The bill passed 327 to 98; all but one Republican and 89 Democrats voted yes. The bill will be considered under the suspension of normal House rules, meaning it required at least a two-thirds majority to pass.

The measure would permit government auditors to conduct deeper audits of the Fed’s monetary policy operations. Despite opposition from some Democrats and the Federal Reserve, the bill has at least 274 cosponsors, including more than three dozen Democrats facing difficult reelection campaigns.

Wednesday’s vote was a coup for its chief sponsor, Rep. Ron Paul (R-Tex.), a longtime nemesis of the Fed, which he has called “an enormously destructive and unaccountable force in both the U.S. economy and the greater global economy.”


House Democratic leaders oppose the bill, but said they don’t plan to whip the vote — or force most members to vote the party line. House Minority Whip Steny Hoyer (D-Md.) said Tuesday that the measure “increases the likelihood that the Fed will make decisions based on political rather than economic considerations, and that is not a recipe for sound monetary policy.”

Even with broad bipartisan support in the House, aides said the bill is unlikely to be considered in the Democratic-controlled Senate.

‘Audit the Fed’ bill passes in the House with bipartisan support - 2chambers - The Washington Post (http://www.washingtonpost.com/blogs/2chambers/post/audit-the-fed-bill-set-for-house-vote/2012/07/24/gJQAJypU7W_blog.html)

It's funny, 10 years ago, Ron Paul introduced the same bill, and lost with a 414-1 vote. Now, there's 270 co-sponsers, and the Senate probably won't even consider it.

:smack:

-vZZLEgwzGc

Rep. Ron Paul Discusses House Vote For H.R. 459, Audit The Fed - YouTube (http://www.youtube.com/watch?v=-vZZLEgwzGc)

House Minority Whip Steny Hoyer (D-Md.) said Tuesday that the measure “increases the likelihood that the Fed will make decisions based on political rather than economic considerations, and that is not a recipe for sound monetary policy.”

I really don't even know how to respond to this. I mean, do we, in any way, have sound monetary policy now???

The Fed pursues policies congress tells it to so, like it or not, it is a political institution. Their orders used to be protecting a sound dollar which it wasn't very good at. Now, it's mandate is to think and act in terms of employment, value of the dollar be damned.

I really don't even know how to respond to this. I mean, do we, in any way, have sound monetary policy now???

The Fed pursues policies congress tells it to so, like it or not, it is a political institution. Their orders used to be protecting a sound dollar which it wasn't very good at. Now, it's mandate is to think and act in terms of employment, value of the dollar be damned.

You know this is really basic stuff...the Fed has a dual mandate. Namely maintaining price stability AND full employment. Why does no one seem to understand this? Prices are stable...in fact the monster that is being fought is deflation, not inflation. Unemployment is too high by any measure.

Ron Paul can't define "sound money"...can you? Ron Paul doesn't even understand that he has every right as a US citizen to own as much or as little of any metal as he so chooses.

Right now we have a very accomodative monetary policy that is being pursued in order to stimulate lending and growth. The Fed is the only arm of govt that is acting at all. Congress won't do anything and the President is inept.

What would YOU do differently and why?

You know this is really basic stuff...the Fed has a dual mandate. Namely maintaining price stability AND full employment. Why does no one seem to understand this? Prices are stable...in fact the monster that is being fought is deflation, not inflation. Unemployment is too high by any measure.

Ron Paul can't define "sound money"...can you? Ron Paul doesn't even understand that he has every right as a US citizen to own as much or as little of any metal as he so chooses.

Right now we have a very accomodative monetary policy that is being pursued in order to stimulate lending and growth. The Fed is the only arm of govt that is acting at all. Congress won't do anything and the President is inept.

What would YOU do differently and why?

Well, leaving aside the central question as to whether congress has enough and proper oversight over the Fed, which Rep. Paul and others think it clearly does not, no, I can't define 'sound money' in terms of exact value and purchasing power and what the economy should exactly look like. Rep. Hoyer seems to think we do have 'sound' money so, it would follow that he thinks that the economy, in general, is just peachy.

Further, I really don't know how you think we have stable prices. Look at housing. Food. Medical costs. Energy. Stable? Compared to what, Greece?
And why do you call deflation a monster? If some things cost 'too much' whats wrong with the prices falling into a 'better' range?

All of this stuff gets rather subjective rather quick so, you really can't leave out the point of this tread; greater oversight of the Fed. Is the dollar 'sound'? Why or why not? Is deflation a 'monster'? Why or why not? What 'should' employment numbers be? Why? In any event, what would I do? I assume you mean as Boss Fed, yes?

