Ben Bernanke to Ron Paul: “I will resist any attempt to dictate monetary policy.”

Event: Congress’ Joint Economic Committee
Date: 5/5/2009

Transcript:

Ron Paul: Welcome, Chairman Bernanke. I have a couple of questions, but first I want to mention that I find it awfully frustrating at times when we always talk about inflation and we only talk about the prices and say, “We have prices under control, there is no inflation”. We have to realize that the monetary base, the liquidity was doubled in a few short months. To me there is a lot of inflation out there. It’s already inflated, we’re in the midst of inflation. Because the prices haven’t gone up doesn’t mean we don’t have the distortion. And it was that system that gave us the financial bubble. Artificially low interest rates, the mal-investment, all the mistakes made. And now we’re trying to correct all that by doing the very, very same thing.

So, I think someday we’re going to have to address this somewhat differently because I’m not very optimistic that we can solve our problems with more spending and more borrowing and more inflation in order to solve those problems. But you’ve answered this question several times, I want to bring it up again and this question has to do with when will some of this liquidity be drained? And I don’t think the answer you’ve given is very specific and I don’t expect to get a more specific answer, but I’m going to try.

What if we have a situation where prices, which is not the best measure of inflation, but let’s say the consumer price index (CPI) is going up 8% to 10% and there is no economic growth. Where are you then, because that’s not impossible, it’s happened. It’s happened in our history, it happens throughout the world, it’s a common thing, it puts you between a rock and a hard place. If you drain, interest rates go up and the economy further crashes. If you don’t, you have the explosion.

Can you give me an idea what you precisely would do if you face the situation where prices were going up 10% with no economic growth?

Ben Bernanke: Well, I think that’s an unlikely scenario but we certainly would have to take steps to ensure price stability, because if inflation gets out of control we know it has very adverse effects on the economy, both in the medium and long term and so we would obviously have to address that.

Ron Paul: Which means you would have to raise interest rates?

Ben Bernanke: This is exactly the same problem which is always faced by monetary policy, which is in a recovery when the economy is starting to grow but has not yet gotten very far, perhaps, and unemployment is still above where we would like it to be. You know, you have to take away the punch bowl, as someone once said, in order avoid the inflation risk.

Ron Paul: I see this as the real problem because we practice economic planning through manipulation of money and credit. Socialism always fails because they don’t have a pricing structure. Interventionism and inflationism fail because we don’t have a free market pricing system of money; the interest rates. Therefore it fails, it comes to conclusion and inevitably it leads to a more socialized economy. Just witness what we’re talking about. Taking over companies, taking over insurance companies, taking over banks. This has been the prediction of the free market economists and yet we continue down this path of socializing our entire economy.

I do want to address one other subject and it has to do with transparency. You said you have made a commitment to transparency and openness, which is very good and there is a lot of us that want that. And I have dealt with that and have a legislation, HR 1207, dealing with that. But in a real sense, I know what you’re doing here, but the code really protects you from telling us some of the things we’d like to know. For instance, in 1978 when the GAO was given the authority to audit the Fed, it put the exclusion in there that you can’t ask these questions. Precisely, if I wanted to know about all your agreements and discussions with foreign central banks, with foreign governments, with international financial organizations, you have no obligation and you haven’t volunteered to do this. So is there a way that you would, since you’re moving in this direction, move and consider supporting a position where Congress has a right to know these very, very crucial, vital issues dealing with their money?

I mean, everything you do deals with their money. Would you ever be open to repeal some of these provisions?

Ben Bernanke: Yes I would. Now, if you let me be specific. We have many programs where we lend money, we take collateral, and obviously we are repaid. I want to assure you, first of all, that we have very substantial oversight and controls, we have precise internal divisions which monitor these things, we have an independent IG and we have an external auditing company, a private company which provides audits every year and has given us a clean bill of health on all our financial controls, all levels of Sarbanes-Oxley requirements. That being said, if Congress needs more information about the operations that we’re doing, exactly how we manage our collateral and how we manage our lending and those sorts of things, I think we can talk to you about providing more information about that and if necessary working with the GAO.

Where I’ll be very careful, where I’d like to be just very clear, there’s been some discussion of the GAO “auditing monetary policy”. I don’t know what that means, but I certainly would resist any attempt to dictate the Federal Reserve how to make monetary policy. It’s the independence of monetary policy which is crucial to the maintenance of price stability and economic growth in this country. And that would not be acceptable but if it’s an issue of making sure that we’re appropriately managing our systems and doing what we’re saying we’re doing in terms of our lending, we want to be open, we want you to understand that we’re taking every precaution to protect the taxpayer.

Ron Paul: Of course, the policy is the only thing that really counts.

145 Comments:

  1. give it to ’em Dr.Paul!!!!!

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  2. What I find most interesting is Bernanke’s comments about the Fed being audited yearly by a private agency and getting a clean bill of health. People need to realize that this is nothing more than a clever re-use of the “audit” buzzword – this is not the type of audit that HR1207 is asking for. It gives no information to Congress or the American people. And of course they get a clean bill of health – the Fed is a very viable business!!

