The year 2016 makes the 50th anniversary of our class. From this inauspicious beginnings we rose as one group of individuals in our chosen profession in the mother country and our beloved USA. We became a part of a huge extended family, no matter the miles that separate us, yet find unity in a common experience and purpose.. Forever classmates...AMOR PATRIAE
The year 2016 makes the 50th anniversary of our class. From this inauspicious beginnings we rose as one group of individuals in our chosen profession in the mother country and our beloved USA. We became a part of a huge extended family, no matter the miles that separate us, yet find unity in a common experience and purpose.. Forever classmates...AMOR PATRIAE
Friday, September 05, 2025
Documentary – Monopoly Men, Federal Reserve Fraud, 1999 (47 min.)
Will The Fed Cut Interest Rates? Does It Matter?
THE RACKET OF THE FED A NON GOVERNMENT ENTITY CHARGING THE USA INTEREST FOR MONEY THEY PRINT OUT OF THIN AIR EXPLAINS NON SENSICALY (A LOT OF BS) THEIR PURPOSE AS IF THE US TREASURY CAN NOT DO THE SAME FUNCTION TO PERFORM WITHOUT BEING CHARGED INTEREST.
August 07, 2025
The Fed has floating-rate liabilities as well as long-lived, zero-interest liabilities. A barbell of floating-rate and long-duration assets would best offset the interest rate risk from these liabilities. Investing in a more diversified mix of durations, while matching the average duration of assets, could be more practical than the barbell approach but would leave a substantial portion of interest rate risk unhedged. The Fed does not seek to maximize profit. Rather, the Fed uses its balance sheet to advance its public mission, particularly the monetary policy dual mandate of maximum employment and stable prices. The Fed also does not have a for-profit bank’s need to avoid losses. The Fed’s main liabilities, bank reserves and currency, are redeemable only with these same liabilities, which the Fed itself creates. Unlike a commercial bank, the Fed doesn’t face the risk of being unable to pay its debts. Additionally, the Fed remits its net income to the U.S. Treasury and over time intends to hold primarily Treasury securities. That means on the consolidated balance sheet of the public sector, gains or losses on Treasuries in the Fed’s asset portfolio are offset by economic losses or gains on the U.S. Treasury’s liabilities. Even though the Fed doesn’t seek profit, the volatility of income from its balance sheet can complicate its communications. Some policymakers and others have suggested mitigating this challenge by matching the duration of the Fed’s assets to that of its liabilities, not unlike approaches used by commercial banks and other for-profit financial institutions. In a recent working paper, we investigated what such a matching would entail and what consequences the associated investment strategies might have for the volatility of income and mark-to-market valuations. However, we emphasize that minimizing volatility of income or mark-to-market valuations is likely not the only or the most important objective for the balance sheet, given the Fed’s public policy mission. Bank asset management seeks to match liability risk characteristics The basic idea behind traditional bank asset-liability management is to match the most important risk characteristics of a bank’s assets with the corresponding characteristics of its liabilities. That way, the bank will have sufficient assets to meet its liabilities across a range of contingencies. At a high level, the risk characteristic most relevant to the Fed is interest rate risk. Matching the interest rate risk of assets to that of liabilities could mitigate the potential for interest rate swings to cause large losses. A financial instrument’s interest rate risk is frequently described in terms of the instrument’s duration. Loosely speaking, duration represents the average time over which the instrument will pay its cash flows. (In fact, this is the precise definition of the Macaulay measure of duration.) If an instrument’s cash flows will arrive in the more distant future, their present value is more responsive to interest rate changes. The modified duration of a financial instrument measures this sensitivity. Therefore, we explore the notion of matching the duration risk in the Fed’s assets to that in its liabilities. Examining the duration of Fed liabilities Among the Fed’s main liabilities are reserves held by banks and balances in the Fed’s reverse repurchase agreement (reverse repo) facilities, available to counterparties such as government-sponsored enterprises, money market mutual funds and foreign central banks. Liabilities also include currency in circulation and the Treasury general account, which the U.S. Treasury uses to make federal expenditures and receive revenue. Together, these four items account for 99 percent of current liabilities and have accounted for about 95 percent of total liabilities on average for more than two decades (Chart 1). Downloadable chart Chart data In an accounting sense, liabilities carry no interest rate risk. They appear at par value on the balance sheet. But in a financial sense, some liabilities possess interest rate risk. This risk arises because any liability may be used to pay for an investment in assets that pay a market interest rate. Currency provides a straightforward example. Currency does not bear interest. If the Fed invests the proceeds of currency issuance in interest-bearing assets, it earns a spread equal to the market interest rate. The value of these earnings rises with market interest rates. Moreover, because currency in the aggregate almost never returns to the Fed once issued, the Fed can receive these earnings for a very long time. If nominal short-term rates average 3 percent (the median long-run projection for the federal funds rate in the Federal Open Market Committee’s June 2025 Summary of Economic Projections), each $1 trillion in currency in circulation represents about $610 billion in additional economic present value over a 30-year horizon. The additional economic value rises to $720 billion if the average of overnight interest rates is closer to 4 percent. In the $2.4 trillion of currency outstanding as of early June 2025, we estimate the interest rate duration risk equals the duration risk in about $3.4 trillion of 10-year Treasuries. The present value to the Fed from outstanding currency in circulation, over a 30-year horizon, is more than $1.6 trillion (Chart 2). This represents an increase in the economic value of currency to the Fed of more than $1 trillion over the past four years, with 70 percent of that attributable to the rise in interest rates and the rest to growth in currency outstanding. Chart data In an accounting sense, liabilities carry no interest rate risk. They appear at par value on the balance sheet. But in a financial sense, some liabilities possess interest rate risk. This risk arises because any liability may be used to pay for an investment in assets that pay a market interest rate. Currency provides a straightforward example. Currency does not bear interest. If the Fed invests the proceeds of currency issuance in interest-bearing assets, it earns a spread equal to the market interest rate. The value of these earnings rises with market interest rates. Moreover, because currency in the aggregate almost never returns to the Fed once issued, the Fed can receive these earnings for a very long time. If nominal short-term rates average 3 percent (the median long-run projection for the federal funds rate in the Federal Open Market Committee’s June 2025 Summary of Economic Projections), each $1 trillion in currency in circulation represents about $610 billion in additional economic present value over a 30-year horizon. The additional economic value rises to $720 billion if the average of overnight interest rates is closer to 4 percent. In the $2.4 trillion of currency outstanding as of early June 2025, we estimate the interest rate duration risk equals the duration risk in about $3.4 trillion of 10-year Treasuries. The present value to the Fed from outstanding currency in circulation, over a 30-year horizon, is more than $1.6 trillion (Chart 2). This represents an increase in the economic value of currency to the Fed of more than $1 trillion over the past four years, with 70 percent of that attributable to the rise in interest rates and the rest to growth in