Topics in the News: Federal Reserve
Howie Hawkins on Budget & Economy
: May 19, 2019
Socialize big banks; manage the national currency
The national currency is a vital common resource that should be managed in the public interest. We must nationalize the Federal Reserve System as a Monetary Authority in the Treasury Department. The Monetary Authority will create all national currency
(cash and electronic) free of any associated debt. New money will be credited to the account of the federal government as additional revenue to be spent into circulation in the economy in accordance with the federal budget.
Banks will be prohibited from creating new money as loans. Banks will borrow or raise money for lending from savers and investors, including the Monetary Authority. People and businesses will borrow from funds in the banks' accounts.
Socialize the big banks: The allocation of investments according to an economic plan requires a significant sector of public banks.
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Source: 2020 Presidential Campaign website HowieHawkins.us
Arvin Vohra on Corporations
: Feb 22, 2018
End the Fed, to prevent irresponsible cash-negative business
When we eliminate legal tender laws, we allow Americans to spend money and accept payments in any form of currency they choose. This destroys the monopoly the Federal Reserve currently has, and abuses, on currency.When Americans can choose their
preferred currency, they are free to choose to store their money in a form that won't depreciate wildly whenever the government decides to spend more money. That means your savings will still mean much more years later when you go to use them.
Ending
the Federal Reserve also prevents irresponsible, cash-negative businesses from entering the market, making (fully expected) irresponsible decisions, and creating more frequent and more severe business cycles. When the Federal Reserve is not allowed to
interfere, successful business practices will prevail, business cycles will be smoother, layoffs will be massively decreased, and the economy on the whole will prosper. This means responsible business practices will drive market growth.
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Source: 2018 Maryland Senatorial campaign website VoteVohra.com
Arvin Vohra on Budget & Economy
: Dec 12, 2017
Remove legal tender laws & stimulate the economy
When we eliminate legal tender laws, we allow Americans to spend money and accept payments in any form of currency they choose. This destroys the monopoly the Federal Reserve currently has, and abuses, on currency. When the Federal
Reserve is not allowed to interfere, successful business practices will prevail, business cycles will be smoother, layoffs will be massively decreased, and the economy on the whole will prosper.˙I want to make this country fiscally responsible.˙
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Source: 2018 Maryland Senate campaign website VoteVohra.com
Donald Trump on Budget & Economy
: Sep 27, 2016
FactCheck: Fed keeps interest rates low, but apolitically
TRUMP: "We are in a bubble right now. The Fed, by keeping interest rates at this level, is doing political things. The Fed is being more political than Secretary Clinton."THE FACTS: This is a recurrent claim by Trump with no evidence to back it up.
It's the Federal Reserve's job to help improve the economy and to the extent that happens, political leaders may benefit. But presidents can't make the Fed, an independent agency, do anything.
Under former chair Ben Bernanke and current chair
Janet Yellen, the Fed has attracted controversy by pegging the short-term interest rate it controls to nearly zero for seven years. It is still ultra-low at between 0.25% and 0.5%, a rate that some economists worry could spark a stock-market bubble or
inflation. Bernanke was initially appointed by Republican Pres. George W. Bush, and reappointed by Obama.
One reason Yellen is keeping rates low is that, in some ways, she agrees with Trump that hiring needs to keep growing to provide jobs.
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Source: U.S.News & World Report on First 2016 Presidential Debate
Donald Trump on Budget & Economy
: Sep 26, 2016
Worst recovery since Great Depression; we're in a bubble
We have the worst revival of an economy since the Great Depression. And believe me: We're in a bubble right now. And the only thing that looks good is the stock market, but if you raise interest rates even a little bit, that's going to come crashing
down. We are in a big, fat, ugly bubble. And we better be awfully careful. And we have a Fed that's doing political things. This Janet Yellen of the Fed. The Fed is [being] political by keeping the interest rates at this level.
And believe me: The day Obama goes off, and he leaves, and goes out to the golf course for the rest of his life to play golf, when they raise interest rates, you're going to see some very bad things happen,
because the Fed is not doing their job. The Fed is being more political than Secretary Clinton.
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Source: First 2016 Presidential Debate at Hofstra University
Donald Trump on Budget & Economy
: May 6, 2016
The Fed should refinance debt to reduce interest payments
Trump boasted how "I would borrow, knowing that if the economy crashed, you could make a deal." When pressed, though, he said a country is different and he didn't mean to renegotiate the U.S. debt, only to "refinance" existing debt. Of course,
refinancing debt saves money only when rates go down, which raises the question of what the Fed should do with rates.Trump wants rates to remain low to prevent the dollar from appreciating, which would bring "major problems."
But another consideration, he noted, was the [interest payments on the] national debt: "What do we do with all of the money that we owe everybody when rates go up and now all of a sudden we have to borrow at two points more? One point more, even, is
devastating. It has to be handled very, very carefully." For the Fed to base interest-rate decisions on the national debt would blur the lines between monetary and fiscal policy. It's heresy by today's standards, but [was done in the 1960s].
