Senator Bernie Sanders this month thought he was opening a pandora’s box by accusing the Federal Reserve Chairman Ben Bernanke with the crime of stealing $16 Trillion from the American people. On Sander’s webpage, he quotes the GAO supposedly new (1st ever) report concerning the theft of the American’s taxpayers cash and spending the money on foreign banks and U.S. and foreign “fat-cat” corporations. You can read Sanders accusations at: http://sanders.senate.gov/newsroom/news/index.cfm?id=9e2a4ea8-6e73-4be2-a753-62060dcbb3c3
"As a result of this audit, we now know that the Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world," said Sanders.
Sanders provided his “backup proof” by providing a link to the GAO report document that he was quoting: http://sanders.senate.gov/imo/media/doc/GAO%20Fed%20Investigation.pdf
I was all pumped up get this new information. I am opposed on the entire concept of the FED and want to find as much dirt as I can on this unconstitutional organization. The FED is not constitutional now, nor will they EVER be! And I firmly believe that the FED is indeed raping the American public by giving our taxpayer money out to foreign countries and banks.
But as usual… our Senators are complete morons. It is clear that Sanders never read the GAO report nor did anyone in his staff. There are no such accusations by the GAO report detailing a $16 Trillion expenditure (or totaling $16 Trillion) anywhere in the gibberish filled document that the GAO calls a “FED AUDIT.” $1 Trillion, $2 Trillion and up to $5 Trillion here and there are mentioned, but no PROOF of $16 Trillion being taken out of our coffers.
au·dit/ˈôdit/ Noun: An official inspection of an individual's or organization's accounts, typically by an independent body.
Verb: Conduct an official financial examination of (an individual's or organization's accounts).
If Sanders or anyone in the GAO, or anyone in the US Senate calls this “an audit” then it is clear why our nation is so screwed up! It was 252 pages of totally worthless goobledygook. There is not a lawyer, a brain surgeon, a philosopher in the world that could understand two adjoining sentences in this report! Here is an example:
“On September 19, 2008, the Board of Governors of the Federal Reserve System (Federal Reserve Board) authorized the creation of the Asset- Backed Commercial Paper Money Market Mutual Fund Liquidity Facility (AMLF) under section 13(3) of the Federal Reserve Act of 1913 to provide liquidity support to money market mutual funds (MMMF) facing redemption pressures and to promote liquidity in the asset-backed commercial paper (ABCP) markets.1 AMLF became operational on September 22, 2008, and was operated by the Federal Reserve Bank of Boston (FRBB). AMLF was initially set to expire on January 30, 2009. The Federal Reserve Board authorized three separate extensions of the program to address continuing strains in financial markets. AMLF expired on February 1, 2010.” [pg 155 actual page or pg 168 pdf]
This amusing gibberish is totally unintelligible. And not only that, Sec 13(3) of the Federal Reserve Act of 1913 gives no such “authorization.” This is a ploy that the FED uses throughout all of their “documentation” and of course, no one ever checks up and verifies their claims to see if the ACT actually authorizes them to do squat! But here is the actual worthless verbage of the FEDERAL RESERVE ACT OF 1913:
Section 13. Powers of Federal Reserve Banks
3. Discounts for Individuals, Partnerships, and Corporations
A. In unusual and exigent circumstances, the Board of Governors of the Federal Reserve System, by the affirmative vote of not less than five members, may authorize any Federal reserve bank, during such periods as the said board may determine, at rates established in accordance with the provisions of section 14, subdivision (d), of this Act, to discount for any participant in any program or facility with broad-based eligibility, notes, drafts, and bills of exchange when such notes, drafts, and bills of exchange are indorsed or otherwise secured to the satisfaction of the Federal Reserve bank: Provided, That before discounting any such note, draft, or bill of exchange, the Federal reserve bank shall obtain evidence that such participant in any program or facility with broad-based eligibility is unable to secure adequate credit accommodations from other banking institutions. All such discounts for any participant in any program or facility with broad-based eligibility shall be subject to such limitations, restrictions, and regulations as the Board of Governors of the Federal Reserve System may prescribe.