currency outstanding.Downloadable chart Chart data By comparison, the Fed had $1.06 trillion of mark-to-market unrealized losses on its asset holdings at the end of 2024. In other words, the rise in economic value of the Fed’s liabilities has fully offset mark-to-market unrealized losses on the Fed’s asset portfolio. However, while unrealized losses on assets are reported on the Fed’s financial statements, the mark-to-market value of liabilities is less visible because it is not reported under the Fed’s accounting conventions. Our calculation of currency’s interest rate risk treats currency as having a 30-year lifetime, consistent with historical evidence that U.S. currency demand is highly persistent and varies little with interest rates. If currency demand became more sensitive to interest rates or were to decline in response to the development of novel payments technologies such as stablecoin, currency’s duration would be lower. In contrast to currency, reserves and reverse repo balances pay floating interest rates. Those interest rates, in the Fed’s ample-reserves monetary policy implementation regime, are close to market rates. The economic value of reserves and reverse repo balances is therefore par regardless of changes in market interest rates, meaning these liabilities create no interest rate risk. The Treasury general account presents an intermediate case. On the one hand, like currency, this account does not pay interest. The Treasury has said it plans over time to hold a buffer in the account equal to five days of expected outflows, so this liability could be viewed as long-lived. However, on the other hand, over short horizons, the account can be highly volatile, which could motivate viewing this liability as one with a short duration. How liabilities’ durations affect Fed finances Floating-rate liabilities with zero duration and long-lived, non-interest-bearing liabilities have distinct implications for the Fed’s income and balance sheet over time. Floating-rate liabilities will cause the Fed’s interest expense to vary. If variation in interest income on the Fed’s assets does not offset the variation in interest expense, the Fed’s net income will also fluctuate. By contrast, long-lived, non-interest-bearing liabilities do not create any variability in interest expense. The Fed can minimize the volatility of the net income associated with these liabilities by backing them with assets that lock in fixed interest rates for a long time, that is, long-duration assets. From the perspective of mark-to-market valuations, the implications are the opposite. The Fed’s accounting rules do not call for marking assets or liabilities to market at current prices. Rather, liabilities are shown on the Fed’s financial statements at par and assets at amortized cost, similar to the accounting framework used by commercial banks. Neither floating-rate nor long-duration liabilities affects the accounting value of the balance sheet under this convention. Nevertheless, the mark-to-market value of assets can easily be computed and is shown in the notes to the Fed’s statements; the mark-to-market value of liabilities can similarly be computed. Floating-rate liabilities’ economic value does not depend on interest rates, so their mark-to-market value is constant. Backing these liabilities with floating-rate assets, whose market value is also stable, will limit net mark-to-market volatility on this part of the Fed’s balance sheet. Long-lived liabilities’ economic value varies with interest rates. Backing these liabilities with long-duration assets whose value varies similarly will limit net mark-to-market volatility. Putting together these ideas, the Fed can minimize both the volatility of its net income and the volatility of the net mark-to-market value of its balance sheet by backing floating-rate liabilities with floating-rate assets and long-duration liabilities with long-duration, fixed-rate assets. While long-duration securities help offset the economic interest rate risk intrinsic to long-duration liabilities, such duration matching can have optical implications. A long-duration asset portfolio shows unrealized mark-to-market losses when rates rise. Currency in circulation, meanwhile, is always marked at par in the Fed’s quarterly financial statements. The economic value of currency in circulation to the Fed rises when rates rise, as shown in Chart 2. That change does not appear in the financial statements, however. As a result, when dealing with long-duration liabilities, there is an optical trade-off between income volatility and mark-to-market volatility on the asset side of the balance sheet. Neutralizing interest rate risk from an economic perspective can result in reported mark-to-market (unrealized) losses on the asset side in a higher-rate environment. To be sure, this trade-off is purely the optical effect of marking one side of the balance sheet to market but not the other. If both sides were marked to market, the balance sheet would accurately show that long-duration assets neutralize the interest rate risk in long-duration liabilities. Asset portfolio models show trade-offs for various interest rate paths Our working paper examines different combinations of assets and liabilities. To study the trade-offs among these combinations, we simulate the volatility of net income and mark-to-market valuations under a range of future interest rate paths reflecting the historical volatilities of interest rates at different maturity points and the correlations among them. We focus on portfolios of Treasuries in light of the Federal Open Market Committee’s intention to primarily hold these securities in the long run. We start by examining an asset portfolio funded only by currency (or, equivalently, the portion of the Fed’s assets held against currency). Chart 3plots the Fed’s net income volatility, the mark-to-market volatility of assets, and the net mark-to-market volatility of assets minus liabilities for five different benchmark asset portfolios. Downloadable chart Chart data Each asset portfolio is a rolling ladder of securities. For example, the five-year ladder distributes the amount to be invested equally among Treasury securities with up to five years to maturity. In each year of the simulation, one-fifth of these securities mature, and the proceeds are reinvested in a new five-year Treasury. We create the one-, two-, 10- and 30-year ladders similarly. Because the longest-duration Treasury securities issued are 30-year bonds, the 30-year ladder represents the longest duration asset portfolio the Fed could have if it holds all assets to maturity. Increasing the average duration of assets beyond that of the 30-year ladder would require selling seasoned securities before they mature and replacing them with newly issued ones of longer duration. Historically, the Fed has largely avoided such active sales and purchases to reduce transaction costs and its footprint in markets. As the chart shows, for a portfolio funded by currency, the 30-year ladder minimizes both the volatility of net income and the net mark-to-market volatility of assets minus liabilities. This result is as expected because long-duration assets have less volatile income and more closely match the duration of currency. However, the 30-year ladder also has the highest mark-to-market volatility when considering the asset side of the balance sheet on its own, illustrating the trade-off between optical effects and risk matching. Motivated by evidence that U.S. currency in circulation has been very sticky, our simulation models currency with a life of 30 years. That results in a modified duration exceeding the 9.7-year weighted average duration of the 30-year ladder, a reason why the 30-year ladder does not eliminate net mark-to-market volatility. However, holding assets with shorter duration could help hedge the risk that currency’s duration decreases, because of the growth of novel payment technologies, for example. Moving to the opposite extreme on the liability side of the balance sheet, the case of a reserve-funded portfolio is straightforward. Our simulation confirms the volatilities of net income, mark-to-market values and values shown under accounting conventions are all minimized by backing floating-rate liabilities such as reserves with very short duration assets. In practice (as illustrated in Chart 1), the Fed has a mix of floating-rate