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Source: Wall Street Journal, "Lean on the Fed?", by Greg Ip
Bernie Sanders on Budget & Economy
: Apr 30, 2015
Break up large banks; add fees for high-risk investments
Sanders would divide large banks into smaller entities and charge a new fee for high-risk investment practices, including credit default swaps. In addition, he believes the Federal Reserve is an opaque organization which gives too much support to large
corporations. His pushed for a 2011 audit of the Fed and he would use the Fed to force banks into loaning more money to small businesses. Finally, he would ban financial industry executives from serving on the 12 regional boards of directors.
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Source: PBS News Hour "2016 Candidate Stands" series
Bernie Sanders on Corporations
: Feb 10, 2015
Bank bailout was socialism for the rich
After the banking crisis of 2008, we got alarmed and we passed regulations. The only problem is, we passed regulations on the banks that weren't involved and gave more power to the bank that was involved--the Fed.
No bank in Kentucky failed during this crisis, yet Dodd-Frank pummeled our small community banks with crippling regulations. What we really needed was more oversight of the Fed, not small community banks.
Sen. Bernie Sanders (I-VT) and I don't agree on much, but I thought he did a great job of describing the Fed and the bank bailouts as: "A clear case of socialism for the rich; and rugged-you're-on-your-own-individualism for everyone else."
The Fed, with unlimited ability to print money, now prints that money to lobby against Congressional oversight. It is a disgrace and every citizen in the land should rise up and say: We the people are in charge and we demand an audit!
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Source: Article: Audit/End the Fed, by Rand Paul, on Breitbart.com
Joe Biden on Budget & Economy
: Sep 20, 2011
As banks become profitable, start fundamental reforms
Obama began to double back, wondering what his team thought of [Federal Reserve chair] Volcker's idea. Biden, who was an old friend of Volcker's, stepped in during a White House meeting and said that the banks were strong enough to take
some medicine now, even if it wasn't fundamental change. They were making money again, gambling with depositors' funds and with implicit, or explicit, support of the taxpayer. It wasn't right. Obama nodded. Joe had said it, straight and true.
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Source: Confidence Men, by Ron Suskind, p.349-350
Bernie Sanders on Budget & Economy
: Dec 10, 2010
Why did we bail out South Korea?
I think the American people are interested to know that the Fed bailed out the Korea Development Bank, the wholly owned, state-owned Bank of South Korea, by purchasing over $2 billion of its commercial paper. The sole purpose of the
Korea Development Bank is to finance and manage major industrial projects to enhance the national economy not of the United States of America but of South Korea. I am not against South Korea.
I wish the South Koreans all the luck in the world. But it should not be the taxpayers of the United States lending their banks' money to create jobs in South Korea.
I would suggest maybe we want to create jobs in the United States of America. At the same time, the Fed also extended over $40 billion for the Central Bank of South Korea so that it had enough money to bail out its own banks.
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Source: The Speech: A Historic Filibuster, by Bernie Sanders
Bernie Sanders on Government Reform
: Sep 29, 2010
Introduced Federal Reserve Transparency Act with Ron Paul
When Fed Chair Ben Bernanke refuses to give us information about the trillions of dollars of credit that he recently passed out in the bailout process because that would be "counterproductive," he is really saying, "It's none of your business."
He may well be protected by the law, but he is in defiance of the Constitution. The courts, under today's circumstances, will never rule that the Federal Reserve Bank chairman must reveal the information that the Congress or the people seek.
One thing
I have noticed in studying the issue is that the more power the Fed has gained, the greater the secrecy they demand. Transparency is currently a hot issue in Congress because the people have awoken and have sent a message. This is not a conservative or
liberal issue; it's not a Republican or Democratic issue. It is pervasive, across the political spectrum.
I introduced a Federal Reserve audit bill the Federal Reserve Transparency Act, HR 1207, which Bernie Sanders introduced in the Senate.
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Source: End the Fed, by Rep. Ron Paul, p.174-175
Barack Obama on Budget & Economy
: Sep 16, 2009
Some wealth of the last economic boom was illusory
The Fed has one power that is unique to it alone: it enables the creation of money out of thin air. We are talking about an awesome power. It is the power to weave illusions that appear real as long as they last. That is the very core of the
Fed's power. As Pres. Obama said of the economic boom that went bust: "I think it's important to understand that some of that wealth was illusory in the first place."
Exactly. But let's also understand the source of the illusion and what to
do about it. Of course not everyone is instinctively against this illusion-weaving power, and many even welcome it. They just want to get back to the times when "everything was good" even though it was all just a mirage--a creation of the appearance
of wealth by the Fed.
Tragically, the innocent who understand little about the complexity of the monetary system suffer the most, while those who are in the know reap great profit whether the market is going up or down.
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Source: End the Fed, by Rep. Ron Paul, p. 2-3
Joe Biden on Budget & Economy
: Aug 19, 2007
More transparency for hedge funds and private equity funds
Q: The Fed lowered the discount rate for banks to address the mortgage crisis. Should they lower rates for everyone else? A: The answer is yes. But we need more transparency, particularly with regard to hedge funds and private equity funds.
They are the ones that are causing this thing to go under. And there’s no transparency, no accountability. We don’t know how deep this problem is. I think it’s almost as deep in terms of dollars, not liability, as the savings and loan crisis.
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Source: 2007 Democratic primary debate on “This Week”
Page last updated: Aug 01, 2019