i. As soon as is practicable after the date of enactment of this subparagraph, the Board shall establish, by regulation, in consultation with the Secretary of the Treasury, the policies and procedures governing emergency lending under this paragraph. Such policies and procedures shall be designed to ensure that any emergency lending program or facility is for the purpose of providing liquidity to the financial system, and not to aid a failing financial company, and that the security for emergency loans is sufficient to protect taxpayers from losses and that any such program is terminated in a timely and orderly fashion. The policies and procedures established by the Board shall require that a Federal reserve bank assign, consistent with sound risk management practices and to ensure protection for the taxpayer, a lendable value to all collateral for a loan executed by a Federal reserve bank under this paragraph in determining whether the loan is secured satisfactorily for purposes of this paragraph.
ii. The Board shall establish procedures to prohibit borrowing from programs and facilities by borrowers that are insolvent. Such procedures may include a certification from the chief executive officer (or other authorized officer) of the borrower, at the time the borrower initially borrows under the program or facility (with a duty by the borrower to update the certification if the information in the certification materially changes), that the borrower is not insolvent. A borrower shall be considered insolvent for purposes of this subparagraph, if the borrower is in bankruptcy, resolution under title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act, or any other Federal or State insolvency proceeding.
iii. A program or facility that is structured to remove assets from the balance sheet of a single and specific company, or that is established for the purpose of assisting a single and specific company avoid bankruptcy, resolution under title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act, or any other Federal or State insolvency proceeding, shall not be considered a program or facility with broad-based eligibility.
iv. The Board may not establish any program or facility under this paragraph without the prior approval of the Secretary of the Treasury.
C. The Board shall provide to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives—
i. not later than 7 days after the Board authorizes any loan or other financial assistance under this paragraph, a report that includes—
I. the justification for the exercise of authority to provide such assistance;
II. the identity of the recipients of such assistance;
III. the date and amount of the assistance, and form in which the assistance was provided; and
IV. the material terms of the assistance, including—
§ aa. duration;
§ bb. collateral pledged and the value thereof;
§ cc. all interest, fees, and other revenue or items of value to be received in exchange for the assistance;
§ dd. any requirements imposed on the recipient with respect to employee compensation, distribution of dividends, or any other corporate decision in exchange for the assistance; and
§ ee. the expected costs to the taxpayers of such assistance; and
ii. once every 30 days, with respect to any outstanding loan or other financial assistance under this paragraph, written updates on—
I. the value of collateral;
II. the amount of interest, fees, and other revenue or items of value received in exchange for the assistance; and
III. the expected or final cost to the taxpayers of such assistance.
D. The information required to be submitted to Congress under subparagraph (C) related to—
i. the identity of the participants in an emergency lending program or facility commenced under this paragraph;
ii. the amounts borrowed by each participant in any such program or facility;
iii. identifying details concerning the assets or collateral held by, under, or in connection with such a program or facility, shall be kept confidential, upon the written request of the Chairman of the Board, in which case such information shall be made available only to the Chairpersons or Ranking Members of the Committees described in subparagraph (C).
E. If an entity to which a Federal reserve bank has provided a loan under this paragraph becomes a covered financial company, as defined in section 201 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, at any time while such loan is outstanding, and the Federal reserve bank incurs a realized net loss on the loan, then the Federal reserve bank shall have a claim equal to the amount of the net realized loss against the covered entity, with the same priority as an obligation to the Secretary of the Treasury under section 210(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
[12 USC 343. As added by act of July 21, 1932 (47 Stat. 715); and amended by acts of Aug. 23, 1935 (49 Stat. 714); Dec. 19, 1991 (105 Stat. 2386); and July 21, 2010 (124 Stat. 2113). As enacted by Public Law 111-203 (124. Stat. 2115), “any reference in any provision of Federal law to the third undesignated paragraph of section 13 of the Federal Reserve Act [FRA] (12 USC 343) shall be deemed to be a reference to section 13(3) of the FRA.”]
There are no two people in America or on this planet that can give a solid, meaningful summary of this Section 13. No two lawyers can even define the words let alone the concepts of any two sentences therein. If any one of you think you have even a partially functioning brain, please just give me a summary and MEANING of just the 1st paragraph of above Section 13 (3)… or if you think I am being too harsh/mean, then pick any section, any page and paragraph of the other 31 Sections of this gibberish of the Federal Reserve Act of 1913 and please attempt to translate the unintelligible mumblings found therein.
Bernie, all I can say… is that you don’t know squat! Between you and the FED, I understand why our nation is so SCREWED!
Edward C. Noonan
President - 2012