and long-duration liabilities. The exact mix in the long run is uncertain because it depends on future demand growth for currency, the amount of reserves needed for the Fed’s ample-reserves regime and whether the Treasury general account is treated as having long or short duration. As a rough benchmark for the composition of the Fed’s liabilities over time, we consider a balance sheet funded 50 percent with currency and 50 percent with floating-rate liabilities such as reserves. This benchmark is similar to the projection in the New York Fed's most recent annual report on open market operations that reserves would reach a minimum in 2026 and equal 44 percent of the Fed's securities holdings at that time. Chart 4 shows the income and mark-to-market volatility of various asset portfolios when the Fed’s liabilities are an equal mix of currency and floating-rate liabilities. In addition to the one-, two-, five-, 10- and 30-year ladders, we consider three additional asset portfolios. One is a barbell consisting of a 50-50 mix of the one- and 30-year ladders. The second is an across-the-curve portfolio that combines the five ladders in proportions to roughly match the universe of outstanding Treasuries. The third is a 50-50 mix of the one-year ladder and the across-the-curve portfolio; this portfolio effectively pairs reserves with low-duration assets and pairs currency with investments across the curve. Chart data Each asset portfolio is a rolling ladder of securities. For example, the five-year ladder distributes the amount to be invested equally among Treasury securities with up to five years to maturity. In each year of the simulation, one-fifth of these securities mature, and the proceeds are reinvested in a new five-year Treasury. We create the one-, two-, 10- and 30-year ladders similarly. Because the longest-duration Treasury securities issued are 30-year bonds, the 30-year ladder represents the longest duration asset portfolio the Fed could have if it holds all assets to maturity. Increasing the average duration of assets beyond that of the 30-year ladder would require selling seasoned securities before they mature and replacing them with newly issued ones of longer duration. Historically, the Fed has largely avoided such active sales and purchases to reduce transaction costs and its footprint in markets. As the chart shows, for a portfolio funded by currency, the 30-year ladder minimizes both the volatility of net income and the net mark-to-market volatility of assets minus liabilities. This result is as expected because long-duration assets have less volatile income and more closely match the duration of currency. However, the 30-year ladder also has the highest mark-to-market volatility when considering the asset side of the balance sheet on its own, illustrating the trade-off between optical effects and risk matching. Motivated by evidence that U.S. currency in circulation has been very sticky, our simulation models currency with a life of 30 years. That results in a modified duration exceeding the 9.7-year weighted average duration of the 30-year ladder, a reason why the 30-year ladder does not eliminate net mark-to-market volatility. However, holding assets with shorter duration could help hedge the risk that currency’s duration decreases, because of the growth of novel payment technologies, for example. Moving to the opposite extreme on the liability side of the balance sheet, the case of a reserve-funded portfolio is straightforward. Our simulation confirms the volatilities of net income, mark-to-market values and values shown under accounting conventions are all minimized by backing floating-rate liabilities such as reserves with very short duration assets. In practice (as illustrated in Chart 1), the Fed has a mix of floating-rate and long-duration liabilities. The exact mix in the long run is uncertain because it depends on future demand growth for currency, the amount of reserves needed for the Fed’s ample-reserves regime and whether the Treasury general account is treated as having long or short duration. As a rough benchmark for the composition of the Fed’s liabilities over time, we consider a balance sheet funded 50 percent with currency and 50 percent with floating-rate liabilities such as reserves. This benchmark is similar to the projection in the New York Fed's most recent annual report on open market operations that reserves would reach a minimum in 2026 and equal 44 percent of the Fed's securities holdings at that time. Chart 4 shows the income and mark-to-market volatility of various asset portfolios when the Fed’s liabilities are an equal mix of currency and floating-rate liabilities. In addition to the one-, two-, five-, 10- and 30-year ladders, we consider three additional asset portfolios. One is a barbell consisting of a 50-50 mix of the one- and 30-year ladders. The second is an across-the-curve portfolio that combines the five ladders in proportions to roughly match the universe of outstanding Treasuries. The third is a 50-50 mix of the one-year ladder and the across-the-curve portfolio; this portfolio effectively pairs reserves with low-duration assets and pairs currency with investments across the curve.Downloadable chart Chart data The barbell portfolio has by far the lowest net income volatility of these asset portfolios. This is because the two components of the asset barbell closely match the risks on the liability side of the balance sheet. The one-year ladder matches the floating-rate liabilities, and the 30-year ladder matches the currency liability. The mark-to-market volatility of asset value for the barbell is, unsurprisingly, halfway between that of the one-year and 30-year ladders. We do not show the mark-to-market volatility of assets net of liabilities, but this, too, is minimized for the barbell because assets closely match liabilities. The individual ladders and the across-the-curve asset portfolio all have substantially higher net income volatility than the barbell. In particular, the across-the-curve portfolio and the 10-year ladder both have roughly the same weighted average duration as the barbell but produce much higher net income volatility. This difference arises because only the barbell precisely matches the year-to-year fluctuations in interest payments on reserves. In the other portfolios, the resetting of interest rates on liabilities matches the resetting of interest rates only on average over time—that is why the durations are similar—but not each year. This finding produces an important insight: In managing the interest rate risk on the Fed’s balance sheet, it is not just the average duration of assets that matters, but the mix of durations that make up the average. However, a pure barbell portfolio could be challenging to implement at scale. The Fed has $2.4 trillion of currency in circulation. Backing this liability with a 30-year ladder would require investing $2.4 trillion distributed equally across all maturities from one to 30 years. While $2.4 trillion is about 10 percent of all Treasury coupon securities, the outstanding securities are concentrated at shorter maturities, and the Fed would end up owning a large share of the market at some maturities—around 40 percent of the 20- to 25-year sector, for example. Concentrated Fed holdings could challenge the market. Fortunately, an easier-to-implement across-the-curve portfolio can produce lower net income volatility than a similar duration ladder, although not by as much as a barbell, and with lower mark-to-market asset volatility than the barbell. Other balance sheet considerations Our analysis considers a long-run or steady state Fed balance sheet. On several occasions, though, the Fed has temporarily expanded its balance sheet through large-scale purchases of long-duration assets to provide monetary accommodation and support smooth market functioning. Large-scale asset purchases, which require backing newly created reserves with long-duration assets, necessarily generate at least a temporary mismatch between the durations of assets and liabilities. Additionally, we have not investigated how the steady state composition of the Fed’s asset holdings might affect the shape of the yield curve and other asset prices. Such effects depend importantly on how the Treasury Department and other issuers adjust their debt issuance, if at all, in response to any changes in the Fed’s desired holdings.