    Furthermore, Bernanke says,”it’s the independence of monetary policy which is crucial to the maintenance of price stability and economic growth in this country.” This statement implies an unbiased monetary policy. The Fed controls the creation of money and lends it out at interest to anyone that will borrow – how is that unbiased? Furthermore, a market that isn’t manipulated by the Fed or other government agencies will naturally find stable prices. Similarly, if we outlaw fractional reserve banking (imagine if I was a baker that could create bread without any ingredients!), inflation wouldn’t exist.

    Bernanke never answered Dr. Paul’s first question – what would you do in a specific situation experienced by many nations worldwide (including our own) throughout history – what would you do? Truth is, he doesn’t have a plan, because he’s not an economic genius…at least not in the way most people think he is.

    The Fed is the mother of all ponzi schemes.

    »crosslinked«

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    • “this is not the type of audit that HR1207 is asking for.”

      So then what, exactly, is the type of audit that HR1207 is asking for? Who is going to conduct it and how? Do you have any specifics?

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      • Dude, you’ve read the bill. It answers your questions quite clearly. Read it again.

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      • I think you misunderstand what it means to audit something. From Wikipedia –> “Traditionally, audits were mainly associated with gaining information about financial systems and the financial records of a company or a business.” Bernanke’s claim that this private audit gives the Fed a “clean bill of health” only proves what we already know – they’re making money hand over fist. We want to know how, we want to know with whom, and we want to be able to determine what impacts such private relationships are having our our economy and foreign policy.

        As for the rest of your questions, read the bill:

        “To amend title 31, United States Code, to reform the manner in which the Board of Governors of the Federal Reserve System is audited by the Comptroller General of the United States and the manner in which such audits are reported, and for other purposes.”

        There’s your “who”

        “In General- Subsection (b) of section 714 of title 31, United States Code, is amended by striking all after `shall audit an agency’ and inserting a period.” If you read this section of the US Code, it basically lists all of the things the GAO can audit ONLY WITH THE PERMISSION OF THE FED CHAIRMAN… permission which has never been granted in nearly 100 years that the Fed has existed. HR1207 seeks to remove exceptions entirely.

        There’s your “what”

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        • “they’re making money hand over fist. We want to know how, we want to know with whom, and we want to be able to determine what impacts such private relationships are having our our economy and foreign policy.”

          I am impressed, now that is an audit!!!!

          OK, so you basically want to have a webcam and a webex on every person working at the Federal Reserve so the general populace can oversee/judge/evaluate each action using our collective, extensive knowledge of international economic theory? Wait, or by ‘we’ do you mean the comptroller general?

          Personally, I would prefer an audit like this on our lawmakers first, as (1) they are making and enforcing (by extension) the rule in the first place and (2) politicians are in no way more less susceptible to greed or corruption than bankers.

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          • Here we go again,

            Like a circus rodeo, the straw man riding the red herring in circles.

            Your deflection skills are modest, at best.

            Tell the boys upstairs to send in the backup, as you are getting weaker by the post.

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          • Nice. Equivalent to “oh, i’m sorry, i can’t hear a word you said?”. From some of my research that seems like a reasonable RP response:

            http://www.youtube.com/watch?v=dkNK18BlgkI

            I think my point has been made, you just can’t keep a good conspiracy theorist down. Not sure if you want a solution or just agitation sometimes…

            However, when this bill turns up NOTHING, we will revisit and i’ll get your take on the CONSPIRACY that kept it down, alright?

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  3. On the eve of the 2009 Bilderberg Group conference, which is due to be held May 14-17 at the 5 star Nafsika Astir Palace Hotel in Vouliagmeni, Greece, investigative reporter Daniel Estulin has uncovered shocking details of what the elitists plan to do with the economy over the course of the next year.

    The Bilderberg Group meeting is an annual confab of around 150 of the world’s most influential powerbrokers in government, industry, banking, media, academia and the military-industrial complex. The secretive group operates under “Chatham House rules,” meaning that no details of what is discussed can ever be leaked to the media, despite editors of the world’s biggest newspapers, the Washington Post, the New York Times and the Financial Times, being present at the meeting.

    According to Estulin’s sources, which have been proven highly accurate in the past, Bilderberg is divided on whether to put into motion, “Either a prolonged, agonizing depression that dooms the world to decades of stagnation, decline and poverty … or an intense-but-shorter depression that paves the way for a new sustainable economic world order, with less sovereignty but more efficiency.”

    The information takes on added weight when one considers the fact that Estulin’s previous economic forecasts, which were based on leaks from the same sources, have proven deadly accurate. Estulin correctly predicted the housing crash and the 2008 financial meltdown as a result of what his sources inside Bilderberg told him the elite were planning based on what was said at their 2006 meeting in Canada and the 2007 conference in Turkey.

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  4. End the Fed. An audit is a waste of our time.

