quote:

Originally posted by pkcRAISTLIN so what issues in particular do you think will be more transparent, that aren't already covered in the RB's minutes?

Anything in particular pk. I'd like to know the assets they accepted as collateral for the $9 trillion in off book loans..who the loans were made to..what the realistic chance is of getting paid back..how many losses taxpayers are really taking...I'd also like an audit of their gold stock to verify how much they have left. They claim $250 billion but there have been rumors that most of it has been sold over the past 10 years. I've seen man on the street interviews asking people about the dollar and around half of the people asked believe it is still backed by gold. If an audit is done and we see a few headlines about the fed owning 0.08 tons of gold, that would certainly raise people's consciousness on the issue of our money and what gives it value..and if they hear specifics about the dubious companies that have received hundreds of billions of newly printed dollars from the fed, maybe they would demand the fed be a bit more hawkish when it comes to protecting the value of our currency. That could only be a good thing in the long run.

well, that question was actually in reference to their day to day activities, not the issues in the last 18 months, but point taken. as for your gold obsession, 1) how much gold they have isn't all that relevant, and 2) i doubt the gold reserves would have an impact on the consciousness of the people. they simply dont understand how everything works, so how could it raise consciousness?

since there were privacy clauses in some of the loans as part of the bailout, im not sure this resolution would give you the answers you're looking for. but again, im hoping occ might stick his head back in here at some stage and give us all a lesson

___________________

occ is a member of the illuminati..that's why he got a job offer with the fed. You can't trust him.

quote:

Originally posted by Capitalizt occ is a member of the illuminati..that's why he got a job offer with the fed. You can't trust him.

makes you wonder though, him leaving Fannie Mae at the time he did to go there

quote:

Originally posted by Capitalizt Sure the treasury prints dollar bills..but the fed prints "virtual" money and credit and we have created far more "money" in this manner than the amount of traditional physical currency currently floating around the world.. Basically what happens when the government wants to spend a few hundred billion they don't have, the treasury has the US mint print up a few bonds..white pieces of paper with fancy writing on them claiming they are worth 100 billion dollars. They then sell them to the fed..but since the fed has no real wealth to buy the bonds, they simply enter a few digits into a computer to expand the government's bank account by $100 billion..kazaam! New money is created for the government to to spend immediately on various things without the necessity of printing dollar bills. In theory, the treasury creates money. In practice, the fed does it.

yeah - so that's not really how it works.

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Originally posted by jerZ07002 yeah - so that's not really how it works.

It's how quantitative easing works..and that's what they are doing today.

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Originally posted by Capitalizt It's how quantitative easing works..and that's what they are doing today.

wrong!


quantiative easing is the fed purchasing securities from BANKS, not the treasury, with the fed crediting the banks reserve accounts. the fed doesn't purchase the treasuries directly from the treasury by magically increasing it's bank account. Instead, the fed credits the reserve account of a bank selling treasuries to the fed in the amount of the treasury value. this means that the fed has a corresponding liability owed to the selling bank. Moreover, the fed will soon pay interest on reserves.

quote:

Originally posted by jerZ07002 wrong!

which is why, if you want a definitive knowledge of finance/accounting/taxation/economics, you go to school. self-schooling will only teach you so much, and will leave you getting schooled by the experts on TA

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Sorry jer, normally you would be right..That's what we saw Japan doing during their "lost decade" but the US fed is going one step further and is now buying bonds DIRECTLY FROM THE GOVERNMENT for the first time in 50 years. I believe the number currently stands around $400 billion..and they have announced plans to increase their balance sheet to a whopping $4 TRILLION in the coming months. Most of that will be from toxic assets and mortgage related securities from banks of course, but despite the fed funds rate being at 0%, they are also making huge bond purchases from the government..basically enabling them to issue more debt than they would otherwise be able to.

Here is a good explanation of what is happening during the process

The fed announced it as part of their $1.25 trillion quantitative easing plan and that's why the Chinese are so pissed at us. They are calling their actions quantitative easing..but it really isn't in the historical sense so you are technically correct. Regardless of what they call it, the results are the same..more dollars chasing the same number of goods. It's one step away from pure debt monetization if you ask me, and I'm willing to bet we will see that start before Obama's second term becayse there is simply no other way to pay for the spending the dems want to do.

Last edited by Capitalizt on Jun-17-2009 at 09:44

quote:

Originally posted by Capitalizt Sorry jer, normally you would be right..That's what we saw Japan doing during their "lost decade" but the US fed is going one step further and is now buying bonds DIRECTLY FROM THE GOVERNMENT for the first time in 50 years. I believe the number currently stands around $400 billion..and they have announced plans to increase their balance sheet to a whopping $4 TRILLION in the coming months. Most of that will be from toxic assets and mortgage related securities from banks of course, but despite the fed funds rate being at 0%, they are also making huge bond purchases from the government..basically enabling them to issue more debt than they would otherwise be able to. Here is a good explanation of what is happening during the process The fed announced it as part of their $1.25 trillion quantitative easing plan and that's why the Chinese are so pissed at us. They are calling their actions quantitative easing..but it really isn't in the historical sense so you are technically correct. Regardless of what they call it, the results are the same..more dollars chasing the same number of goods. It's one step away from pure debt monetization if you ask me, and I'm willing to bet we will see that start before Obama's second term becayse there is simply no other way to pay for the spending the dems want to do.