The Federal Reserve’s most important monetary policy tool is the Fed Funds Interest Rate target. By raising or lowering this benchmark, the Fed hopes to influence the cost of credit throughout the economy, to stimulate or restrain, to control inflation and promote full employment. It is widely assumed that the Fed Funds Rate is an effective lever to move market interest rates, both short-term and long-term rates. For decades, that assumption appeared to hold up.
No longer. This critical policy lever is broken. It stopped working quite suddenly about a year ago. The Fed lowered its target rate three times from September to December 2024, and is getting ready to lower it further – but real interest rates in the market have moved decisively upwards. The correlations between the policy rate and the most important market rates (like Treasury yields and mortgage rates) flipped from extremely positive (i.e, strongly synchronized) prior to September of last year to extremely negative (moving in opposite directions) almost overnight. It is not clear if the breakdown of this long-standing relationship is temporary (“transitory”?) or if it represents a structural shift in the way the macroeconomic system operates. If it is structural, it would mean that the Fed has lost some of its ability to influence the economy. Which could have momentous consequences.
The financial markets are treating the prospect of a rate cut next month as a psychological event. Market sentiment surrounding this prospect is decidedly positive. But viewed as a fundamental economic event, the outlook is cloudy. Last year’s cuts have not worked as a stimulus – have not lowered important market interest rates, and appear in fact to have pushed them higher. Why should a different outcome be expected this time?
Trump’s Fed pick grilled over his ability to distance himself from the president
8 min read
Stephen Miran, head of the Council of Economic Advisers and a Federal Reserve governor nominee, at his Senate confirmation hearing in Washington, DC, on September 4. - Daniel Heuer/Bloomberg/Getty ImagesStephen Miran, the White House economist President Donald Trump nominated to the Federal Reserve’s top ranks, just got an earful about the importance of the central bank’s independence — just as the Trump administration actively defends removing Fed Governor Lisa Cook from her post. The Senate Banking Committee held a hearing Thursday to consider Miran’s nomination to fill a vacant seat on the Fed’s Board of Governors. It was a crucial step in Trump’s efforts to reshape the Fed, potentially eroding its long-accepted independence from politics, which in part has helped the US economy grow to and remain the world’s largest over the past century.
Republican and Democratic senators were unequivocal that the Fed’s decisions on interest rates should remain free of political considerations. Miran agreed at various points throughout the hearing, stating that central bank independence “is critical to the well functioning of the economy and financial markets.” But Democrats questioned Miran’s ability to distance himself from Trump, should he be confirmed to become a Fed governor. Miran said Thursday he plans to technically remain an employee of the White House if he becomes Fed governor on a temporary basis. He told lawmakers he would take a leave of absence from his current role as chair of the Council of Economic Advisers if his Fed term lasts only through January, but said he would resign if he remains for longer. He said he was advised to take that approach by legal counsel.“You are going to be technically an employee of the President of United States, but an independent member of the board of the Federal Reserve. That’s ridiculous,” Democratic Sen. Jack Reed of Rhode Island said. Meanwhile, less than a mile away from Capitol Hill, a federal judge is set to review new court filings from the Trump administration and perhaps rule as early as Thursday whether Cook, whom the president fired last week over allegations of mortgage fraud, can remain as a Fed governor while her lawsuit challenging Trump’s removal order moves forward in litigation.Since the beginning of the year, the Fed has been subject to unprecedented attacks by the Trump administration because central bankers haven’t heeded the president’s demands to lower interest rates. Fed officials have stood pat since December because they’ve wanted to see how the US economy responds to Trump’s sweeping policies first, though they’re gearing up for a rate cut in two weeks.
In another disturbing finding, the GAO said that on Sept. 19, 2008, William Dudley, who is now 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. One reason the Fed did not make Dudley sell his holdings, according to the audit, was that it might have created the appearance of a conflict of interest.
To Sanders, the conclusion is simple. "No one who works for a firm receiving direct financial assistance from the Fed should be allowed to sit on the Fed's board of directors or be employed by the Fed," he said.
The investigation also revealed that the Fed outsourced most of its emergency lending programs to private contractors, many of which also were recipients of extremely low-interest and then-secret loans.
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.
A more detailed GAO investigation into potential conflicts of interest at the Fed is due on Oct. 18, but Sanders said one thing already is abundantly clear. "The Federal Reserve must be reformed to serve the needs of working families, not just CEOs on Wall Street."
The institution which creates and oversees America’s currency wants to keep a “low profile,” according to a published report on Monday, and may willing to dodge the U.S. Treasury in order to do so.