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  5. NotRocketScience

    The Achilles heel of all statist attempts at central economic planning is the problem of economic calculation. Ludwig von Mises, who first formulated the theory of economic calculation, reasoned that socialist planning was theoretically impossible because of its inability to rationally allocate resources due to the absence of information provided by prices determined in the marketplace. Mises’s reasoning holds true for artificial manipulation of the “time market” for interest rates:

    “What economic calculation requires is a monetary system whose functioning is not sabotaged by government interference.”

    Artificially low interest rates result in an impairment of the economy’s ability to perform economic calculation.

    In 1974, the year following the death of Ludwig von Mises, Frederich August von Hayek won the Nobel Prize in Economics for his “pioneering work in the theory of money and economic fluctuations and for their penetrating analysis of the interdependence of economic, social and institutional phenomena.”

    Hayek’s Nobel Prize–winning Austrian economics theories drew directly from Mises’s work on the business cycle. Hayek showed, in his book Prices and Production, how monetary distortions caused by inflation and credit expansion cause the capital structure of the economy to become maladjusted.

    New money that enters the economy does not affect all economic actors equally nor does new money influence all economic actors at the same time. Newly created money must enter into the economy at a specific point. Generally this monetary injection comes via credit expansion through the banking sector. Those who receive this new money first benefit at the expense of those who receive the money only after it has snaked through the economy and prices have had a chance to adjust.

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  6. Economics for Kids!

    The “Stock Market” is like a very big grocery store where people buy things called stocks. While the Stock Market sometimes goes up (sells more for more money), it will eventually (before long) suffer a decline (sell less for less money). This cycle (back and forth) is normal.

    That’s why God made “bonds” (not James) and “precious metals” (gold and silver), so that prudent (smart) investors (rich people) could put money in different places, and take advantage (make money) from natural cycles (ups and downs) happening in different economic arenas (places).

    But the Federal Reserve (banks that secretly create money) decided at some point that cyclical stock downturns (regular fall down and go booms) should be a thing of the past, and that everyone should have as much money as they ever, ever wanted.

    So the Federal Reserve began to give money to anyone who wanted it (or asked nicely), and started to watch the Stock Market very closely. If the Stock Markets became sad (went down), the Federal Reserve just made up more money, and gave it away, or sold it very cheaply. The Federal Reserve calls this “Lowering Interest Rates” but smart people who study the way we use money (Economists) call this “inflation”.

    After 10 years of giving away free money so that the stock market is always happy, the opposite happened. The stock market is now very sad. This is because our money has “devalued” (become worthless), because the Federal Reserve gave too much away. It is like when you eat too much candy, and it makes all your teeth so rotten, they all fall out!

    Now the Stock Market is going to go way down anyway (fall down and go big boom), and our money won’t be worth anything. Why is this bad? Remember those teeth that fell out when you ate too much candy? The Dentist who used to fix your teeth for $2000.00 will now cost $75,000.00.

    The End

    G’Night, Johnboy

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  7. I agree with your intelligent comment Ms. Weston. The information summary about the Fed that was released by the Fed is the law passed by Congress detailing the structure of the Federal Reserve,defining its function as a GOVERNMENT ENTITY [not as a private entity that the ignorants continuously harp on], ITS MAIN RESPONSIBILITY AND GOALS AS THE NATION’S CENTRAL BANK, and HOW THE FED OPERATES TO ACHIEVE THE PURPOSE FOR ITS CREATION BY CONGRESS. The less informed and misinformed as you read them in many of the foregoing comments, thought that the summarized info about the Fed [this is a thick volume that needs to be summarized]that was published by the Fed [you may catch them in the Internet] is a PROPAGANDA released by “thieves” in the Fed [by the way, who are those dirty rats in the first place?]not only to deceive the people but to cover their track of “robbery” and “stealing”, as how wild and politically rabid accusations spread and polute the air dangerously worse than this outbreak of flu epidemic of chicken and swines all over the country. Hard to blame those who know nothing of what they are talking about.
    Just because Ron Paul says so, roughnecks do not only want to abolish the Fed but also taxes, especially the income tax and credit. Obviously, they have a grotesque idea why nations need taxes. The roads they drive on — superhighways and freeways — the modern skylines of Los Angeles and New York [superstructures of buildings, etc.] the physical and social infractures that this wealthiest and mightiest nation on the planet have, are actually taxes and credits [by Jove!! didn’t they know?(!)]
    Anyway, what a waste of time to explain what we now have — what this nation now have — to brains that they do not have.

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    • Sneak I urge you to read the Grace Commission Report, which was commissioned by President Reagan to identify and suggest remedies for waste and abuse in the federal government. I quote”

      Resistance to additional income taxes would be even more widespread if people were aware that:

      -One-third of all their taxes is consumed by waste and inefficiency in the Federal Government as we identified in our survey.
      -Another one-third of all their taxes escapes collection from others as the underground economy blossoms in direct proportion to tax increases and places even more pressure on law abiding taxpayers, promoting still more underground economy-a vicious cycle that must be broken.
      -With two-thirds of everyone’s personal income taxes wasted or not collected, 100 percent of what is collected is absorbed solely by interest on the Federal debt and by Federal Government contributions to transfer payments. In other words, all individual income tax revenues are gone before one nickel is spent on the services which taxpayers expect from their Government.”

