Given the current economic jitters, how about those with knowledge give us a lesson on the Federal R
SanctionII
Posts: 12,422 ✭✭✭✭✭
When was it created? Who created it (Uncle Sam?)? Who owns it (private stockholders or Uncle Sam)? What is its purpose and function? Who are members of it and what qualifications must one meet to become a member? What business relationship does it have with the Treasury Department (including the US Mint and the BEP)? Did is have a predecessor or is it an original creation (if it had no predecessor, how were things done before it was created)? Has it been copied in other parts of the world? How do the people who run it obtain their positions, how long of a term do they serve and to whom are they accountable?
Most importantly, does the Federal Reserve Bank have a coin collection or currency collection of any kind? If so, where is it located and can the public see it?
I for one am not very familiar with the Federal Reserve Bank and would like to learn more about it?
So all of you forumites with knowledge about the Federal Reserve Bank, how about you share your knowledge with me and other kindred souls who need "smoe mo edumacation"
Thanks in advance.
Most importantly, does the Federal Reserve Bank have a coin collection or currency collection of any kind? If so, where is it located and can the public see it?
I for one am not very familiar with the Federal Reserve Bank and would like to learn more about it?
So all of you forumites with knowledge about the Federal Reserve Bank, how about you share your knowledge with me and other kindred souls who need "smoe mo edumacation"
Thanks in advance.
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To keep the Fed from being simply a "bankers club" Congress required that the majority of each Feds board of directors be composed of individuals representing the interests of the consumers and non financial business.
Congress charged the Fed with three tasks:
To develop and supervise the distribution of a national currency.
To establish a nationally coordinated system of check clearing and collection services.
To process the governments financial accounts and to serve as the central depository for government funds.
Before the Fed, the central bank was the First Bank of the United States created by Alexander Hamilton in 1791....this lasted till Congress did not renew its charter in 1811. The Second Bank of the United States was established due to the War of 1812 and lasted until 1837. The free banking period ran fron 1837 to 1912.
The Fed is concerned with monetary policy, is independent of the treasury and directs the monetary policy primarily through the purchase or sale of Treasury securities (T-bonds, T-notes, and T-bills) called open market operations, it also can influence the supply of money through the required reserve ratio of depository institutions but rarely uses this power. It also can influence the monetary base and quantities of money by changing the terms by which it lends reserves through the discount window.
You can take a whole college course on how the Feds use these tools in conducting monetary policy but basically thats it.
Edited to add: No, the Fed does not own a currency or coin collection.... that is the province of the Smithsonian.
Well if you think you can deal with it. Watch this video.
Freedom to Fascism
And there is always this classic....
Money Masters
The Federal Reserve is NOT Federal and it has NO Reserves. It is "quasi-governmental" - meaning it has no real governmental oversight. It is a PRIVATE bank that elects it's oversight committee - so it has no oversight. The proof is that it has no oversight is seen in that it NEVER had an audit in it's almost 100 year history.
Look into it because they are the ones running the dollar into the ground for the private banks.
Rob
<< <i>You REALLY want the truth? Can you handle it?
Well if you think you can deal with it. Watch this video.
Freedom to Fascism
And there is always this classic....
Money Masters
The Federal Reserve is NOT Federal and it has NO Reserves. It is "quasi-governmental" - meaning it has no real governmental oversight. It is a PRIVATE bank that elects it's oversight committee - so it has no oversight. The proof is that it has no oversight is seen in that it NEVER had an audit in it's almost 100 year history.
Look into it because they are the ones running the dollar into the ground for the private banks.
Rob >>
Excellent. Today's Ron Paul-Bernanke meeting was pretty dang good too where Bernanke had no choice but admit that inflation was a tax .
Ron Paul vs the Fed
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
I can give you a bit of history about the Fed. I am sure that others might disagree with some of my statements. All I can tell you is that I worked as a visiting scholar at the KC Fed for 8 months and I know what I am talking about. So, here is a bit about the Fed: The Fed was formed in 1913. Contrary to what others may say, 1) the law that enacted the Fed was passed in the same way that any other law is passed, and 2) the Fed has passed consitutional muster by the Surpreme Court.