According to Bloomberg News, the Federal Reserve Bank will not submit to a voluntary public study of its internal structure and methods of governance, as it was requested to do so by Treasury Secretary Timothy Geithner.
Geithner is the former New York Federal Reserve Bank
chairman. The review he requested is part of President Barack Obama’s financial regulatory reforms, which he proposed in mid-June. Part of those reforms would have studied the Fed’s “ability to accomplish its existing and proposed functions” — a proposal the bank’s board of governors appears to have flatly rejected.
“The agency also said that while the report requested by Secretary Geithner and his department has not yet been scrapped, no work has been done on the project, which is due Oct 1,” noted Reuters.
“The institution is trying to keep a low profile,” Vincent Reinhart, a former Fed monetary policy director, told Bloomberg. “To publish a report now invites comment on that report.”
And comments are the last thing the Fed wants right now.
Under fire
The Federal Reserve has been under growing political fire ever since Congressman Ron Paul (R-TX) made it a frequent target during his presidential campaign. However, Paul has been a longtime opponent of the bank, openly calling for it to be abolished and the U.S. dollar to once again be backed by gold, instead of mere faith.
“From the Great Depression, to the stagflation of the seventies, to the burst of the dotcom bubble last year, every economic downturn suffered by the country over the last 80 years can be traced to Federal Reserve policy,” Paul said in 2002, according to congressional records. “The Fed has followed a consistent policy of flooding the economy with easy money, leading to a misallocation of resources and an artificial ‘boom’ followed by a recession or depression when the Fed-created bubble bursts.”
His bill, House Resolution 1207, which would subject the Fed to a complete audit, has gained significant traction in the U.S. House of Representatives, with over half its members signing on in support of the move. Though mostly Republicans, a large cross-section of Democrats reached across the aisle to support the bill, and Rep. Barney Frank (D-MA), who chairs the House Financial Services Committee, recently told a town hall audience that the Fed will be subjected to a complete audit soon. He predicted the House will pass Paul’s bill — or an amalgam of it, wrapped with other regulatory reforms — “probably in October.”
“A companion bill in the Senate introduced by Sen. Bernie Sanders (I-Vt.) has 27 cosponsors,” noted The Hill.
The Fed has also come under fire for refusing to disclose which firms it paid massive bailouts to in 2008 and early 2009, amid the greatest financial crisis since the Great Depression. A particular amount of interest among lawmakers has focused on the Bank of American – Merrill Lynch & Co. merger, which the Fed facilitated.
The House Domestic Policy Subcommittee, under the leadership of Congressman Dennis Kucinich (D-OH), subpoenaed the Fed in June for records relating to the transaction. New York Attorney-General Andrew Cuomo has claimed that, in 2008, then-Treasury Secretary Hank Paulson and Federal Reserve Chairman Ben Bernanke strong-armed BofA into buying Merrill — a move that, if true, could expose Paulson and Bernanke to prosecution. That investigation is under way.
Fed Chairman Ben Bernanke “has vehemently opposed the idea [of an audit], asserting that it would lead to the politicization of monetary policy by giving Congress an easy way to second-guess any decision the Fed makes,” noted The Los Angeles Times in late August.
That specific argument — that the monetary system is endangered by closer observation of Fed actions — was discounted by Judge Loretta Preska of the Manhattan U.S. District Court, in a ruling that ordered the Fed to disclose which firms received bailout dollars.
While the Fed argued that disclosing who was bailed out on the taxpayer’s dime could be detrimental to the agency’s independence from Congress, Judge Preska wrote that the claim was based merely on “conjecture” and the court remained unconvinced because the Fed had failed to provide adequate evidence to substantiate its claims.
“[The] risk of looking weak to competitors and shareholders is an inherent risk of market participation; information tending to increase that risk does not make the information privileged or confidential,” she wrote.
Here’s a look into who was involved in setting up the Federal Reserve in 1913.
* Rothschild Banks of London and Berlin * Lazard Brothers Bank of Paris * Israel Moses Sieff Banks of Italy * Warburg Bank of Hamburg, Germany and Amsterdam * Kuhn Loeb Bank of New York * Lehman Brothers Bank of New York * Goldman Sachs Bank of New York * Chase Manhattan Bank of New York (Controlled By the Rockefeller Family Tree)
Charles A. Lindbergh, Sr. 1913 “When the President signs this bill, the invisible government of the monetary power will be legalized….the worst legislative crime of the ages is perpetrated by this banking and currency bill.”
A Bit of History
In August of 1929, the Fed began to tighten the money supply continually by buying more government bonds. At the same time, all the Wall Street giants of the era, including John D. Rockefeller and J.P. Morgan divested from the stockmarket and put all their assets into cash and gold.
Soon thereafter, on October 24, 1929, the large brokerages all simultaneously called in their 24 hour “call-loans.” Brokers and investors were now forced to sell their stocks at any price they could get to cover these loans. The resulting market crash on “Black Thursday” was the beginning of the Great Depression.
The Chairman of the House Banking and Currency Committee, Representative Louis T. Mc Fadden, accused the Fed and international bankers of premeditating the crash. “It was not accidental,” he declared, “it was a carefully contrived occurrence (created by international bankers) to bring about a condition of despair…so that they might emerge as rulers of us all.”
He went on to accuse European “statesmen and financiers” of creating the situation to facilitate the reacquisition of the massive amounts of gold which Europe had lost to the U.S. during WWI. In a 1999 interview, Nobel Prize winning economist and Stanford University Professor Milton Friedman stated: “The Federal Reserve definitely caused the Great Depression.”
US DECLAIRED bankruptcy
Because the government of the U.S. (a corporation) had paid its loans to the Fed with real money exchangeable for gold, it was now insolvent and could no longer retire its debt. It now had no choice but to file chapter 11. Under the Emergency Banking Act (March 9, 1933, 48 Stat.1, Public law 89-719) President Franklin Roosevelt effectively dissolved the United States Federal Government by declaring the entity bankrupt and insolvent.
ON JUNE 4 1963, President John F. Kennedy Signed Executive Order #11110, stripping the privately-owned Federal Reserve Bank of its power to loan money to the United States Federal Government at interest.