      All our income taxes pay is the interest on our national debt, the interest we receive from borrowing our money (on all levels) from the FED. Furthermore, according to Ron Paul himself, the money from taxes we collect today, from all other sources besides individual income, is enough to power out country as it was in the early-90s. Now imagine if we had that money, plus most all Americans weren’t paying 40%+ of their income every year. That sounds like a good road to economic recovery to me.

      Besides all that, the income tax is a direct unapportioned tax, which is forbidden by our constitution.

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  8. After reading the run-in for the questioning of Mr. Bernanke it was expected that there would be foul ups on the Fed Chairman’s parts, vaguery, “token” willingness to concede anything & tense moments between he and Mr. Paul. What I saw, however, was a smug Mr. Paul, a calm Mr. Bernanke, no tension and a much more than token willingness to be transparent on the part of the Fed Chairman. In theory I lean toward Ron Paul on nearly every issue, but this video showed him preening his viewpoints in a nearly arrogant fashion and not “pinning” anything on Mr. Bernanke that would cause anyone unfamiliar to think there was anything wrong with the Fed. The final shot reeked and did not show Mr. Paul in a good light. If “we” the people are going to get anything done we must not be arrogant, smug, ignorant, vague or more concerned with looking good than staying to the task. When one stoops down to exalt his viewpoint his glasses fall of and he can’t see where he’s going. Mr. Paul’s attitude was more offensive than the actions of Mr. Bernanke.

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    • “I will resist any attempt to dictate monetary policy.”… how does that fit in with, “… arrogant, smug, ignorant, vague or more concerned with looking good than staying to the task.”?

      How about turning your attention to the matter on hand? Transparency of the Fed activities that is. Who you find most attractive of the two, is nothing but a mere digression ma’am.

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      • Forgive me if I was unclear. What concerned me was the variance between the way the discussion was described on the web-site and the way the video actually showed it. There is no difference of opinion on there being many things manipulated “behind the curtain.” There are also many people making much noise about how to “fix” things. It will take many of us making much noise and taking action to make any effective change. However, before aligning with someone as a frontrunner I want more than agreement on a point or two, I want integrity, constancy and character. The disparity between the hype and the reality, the need for exaggeration causes me to question if Mr. Paul is the right person with which to become aligned. Agreement or no, I will not give my voice to someone I cannot trust.
        I actually found neither man to be “attractive” in their attitude.

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      • Couldn’t the title also have been “Ben Bernanke to Ron Paul: ‘we want to be open, we want you to understand that we’re taking every precaution to protect the taxpayer.'”?

        One question I keep trying to get an answer to regarding this bill: What kind of an audit is Mr. Paul actually asking for? What kind of an audit will suffice to meet his requirements for ‘successfully’ audited? Who will perform the auditing?

        What is Mr. Paul looking for (please don’t parrot ‘dissolve the fed’ that is not the title of this bill) with this piece of legislation? Does anyone really know if we are auditing whether or not they have fancy dinners or collateral management? If it is policy, how do you audit that? Are we auditing the alleged connections between “the Rothschilds and the consipracy that is a Central Bank”?

        I, too, am intrigued but I cannot align myself with something that smacks of vagueness and is supported by a lot (not all certainly, mind you) of hyperbole.

        I don’t need rhetoric, I just need details.

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        • Okay, you’ver read the bill correct. It mainly concerns itself with Section 714 of title 31, United States Code. Here is the part to be amended (as explicitly stated in the bill)…

          (b) Under regulations of the Comptroller General, the Comptroller General shall audit an agency, but may carry out an onsite examination of an open insured bank or bank holding company only if the appropriate agency has consented in writing. Audits of the Federal Reserve Board and Federal reserve banks may not include—
          (1) transactions for or with a foreign central bank, government of a foreign country, or nonprivate international financing organization;
          (2) deliberations, decisions, or actions on monetary policy matters, including discount window operations, reserves of member banks, securities credit, interest on deposits, and open market operations;
          (3) transactions made under the direction of the Federal Open Market Committee; or
          (4) a part of a discussion or communication among or between members of the Board of Governors and officers and employees of the Federal Reserve System related to clauses (1)–(3) of this subsection.

          Read the bill again. Apply what it says and watch your (irrlevant and trivial questions/concerns) disappear. The bill would allow the Comptroller General to audit what is currently not allowed to be audited under Section 714 title 31.

          I don’t see what is so hard to understand about this. It appears you are merely confusing and distracting yourself.

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          • Matt appears to be our resident straw man riding a red herring, in circles.

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          • So you are saying in the audit as conducted under regulations by the Comptroller General will, if there is anything nefarious, be unearthed. As thus, if this bill passes and nothing is found, the conspiracy-mongering will cease?

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          • Probably not. But how am I supposed to know how the conspiracy theorists would react? I barely know my own mind. How am I supposed to know the minds of others?

            But this is just another distraction and entirely irrelevant.

