Stepping into the breach, once more, when called upon……………
The dollar has retreated against other currencies hitting a 6-week low against the Yen, after St Louis Fed President James Bullard said the Fed should keep interest rates low for some time. He also said the Fed should continue buying mortgage backed securities and other assets.
Oil, gold shot up against the dollar. Existing home sales also shot up to 10.1% in October. The shocking home sales number is good for the housing sector, and also for banks. The myth that banks are not lending money should evaporate as it is obvious that people are able to obtain housing loans.
This brings me to write about Rep. Paul Ron, member of the Financial Services Committee, who was on CNBC yesterday, advocating that the Fed should be audited.
His arguments for auditing the Fed are as follows:
- Fear that the proposed amendment of the bill will politicize the Fed is wrong. 75% of the people want the audit of the Fed. Yes, he is pandering to the people, a populist policy!
- The Fed has to answer may questions, such as, how did the Fed spend the money with the creation of new fiat money.
- The names of companies who buy up illiquid assets should be exposed.
- As to compromising the independence of the Fed, it is secrecy that is the problem of the Fed.
- Transparency is what is lacking in the Fed, not hiding from the people when there are ill effects of the financial bubble.
- The Fed has no magic knowledge and they are keeping interest rates artificially low.
- The amendment will remove the stigma of secrecy of the Fed moving to transparency.
- Gold prices are rising against the weak Dollar and it is telling us the Dollar is in great danger , worse than the 1970s.
- The Fed will self destruct when it destroys the Dollar.
- Amendment to the bill is not changing the Fed’s fiscal policy, which is different from monetary policy.
Ron’s Parting shots: The audit will take 2 years or so and will not save us. We regulate too much, which is the Fed’s creation. Congress created the Fed, now they should audit the Fed. This is not politicizing the Fed as the President has always appointed the Fed Chairman. The Fed should not set interest rates, which have been artificially low, while Congress should have the responsibility of auditing the Fed.
Thanksgiving falls on this Thursday in the US and this is a positive seasonality especially the day before Thanksgiving.
Happy Thanksgiving to all American readers,
Ana aka Idkit