The Federal Reserve system comprises 12 Federal Reserve regional banks (located in 12 cities in the US) and the Federal Reserve Board (located in Washington DC). The Fed is said to be a quasi-public/quasi-private organization and this is reflected in its structure. At the bottom of its structure are the member banks--these are the privately owned commercial banks that are members of the Federal Reserve system. Each nationally chartered bank must be a member of the Fed. Member banks buy stock in their Federal Reserve regional bank. This fact is sometimes used to make the false assertion that the Fed is owned by commerical interests and/or the equally false assertion that the Fed is run to further the interests of the member banks. The stock the commercial banks has very few of the ownership rights that we typically associate with stock: it cannot be resold to anyone else; it pays a fixed 6% dividend and the dividend does not increase over time; and, if a bank leaves the Federal Reserve system, it must resell the stock back to the Fed at the same price it paid for the stock. Indeed, the stock is such a poor investment that banks are required by law to own the shares and the amount they must own depends on the bank's size. To the best of my knowledge no bank owns more than the legally required minimum.
The next layer of the Federal Reserve is the 12 Federal Reserve regional banks. Going back to the commercial banks, the only thing the stock the commercial banks own allows them to do is to elect 6 of the 9 members of the Board of Directors of their Federal Reserve regional bank. But these board members do very little that is important--all they can do is to nominate a person to be the President of the Federal Reserve regional bank. That is an important job. The directors nominate a President but the nomination must be approved by the Board of Governors.
So, let's look at the top of the Federal Reserve system, which is the Board of Governors in Washington DC. There are 7 members, nominated by the US President and approved by the Senate. They are appointed to 14 year terms, over-lapping terms. One member, currently Ben Bernanke, is nominated by the President and approved by the Senate to a 4-year term as Chair of the Federal Reserve. These people are selected by a purely political process. The Board is where an immense amount of power resides. The 7 Board members as well as the President of the NY Federal Reserve bank and, on a rotating basis, 4 Presidents of the regional banks serve as voting members on the "Federal Open Market Committee," which is the group that makes US monetary policy. This is the most improtant group within the Fed. Note well: The 7 members selected by a purely political process have a majority on this committee. And the other members, the Presidents of the Fed regional banks, are subject to approval by the Board of Governors..and the Board will deny approval to nominees it dislikes. So most economists (correctly!) look at the Fed as a part of the government.
This post is long enough. If there is interest, I can post again about open market operations and tell you what the Fed does with its "profits."
Mark - What was the rationale behind this? In your opinion, is it still valid?
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
The Federal Reserve Fraud
Also see,
JFK vs. The Fed
Capital investment depends on confidence. - Martin Armstrong
It was supposed to be a temporary measure.
"We shall deal with our economic system as it is and as it may be modified not as it might be. If we had a clean sheet of paper to write upon and step by step we shall make it what it should be" -
Woodrow Wilson, founder of the Federal Reserve System, from his first inaugural address. Now that is some kind of rhetoric!
The US Government issued a publication titled "The Federal Reserve System, It's Purposes and Functions" which outlines much of what Mark related.
As we know, the notes are not redeemable for any metal or commodity, and If I recall correctly, Congress has lowered the metal reserve (Fort Knox, etc.) valuation percentage to a rate at which the government's gold and silver reserves would not begin to cover the amount of FRN's in circulation.
Today's FRN's are simply pieces of fiat money.
The replies to this thread are great. Keep it coming.
There sure is quite a bit of knowledge, life experience, expertise and wisdom on the CU Coin Forums............................., plus lots of good old fun, spirited discussion and humor.
The FED has been the inflation and wealth transference engine of our economy since 1913. That is it's primary function, that is, to make money for the bank owners and transfer wealth from the USA to the FED. Even Greenspan said as much in 1966. The FED's owner makeup has been discussed here before. Ringleaders include the Rothschilds, Rockefellers, Bank of England, JPMorgan, Lehman, and much more older money throughout Europe and the USA. We finance the FED's operation and lend them money so they can lend it back to us with interest. Why we need such an expensive middleman is beyond me. He who controls the nation's currency, controls the nation. Some say that J.P. Morgan was rewarded in 1913 by being made a FED member for his role in financing the US out of the 1907 banking crisis. You can bet the farm and anything else you like that the FED's policies are solely to favor its owners. The fact that they occasionally do something that favors the USEconomy is probably more by coincidence than design.