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  9. Out of my ignorance, I read a down-to-earth summary publication of what the Fed is all about. It was published by the Fed so that ignorants like myself should not fume mad like rabid dogs in attacking the Fed. The first discovery that struck me is that the Fed is the Federal Government and private banks functioning as a single government entity. It does not function as a private bank as the ignorants believe, but as a central bank of the government. Now I know what a central bank is that all civilized nations have because I have a degree in economics. When the Fed formulates monetary policies, those from the government sitting down with their private bank counterparts are the Excutive Department acting through the President of the United States, and Congress that lays down the criteria for the Fed to follow. The make up the Board of Governors. This crazy talk about J.P. Morgan, Rockefellers and Rothchilds robbing the people of their hard money does not happen and cannot happen in the Fed is structured. The thief would be the Executive Department and Congress, not just the counterpart private banks. Such nonsense insults the intelligence of average Americans. When rabid dogs barks their protest, we know that they cannot
    think straight. The issue here is like the swine flu pandemic,the spread of ignorance that contaminates. Kalantiaw.

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    • Only quote out of that I need. “It was published by the Fed”. I think they may have a agenda in their publications, agree?

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    • – It is indeed interesting, “sneaky”, that you signed off with “Kalantiaw”. Interesting for the very reason that “Datu Kalantiaw” was the greatest hoax ever done by Jose E. Marco. In fact it is still a truth among many people! Incredible.
      Interesting for the very reason that the Federal Reserve Bank is also a giant hoax. It is the biggest hoax ever designed by the Rothschild clan, and carried out by their paisanos. AND!, “sneaky”, you are a living proof of how well their scam still works. Also incredible! (However… LOL… it might have something to do with your “degree in economics”? LOL!)

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  10. Bernanke provided some affirmative response. So, work on it. Submit your requests to him, and get it going.

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  11. End private central banks, they never work, imprison bernanke that crook and restore the monetary system to the people.

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  12. WHEN ABRAHAM LINCOLN CHASED THE CENTRAL BANK BACK TO EUROPE IT COST HIM HIS LIFE. THE CONNECTIONS BETWEEN THE ROTHCHILDS AND THE ASSASINS ARE ABSOLUTE. THEY TRIED TO WHACK ANDREW JACKSON TWICE FOR CHASING THEM OUT. THEY FED’S DUMBEST AND MOST FOLLOW THE RULES AS ORDERED EMPLOYEE MR.GEORGE BUCKFUSH SHOULD BE ARRESTED FOR TREASON AGAINST THIS COUNTRY AND IT’S FINANCIAL INDUSTRY. VERY FEW PEOPLE KNOW THAT FIVE DAYS BEFORE 9/11 GEORGE SIGNED THE P4P AGREEMENT WITH CANADA , MEXICO AND THE UNITED STATES. IN THIS HIDEOUS PIECE OF BUSH LEGISLATION HE APPROPRIATED $400 BILLION DOLLARS TO PLACE FIVE MILLION MEXICAN IMMIGRANTS IN HOMES BY 2010.
    HE ALSO CHANGED ALL THE LENDING RULES FOR ALL BANKS , MORTGAGE COMPANIES, FANNIE MAY , FREDDIE MAC AND WALL STREET.ALL REGULATIONS WERE REMOVED. THAT ENTITLED THESE CROOKED FREAKS TO ACCOMPLISH THEIR GOAL BY CREATING UNINSURED CREDIT SWAPS TO BRING ABOUT A GLOBAL FINANCIAL MELTDOWN. ON BRASSCHECK TV THERE IS A VIDEO BY A GENTLEMAN FROM ARGENTINA NAMED SALDUCHI (I THINK THATS CORRECT) WATCH IT AND HEAR WHAT HE SAYS THE FED DID TO ARGENTINA A COUNTRY IN THE 1900’s WAS ONE OF THE MOST PROSPEROUS COUNTRIES ON THE PLANET. TODAY THE MONEY IS WORTHLESS, PEOPLE ARE STARVING AND THEY OWE THE FED FOUN HUNDRED BILLION DOLLARS. AFTER JOHN D. ROCKEFELLER AND J.P. MORGAN GOT THROUGH CREATING THE FED IN 1913 THROUGH INTIMIDATION , BRIBERY , BLACKMAIL AND MURDER EIGHT MONTHS LATER THESE SAME TWO TRAITORS TO THIS COUNTRY CREATED THE IRS THE EXACT SAME WAY. AS THEIR KNEE BREAKER PARTNERS THEY ENLISTED OUR OWN FEDERAL GOVERNMENT AS THEIR ENFORCERS. AS DR. PAUL SAYS, THE FIRST TO GO MUST BE THE FED AND THE IRS. THIS COUNTRY WAS FOUNDED TO GET AWAY FROM TAXATION WITHOUT REPRESENTATION AND THEY FORMED THE IRS WHICH GIVES ABSOLUTELY NO SAY SO ABOUT THESE HIDEOUS TAXES. TO THE FED “MONEY IS DEBT AND DEBT IS MONEY” AND AS I SAID, AS LONG AS THEY OWN THE MORTGAGE ON THE PLANET THEY HAVE US BY THE SHORT HAIR.REMEMBER, THE IRS, THE FED,SKULL AND BONES, FREEMASONS, KNIGHTS OF COLUMBUS AND THE RHODES SCHOLAR SOCIETY ARE SECRET SOCIETIES AND THEY ANSWER TO NO ONE EXCEPT THE ROCKEFELLERS AND ROTHCHILDS!!!!!!
    WOLFMAN

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    • You are hitting it dead on again, Wolfman! However, in this connection, I would also like to draw attention to the following:

      On June 4, 1963, a little known attempt was made to strip the Federal Reserve Bank of its power to loan money to the government at interest. On that day President John F. Kennedy signed Executive Order No. 11110 that returned to the U.S. government the power to issue currency, without going through the Federal Reserve.