If so, I'd be doing exactly as Bernanke is doing because he is, clearly, doing what a lot of politicians, backed by the Too Big To Fail model, Wall Street, corporations, want him to be doing which is killing off more and more mid and low level competition which does nothing but make the Too Big's To Fail bigger and safer. The Fed has oversight. It's just not very public.

Now, what would I do if had free rein? I'd argue that we need a national energy policy based on oil under $50 a barrel and I'd argue we need enormous write off's in housing to heal that crucial market and write off's in student loans as well as a sound immigration plan. To do this, I'd want interest rates up around 7-8% so banks could actually earn off their money instead of all the schemes they come up with to make money with such low interest rates. Earning money allows them to absorb the blow of the balance sheet losses. The balance sheet loses free up enormous consumer dollars, wipe out uncertainty and allow people to start to move forward again. Properly priced oil is the second part of this. The middle class can not be healthy with all this debt nor high energy prices. Properly, in my view, is under $50 a barrel and this would produce enormous relief on consumer costs across the board. And, finally, a sound immigration policy allows labor and wages (jobs, jobs, jobs) to get healthy where the economy is demanding labor, attracting it with good wages and removing the make work mentality of current policy.

You'll note a bunch more subjective words in there not to mention a whole bunch of things the Fed has little or no direct control over which brings us back to the original point; more oversight. Knowing what the Fed is doing and why and, perhaps changing the Feds mandate based on that oversight. The larger point is that ALL of those things are necessary to have what I would consider a sound economy, also a subjective thing. And, as Fed Boss, I'd argue anything I do QE3 or 4 or 5, is so much pissing in the wind absent the 'sound' dollar I envision given a massive write off of debt, solid interest rates generating real earnings, good energy and labor, err, immigration policies.

Regardless of what one thinks the Fed does or should be doing and how well it is accomplishing those goals, I don't see how we can't think more oversight is essential for we, the people, to be making any kinds of educated decisions on who to vote for and what policy ideas to support. In my view, the Fed would benefit, greatly, with more oversight simply if it served to clarify in the public mind what they can and can't do, or, can and can't be expected to do given policy in so many other areas.

Lack of oversight does two things; leaves a poor picture of whether or not the Fed is doing well or not and why and, secondly, the exact same thing about our elected leaders; are they doing a good job or not and why. There's plenty of congresspeople who do NOT want us understanding what the Fed does because they do NOT want us understanding what they, our elected leaders, are doing.

:buddies:

Y The Fed is the only arm of govt that is acting at all. Congress won't do anything and the President is inept.

?

Oh, and that's not true. At all. The government is spending money at a rapid rate.

And, in my view, it's not working.

...The Fed is the only arm of govt that is acting at all. Congress won't do anything and the President is inept.

What would YOU do differently and why?

I believe this to part of the problem. The knee-jerk reaction, "We have to do something to fix this!" The people point fingers and blame the government. The government SHOULD tell them to go dig a ditch, but no, they instead increases entitlements and spend more money.

My question is, why do YOU think the government should be stepping in at all?

They DO NOT have a good track record of doing what is needed. Sometimes is better just to do nothing and allow the path to run its course.

Technically, the Fed is a private (non-govt.) entity that controls our entire monetary policy. I'd say we have every right to make sure they are doing it right.

Let me hit some of the general themes before responding to Larry's long post.

The Fed as a "technically private" entity. Technically true. But an extremely simplistic view. Fed governors are appointed by Pres and approved by Congress...so to imply there is no oversight is misleading in the most.


My question is, why do YOU think the government should be stepping in at all?

They DO NOT have a good track record of doing what is needed. Sometimes is better just to do nothing and allow the path to run its course.

Why do I think the gov't should step in? Good lord...80-90 years of economic research and actual experience. Those who argue against the use of fiscal stimulus and monetary easing have obviously not been paying attention and don't understand the type of recession we went thru.

Oh, and that's not true. At all. The government is spending money at a rapid rate.

And, in my view, it's not working.

Here we go again with the simplistic, misleading viewpoint as perpetrated by the Fox News types.

A week or so ago, I posted a link to a Treasury Dept/CBO set of slides that discussed our current situation. Just wondering if you bothered to look at it? Probably not.

We are spending money at a rapid rate and in your view its not working? Would love to hear your thoughts as to what you think we are spending our money on and why it is not working. Based on your comment, I can almost guarantee that your impressions are incorrect. But go ahead and let me know what prompted that post.

Well, leaving aside the central question as to whether congress has enough and proper oversight over the Fed, which Rep. Paul and others think it clearly does not, no, I can't define 'sound money' in terms of exact value and purchasing power and what the economy should exactly look like. Rep. Hoyer seems to think we do have 'sound' money so, it would follow that he thinks that the economy, in general, is just peachy.

