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Yellen opposes GOP proposal to boost Fed oversight

REO 54

Midas Member
Midas Member
Jul 4, 2010
No shit Sherlock. If we had oversight and transparency about the Fed we would plainly see how Effed we are!

Yellen opposes GOP proposal to boost Fed oversight
Yellen opposes GOP proposal to boost Fed oversight
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By MARTIN CRUTSINGER, AP Economics Writer Nov 17, 2015
WASHINGTON (AP) - Federal Reserve Chair Janet Yellen said Tuesday that legislation supported by House Republicans to make the Federal Reserve more transparent and accountable would be a "grave mistake" that could harm the U.S. economy.

Yellen said the proposal which could be voted on by the House this week is "significantly flawed" because it would require the Fed to use a mathematical rule in determining where to set interest rates. She said that approach is unworkable and would lead to "poor economic outcomes."

The measure is supported by Republicans who want to increase congressional oversight of the Fed but is strongly opposed by Democrats.

"The bill would severely impair the Federal Reserve's ability to carry out its congressional mandate and would be a grave mistake, detrimental to the economy and the American people," Yellen wrote in a letter to House Speaker Paul Ryan, R-Wisconsin, and Minority Leader Nancy Pelosi, D-California.

But House Financial Services Committee Chairman Jeb Hensarling, R-Texas, said the measure known as the Fed Oversight Reform and Modernization (FORM) Act was needed to deal with the enhanced powers the Fed has used to respond to the 2008 financial crisis and the deep recession that followed.

"While the Fed's unusual monetary activities and power have increased, there has regrettably been no corresponding increase in its transparency and accountability," Hensarling said in reaction to Yellen's letter.

The bill won approval by the House Financial Services Committee on July 29 on a party-line vote of 33-25. The House majority leader's office has announced it is on the schedule for a vote by the full House this week.

The measure would require the Fed to use a formula to set interest rates but would allow the central bank to deviate from that strategy if economic conditions warranted a change.

The Fed's chosen formula would be subject to a review by the Government Accountability Office, the auditing arm of Congress, and the GAO would also be required to audit the Fed any time the central bank chose to make changes to its rule.

Yellen said had the Fed been required to comply with a policy rule over the past seven years when its key rate has been at a record low near zero, the unemployment rate would have been "substantially more painful than it already was" and inflation would be even farther from the Fed's 2 percent goal.

"Millions of American would have suffered unnecessary spells of joblessness over this period, generating enormous amounts of personal and collective damage that could have been avoided - and, in fact, was avoided because we had the latitude to use our available tools responsibly and forcefully," she said.

The GOP legislation would also require the Fed to be more transparent about the stress tests it requires the country's biggest banks to pass each year. It would also place new restrictions on the Fed's ability to make emergency loans during periods of financial crisis.



Silver Member
Silver Miner
Apr 1, 2010
No where in there did I see it say that the owners of the Fed would have their salaries and compensation packages audited. In addition to that there is insider trading and market manipulation which directly benefits the owners of every Central Bank on the planet. All this without even touching on the fact that this thievery has been going on for a century at least. It's impossible to force any kind of restitution at this point.

I found an interesting article and quote, take a look:


Let's start with a quote from U. S. Congress Representative Louis T. McFadden, Chairman of the Committee on Banking and Currency for 12 years, quoted from the Congressional Record:

"The Federal Reserve Board has cheated the Government of the United States and the people of the United States out of enough money to pay the national debt, Our people's money, to the extend of $1,200,000,000 has within the last few months been shipped abroad to redeem Federal Reserve Notes and to pay other gambling debts of the traitorous Federal Reserve Board and the Federal Reserve Banks ... "


1a. The Federal Reserve (FED) is a PRIVATELY OWNED, organization. Unbelievable? Check the ENCYCLOPAEDIA BRITANNICA.


In all, there are about 300 VERY POWERFUL, partly foreign individuals that owns the FED.

2. Although the FED is required to give back most of its PROFITS back to the Treasury Dept., there is NO ORGANIZATION that has the power to AUDIT the FED (not even the Congress or the IRS). This creates a HUGE opportunity for creative accounting to hide the profit that ROBS the US Tax Payers Hundreds of Billions of Dollars annually.

3. Every year, a few Congressmen introduce a legislation to AUDIT the FED; and every year, the legislation is defeated. The FED has the most powerful, invisible lobbying power there is.