The FED governor is chosen such that they will follow the whims of the banking cartel. Once in, we as a nation have no control over their actions when it comes to rates, bailouts, back door deals, open market operations (ie PPT and gold supression and naked shorting of anyone that gets in their way). The FED is part of govt in that they are corrupt as well. This is the classic old boys club where the Bilderbergs lunch. We have a privately owned corporation (lead by the Bank of England) whose goal is to get financial control of the USA back after losing it in the 1700's. They are succeeding beyond their wildest dreams. Our Founding Fathers would be livid.
1) the law that enacted the Fed was passed in the same way that any other law is passed, and 2) the Fed has passed consitutional muster by the Surpreme Court.
The law was passed in December 1913 when numerous members of congress were on holiday. When Woodrow Wilson signed this bill he said that he had basic destroyed the country and given control over the bankers. He was right. Much like the Patriot Act, you can be assured that few members of Congress knew what they were signing back in 1913.
....open market operations and tell you what the Fed does with its "profits."
Yes, we'd like to know how the FED will profit by picking up $400 BILLION in basically worthless mortgage securities and holding them essentially forever. They are currently doing this via the 28 day repo window and renewing the leases every 28 days...ad infinitum. This is the loan that never gets paid back. For now they are passing on the profits in order to save the hides of their fellow bankers at all costs....even if it destroys the US in the process. As long as the banks have their dough (and gold).....mission accomplished.
"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." ....Thomas Jefferson.
Considering that our dollar is worth 5C what it was in 1913, I vote for my view of what the FED is rather than what Mark posted. And events over the past 7 years only accentuate that belief.
roadrunner
Re the requirement that banks must buy stock in the Federal Reserve: I suspect it serves very little purpose. But I also expect that doing away with it wouldn't make much of a difference.
I guess there would be one beneficial thing result of getting rid of it: Removing the regulation would eliminate some of the noise that surrounds the Fed. But there still would always be people who believe the Fed is some illegal, immoral, nefarious plot to help some cabal run the world's economy.
"Keep your malarkey filter in good operating order" -Walter Breen
Now that's a definition I can live with.
And it's not "some cabal" either, they are THE cabal.
roadrunner
You can find some excellent reports about things like the Panic of 1857 or pre-Civil War banks, etc.
The FRB of Richmond has some good info, as does the FRB of Atlanta, but it's worthwhile to look at each District's website and check out their research reports.
Also, the National Monetary Commission (which resulted in the creation of the FRB) produced some excellent research in 1913, which was published in several books - these are still available, both in the original editions and in reprints.
If you're interested in 19th century financial history, these are excellent sources!
Check out the Southern Gold Society
<< <i>Considering that our dollar is worth 5C what it was in 1913... >>
I would be interested in an explanation of how this has been a Good Thing for the American people (well, the lower and middle class ones, anyway).
<< <i>But there still would always be people who believe the Fed is some illegal, immoral, nefarious plot to help some cabal run the world's economy. .....rep. Ron Paul is one such believer.
Now that's a definition I can live with.
roadrunner >>
Me too!
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
The Fed controls the nation's money supply, primarily as GFourDriver accurately states, by using open market operations. An open market operation is the purchase or sale of U.S. government securities by the Fed in the (open) market. Just as you and I can buy and sell government securities, so, too, does the Fed. The difference is that when the Fed buys securities it pays for them using new created bank reserves or newly printed currency. Over the years since it was founded, the Fed has accumulated about $500 or $600 billion of government securities. Clearly this sort of endeavor is highly profitable: The Fed buys government securities that pay interest and pays for them with currency and reserves, neither of which pay interest. So what does the Fed do with its profit? First it pays its expenses. (One of which was, at least in the 1980s, heavily subsidized lunches. Prime rib for lunch was 90 cents at a time when a prime rib dinner was about $9. My lips water just thinking of the lunches at the Fed!) The rest of the profit the Fed transfers back to the Treasury (yet another sign of the government agency role of the Federal Reserve). So, with some made up but potentially realistic numbers, think of it this way: The Treasury pays, say, $30 billion in interest on its debt to the Fed. The Fed covers its expenses, say, $6 billion. The difference, $24 billion using my made up numbers, is then given back to the Treasury. The fact that the vast majority of the interest paid to the Fed is given back to the Treasury is over-looked by many who assert that the Fed is run for the profit of some group of people.
