Category Archives: Inflation

Babs Boxer Will Do Anything For Re-Election: Even Cosponsor S.604!

Activism, Currency and Monetary Policy, Economics, Election '10, Government Transparency, Inflation, Monetary Issues, Politics

Back in July, I sent letters to Barbara Boxer and Dianne Feinstein urging them to support or even cosponsor S.604, the Audit-The-Fed bill. I received the typical mealy-mouthed responses (posted below after the fold), and like a bad blogger I never actually mentioned the responses here. How mealy-mouthed was Boxer’s response? Well, THIS was the most substantive thing she said:

I believe that all citizens should become involved in the legislative process by letting their voices be heard, and I appreciate the time and effort that you took to share your thoughts with me. One of the most important aspects of my job is keeping informed about the views of my constituents, and I welcome your comments so that I may continue to represent California to the best of my ability. Should I have the opportunity to consider legislation on this or similar issues, I will keep your views in mind.

Great… You thank me for sharing my thoughts. I feel empowered!

What you don’t say is anything whatsoever regarding your opinion on the legislation (at least Feinstein gave me *something*). So how do I interpret your letter?

‘I’m gonna put my finger up in the air and see which way the wind blows, because I have a vulnerable seat in 2010 and I don’t want to piss anyone off. If I see any benefit to myself, I might at some point take a position on this legislation.’

So, today, when I was reading United Liberty, I was reminded of S.604, and decided to check to see if there were any surprises. And to my astonishment, there was! Barbara Boxer actually co-sponsored S.604!!

Do I think she’s really all that interested in an audit of the Federal Reserve? Not from the email response I received. But hey, she knows a populist wave when she sees one, and she’s gonna ride this one to Nov 2010.

There are a lot of forces assembling behind the Audit the Fed movement. Those forces are having traction. Enough traction, in fact, to get a California Democratic Senator to fall into line. It may be a political calculation, but if someone like Boxer has to make that calculation, it proves that there’s actually some real mojo here. Congratulations are due to Ron Paul, because without his tireless work in the House, we wouldn’t be this close to a serious review of what goes on at the Fed.
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Brad Warbiany
https://thelibertypapers.org/

Why You Should Support Auditing The Fed

Currency and Monetary Policy, Economics, Government Transparency, Hubris, Inflation, Monetary Issues

The Fed is tasked with the dual goals of price stability and restraining inflation. Folks like myself would suggest it hasn’t done a very good job of either, but that’s not crucial to the question of whether we should be able to determine how they’re attempting to fulfill their mission.

Particularly irksome when we’re talking about an audit is the fact that they’ve just admitted to engaging in gold swaps, influencing the gold price, in opposition to past denials and with the assertion that they should be able to continue hiding the specifics:

The Federal Reserve System has disclosed to the Gold Anti-Trust Action Committee Inc. that it has gold swap arrangements with foreign banks that it does not want the public to know about.

The disclosure, GATA says, contradicts denials provided by the Fed to GATA in 2001 and suggests that the Fed is indeed very much involved in the surreptitious international central bank manipulation of the gold price particularly and the currency markets generally.

The Fed’s disclosure came this week in a letter to GATA’s Washington-area lawyer, William J. Olson of Vienna, Virginia (http://www.lawandfreedom.com/), denying GATA’s administrative appeal of a freedom-of-information request to the Fed for information about gold swaps, transactions in which monetary gold is temporarily exchanged between central banks or between central banks and bullion banks. (See the International Monetary Fund’s treatise on gold swaps here: http://www.imf.org/external/bopage/pdf/99-10.pdf.)

Gold has been flirting with the $1000/oz level for several weeks (topping it a few times). Those in the gold market have long believed that central banks are suppressing the price to keep fears of inflation from hitting the roof.

How much longer do we have to allow the fed to lie to us, and then when we catch them red-handed, assert that they know well enough that we have to let them hide details on top of their lies?

I say we audit the fed. Then End The Fed.

Brad Warbiany
https://thelibertypapers.org/

Chinese Worried Obamacare Is Too Expensive For Them To Pay For

Credit Crisis, Currency and Monetary Policy, Economics, Fiscal Policy, Healthcare, Inflation, Monetary Issues

Obama says that he won’t sign a healthcare bill that adds one dime to the deficit. I hope he’s right about that, because the people who are financing that deficit are a tad bit worried about the prospect:

And yet, there was budget director Peter Orszag rushing to a lunch with Chinese bureaucrats on a Monday in late July. To his surprise, when Orszag arrived at the site of the annual U.S.-China Strategic and Economic Dialogue (S&ED), the Chinese didn’t dwell on the Wall Street meltdown or the global recession. The bureaucrats at his table mostly wanted to know about health care reform, which Orszag has helped shepherd. “They were intrigued by the most recent legislative developments,” Orszag says. “It was like, ‘You’re fresh from the field, what can you tell us?’?”

As it happens, health care is much on the minds of the Chinese these days. Over the last few years, as China has become the world’s largest purchaser of Treasury bonds, the government has grown increasingly sophisticated in its understanding of U.S. budget deficits. The issue has become all the more pressing in recent months, as the financial crisis and recession pushed the deficit to record levels. With nearly half of their $2 trillion in foreign currency reserves invested in U.S. bonds alone, the Chinese are understandably concerned about our creditworthiness. And this concern has brought them ineluctably to the issue of health care. “At some point, if you refuse to contain health care costs, you’ll go bankrupt,” says Andy Xie, a prominent Shanghai-based economist, formerly of Morgan Stanley. “It’s widely known among [Chinese] policymakers.” Xie himself wrote a much-read piece on the subject in 2007 for Caijing magazine–kind of the Chinese version of Fortune.

