Why does the Obama administration want to kill the popular Senate Bernie Sanders amendment to audit the Fed? The amendment may be up for a vote later this week and there are reports the amendment vote will be hit with that magical, fictional 60 to pass, instead of 50, which is the norm for amendments.
According to the Wall Street Journal:
Obama administration officials have declined to weigh in on any specific amendments, with one exception: a move by Sen. Bernie Sanders (I., Vt.) to give the government more power to audit certain operations at the Federal Reserve. Fed and administration officials have signaled they would fight to stop it at all costs. Mr. Sanders has more than a dozen co-sponsors.
At all costs. Really? Including a veto? What is wrong with wanting to know what happened to $2 trillion dollars? Why would the Obama administration demand to remove public disclosure out of the financial reform bill?
So, the Federal Reserve can keep things secret, such as Greenspan did, to stop public disclosure on the housing bubble? Imagine if the public had been warned, how many people would not have lost their life savings.
Senate Bernie Sanders on the Obama administration trying to kill the amendment:
The Obama administration has sided with the Fed and powerful Wall Street interests in opposition to the amendment. “When it comes to openness vs. secrecy, Wall Street vs. Main Street, taxpayers vs. the big bankers, I am sorry to say that the White House has come down on the wrong side,” Sanders said. “With growing support for this amendment from both the left and right, I hope that the administration reconsiders.”
Now Rahm Emanuel, Obama Chief of Staff, is working with the Federal Reserve to stop the audit.
My, my, such an obvious thing. It's our money, we want to know what's going on and where it is going and this is the result. Perhaps it has to do with the mortgage backed securities the Fed has purchased, now over $1.1 trillion dollars:
Maybe it's the reserve bank credit, a mix of Maiden Lane, commercial bank loans, repurchase agreements, assets held and so on...now valued at $2.32 trillion dollars. I see, the public has no idea who received these loans, for what, what kind of assets were exchanged, if they were correctly valued.... $2.32 trillion.
The Fed, I am convinced, went to these commercial banks and offered to take many of their toxic mortgage assets off their books, often accepting them as collateral for loans to the banks. In exchange, the Fed credited the commercial banks with an increase in the reserves held at the Fed, so long as the banks agreed not to withdraw the excess reserves immediately. Magically, the Fed was able to take a bad asset like a CDO and transform it into a sparkling good asset: bank reserves at the Fed. The irony is that the CDO itself began as a compilation of leaden BBB subprime mortgages and had been transformed into a golden AAA security only through the alchemy of the CDO process. And I think the record will show that the Fed intentionally overpaid for these securities, so that the banks wouldn't have to acknowledge life-threatening losses on the sales or the remarking of their inventory of similar assets. The Fed also began buying mortgage securities directly in the marketplace in an attempt to create demand in the absence of a healthy securitization program.
So the Federal Reserve, with no approval by the president, the Congress, the people or their elected representatives, ended up purchasing $1.5 trillion of new assets of unknown quality.
It's public from a SIGTARP report that the Federal Reserve is the residential housing market through it's actions. SIGTARP has reported this as well. Additional SIGTARP tallied up the potential risk America is on hook for and at one point it was $23.7 trillion dollars (link overviews this report from last year). We've also asked how far does corruption of the banking regulators go?
Representative Alan Grayson has an online action item asking you to help get the Audit the Fed Sanders amendment passed.
Obviously since Wall Street, the White House and the Federal Reserve are all trying like hell to fight any public disclosure, there is clearly something to hide. Look at the latest appeal attempts, by the Federal Reserve. They are trying to stop Bloomberg from obtaining the specifics of which banks received loans, what deals were made and what assets were used in the $2.32 trillion dollars the Federal Reserve issued. Bloomberg won their case, yet the appeals drag on in what appears to be a stalling tactic at minimum.
The whole nation should demand the Sanders Audit the Fed amendment be passed. I suggest you get on the phone and call your Senators saying so.