As roadrunner states, the Fed also makes loans. Until recently these loans were made exclusively to comemrical banks and the Fed actively discouraged borrowing from it. With the financial turmoil this year the Fed has now made loans to other entitites, such as investment banks. The Fed asserts that it is making these loans in its "lender of last resort"role and in an attempt to avoid bank panics and bank runs. To the extent that the interest rate the Fed charges for these loans is "too low," the Fed is definitely subsidizing the borrowers. (I expect roadrunner will agree with that statement
When the Fed decides it wishes to change the total quantity of money in depository institutions, (M1 or ...more often now M2), the FOMC will send a directive to the trading desk at the FRB of New York to either purchase or sell Treasury securities. This can be in the form of a repurchase transaction, an outright transaction, or more commonly a reverse repurchase agreement. Basically it works like this.... if the Fed wishes to add money to the monetary base it will purchase securities which in turn increases deposits at depository institutions who may then loan out most of that money which will be deposited at another bank which can then loan that money out .... so say if the Fed buys $100 Million the effect is not just a straight $100 M addition to M2, it will be multiplied every time it is loaned out again....thats called the Money Multiplier effect so if there is a Money multiplier factor of 6 the total addition to the quatity of money will be $600 Million.
An open market sale will have an opposite effect because the banks have to pay for the securities thereby reducing its total reserves. So if the Fed wants to reduce the total amount of money they will sell Treasury securities.
This is a pretty basic view but I hope it helps to explain what the Feds do to change the amount of Money out there.
Brian - Assuming your world view is correct, there's something that confuses me. Maybe you can shed some light on it. Who has benefited from the inflation of the past 95 years and why has the Fed chosen to help them?
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
This is like stomping a week old deer carcass and watching the tin-hat blow flies swarm....
The assertion that members of Congress didn’t know what they were approving in December 1913 is absurd. Work on providing the country with some sort of central bank, as was the case in other nations, dates at least to 1894. The issue was pushed by every administration from McKinley through Wilson and was the subject or numerous conferences, committee meetings and Congressional testimony. The short panic of 1907 was the final event that brought agreement on the Federal Reserve System. This was part of the Republican Party national program from 1896 to 1913.
The great failings of the Fed from 1914 through 1933 were its regionalism and hesitancy to take necessary measures to respond to national financial problems.
For the buzzing blow flies:
It’s OK to wear you tin-hat to bed, but best to put it on your head not your arse, unless that is where the nut-fringe does its thinking.
Now lets put the blame where it properly belong. The US Government. The American public. Meaning the executive and legislative branch. Also the people.
For many years when the US Government was able to balance its books, the Federal Reserve was able to do its duty to properly monitor the money supply and be the vanguard against inflation. The people elected representatives to run a smaller government.
When the Federal government began to deficit spend in the 1950's, (indeed it did deficit spend in the 40's due to WWII) it gradually watered down what was once a legitimate form of fractional reserve (of gold) as a backing against the Federal Reserve Notes. The business schools of the 1950's taught the concept of fractional reserve in that all FRN's were backed up by at least 50% gold bullion plus the insurance that member banks had in the FDIC and FSLIC. For a time, the insurance programs worked very, very well. Banks of the day were quite conservative and loan decisions were made at the local branch level when the bank President looked you in the eye and truly made usually wondrous decisions to lend or not lend.
Those were the days of "its a Wonderful Life" when there were ethics galore and plenty to spare. Most local banks were owned by the depositors and relationships between the two were very close and fruitful.
Then came the 1960's and 1970's and the deterioration of ethics. The baby boomers (my generation) wanted the Federal Government to perform cradle to grave services for the public not understanding that the money had to come from somewhere. By doing so, the government gave more incentives to businesses to do away with their own adulthood to grave support for their employees.