4. The owners of the FED own the controlling interests in ALL major media in the US. Rockefeller, through Chase Manhattan bank, controls CBS and ABC and 28 other broadcasting firms. Each of the other owners of the FED also have controlling interest in the US media. This explain why the media have been silent about the FED scam. The FED fraud is the biggest and longest cover-up in the US today.

5. According to Article 1, Section 8 of the Constitution, the US Congress has the power to print money (The Congress shall have the power to coin money, regulate the value thereof, and of foreign coin, ... According to the Supreme Court, the Congress can not transfer its power to other organization like the FED.

After several attempts to push the Federal Reserve Banking Act through Congress, a group of bankers funded and staffed Woodrow Wilson's campaign for President. In 1913, Nelson Aldrich, maternal grandfather to the Rockefellers, pushed the Federal Reserve Act through Congress just before Christmas, when most Congressmen were on vacation. Naturally, President Wilson passed the Act when he was elected as a pay back to the bankers.

more at the link: http://www.federalbudget.com/fed.html

REO 54

Midas Member
Midas Member
Jul 4, 2010
Tue Nov 17, 2015 5:50pm EST
Prudential's Peters uses barbell as rate hike looms

Gregory Peters, who helps manage more than $565 billion of assets at Prudential Fixed Income (PRU.N), said he is favoring investment-grade financial sector bonds and higher-quality junk bonds, as the Federal Reserve prepares to end its long tease of the markets and raise benchmark interest rates.

Speaking on Tuesday at the Reuters Global Investment Outlook Summit in New York, Peters said a rising rate cycle "is when you want to start buying bonds," and said he feels "really good about fixed income over the slightly longer term."

Peters, a senior investment officer who runs the Prudential Total Return Bond Fund (PDBAX.O), forecast at last year's Summit that the Fed might wait until late this year or even 2016 to raise rates for the first time since June 2006.

He now sees an 80 percent chance of a December rate hike, after the central bank made a "policy mistake" by doing nothing in September. Peters said subsequent statements by Fed officials may have been intended to help markets price in an eventual hike, even as small as 0.25 percentage point.

"That overhang is more detrimental," he said, referring to the unfulfilled threat of raising rates. "It's like being a kid: When you're constantly being threatened, the punishment ultimately doesn't work that well."

Peters has been emphasizing bonds from different parts of the credit spectrum, in a sort of barbell strategy, combining higher- and lower-risk assets.

He said he likes banks such as Citigroup Inc (C.N) and Barclays Plc (BARC.L), sometimes dropping down the capital structure to buy preferred securities for their extra yield.

Peters also favors short-term, "double-B" rated bonds, saying some junk-rated companies are "paradoxically" managing themselves more conservatively than their investment-grade counterparts, especially in the industrial sector.

"Spreads have moved on the investment-grade side in a meaningful way," he said. "At the same time, leverage is the highest I've ever seen going into a down cycle. So I really worry about what happens to these companies with the stock of debt growing so meaningfully."

Peters also said he is "quite negative" on energy companies, which have suffered from excess debt and capacity, and falling oil prices that he said could fall to $35 a barrel in 2016 from about $41 now, and more than $100 as recently as July 2014.

"There's no catalyst to move them higher," he said. "A lot of these companies are not going to go away gracefully necessarily, and so the capacity kind of remains high as well. I think this is a longer-term problem."

On the other hand, Peters said he remained "very positive" on structured securities, including high-quality collateralized loan obligations.

The economy, Peters said, should weather a rate hike, if there is one.

"It's not like 25 basis points is going to disallow (consumers) from getting a cheap mortgage," he said. "It's rare that you see us entering a recession without consumer confidence rolling over first, and we're not even close to that."

Peters nonetheless said the Fed has appeared "wishy-washy" about its commitment to raising rates and can use December's meeting to make its intentions, including for 2016, clear.

"I worry about them more trying to convince the market it's going to hike, and then they don't," he said.

Follow Reuters Summits on Twitter @Reuters_Summits

(Reporting by Jonathan Stempel and Ross Kerber in New York; Editing by Steve Orlofsky and Alan Crosby)

Read more at Reutershttp://www.reuters.com/article/2015/11/17/us-investing-peters-idUSKCN0T62LJ20151117#CKRGt2mgwIlCH8GH.99