Left: Federal reserve Note
Right: US Treasury Note
Full size later in post
With the stroke of a pen, President Kennedy declared that the privately-owned Federal Reserve Bank would soon be out of business.
~ When President Kennedy signed this Order, it returned to the Treasury Department the Constitutional power to create and issue money without going through the privately- owned Federal Reserve Bank. United States Notes were then issued as an interest-free currency.
~ President Kennedy was assassinated on November 22 1963 and the United States Notes he had issued were immediately taken out of circulation.
[...] Why did President Lyndon Baines Johnson not continue President Kennedy’s Executive order? Was he afraid for his own life?
While the source of this information does not come from Mainstream media, it is believable and available elsewhere on the Net, I have also seen a list of the private US banks that own the Fed, perhaps the above names are the actual people behind it all.
Yet they may not be omnipotent, the Israeli press (Ynet) is opinioning that Israel should no longer assume the US will automatically come to its aid.
No wonder Europe and the US are so close!
“United States Notes” were issued as an interest-free and debt-free currency backed by silver reserves in the U.S. Treasury. We compared a “Federal Reserve Note” issued from the private central bank of the United States (the Federal Reserve Bank a/k/a Federal Reserve System), with a “United States Note” from the U.S. Treasury issued by President Kennedy’s Executive Order. They almost look alike, except one says “Federal Reserve Note” on the top while the other says “United States Note”. Also, the Federal Reserve Note has a green seal and serial number while the United States Note has a red seal and serial number.
Somewhere in the trillionaires room of Heaven three old codgers are sitting around a table smoking cigars and chuckling over the J. P Morgan Chase & Company buyout of Bear Stearns for a paltry $2.00 a share. Not so much because the price had been over $130 a share a few weeks earlier but because the Federal Reserve Board put up $30 billion of the government’s money to guarantee the sale.
Yes, Mayer Amschel Rothschild, J. P. Morgan and John D. Rockefeller, patriarchs of three of the most powerful family fortunes in history have waited nearly two centuries to see their dreams fulfilled. Perhaps such patience is why their families have remained successful by steadfastly maintaining the rules of the game as set down by their founders.
It was 248 years ago, in 1760 that Mayer Amschel Rothschild created the House of Rothschild that was to pave the way for international banking and control of the world’s resources on a scale unparalleled and somewhat mysterious to this date. He disbursed his five sons to set up banking operations throughout Europe and the various European empires.
“Give me control of a nation’s money
and I care not who makes the laws.”
Mayer Amschel Rothschild
In time the House of Rothschild was able to take control of the Bank of France and Bank of England and relentlessly pursued an effort over two centuries to control a national bank in the USA. By 1850 it was said the Rothschild family was worth over $6 billion and owned one half of the world’s wealth.
From oil (Shell) to diamonds (DeBeers) to gold (from 1919 until 2004 a Rothschild was permanent Chairman of the London Gold Fixing committee which met twice a day in the Rothschild offices in London) the Rothschild’s quietly accumulated a foothold in critical industries and commodities throughout the world.
A master at building impenetrable walls around his family assets the current value of the Rothschild holdings are estimated to be between $100 and $300 trillion, yes that is trillion dollars! Now for a point of reference the current United States National Debt is $9.4 trillion.
J. P. Morgan began as the New York agent for his father’s business in London in 1860 and by 1877 was floating $260 million in US Bonds to save the government from an economic collapse. In 1890 he inherited the business and in 1895 bought $200 million in US Bonds with gold to again save the US economy.
“If you have to ask how much it costs,
you can’t afford it.”
J. P. Morgan
By 1912 he controlled $22 billion and had started companies such as US Steel and General Electric while he owned several railroads. Morgan was also an American agent for the House of Rothschild in London and used the Rothschild resources to help people like John D. Rockefeller.
Rockefeller, who started Standard Oil in 1863 with the help of Morgan, grew his company into the largest oil company in the world and by 1916 Rockefeller was the first billionaire in American history. In 1909 he had set up the Rockefeller Foundation with $225 million and donated nearly a billion more dollars to various causes. The Rockefeller family fortune is estimated to be around $11 trillion today.
“The way to make money is to buy
when blood is running in the streets.”
John D. Rockefeller
So what did they have in common these extraordinary capitalists? They all were dedicated to owning a national bank in America so they could determine the fiscal policies of the nation and earn interest on the debt of the nation.
Rothschild agents in 1791 formed the First Bank of the United States but intense opposition to foreign ownership by President Jefferson and others helped kill it by 1811. A Second Bank of the United States was formed in 1816 once again by Rothschild agents and this time they secured a 20-year charter. However, President Andrew Jackson was also opposed to foreign ownership and withdrew the federal deposits in 1832 as part of his plan to kill the bank charter in 1836.
An attempt to assassinate Jackson in 1834 left him wounded but more determined than ever to stop the central bank. Thirty years later President Lincoln refused to pay international bankers extremely high interest rates during the Civil War and ordered the printing of government bonds. With the help of Russian Czar Alexander II who also blocked a similar national bank from being set up in Russia by the international bankers they were able to survive the economic squeeze.
Lincoln said, “The money powers prey upon the nation in times of peace and conspire against it in times of adversity. The banking powers are more despotic than a monarchy, more insolent than autocracy, more selfish than bureaucracy. They denounce as public enemies all who question their methods or throw light upon their crimes. I have two great enemies, the Southern Army in front of me and the bankers in the rear. Of the two, the one at my rear is my greatest foe. Corporations have been enthroned, and an era of corruption in high places will follow. The money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until the wealth is aggregated in the hands of a few, and the Republic is destroyed.”
Both Lincoln and Alexander II were assassinated. In 1881 James Garfield became president and he was dedicated to restoring the right of the federal government to issue money like Lincoln did in the Civil War and he was also assassinated.
Finally along came 1913 and the US was again suffering from a weak economy and there was a threat of another costly war, a world war this time, and business tycoons J.P. Morgan, John D. Rockefeller and E.H. Harriman were part of a group that got Woodrow Wilson to sign into law the Federal Reserve Act creating a network of 12 privately owned banks as part of a new Federal Reserve network.
