Federal Reserve is the primary tool of the new financial oligarchy – The ultimate banking clearing house with zero oversight from the people still holds over $2 trillion on its balance sheet.

The Federal Reserve system (the Fed for short) is the US central banking system.  The Fed was created in 1913 with the enactment of the Federal Reserve Act.  In the beginning the Fed had limited powers and its mission was limited.  According to the Fed its mission today is to conduct monetary policy, supervise and regulate banking institutions, and maintain stability in the financial system.  If this is the mission of the Fed, it has radically failed and the American people should audit the Fed to see what went wrong.  The problem with the Fed is that it is independent within the government since it does not need to seek legislation for actions.  Yet the authority of the Federal Reserve is derived from the US Congress.  Yet we have recently seen when a push to audit the Fed was issued in Congress a major backlash hit from the Fed and we have yet to conduct a full audit of the Federal Reserve.  The Fed has conducted and put at risk the US currency to protect the banking interests of its member banks.  The unstated mission of the Fed is to protect its banking allies even if it means destroying the economic structure of its host nation so long as wealth is stabilized in the new financial oligarchy.

Even as the Fed gloats that the economy is on a mends, we see that the Fed balance sheet hasn’t really shifted since the financial crisis hit:

fed balance sheet

Source:  Wikipedia, chart

The Fed currently has over $2 trillion in “assets” on its balance sheets.  We have documented that within this enormous amount of assets, there are questionable loans and items including shadow bailouts of the imploded commercial real estate market.  The Fed has bailed out shopping malls in Oklahoma that have no adequate traffic to justify their existence all the way to luxury hotels.  Do you think the American people consider this a solid way of managing the nation’s financial health?

Yet let us go back to one of the stated items listed on the Fed’s mission statement, that of financial stability.  In the last decade the US financial markets have seen some of the worst financial volatility since the Great Depression.  The Fed did not sit idly by as we now know with the released lending notes during the crisis.  The Fed made $9 trillion in short-term loans to 18 of the largest financial institutions in the country.  It also made loans to corporate entities like McDonalds for example.  The Fed of course did not want this information to be released since it showed favoritism to the largest organizations in the country all the while lending tightened up to smaller businesses and organizations.  Individuals certainly have felt the credit freeze and nowhere in the notes do we see the Fed making a solid effort to bolster lending to the American public.  They were concerned about the biggest institutions and the rest were left hanging on a shingle.

During the banking crisis of the Great Depression many banks failed in a system setup under unit banking:

bank failures

Source:  Mortgage News

Yet the big problem today is that we have a handful of banks holding over 50 percent of all total banking assets ($13 trillion and half with 19 banks out of 7,700+).  So the raw count of bank failures is deceptive.  We can have 100 bank failures costing $1 million each or have one giant failure like IndyMac costing $8 billion.  The era of too big to fail is just as dangerous as one in which banks are isolated.  In fact with the data released from the Fed we see the insidious problem of a system in which the worst performing banks with the most deceptive practices not only are bailed out but are given more capital to remain in business.  All this does is solidifies their actions and makes them grow even bigger, the side effect of moral hazard.  Think of JP Morgan taking over Washington Mutual and now they are going to charge customers $10 a month for what used to free checking for life.  Think of Bank of America swallowing up Countrywide Financial.  This is the kind of banking consolidation that the Fed has orchestrated since the crisis started with no accountability to Congress or the American people.

The Fed would like you to believe that they are using their own money but this is a lie.  The Fed was instrumental in creating the housing bubble with their low Fed funds rate:

fed funds rate

Most Americans carry a large part of their net worth in real estate.  So the fact that the Fed turned what used to be a stable asset into a highly volatile commodity that encouraged Wall Street banks to develop CDOs and other instruments of financial destruction was a method of siphoning off wealth from most Americans to their banking overlords.  Again, the Fed is designed to maintain financial stability but the actions of the last few decades demonstrate that their mission should read:

“To aggregate as much wealth into the banking system while eliminating the American middle class by a slow systematic dilution of their currency and financial well being and standard of living.”

This is exactly what has happened in the last decade.  The average American makes roughly $39,000 a year or less.  72 million Americans make $25,000 or less each year.  Yet at the same time wealth at the top is getting more and more consolidated.  So now we have a system where giant bank failures don’t happen but we have a slow destruction of wealth for the remainder of the American public.  The Fed only cares about stability for its member banks.  Ben Bernanke, the current Fed chief went on 60 Minutes claiming that Americans would be better off if they just got more educated.  Oh really?  So you mean with the current higher education bubble Americans should borrow more money from banks and the government so they can go into massive debt for a degree that may not help them land a job?  We all know that the cost of college has far outpaced the cost of most items including healthcare costs. Yet the solution to our current crisis is to get into deeper debt and become slaves to banks yet again?  Sounds like Alan Greenspan being a champion for adjustable rate mortgages.

The Fed has given horrible advice over and over.  It wouldn’t be such a problem if they were a pundit on a radio show.  But this is our central bank!  This is the institution that made $9 trillion in short-term loans and fought Congress to keep it hidden from the American people.  This is the institution that has over $2 trillion in “assets” and doesn’t want to say what it is because the American people will find out that junk mortgages on failed real estate deals will show up.  The Fed has failed on its explicit mission and it is time to fully audit the Fed.

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7 Comments on this post

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  1. Bill said:

    The Fed is an instrument, the President is the tool.

    December 19th, 2010 at 3:26 pm
  2. William Alford Belleview, Florida said:

    If this nation is in such dire straits due to the dishonesty of a private entity, why doesn’t these so called honest elected officials stand up and stop the BS. I realize there are crooks but, from what I get from you the whole damned world is on the take.

    December 20th, 2010 at 5:30 am
  3. Hambone said:

    Audit the Fed? That is a fine colloquial, antiquated idea. Would have been helpful if it had never allowed the bailout.

    But now, it’s simply too late. The “assets” are ours. Short of a revolution there is no offloading or put back mechanism (that I know of or that would be allowed to be utilized). Instead it is expected the public will pay interest forever on debt unending. No better control mechanism when individuals can no longer feed, cloth themselves.

    Don’t get me wrong, would be good (awful) to know what exactly the Fed took as collateral, bought, etc. But then what?

    The Fed has acted at the behest of a few at the expense of the many and now we come to the grand finale of the exponential curves (debt, population, energy).

    What does it all add up to?

    December 20th, 2010 at 4:27 pm
  4. Mike said:

    They are not going to audit the fed, they are running the US corp bankruptcy since 1933 Bernanke is the dicator of america. And they are going to crush us

    December 20th, 2010 at 5:11 pm
  5. Fed Slave said:

    They will never audit the fed, they fed is running the US bankruptcy since 1933, The US is not a country but a corp. and the fed reserve is running us into the ground on purpose. Then the IMF will come in here and take everything.

    December 20th, 2010 at 5:21 pm
  6. medicis said:

    The Federal Reserve is a privately owned corporation. It is NOT part of the government. It’s head is paid through the IMF. Foreign owners include the Rothschild cabal and Windsor family. It’s primary goal is to collect American resources securitized under the 1933 bankruptcy of the Federal Corporation known as the ‘United States’ (see title 28). It’s primary goal? To rape America and to monetize the wealth of the nation. The solution? Bannish the FED. Try every employee of that institution for treason against the Republic. Ignorance of complicity is no excuse.

    December 21st, 2010 at 6:16 pm
  7. Richard said:

    Do you believe that the Fed should be abolished like Ron Paul prefers? Why or why not?

    December 21st, 2010 at 11:15 pm

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