republican amendment that will gut consumer protections and is worse than the status quo," Mr. Obama said in a statement. He added, "I will not allow amendments like this one written by Wall Street's lobbyists to pass for reform."

The Republicans' proposal calls for a much more limited division in the Federal Deposit Insurance Corp. that would have oversight over only a portion of the financial-services industry. Current bank regulators would retain their consumer protection authority over banks and thrifts.

Mr. Obama said the amendment included "dangerous carve outs" for payday lenders, debt collectors, and others in the financial-services industry.

—Jared A. Favole and Jon Hilsenrath contributed to this article.

bobbyw24
05-06-2010, 12:34 PM
The same Bernanke who told us in 2006 and 07 that the housing market will not fall and will continue to rise?

No1ButPaul08
05-06-2010, 12:36 PM
An audit would increase inflation fears? Who would have thought

lx43
05-06-2010, 12:47 PM
The same Bernanke who told us in 2006 and 07 that the housing market will not fall and will continue to rise?

Yes that's him. It shames me this man is from my state, of course, look at who else we have elected to office James Clyburn, John Spratt, and Lyndsey Graham.

lx43
05-06-2010, 12:48 PM
An audit would increase inflation fears? Who would have thought

Yes you didn't know that???? lol An audit of the fed will actually cause double digit inflation. :rolleyes: :rolleyes:

Imaginos
05-06-2010, 12:51 PM
Thus his majesty Bernanke has spoken.
Now Playing: Killi the King (by Rainbow)
:D

TCE
05-06-2010, 01:06 PM
They said that last year when the list of banks who got money at one time was released on the Fed's website, thanks to Bernie Sanders, the apocalypse didn't occur.

catdd
05-06-2010, 02:07 PM
"Such amendments, if enacted, would seriously threaten monetary policy independence, increase inflation fears and market interest rates, and damage economic stability and job creation," Mr. Bernanke wrote.

I see this as a thinly veiled threat of what the world wide central banks might do if we go ahead with the audit.

Sentient Void
05-06-2010, 02:24 PM
"Such amendments, if enacted, would seriously threaten monetary policy independence, increase inflation fears and market interest rates, and damage economic stability and job creation," Mr. Bernanke wrote.

I see this as a thinly veiled threat of what the world wide central banks might do if we go ahead with the audit.

Absolutely...

Remember the congressmen who publicly stated (on CSPAN) that if they didn't pass the TARP, they were threatened by govt agents and bankers that the markets WILL collapse and there will marshall law?

Same shit, different shovel.

Cowlesy
05-06-2010, 02:41 PM
It's complete BS. The transcripts wouldn't be audited for over 6 MONTHS from the time of their consummation.

Even Larry freakin' Kudlow wants Audit the Fed.

AUDIT. THE. FED.

Anti Federalist
05-06-2010, 02:47 PM
It's complete BS. The transcripts wouldn't be audited for over 6 MONTHS from the time of their consummation.

Even Larry freakin' Kudlow wants Audit the Fed.

AUDIT. THE. FED.

I'm With Roy.

Freaking Banksters.

specsaregood
05-06-2010, 02:50 PM
It will be interesting to see what the political ramifications will be should Obama veto a bill containing an audit the fed provision.


This poison pill amendment is perfect argument AGAINST line item veto.

Elwar
05-06-2010, 02:50 PM
I'll be sure to duplicate all of the efforts currently being made by the Federal Reserve if I'm ever called up for an income tax audit.

http://www.theronpaulteaparty.com/e107_images/banners/banner.jpg (http://www.TheRonPaulTeaParty.com)

lester1/2jr
05-06-2010, 02:52 PM
we need to have this strange kubuki theatre corner of the political process where people try and interpret my words like dreams. it's the jey to democracy and stability

catdd
05-06-2010, 09:20 PM
Absolutely...

Remember the congressmen who publicly stated (on CSPAN) that if they didn't pass the TARP, they were threatened by govt agents and bankers that the markets WILL collapse and there will marshall law?

Same shit, different shovel.

And isn't it funny how the market dipped today just before Bernie sold out?
Coincidence? Hell no, that was an ominous warning if you ask me.

ChooseLiberty
05-06-2010, 09:36 PM
Lucky you copied this article.

Click the link now.

They completely pulled the original and replaced it at the same link.

Nothing unusual there. LOL.