      Then follows his famous words in a speech made to Columbia University on Nov. 12, 1963: “The high office of the President has been used to foment a plot to destroy the American’s freedom and before I leave office, I must inform the citizens of this plight.”
      Hmmm?… Those words, Wolfman, he spoke ten days before his assassination!

      Dr. Ron Paul is indeed a most courageous man…

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      • Brandulph,
        You speak as one well advised. Do you have any recommendation for reading material. Even some of Mr. Paul’s supporters seem to have different takes on some of the basics of the Fed.
        I would like to become more knowledgeable and would appreciate any assistance you might offer.

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      • Great observation Mr B..Let me ask a ccouple of q’s regarding..That awful day in Dallas and Pres. order # 11110…
        It is my understanding that JFK had indeed written it in like mid June’63..had actually already had printed something like $45 Billion in Silver Certificates ready to be launched as soon as Kennedys second term was underway…Does anyone here remember when like out of the blue , this Presidential oorder was “discovered” a few short years ago, right?..I mean I try to keep plugged into the assassination and anythingnew and I fo not remember ever hearing about this bombshell until, as I said, it’s resurfacing within the last few years..If anyone has more concrete knowledge about it..please tell us all…I wrote a BLOG about JFK’s murder just a couple of months ago. I believe that his murder has been solved. I also believe that the shooter who fired the fatal shot at the Grassy Knoll area..is very much alive and in prison in the mid-west on an unrelated murder attempt… I say this with trepidation and dread knowing that most will think me a loon for even broaching the subject of JFK and a conspiracy that I believe has a lot to do with what we see happening to our Republic here and now..If anyone is interested in checking it out , I have SOME WEB ADDRESSES FOR YOU TO REVIEW AND COME TO YOUR OWN CONCLUSIONS..My BLOG was entitled..”All roads lead out of Dallas”..including the road we are traveling on right now..Nothing will chamge those roads until ot unless we solve this sgameful and largely ignored crime of the Century back in ’63..Your thoughts and opinions are coveted

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  13. Mr. Bernanke – it is not your job to educate Ron Paul what the Federal Reserve is all about. No matter what you say to him, it is not only that he will not understand it but because he cannot understand it, especially the intricate workings of the applied principles of economics as we learned them in school to get a doctorate.
    This ignorance is suffocating: Liquidity was doubled in a few short months and there is a lot of inflation out there, he says, as if inflation is numerous and Paul counted them on his fingers and found out there was a lot! See this nonsense?
    There is no such thing as “double liquidity”. What the hell is he talking about …
    His limited mind on economics thinks that inflation is a distortion. Inflation is not an ogre that at the mere mention of it needs to be slain. We need inflation to expand the economy. It is run-away inflation – not inflation itself – that the Fed is on the look out. That’s where the damage comes from if not controlled. You should have tapped his head on this to share with him a little bit of your knowledge and expertise.
    You told him about controlling inflation – that’s a whole book in economics, buddy. You cannot throw the book on someone who cannot even talk sense in economics! He wants the GAO to audit economic policies. Audit policies like how GAO audit government expenditures … !? Where the hell did that come from.
    I suggest you just request him to read a book about the Federal Reserve. It’s monetary economics that you are very good at considering your Ph.D., and if Paul would have a hard time understanding what the Fed is about because he has no academic background in economics, would you please be kind enough to help him?
    If you help him, you will not only help him out of his misery but also would enlighten his angry followers that like Paul are throwing punches in the air trying to knockout the moon.

    Take it from SNEAK.

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    • And I suppose that you also suggest reading O.J. Simpson’s book titled “How I would Have Killed My Wife If I had Done It” as well? Hmmmmm.

      Let me get this straight. We Neanderthalls should calm down and take the time to read a book on the Federal Reserve? Written by whom? Please don’t say the same Federal Reserve.

      Gee, when a book is written by the same individual/individuals who have a vested interrest in covering their tracks (sic Mein Kampf/Hitler) “don’t ya think there just might be a tad bit of old fashioned bias-bullshit in there boyeeeeee?” I think I’d prefer to just wait and read “The Federal Reserve” yet to be written by the U.S. Congress after the first audit.

      “Federal Reserve Chairman Ben Bernanke and then-Treasury Department chief Henry Paulson pressured Bank of America Corp. to not discuss its increasingly troubled plan to buy Merrill Lynch & Co. — a deal that later triggered a government bailout of BofA — according to testimony by Kenneth Lewis, the bank’s chief executive.” – CoyoteBlog (do you feel comfortable with this,Sneakers?)