When banks began to "play games" with the public and put "investment advisors" on the floor selling non FDIC/FSLIC insured products to the public without proper disclosure, this was the beginning of the end (Keating). The ethics imploded and it was a free for all.
How Congress ever repealed Stegall-Glass protection for the public is beyond me. That was the best legislation of the 20th century
and it should be reinstated. This was the law that did not allow banks to anything other than being banks. It did not prevent all banking failures but it did a heck of a good job.
The Treasury Department and Congress working together has been essentially broke for the past few years. Along with the SEC, they have essentially been toothless and have not done their job in the last 10 years plus.
This has increased pressure on the Federal Reserve to perform "miracles."
Paul Volker in creating the worst recession the USA had since the Great Depression probably saved the US dollar for an additional 30 years. In my opinion is the one of the 10 greatest men of the 20th century.
Alan Greenspan, while having tremendous insight into the system and a former "gold bug," failed in his job in allowing interest rates to stay down too long after 2002.
Bernanke, while a brilliant man, has not evoked confidence in the business community or in the general public. He has also made numerous mistakes but hopefully he will do better. The problem is he is being asked to do the US Treasury's job in addition to the Federal Reserve's normal job.
It is a very dangerous precedent turning over more power to the Federal Reserve even though they did not seek such additional power.
Re who benefitted from the inflation: Inflation is a tax upon those people who hold money. If the inflation rate is 5%, then if you hold a dollar for a year, you have lost 5% of the dollar's purchasing power. The revenue from the tax goes, via the Fed's profit, back to the U.S. Treasury and helps finance government operations. So, who gained from the inflation tax? Well, one group of gainers are the people whose taxes would otherwise have been higher in the absence of the revenue from the Fed. Alternatively you could say that the people who used the government services that were financed using the inflation tax gained. (However, you can't say that some slimy group of international bankers gained...or, at least you cannot say that and be correct.)
It always amazes that many of the people who rant about the Fed make the statement that "inflation is a tax" as if that statement was controversial and somehow newly discovered. It's not controversial--99% (or perhaps more) of economists recognize this fact--and it's not new--as long as I have been an economist, over 30 years now, it has been widely recognized.
<< <i>It's not controversial--99% (or perhaps more) of economists recognize this fact-- >>
I'd bet if you ask the average guy on the street what inflation is, he'll probably say "When the price of gas goes up" and if you ask him who's responsible, he'll probably say "Greedy businessmen."
The fact that the FED ownership is a who's who of world banks, centered in London leads one conclude it's got NOTHING to do with our government. The only thing quasi-govt about them is that they are allowed all the perks and benefits of a govt agency with none of the risks.
The FED is not FEDERAL, nor do they own any RESERVES. The US owns the reserves the FED gives away. We even print the FRN's that they freely distribute to us.
Mark is an economist which to me means there are pre-sets that come with being in that community. Sometimes one can be so close to a situation as to not see the forest. Economists as a rule get their bread buttered by governments, states, municipalities, and universities. To buck the trend of present day thinking means less grants, lower paying jobs, and being out of the main loop of economists. And that's career suicide if you buck the establishment. I always have to look who is supporting a group to understand where the biases tend to be. When judging an economist's view of the economy or financial world, I feel that we are starting off with a stacked deck. It's like having the bankers tell us what they think of derivatives. And up to 2 yrs ago you had heads of FED banks and regional banks saying what a great job they did in spreading out risk. We know the truth today in that they concentrated the risks.
I'm not sure I'm a great coin collector as Mark says, I'm probably more of a speculator who hasn't trusted FRN's (or the FED) since the early-1970's. But I do know a scam when I see one. I may not be an economist but I do know something about coins, nuclear power, energy from waste, mathematics, and golf (not necessarily in that order). In some ways, I view economics as a way to apply smoke and mirrors to statistics in order to get what you want (ie the BLS).
We are currently in the process of figuring out that the Keynesian system we've been following for decades doesn't work. Just look at the mess the FED and congress have created using it. Had not we won the world's reserve currency in 1944, the system never would have lasted this long without blowing up. We are, or at least I am, slowly realizing that the Austrian school has lots to offer us.
roadrunner
The restriction on interstate banking restrictions was ineffective, since large banks merely had to open management companies in each state it wished to have branches in.