One of the largest stockholders in the new Federal Reserve was the House of Rothschild through their direct and indirect holdings. A few years later it was disclosed that the Rothschilds also owned about 20% of J. P. Morgan. In time Morgan would merge with the Chase Manhattan Bank of the Rockefellers.
Years later John F. Kennedy opposed a private national bank and was assassinated in 1963 and Ronald Reagan opposed a private national bank and in 1981 an attempt was made to assassinate him. Coincidence or not the opposition to a privately owned national bank was a common characteristic.
Which brings us full circle to the present bailout of Bear Stearns by J.P. Morgan Chase & Company and we find the Rothschild, Morgan and Rockefeller families are all conveniently part of the same group benefiting from the bailout and the $30 billion guarantee by the Federal Reserve. This is the third time the J. P. Morgan Company has come to the rescue of the American banking system and economy.
The first top-to-bottom audit of the Federal Reserve uncovered eye-popping new details about how the U.S. provided a whopping $16 trillion in secret loans to bail out American and foreign banks and businesses during the worst economic crisis since the Great Depression. An amendment by Sen. Bernie Sanders to the Wall Street reform law passed one year ago this week directed the Government Accountability Office to conduct the study. "As a result of this audit, we now know that the Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world," said Sanders. "This is a clear case of socialism for the rich and rugged, you're-on-your-own individualism for everyone else."
Among the investigation's key findings is that 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. "No agency of the United States government should be allowed to bailout a foreign bank or corporation without the direct approval of Congress and the president," Sanders said.
Table 31: Largest TSLF Borrowers by Total Dollar Amount of Loans (Includes TOP Loans) Dollars in billions Rank Primary dealer Total TSLF loans (market value) Percent of total 1 Citigroup Global Markets Inc. $348 15.0% 2 RBS Securities Inc. 291 12.6% 3 Deutsche Bank Securities Inc. 277 11.9% 4 Credit Suisse Securities (USA) LLC 261 11.2% 5 Goldman Sachs & Co. 225 9.7% 6 Barclays Capital Inc. 187 8.0% 7 Merrill Lynch Government Securities Inc. 166 7.2% 8 UBS Securities LLC. 122 5.3% 9 Morgan Stanley & Co. Incorporated 115 4.9% 10 Banc of America Securities LLC 101 4.3% 11 Lehman Brothers Inc. 99 4.3% 12 J.P. Morgan Securities LLC 68 2.9% 13 BNP Paribas Securities Corp. 41 1.8% 14 Countrywide Securities Corporation 8 0.3% 15 HSBC Securities (USA) Inc. 4 0.2% 16 Cantor Fitzgerald & Co. 3 0.1% 17 Bear Stearns & Co., Inc. 2 0.1% 18 Dresdner Kleinwort Securities LLC 1 0.1% Total $2,319 100.0% Source: GAO analysis of Federal Reserve Board data. Note: Amount shown for Banc of America Se
In 1916 there were Income tax revenues. I guess someone between 1915 and 1916 figured they needed to tax peoples income.
Over 47% revenue was spent on Defense (war).
It is all rather interesting to see how income Revenues and Spending compares from year to year however.
One can track the changes in social spending as well. Do visit the Source, you will find it all rather interesting.
IN 2008
Amounts in $ billion
About one quarter of the Budget is Spent on Defense ( War) 728.7,
Add that to interest paid 243.9 on money that was borrowed.
War + Interest = about one third of the spending.
Total spending is 2,931.2
Revenue however is only 2,521.2
They are of course spending more then they receive in Revenue, as a result are running a deficit, meaning they will have to borrow money to cover their spending.
This means also more interest will have to be paid the following year or years.
This adds to the Debt for future generations.
Go to source for 1902 to 2008 and see how things have changed over the years.
What is interesting about this, Bush is working on convincing Americans to go to war with some of the very people that have lent the US money. Now isn’t that SPECIAL??
Now if you look at this way, it is a bit easier to understand. I like to simplify things. Sometimes when you simplify it is easier to grasp the concept of a senerio.
So you lend your neighbor money, then he bad mouths you to all the other neighbor, then comes and blows your house up.
He kills your wife, kids, aunts uncles, cousins. grandparents and a few of your friends.
Then says he did it to rescue them, from the mean nasty father namely you.
Of course what the rest of the neighbors didn’t know,
You were nice enough to lend the murder money.
They actually thought he the murder was a nice guy.
He sure could BS his way into their hearts and minds.
He even took some of the money you lent him and paid one of the other neighbors money, to help him blow up your house.
Well you know sooner or latter the rest of the neighbors will find out what he did and yes he should go to jail.
Not much of a neighbor is he. Not someone you really want as a friend.
Turns out a whole lot of other neighbors, lent him money too.
Oh yes it gets more interesting all the time.
He also went around bad mouthing them too. Well the nerve of him.
He was also trying to get some of the other neighbors, to go blow their houses up too.
What and S.O.B.
Well everyone finally had a neighborhood meeting and found out what was really going on.
They found out the murder was a drug dealing, drug doing, low life, lier.
Boy is everyone pissed off when they find out the truth.
Well wouldn’t you be a bit angry or downright furious?
Think about it?
Anyway Back to the task at hand.
The national debt equates to $30,400 per person U.S. population, or $60,100 per head of the U.S. working population, as of February 2008.
Of course now that the Bailout Bill of about 810 billion has been implemented keeping in mind &00 Billion + $110 Billion in other areas and the 612 billion for Defense Spending has been put in place that will increase substantially. More borrowing, more interest, More Debt.
This is also like dating a drug addict. They just can’t quit. Their drug of choice is War.
Now from what I understand they will to save money, cut anything but Defense spending as a matter of fact it has grown year after year and has become a staggaring burden to the American people. So if they tell you they need to cut social spending or pension plans that is pure BS if anything should be cut it would be Defense spending. War is not a nessesity.
If they try blaming their problems on the Poor which have been doing for years it is not now or ever was the poor it was always War that drove the American people into deficit and debt. Because of their war addiction they have also created poverty not only in America but in the countries they have invaded.
Because of absolute mismanagement, the American people are being driven onto the streets and becoming homeless. The middle class are becoming the poor. Children are going hungry. Innocent people are dieing due to lack of Health Care. For others their debts due to medical bills or job losses are also causing them to lose their homes.They are the new homeless folks. You could be next. You could end up on welfare. Many have because of mismanagement.