Actually, bernake is calling the feds actions credit easing.

Anyway - maybe you can explain how moving treasuries from one gov agency to another expands the money supply such that the fed is "printing money".

Heck, read some headlines back when it was announced in march jer..These are first ones google pulled up..

http://blogs.law.harvard.edu/philg/...american-style/
http://prudentinvestor.blogspot.com...everything.html
http://www.marketwatch.com/story/fe...t-boost-economy
http://seekingalpha.com/article/129...monetizing-debt
http://forex.gftforex.com/public/item/228971

Just turn on CNBC any day of the auctions and you will hear Rick Santelli discussing the fed's efforts to absorb part of the debt offerings and how they are competing with foreign investors to buy the debt. This is not your ordinary "transfer of money" from what pocket to the other as it is when a bank sells assets to the fed for dollars. It is the treasury printing bonds that didn't exist 5 seconds earlier and the fed printing dollars that didn't exist 5 seconds earlier..Neither "asset" existed before the transaction took place. There was no savings or wealth behind either side in this transaction..but more dollars certainly end up sloshing around and competing with other dollars for a limited number of goods as a result. It's one step away from printing bills and throwing them out of helicopters my man.

The fed isn't taking part in auctions to lower their key rate any more..and they aren't keeping their balance sheet stable. They are increasing it more than 400% and printing like mad just to enable the government to keep going. And sure, the treasury must pay interest on this debt it issues to the fed..but don't forget that the fed returns every penny to the treasury..lol! It isn't much of a liability when they are in bed together every night is it? Read the article in my other post..It describes how the "assets" cancel each other our during the process and the end result is an inevitable inflation of the money supply. Bottom line is when banks sell treasuries to the fed in exchange for federal reserve notes (dollars), they are exchanging real earnings and profits they have earned over the years and saved in the form of treasury bills. The U.S. government exchanges "assets" as well..only their assets didn't exist a few seconds before the transaction took place. They are exchanging nonexistent wealth for a huge supply of paper that can be used to acquire property and other real assets. This is inevitably going to lead to uber-inflation down the road.

Last edited by Capitalizt on Jun-17-2009 at 15:34

quote:

Originally posted by Capitalizt Heck, read some headlines back when it was announced in march jer..These are first ones google pulled up.. http://blogs.law.harvard.edu/philg/...american-style/ http://prudentinvestor.blogspot.com...everything.html http://www.marketwatch.com/story/fe...t-boost-economy http://seekingalpha.com/article/129...monetizing-debt http://forex.gftforex.com/public/item/228971 Just turn on CNBC any day of the auctions and you will hear Rick Santelli discussing the fed's efforts to absorb part of the debt offerings and how they are competing with foreign investors to buy the debt. This is not your ordinary "transfer of money" from what pocket to the other as it is when a bank sells assets to the fed for dollars. It is the treasury printing bonds that didn't exist 5 seconds earlier and the fed printing dollars that didn't exist 5 seconds earlier..Neither "asset" existed before the transaction took place. There was no savings or wealth behind either side in this transaction..but more dollars certainly end up sloshing around and competing with other dollars for a limited number of goods as a result. It's one step away from printing bills and throwing them out of helicopters my man. The fed isn't taking part in auctions to lower their key rate any more..and they aren't keeping their balance sheet stable. They are increasing it more than 400% and printing like mad just to enable the government to keep going. And sure, the treasury must pay interest on this debt it issues to the fed..but don't forget that the fed returns every penny to the treasury..lol! It isn't much of a liability when they are in bed together every night is it? Read the article in my other post..It describes how the "assets" cancel each other our during the process and the end result is an inevitable inflation of the money supply. Bottom line is when banks sell treasuries to the fed in exchange for federal reserve notes (dollars), they are exchanging real earnings and profits they have earned over the years and saved in the form of treasury bills. The U.S. government exchanges "assets" as well..only their assets didn't exist a few seconds before the transaction took place. They are exchanging nonexistent wealth for a huge supply of paper that can be used to acquire property and other real assets. This is inevitably going to lead to uber-inflation down the road.

ok - let's take a minute to be a little more precise. The fed does not print money; the treasury prints money.

i'll admit, i haven't read all those links because i don't have the time, however, it is my understanding that the fed is using the cash it has on reserve to purchase these securities (i.e., making available money that is otherwise not usable). Feel free to correct me if i'm wrong. The same goal could be accomplished by reducing the reserve requirements.

i know your claim is that the government is just entering numbers into a computer to increase it's ability to purchase treasuries, but i'm skeptical that's what is actually going on. I can be persuaded by citations that aren't blogs (i.e., a wall street journal article, a fed statement, etc...).

FYI - none of your cites say that the fed is creating false wealth, except the harvard cite, which is a blog (written by an engineer), so i'm not entirely convinced it is a true representation of what's going on. Furthermore, i think people describing what's going on don't have a great handle on the actual facts and they are inaccurately explaining the events (e.g., saying the fed is just entering numbers into a computer when in fact they are transferring funds from reserve accounts).

Last edited by jerZ07002 on Jun-17-2009 at 16:14