Further, I really don't know how you think we have stable prices. Look at housing. Food. Medical costs. Energy. Stable? Compared to what, Greece?
And why do you call deflation a monster? If some things cost 'too much' whats wrong with the prices falling into a 'better' range?

All of this stuff gets rather subjective rather quick so, you really can't leave out the point of this tread; greater oversight of the Fed. Is the dollar 'sound'? Why or why not? Is deflation a 'monster'? Why or why not? What 'should' employment numbers be? Why? In any event, what would I do? I assume you mean as Boss Fed, yes?

If so, I'd be doing exactly as Bernanke is doing because he is, clearly, doing what a lot of politicians, backed by the Too Big To Fail model, Wall Street, corporations, want him to be doing which is killing off more and more mid and low level competition which does nothing but make the Too Big's To Fail bigger and safer. The Fed has oversight. It's just not very public.

Now, what would I do if had free rein? I'd argue that we need a national energy policy based on oil under $50 a barrel and I'd argue we need enormous write off's in housing to heal that crucial market and write off's in student loans as well as a sound immigration plan. To do this, I'd want interest rates up around 7-8% so banks could actually earn off their money instead of all the schemes they come up with to make money with such low interest rates. Earning money allows them to absorb the blow of the balance sheet losses. The balance sheet loses free up enormous consumer dollars, wipe out uncertainty and allow people to start to move forward again. Properly priced oil is the second part of this. The middle class can not be healthy with all this debt nor high energy prices. Properly, in my view, is under $50 a barrel and this would produce enormous relief on consumer costs across the board. And, finally, a sound immigration policy allows labor and wages (jobs, jobs, jobs) to get healthy where the economy is demanding labor, attracting it with good wages and removing the make work mentality of current policy.

You'll note a bunch more subjective words in there not to mention a whole bunch of things the Fed has little or no direct control over which brings us back to the original point; more oversight. Knowing what the Fed is doing and why and, perhaps changing the Feds mandate based on that oversight. The larger point is that ALL of those things are necessary to have what I would consider a sound economy, also a subjective thing. And, as Fed Boss, I'd argue anything I do QE3 or 4 or 5, is so much pissing in the wind absent the 'sound' dollar I envision given a massive write off of debt, solid interest rates generating real earnings, good energy and labor, err, immigration policies.

Regardless of what one thinks the Fed does or should be doing and how well it is accomplishing those goals, I don't see how we can't think more oversight is essential for we, the people, to be making any kinds of educated decisions on who to vote for and what policy ideas to support. In my view, the Fed would benefit, greatly, with more oversight simply if it served to clarify in the public mind what they can and can't do, or, can and can't be expected to do given policy in so many other areas.

Lack of oversight does two things; leaves a poor picture of whether or not the Fed is doing well or not and why and, secondly, the exact same thing about our elected leaders; are they doing a good job or not and why. There's plenty of congresspeople who do NOT want us understanding what the Fed does because they do NOT want us understanding what they, our elected leaders, are doing.

:buddies:

I'm not going to get into the Ron Paul debate. He is wrong or misleading. He follows an economic school of thought that has been trivialized and dismissed.

So you have no idea no what "sound money" is...just that we need it? Well, to me that sounds like you have no idea what you are tallking about and you just want to complain.

Your points about what you would do if you had free reign are in direct conflict with your complaining about federal spending. Do you see that?

You complain about federal spending then say we should have massive write downs of mortgages (I don't disagree with that by the way). But how are you going to pay for that if you think we are spending too much money now???

Immigration and engergy policies have nothing to do with the Fed. However, those are nice ideal....no substance of course. This is the problem with all these internet boards. Everyone comes on here to piss and moan but then they have no ideas to offer to fix things...or the ideas that are offered are nothing more than simplistic/unrealistic concepts that would never work.

Oh...how do I think we have stable prices? Here is another problem with the education level of the average citizen. The Fed and the govt are concerned with overall pricing in the entire economy. They can not be focused on the pricing of one item or just the items you buy. And, if you haven't noticed...gas prices are much lower than they were 3 months ago...lower than they were a year ago and lower than they were 4 years ago. Housing prices are starting to rebound and the housing market is starting to show signs of life. I guess it is hard to understand these things when one only gets information from the likes of Fox News or MSNBC.