      “Fact: one can argue that the Enron situation is more honorable than the BofA situation. Enron management was trying to protect the value of Enron shareholders.In the case of BofA, the feds demanded that BofA management hide information in order to complete a transaction that BofA shareholders might rightly oppose.” – CoyoteBlog (former Enron Execs are sitting in jail,and yet,with your education,you actually believe that there is nothing wrong with this as well? no need for an audit right?)

      http://www.coyoteblog.com/coyote_blog/2009/04/double-standard.html

      But alas,common sense has no place in the mind of an Educated Self Proclaimed Genius such as Sneak. Why question? Why even dare to doubt him? A true sign of wisdom is one’s willingness to trust the motives and abilities of the intelligent,annointed ones.Like the afore mentioned Bernanke/Paulson.And now Tiny Tim Tax Cheat. Who are trying so hard to have patience with all of us pesky little low-mental tax payers.

      Wow! Golly Gee whillickers! Them damn yankee college boys have got their game on I tell ya! He He! Just look how they’re able to twist and force things any way they want for our own good! They persecute others while gittin away with the same thing! Holy Catfish!! But their doing it for us little ones. Cause they Luvvvvvv us!!

      Go ahead Sneakers. Keep thinking we’re a bunch of dumb hicks.If that’s what makes you feel more like a man in front of your Mom’s mirror.

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    • Sneaky,

      Another Keynesian whore defending the indefensable.
      Go ahead and spout your Marxist economic theory and we’ll just hold up the P&L statement, and point at the bottom line.

      Your Ponzi scheme economics have driven this country into the ditch, AGAIN.

      Your unconstitutional economic policy is destroying the middle-class, and Keynesian whores like yourself continue to defend it because that was what you were taught in your state-sponsored institution of re-education.

      BTW, Dr. Ron Paul is well schooled in medicine, history, and economics. Bernanke could not touch him in any of these subjects.

      Let’s ask these academics, that all back his proposed policies;

      Jonathan Bean, Ph.D. – research fellow at Independent Institute*, professor of history, Southern Illinois University

      David Beito, Ph.D. – professor of history at University of Alabama

      Walter Block, Ph.D. – professor of economics at Loyola University* and fellow at the Mises Institute

      Nelson Borelli, M.D. – Department of Psychiatry and Behavioral Sciences,?Medical School, Northwestern University

      Samuel Bostaph, Ph.D. – Chairman, Department of Economics, University of Dallas

      Jack Chambless, Ph.D. – professor of economics at Valencia College

      Joe Michael Cobb, Ph.D. – retired professor of economics, Orange Coast College* and Saddleback College

      Casimir Dadak, Ph.D. – Associate Professor of Finance and Economics, Dept. of Business and Economics, Hollins University

      Thomas DiLorenzo, Ph.D. – Professor of Economics, Loyola College in Maryland; Senior Faculty Member, the Ludwig von Mises Institute

      Gary Galles, Ph.D. – professor of economics at Pepperdine University

      Keith Halderman – research assistant at Trebach Institute* and adjunct professor at American University

      Steve H. Hanke, Ph.D. – Professor of Applied Economics, The Johns Hopkins University and Journalist for Forbes Magazine

      David R. Henderson, Ph.D. – Hoover Institution* and professor of economics at the Naval Postgraduate School in Monterey, California

      Guido Hulsmann, Ph.D. – Senior Fellow, Ludwig Von Mises Institute

      Zagros Madjd-Sadjadi, Ph.D. – Assistant Professor of Economics, Department of Economics, Winston-Salem State University

      Mark LeBar, Ph.D. – Department of Philosophy, Ohio University

      William Marina, Ph.D. – Department of History, Florida Atlantic University

      Charles W. Nuckolls, Ph.D. – Department of Anthropology, Brigham Young University

      William H. Peterson, Ph.D. – Schlarbaum Laureate, Ludwig von Misis Institute

      Ivan Pongracic, Jr., Ph.D. – Department of Economics, Hillsdale College

      Arthur Robinson, Ph.D. – Founder, Robinson Curriculum; President of the Oregon Institute of Science and Medicine

      Joseph T. Salerno, Ph.D. – Graduate Program Chair, Department of Finance and Economics, Lubin School of Business, Pace University

      D. Eric Schansberg, Ph.D. – Department of Economics, Indiana University

      Ken Schoolland, M.S.F.S. – economics and political science, Hawaii Pacific University

      Larry J. Sechrest, Ph.D. – Professor of Economics, Sul Ross University

      Mark Thornton, Ph.D. – Author, Former Economic Advisor to the Governor of Alabama; Senior Fellow, Ludwig von Mises Institute

      Walter E. Williams, Ph.D. – professor of economics at George Mason University

      Thomas E. Woods, Jr., Ph.D. – author and resident historian at the Mises Institute

      James Yohe, Ph.D. – Gadsden State Community College

      When you are defending the indefensable, you are part of the problem.