Mark - You lost me there. I understand that inflation has the same effect as a tax on those who hold money, but I don't see how this turns into a profit for the Fed.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
The owners of the FED and those connected to them. You can call them the Rothschilds, the Morgans, the Rockefellers, etc. They have taken control of television and news stations, newspapers, corporations, etc. In short, they are in a position of power and control and getting stronger as we sell off bigger hunks of our businesses and assets. The FED has chosen to help themselves. The facade of a FED chief and board of governors gives the appearance of a govt organization that probably 90% of US citizens would say is no different than the US Treasury Dept. (ie owned by Americans).
The great failings of the Fed from 1914 through 1933 were its regionalism and hesitancy to take necessary measures to respond to national financial problems.
I think you overestimate the intellects of our elected officials if you feel they knew what they were signing in 1913 (ie what it really meant years down the road). My own senator, Chris Dodd who heads the senate banking committee has stated that we need these bailouts to smooth out the emotions of the masses. That is, that the system is sound and liquid. I never voted for the guy either. The fact that he got favored "star" status on his CountryWide mortgage refinances back in 2003 speaks volume of where his head is at. The FED immediately began inflating the money supply in 1914-1916. That was their goal, not taking measures to respond to national problems. The problems we are seeing today were easily forecasted 5-10 years ago. If you read Sinclair or even our own forum thread in 2004 we were talking about a mortgage and derivatives blowup. Greenspan saw this coming to and did nothing but inflate the bubbles and accentuate the risks. Bernanke is doing the same. It's criminal. It's quite obvious from the FED's lack of oversight and actions of the past few years to control their own bankers and brokers, lead us down this path. Their goal is only to make money for their masters.
Inflation is wealth transference at it's finest. Even Greenspan admitted this in 1966 and said gold was the only thing keeping a currency from becoming worthless.
It always amazes that many of the people who rant about the Fed make the statement that "inflation is a tax" as if that statement was controversial and somehow newly discovered. It's not controversial--99% (or perhaps more) of economists recognize this fact--and it's not new--as long as I have been an economist, over 30 years now, it has been widely recognized
If you will check today's testimony on the hill between rep Ron Paul (TX) and Mr. Bernanke, old Ben basically admitted that inflation was a tax. I guess old sayings die hard. We have a more bifurcated society than ever before. The cost of living has shrunk the middle class such that the haves have more, and the lower classes have less. Inflation has been particularly brutal on homes prices, education, services, etc. This is where the rich get richer and the poor get poorer. The wealty is being concentrated in ever tinier circles (bankers, laywers, Bill Gates, Buffett, etc). That's who is benefitting from inflation. The very rich own more things than ever before. The fact that more people don't understand the "hidden tax" is just remarkable.
I do agree with Oreville that you need congress working with the FED to make all this happen. But to conclude the FED is without blame or is a benign entity working for our national good is obscene.
It does start with Congress who could vote the FED out if they had any common sense. But who can blame them when they leave office with million dollar golden parachutes and set up for life?
roadrunner
Where is this list of international bankers who own the Fed? Don't just assert that a bunch of bankers on the Fed--show a list that can be independently verified. I know this is tough but I think it is incumbant upon those who make such a statement to provide others the opportunity to refute or support it.
Re being an economist: Ironically I tend to have a bit more sympathy with Austrian approach than the average cnomist. But I totally disagree with their assessments that 1) math is not useful in understanding how the economy works, 2) working with data to test theories is equally useless, so 3) the only way to proceed to analyse the economy is to use verbal arguments about prices and other economic issues. That part of their approach strikes me as very non-scientific.
Now, to assert that because I am economist, I am therefore biased and do not know what I talk about (or cannot be trusted) also strikes me as foolish. That approach would say any expert who spends his or her life studying an issue cannot be believed because he or she is too close to the issue. And, for what it's worth, I have never had a government grant to support my research, though some of my co-authors have had grants while we work on a paper. I do, however, work for a state university but that fact hardly precludes me from being critical of the Fed or any other government agency.
Mark
PS: You are still a great collector.