GAO Audit of Federal Reserve Reveals Strong Conflicts of Interest | The Economic Populist (http://www.economicpopulist.org/content/gao-audit-federal-reserve-reveals-strong-conflicts-interest)

I'm not going to get into the Ron Paul debate. He is wrong or misleading. He follows an economic school of thought that has been trivialized and dismissed. I understand that. It would be nice if we, the people, stopped saying we wanted less spending and government when we vote against it every time.

So you have no idea no what "sound money" is...just that we need it? Well, to me that sounds like you have no idea what you are tallking about and you just want to complain. There is some of that, sure, but, I explained my intentions; oversight and added my view of what sound money might look like. I'll wait for your idea of what 'sound' money is.

Your points about what you would do if you had free reign are in direct conflict with your complaining about federal spending. Do you see that? No, it's not.

You complain about federal spending then say we should have massive write downs of mortgages (I don't disagree with that by the way). But how are you going to pay for that if you think we are spending too much money now??? I wrote it. I can't make you read it. HIGHER interest rates. That costs nothing in government spending. I'll spell it out for you; is it better to be earning low interest on something that isn't getting paid anyway, but, looks good on the asset side of the ledger or, be earning solid money, which I gave an opinion on, on a smaller asset that IS getting paid? I hope this question answers itself.

Immigration and engergy policies have nothing to do with the Fed. Money policy has something to do with EVERYTHING. If you don't see the direct correlation between US monetary policy and otehr economic decisions down stream, including labor (immigration) and energy (cost of doing business) then you marginalize yourself. However, those are nice ideal....no substance of course. :lol: This is the problem with all these internet boards. Everyone comes on here to piss and moan but then they have no ideas to offer to fix things...or the ideas that are offered are nothing more than simplistic/unrealistic concepts that would never work.
yeah, that;s the problem with these internet boards; when we spend too much and then some moron says 'then spend less', or lack of oversight is meant with "add oversight" I mean, seriously!? Really???

Oh...how do I think we have stable prices? Here is another problem with the education level of the average citizen. The Fed and the govt are concerned with overall pricing in the entire economy. They can not be focused on the pricing of one item or just the items you buy. And, if you haven't noticed...gas prices are much lower than they were 3 months ago...lower than they were a year ago and lower than they were 4 years ago. They were $1.80 on average when Obama took office. You're being intentional wrong or you just didn't know that? Housing prices are starting to rebound and the housing market is starting to show signs of life. You are on bath salts. I guess it is hard to understand these things when one only gets information from the likes of Fox News or MSNBC.

Ah! So, we get to the end and it's the media's fault! I live a real life, pal, with real friends. People in small business, government, medicine, real estate, union jobs, you name it. I ask questions. I don't go around dismissing people's opinions because they don't have their heads in the same hole in the ground as you do.

Here is a chance at sounding like you have a clue; what would be wrong with more congressional oversight of the fed? Oh, and your comments about housing and energy just revealed that, basically, you think we have sound money now. You're not running for office in Greece, are you?

Ah! So, we get to the end and it's the media's fault! I live a real life, pal, with real friends. People in small business, government, medicine, real estate, union jobs, you name it. I ask questions. I don't go around dismissing people's opinions because they don't have their heads in the same hole in the ground as you do.

Here is a chance at sounding like you have a clue; what would be wrong with more congressional oversight of the fed? Oh, and your comments about housing and energy just revealed that, basically, you think we have sound money now. You're not running for office in Greece, are you?

Good lord...You ask questions...sounds like you need to find a different group of people to talk to.

Gas was $1.80 when Obama took office? Is that the best you can come up with? When President Obama took office we were in the midst of the worst economic situation this country has faced in 80 years!! Did you forget that or just forget to ask that question of the multitude of adivisors you rely on for your opinions?

Maybe a financial crisis induced recession is what you would like to go back to?

700,000 first time claims for unemployment benefits...WEEKLY!
An economy that was shrinking at an annualized rate of over 8%!
US auto manufacturers on the edge of bankruptcy
the banking system failing

Yeah...those certainly were heady times when Obama came into office and gas was $1.80! Those were great days bro!

Housing may or may not be recovering on your street...but there is a whole big country out there and it is getting better.

What would be wrong with more Congressional Oversight? Explain to me what Congress does correctly now? Come one...they can't even agree on what to eat for lunch!! You want them running monetary policy??? The same bozos would had to vote for millions of dollars to subsidize wooden arrows before they would vote to save the financial system???

The guy running the Fed right now spent his entire academic career studying the Great Depression.

You think Congress is going to be able to oversee monetary policy???

You complain that the Fed is being political and the way to rectify that is to add more Congressional oversight????

We are spending money at a rapid rate and in your view its not working? Would love to hear your thoughts as to what you think we are spending our money on and why it is not working. Based on your comment, I can almost guarantee that your impressions are incorrect. But go ahead and let me know what prompted that post.