Somewhere in the trillionaires room of Heaven three old codgers are sitting around a table smoking cigars and chuckling over the J. P Morgan Chase & Company buyout of Bear Stearns for a paltry $2.00 a share. Not so much because the price had been over $130 a share a few weeks earlier but because the Federal Reserve Board put up $30 billion of the government’s money to guarantee the sale.
Yes, Mayer Amschel Rothschild, J. P. Morgan and John D. Rockefeller, patriarchs of three of the most powerful family fortunes in history have waited nearly two centuries to see their dreams fulfilled. Perhaps such patience is why their families have remained successful by steadfastly maintaining the rules of the game as set down by their founders.
It was 248 years ago, in 1760 that Mayer Amschel Rothschild created the House of Rothschild that was to pave the way for international banking and control of the world’s resources on a scale unparalleled and somewhat mysterious to this date. He disbursed his five sons to set up banking operations throughout Europe and the various European empires.
“Give me control of a nation’s money
and I care not who makes the laws.”
Mayer Amschel Rothschild
In time the House of Rothschild was able to take control of the Bank of France and Bank of England and relentlessly pursued an effort over two centuries to control a national bank in the USA. By 1850 it was said the Rothschild family was worth over $6 billion and owned one half of the world’s wealth.
From oil (Shell) to diamonds (DeBeers) to gold (from 1919 until 2004 a Rothschild was permanent Chairman of the London Gold Fixing committee which met twice a day in the Rothschild offices in London) the Rothschild’s quietly accumulated a foothold in critical industries and commodities throughout the world.
A master at building impenetrable walls around his family assets the current value of the Rothschild holdings are estimated to be between $100 and $300 trillion, yes that is trillion dollars! Now for a point of reference the current United States National Debt is $9.4 trillion.
J. P. Morgan began as the New York agent for his father’s business in London in 1860 and by 1877 was floating $260 million in US Bonds to save the government from an economic collapse. In 1890 he inherited the business and in 1895 bought $200 million in US Bonds with gold to again save the US economy.
“If you have to ask how much it costs,
you can’t afford it.”
J. P. Morgan
By 1912 he controlled $22 billion and had started companies such as US Steel and General Electric while he owned several railroads. Morgan was also an American agent for the House of Rothschild in London and used the Rothschild resources to help people like John D. Rockefeller.
Rockefeller, who started Standard Oil in 1863 with the help of Morgan, grew his company into the largest oil company in the world and by 1916 Rockefeller was the first billionaire in American history. In 1909 he had set up the Rockefeller Foundation with $225 million and donated nearly a billion more dollars to various causes. The Rockefeller family fortune is estimated to be around $11 trillion today.
“The way to make money is to buy
when blood is running in the streets.”
John D. Rockefeller
So what did they have in common these extraordinary capitalists? They all were dedicated to owning a national bank in America so they could determine the fiscal policies of the nation and earn interest on the debt of the nation.
Rothschild agents in 1791 formed the First Bank of the United States but intense opposition to foreign ownership by President Jefferson and others helped kill it by 1811. A Second Bank of the United States was formed in 1816 once again by Rothschild agents and this time they secured a 20-year charter. However, President Andrew Jackson was also opposed to foreign ownership and withdrew the federal deposits in 1832 as part of his plan to kill the bank charter in 1836.
An attempt to assassinate Jackson in 1834 left him wounded but more determined than ever to stop the central bank. Thirty years later President Lincoln refused to pay international bankers extremely high interest rates during the Civil War and ordered the printing of government bonds. With the help of Russian Czar Alexander II who also blocked a similar national bank from being set up in Russia by the international bankers they were able to survive the economic squeeze.
Lincoln said, “The money powers prey upon the nation in times of peace and conspire against it in times of adversity. The banking powers are more despotic than a monarchy, more insolent than autocracy, more selfish than bureaucracy. They denounce as public enemies all who question their methods or throw light upon their crimes. I have two great enemies, the Southern Army in front of me and the bankers in the rear. Of the two, the one at my rear is my greatest foe. Corporations have been enthroned, and an era of corruption in high places will follow. The money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until the wealth is aggregated in the hands of a few, and the Republic is destroyed.”
Both Lincoln and Alexander II were assassinated. In 1881 James Garfield became president and he was dedicated to restoring the right of the federal government to issue money like Lincoln did in the Civil War and he was also assassinated.
Finally along came 1913 and the US was again suffering from a weak economy and there was a threat of another costly war, a world war this time, and business tycoons J.P. Morgan, John D. Rockefeller and E.H. Harriman were part of a group that got Woodrow Wilson to sign into law the Federal Reserve Act creating a network of 12 privately owned banks as part of a new Federal Reserve network.
One of the largest stockholders in the new Federal Reserve was the House of Rothschild through their direct and indirect holdings. A few years later it was disclosed that the Rothschilds also owned about 20% of J. P. Morgan. In time Morgan would merge with the Chase Manhattan Bank of the Rockefellers.
Years later John F. Kennedy opposed a private national bank and was assassinated in 1963 and Ronald Reagan opposed a private national bank and in 1981 an attempt was made to assassinate him. Coincidence or not the opposition to a privately owned national bank was a common characteristic.
Which brings us full circle to the present bailout of Bear Stearns by J.P. Morgan Chase & Company and we find the Rothschild, Morgan and Rockefeller families are all conveniently part of the same group benefiting from the bailout and the $30 billion guarantee by the Federal Reserve. This is the third time the J. P. Morgan Company has come to the rescue of the American banking system and economy.
Since our nation’s inception in 1776 – cold, cunning conspirators have sought to undermine our political sovereignty for their own personal profit. Behind a facade of corporate and congressional respectability, a cabal of ruthless men use extortion and murder to steal our nation’s wealth and turn the United States into a fascist war-machine that inexorably threatens the entire world. But now at last, the American people are rising to unmask “THE ENEMY WITHIN”!
Downloadable chart
Downloadable chart
Downloadable chart
Downloadable chart
Left: Federal reserve Note