While the overall Fed itself may not have a collection, individual banks do.
In 1958 the Philadelphia FRB had a mobile exhibit and a home office exhibit. You had to state your business to the guard to get in, but you could get in. I was particularily fascinated by the 1934 $100 gold certificate. I wish they has shown the back too. It was many years before I found out they had gone back to the orange backs for those. I find the wording on them bizarre - "legal tender for all debts, public and private", yet illegal to own.
In 1963 the Boston bank was putting together an exhibit or museum.
I think I have heard of a San Francisco one. There could easily be more.
Can somebody tell me how come the big cheese at an FRB in 1929 was the govenor of the bank and today it is the president of the bank?
The owners of the FED and those connected to them. You can call them the Rothschilds, the Morgans, the Rockefellers, etc. They have taken control of television and news stations, newspapers, corporations, etc. In short, they are in a position of power and control and getting stronger as we sell off bigger hunks of our businesses and assets. The FED has chosen to help themselves. The facade of a FED chief and board of governors gives the appearance of a govt organization that probably 90% of US citizens would say is no different than the US Treasury Dept. (ie owned by Americans).
Upon reflection, I think I'll try answering my own question. The myth is that debtors benefit from inflation, but that's a fallacy. Inflation is built into interest rates. In fact, nobody benefits from inflation. Inflation just represents a shift of power from the people to their government, which really doesn't do anybody any good.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Agreed. But anticipated inflation can turn out to be too high or too low. In the long run, on average, it's probably about right.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Mark, you'll have to dive back on this thread at least a couple of weeks, maybe a bit more. I posted a nice link showing the original FED members and how their money and wealth has been passed down and spread out over dozens or hundreds of people and companies over the years. It's a fascinating lineage chart. You can probably did it up by doing a google search for "FED ownership" or something similar. I make it a point to post many links to things I find of interest or things I need to back up a point.
Too bad there wasn't a way to summarize all our links because flipping through months of pages to find a link is a huge waste. This past weekend I was looking for a link to the FDIC OTC derivatives on bank balance sheets that I posted last year and I couldn't find it after 30 min of page flipping. Hey, if posting the owners of the FED, like any other publically owned US company (or govt entity) is no big deal, they why doesn't the FED post such a listing? What are they hiding? What would Joe 6 pack think if he saw a bunch of foreign bankers on that list? After all, Joe does think the govt owns the FED lock stock and barrel.
Andy, if no one benefited from inflation, then why do we have a "national" policy of approx 3% inflation over the past 95 years?
And that's inflation above and beyond what we really need to grow the economy. If inflation benefited "no one" why have we increased the money supply 13X since 1982 and an average of 10% per year since 1996? Those monies went into bubbles and made many people rich. Eventually it all ends up with the bankers who make the loans, take their percentage, and make bets that usually don't lose. Why have the banks made hundreds of TRILLIONs in derivative's bets over the past 10 years if this benefits "no one"?...other than the hundreds of billions or even TRILLIONS in fees they collected along the way
roadrunner
Read my reply to Andy about who benefits from inflation.
By the way, I suspect that you and I are in total agreement about government spending being more than optimal!
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
Because deflation is a bigger worry, and they can't cut it too close.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
"Keep your malarkey filter in good operating order" -Walter Breen
I did read it and I thought I posted a reasonable reply to it.
How about this approach. If the guy holding the dollar loses the most, well that is Joe 6 pack. He is the guy who either keeps some money in the bank, if he's middle class he pays more than his fair share of taxes. The upper classes and the rich do a good job in sheltering their total wealth (tax breaks, tax shelters, tax attorneys to do this for them, etc)...esp from generation to generation. I don't think it's any secret that the middle classes pay a larger % of their income earned to taxes (sales taxes, gas taxes, cig tax, liquor tax, etc). Bill Gates earning BILLIONS per year on his total net worth is not paying 50% in taxes on that. The "haves" have ways to keep most of their wealth. That's just the way of the world. With inflation running at 10% per year right now, J6P is paying taxes on that bogus 10% that his dollar denominated assets have "increased." Richy Rich is deep into tax shelters, false corporations, maybe even gold today, and other havens to hide his wealth from the tax man. Joe 6P is no match for him.