The Chinese, unfortunately for them, have worked their way into a suicide pact with America. They are simply too heavily invested here to see any serious problems with our economy, government, or monetary base. Had they not spent the last decade buying up enormous Treasury holdings, they could let us implode our economy and “fix” our debt/spending issues through debasing our currency, and then swoop in to buy assets on the cheap once we hit bottom. But that’s not on the agenda. If we take the low road, we’re towing them along for the ride.

Obama says he won’t accept a bill that adds to the deficit. I don’t believe him, since I’ve already seen him fail to live up to his promises on taxes and legislative transparency. Even worse, though, he’s got the folks who plan to finance that deficit worried. And the last group you want to scare are the ones you’re trying to get to lend you money.

Hat Tip: Ezra Klein

Brad Warbiany
https://thelibertypapers.org/

Obama: You’re doing a heck’uva job, Bernie

Credit Crisis, Currency and Monetary Policy, Doublespeak, Dumbasses and Authoritarians, Economics, Fascism in America, Government Incompetence, Hubris, Inflation, Monetary Issues

Continuing his George Costanzaesque presidency, Obama has decided to reappoint Ben “Helicopter” Bernanke to another term on the Fed.

Here’s what Obama had to say:

Ben approached a financial system on the verge of collapse with calm and wisdom; with bold action and outside-the-box thinking that has helped put the brakes on our economic freefall

I thought it might be useful to take a look at some highlights of this Solon, this central – planner whom George Bush put in charge of the money supply:

Of course, as usual, Obama is dead wrong: the Federal Reserve’s actions have actually prolonged the downturn, made it worse, and have laid the foundations for an even bigger crash down the road.

Monetary Base of U.S. Dollar

In the days before the election, I told many of my fellow Massachusetts residents that Obama was not so much a break from George Bush as a continuation of his worst policies. I am sorry to say that he has been proving me right since. And this is yet another nail in the coffin of an administration that is showing itself to be even more incompetent than the Bush presidency.

tarran
I am an anarcho-capitalist living just west of Boston Massachussetts. I am married, have two children, and am trying to start my own computer consulting company.
https://thelibertypapers.org/author/tarran/

Letters To Boxer & Feinstein To Support S.604 On Auditing The Fed

Activism, Credit Crisis, Currency and Monetary Policy, Economics, Inflation, Monetary Issues, Politics

Below is the text of a letter I’ve sent to Senators Barbara Boxer and Dianne Feinstein. H.R. 1207 (introduced by Ron Paul) and S. 604 (introduced by Bernie Sanders) is a bill that requires the Comptroller General to audit the Fed and report back to Congress within the next 18 months. Given that the only oversight they undergo is occasionally having Bernanke lie and befuddle Congress with confusing non-answers, I think it makes sense.

The below letter should be read as a potential template for readers to use when writing to your own Senators and Congressmen. However, there are two caveats to this. First, there are a few points here about California, as we have had some special challenges throughout the tech crunch and the housing collapse. Second, the tone of the letters is geared towards Democrats. If you’re sending this to Republicans, it would make sense to change the language in certain areas.

Either way, I wanted to provide potential talking points for readers who want to contact their Senators and get this ball moving.

July 9, 2009

Dear Senator XXXXX,

Senate bill S.604, a bill to require the Comptroller General of the US to audit the Federal Reserve, is currently under review with the Senate Committee on Banking, Housing, and Urban Affairs. I am writing to urge your support for this bill.

California has been the epicenter of two asset bubbles over the last two decades: the high tech bubble and the housing bubble. Both brought the illusion of wealth to our state, and both caused much pain to our residents and our state government when they collapsed. There are many causes of asset bubbles, but chief among them are the loose monetary policies of the Federal Reserve. These policies cause malinvestment and excessive speculation, the hallmark of any bubble.

The Federal Reserve policies of Alan Greenspan and continued by Ben Bernanke are placing the financial system of the United States in jeopardy. These policies are largely undertaken without Congressional or Federal oversight, and benefit the interests of our financial sector at the expense of our citizens.

Most recently, the Fed has expanded their balance sheet to $2T buying securities, all the while engaging in a policy of “quantitative easing”, which is the euphemistic term for “printing money”. These policies are unprecedented in American history, and their long-term effects may be far worse than the problems they’re expected to address today.

S. 604’s sister bill in the House (H.R. 1207) has widespread bipartisan support, and over 250 cosponsors – including 25 from California. S. 604 is rapidly gaining sponsorship in the senate, with three additional cosponsors added in the last several days to a (now) total of 7 sponsors.

The Federal Reserve is adopting policies that affect every American at the core of their economic life – the value of our dollars and the value of our homes. They are making these decisions without meaningful Congressional oversight and without allowing anyone to “check the books”.

Congress has a duty to Americans to ensure that the Federal Reserve is acting in our interests, and the first step to doing so is to understand what they’ve already done. An audit is necessary. I hope that I’ve convinced you to support and possibly cosponsor S.604.

Sincerely,
Brad Warbiany

(Followed by contact info)

Give it a shot. I prefer to fax things to elected officials, as I believe there to be a more definitive tactical feel to actual paper. When they see that it’s printed out and faxed, I think it carries a little bit more significance than an email. I also emailed this to both of them, just in case their staffers are more likely to read one than the other.

Brad Warbiany
https://thelibertypapers.org/
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