What is our fed spending money on:

US Federal Budget FY13 Estimated Spending Breakdown - Pie Chart (http://www.usfederalbudget.us/budget_pie_gs.php)

Defense: 24%
Healthcare: 22%
Pensions: 22%
Welfare: 12%
Interest: 6%
Education: 4%
And some other spending

U.S. National Debt Clock : Real Time (http://www.usdebtclock.org/)

Current deficit: Nearly 1.3 trllion
Current Debt: 15.8 trillion
Debt per person: $50,687
Debt per tax payer: $139,580
Interest owed: 3.8 trillion


GDP growth: 1.5%
Current Unemployment: 8.2%
Some reports (http://money.cnn.com/2012/05/03/news/economy/unemployment-rate/index.htm) are saying we could have up to about 86 million people out of work.

Poverty rate nears worst mark since 1965

Poverty rate nears worst mark since '65 - SFGate (http://www.sfgate.com/nation/article/Poverty-rate-nears-worst-mark-since-65-3726870.php)

A new record in number of people (1 in 7) collecting Food Stamps

Does Obama push food stamps? - Jan. 17, 2012 (http://money.cnn.com/2012/01/17/news/economy/obama_food_stamps/index.htm)

US Dollar nearing all-time low

FOREX-US dollar tumbles broadly; all-time index low in sight | Reuters (http://www.reuters.com/article/2011/04/21/markets-forex-idUSN2128742920110421)

The economy as a whole is mudding along; some say on the verge of a relapse into recession. Can you honestly say all this spending, stimulus, TARP has worked? If so, tell it to the 86 million that can't find a job.

I'm not going to get into the Ron Paul debate. He is wrong or misleading. He follows an economic school of thought that has been trivialized and dismissed.



was that by Krugman tommyboy

and which economic school

and I am still waiting for that comparison contrast .......... :tap:

The guy running the Fed right now spent his entire academic career studying the Great Depression.





and what real jobs has he held ?

What is our fed spending money on:




u24nH03NccI

The guy running the Fed right now spent his entire academic career studying the Great Depression.



Well, given how you're ignoring my responses and playing 'whack a mole' I suppose we could just try and keep it simple and focus on one thing at a time? How'd that be?

You make a good point how the Fed boss has been studying the Great Depression his whole life and that, time after time, seems to be the only real reason anyone gives when discussing Ben, what he's done and the effects. "Well, uh, you do know he studied the Great Depression, don't you?" :tap:

If he studied the Civil War his entire academic career he could probably go back in time and win it for 'ol Dixie. That's about how much relevance the Great Depression has with today.

1929 was not about a housing collapse. It was not about things like credit default swaps or other derivatives. It had nothing to do with the stunning amount of leverage and exposure investment banks and insurers had and certainly not the wink and nod understanding that, as they played Big Casino on Wall Street that it was, if something went awry, going to be House money (ours).

Nor were we in a global economy where normal, day to day goods were coming from all over the globe from enormous corporations that could spin on a dime and switch from one product to another virtually at will. Nor was the distribution system even remotely as effective and efficient as today. Nor was there the enormous question and pressure of run away illegal immigration. Nor were energy costs so stunningly out of line. Nor were we engaged in wars around the globe that were costing trillions and returning nothing.

Nor did we have a social welfare system driving some 20-30% of the economy, costs that produced nothing but, cost just the same. Nor did we have GSE's that drove leverage to the breaking point with the added benefit of being tax payer, not investor, money.

In 1929, things froze and shut down. Orders, manufacturing, borrowing, purchasing, and the entire economy was, well, 1929. It did not and could not just spin on demand and wheel around and respond like it can and does today. In 1929, there was no sense of widespread dependency like we have today. In 1929, communications, technology, food, clothing, housing, it was a very, very different world.

I have every confidence that Chairman Bernanke may well have been the go to guy in 1929. However, we don't have time machines, generals always fight the last war and his being a master at a problem and a time period that have so little similarities to today is, if anything, a really good reason to not just trust that we, the people, have no reason or need to know what goes on in the Fed. At the end of the day, what ended the GD was World War II, the enormous spending we did AND the ENORMOUS benefits we reaped rebuilding the post WWII war. Now, we are spending. And spending. And spending. And, where will the dollars come from to pay for it all? Certainly not from the spoils of war. Certainly not from any sort of massive boom in US based manufacturing.

So, defend Ben's actions vis a vis the Great Depression and today.

This ought to be good.

:popcorn:

u24nH03NccI

Good stuff by Whittle as usual.