That inflation calculator is cute, but it's based on the warped CPI that went south in 1983 when "imputed rent" on one's owned residence went into effect. I'd like to see an actual inflation calculator that is based on real monetary changes, not a bogus basket of goods that shrinks any time the BLS needs to show a lower CPI.
Andy, we haven't had any close calls with deflation for 70 years. But inflation has caused irreparable long term damage. If the end result of fiat is total worthlessness, how is that not a problem. The only question is when between now and 2050 will our currency go bust and be replaced. It could be much sooner than 2050 as well.
roadrunner
I did as you suggested and googled "fed ownership." The first link google gave me was just as I suspected: Utter nonsense. (It's located here by the way.) Most of the charts are incomprehensible. Plus the lists of people and/or banks are hardly evidence that would be allowed in any sort of scientific endeavor. (For instance, I could have a list of roadrunner---mark---bernanke and that list is surely not evidence that we own the Fed.
<< <i>Andy, unanticipated inflation benefits a debtor. He is paying back in dollars not built into the loan interest risk. >>
Who's 'they'?
What if 'they' cannot pay anything back because the economic benefit of their borrowing is lost due to the same inflation?
I give away money. I collect money.
I don’t love money . I do love the Lord God.
Didn't the early 19th century Bank of the US also fail financially?
<< <i>Inflation is a tax upon those people who hold money. If the inflation rate is 5%, then if you hold a dollar for a year, you have lost 5% of the dollar's purchasing power. The revenue from the tax goes, via the Fed's profit, back to the U.S. Treasury
Mark - You lost me there. I understand that inflation has the same effect as a tax on those who hold money, but I don't see how this turns into a profit for the Fed. >>
I am lost on that one too! The Fed and the treasury represent the same government which represents the people. Its a circle jerk where eveyone is getting hurt.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
Think of a lifetime of absolute Zero% inflation.
Every penny saved is a penny earned....Sound familiar??
This hogwash of 'a little inflation is good' is nonsense.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
But until this benevolent "FED" corporation that is trying to "save" our economy and dollar comes out with a listing of ownership, I'll stick to the cabal theory. If so benevolent and pure in their thoughts, why not publish a listing to put all our minds at ease? And while we're at it, let's inventory the nation's gold stocks so we can put the gold supression theory to rest as well
And while we're at it, we all know the FED ditched the M3 tracking because it would save the govt a million a year in expenses. Man, those FED guys are really on the ball and watching pennies and nickels! They are really looking our for the old USA! Go FED!
Yup, no cabal here.
roadrunner
You are essentially correct that the Fed and Treasury are closely related. Indeed, whenever the Fed gains revenue--from buying bonds, issuing additional currency, and creating inflation--the Treasury will get the additional revenue transfered to it from the Fed. Now I am unsure about the rest of your assessment about precisely how close they are (you know, the part that involves geometry...
Incidentally, I also agree with you and roadrunner that there are some people harmed by inflation. That's definitely the case. Of course, given that the government was going to spend the funds anyway, what the inflation has done is to make one group of people pay--those who hold money--while other people--those whose income taxes are lower because the government will raise some funds via inflation--avoid paying.
It may well be that a list of which banks own how much stock in the Fed is available. I'll look for it...later. Till then, take care and I'll see you again in the next discussion about the Fed or the CPI.
Another topic we never really answered was the printing money thing. The FED has access to an electronic button where with key strokes they can dump hundreds of billions in liquidity into the system without printing any currency. In my mind this stuff is essentially off the balance sheet but shows up as credit/liquidity down the road and ultimately inflation. This was a major reason imo why they wanted to dump M3 in order to hide all the massive repo's and loans they would be handing out in 2006 and beyond. And that has in fact happened. And the fact that they are not recalling loans after 28 days but merely extending them, is another way to get around the printing of currency thing. This is not a loan, but a long term bailout at taxpayer's expense. Instant electronic currency off the balance sheet is a great tool....just like OTC derivatives. But in the wrong hands it's lethal. What they probably didn't count on the was the $250 rise in the pog just after they made that decision and gold went ballistic into April 2006. Gold was not fooled by the decision to eradicate M3.
roadrunner