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    • Read Henry Hazlitt “Economics In One Lesson”. There are MANY
      other books on economics. Hayek “The Roal TO Serfdom” Griffin’s
      “Creature From Jekyl Island”. etc. At 78 years, retired history teacher and state committee of the Reform Party, the fact that you “swallow whole” the Federal Reserve publication
      is amazing especially with a degree in economics!

      Also consider that the policy is NOT made by the administration of ANY President but only implimented when dictated by the Fed which is THE INTELLECTUAL AND EXPERIENTIAL SUPERIOR — THEY SAY!

      Also consider the record since 1913. This was sold to the US as a way to control (manipulate) the money supply (M3 which has not even been reported for the past 3 years) so that we wouldn’t have the boom – bust cycles. 16 years later -1929- the market crashed. Why didn’t congress repeal the Fed then? Was Aldrich still in the Senate?

      The money has been loosened, prosperity AND prices rose, then the money men tightened down on credit, the market fell, the money men bought assets at VERY LOW PRICES. This happenned over and over since 1913 explaining why they (Money Men) end up with “all the marbles”. Read H.W.Brand’s “Tbe Money Men” – it’s about capitalism (really free market) vs a republic since
      our revolution.

      Also, PhD = Piled Higher and Deeper. fernhart@verizon.net

      Marianne

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  14. Bernanke says: “It’s the independence of monetary policy which is crucial to the maintenance of price stability and economic growth in this country.” Number one, they are doing a lousy job of it, if that is what they believe their mission is. However, they should not be in this business to begin with. Why is the Federal Reserve doing the job of our Congress and making monetary policy at all? Isn’t that the responsibility of our government? I don’t think the average American understands that our government has lost control of its US monetary policy to a privately held enterprise. As a private enterprise, American citizens are the customers of the Federal Reserve, not their dependents looking to them for policy of anything. Congress MUST get control back of the reigns on US monetary policy NOW from the Federal Reserve. I knew there was a problem, but this video really opened my eyes to the severity of mindset and worldview that must be changed if the US is ever to recover its financial and economic stability.

    Bernanke says: “It’s the independence of monetary policy which is crucial to the maintenance of price stability and economic growth in this country.” He’s absolutely right……..wrestling the independence of monetary policy of the American People BACK from the Federal Reserve is absolutely crucial and urgent.

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  15. Well, obviously he hasn’t been shopping and seen how much the basic cost of everyday living has increased. This is not visible until you are trying to live on next to nothing and stretch the almighty dollar to buy the basics of living. Just yesterday we were trying to buy groceries on a very small amount of cash that we are currently forced to live on, and we realized that what we used to be able to live on was no longer viable. We observed that virtually EVERYTHING we normally buy as a food or living staple has already increased by not 10%, but 20-30%. For example, I bought a case of Kleenex that was $13.88 but not too long ago it was under $10 and had been for years. We were walking down the isle remarking that grocery items that a year ago used to be $4-6 are now $8-10. Like everything else, they can measure and make statistics say whatever they want them to say, but they can’t change the fact that the dollar doesn’t go as far at the grocery store as it did just a year ago. Bottom-line for consumers.

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  16. When the Fed does get audited – if they don’t destroy the evidence first – the books will show trillions of dollars being diverted to the Pentagon – Rumsfeld testified that he could not account for more than 3 trillion dollars in defense spending on Sept. 10, 2001- it’s on YouTube – . Trillions were also diverted to european interests and to a new World Bank.

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    • No question about that, Eric Burt, but I am of the firm opinion, that what you point at is only the tip of “the iceberg”. It has gone on for nearly a hundred years through their FED, and now, they even have their new scam to carry on with; The European Central Bank!

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  17. Great Job Dr. Paul !
    Bernanke’s smug answers don’t hold up against your questions – it is all about the policy – The depression and all the recessions in the 20th century have been created by Fed policies. The Fed doesn’t want to change because they profit from flooding our market with liquidity.

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  18. David Knollhoff

    Thank you, Mr. Paul for fighting the good fight. Keep it up!

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  19. Very good, he’s getting defensive. Can’t wait for their reaction when the bill is implemented. Even with the bill in place they will not give away their secrets, this might be the final trigger for the rise of massive public awareness. Maybee even globally.
    Whatever happens, they can’t stop public awareness anymore and they will run through their procedures in a hurry to meat their globallisation goals even more. It will be so obvious and they will break down in a panic and the rats will leave the ship.
    After that operation “Clean Up” is well on it’s way. :)
    Getting rid of all ‘think tanks’ will be fun. Liquidating all accets of members and former membbers will be a laugh.
    After reinstalling the constitution, make sure by law that members in public office may not and may not have been member of any secret society.
    The world will look great, green, prosperous and peacefull. Noone has to be hungry if we don’t want it!

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    • Well because your liguistic skills are more in alignment with Bandito Ben- perhaps you should take over the Senators seat and if nothing else you and the Fed thief can impress one another with the fact that you are truly Cunning Linguist..I think i’ll stick with my boy from Texas

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      • Thank you very much for informing me about my poor linguistic skills or as you put it liguistic skills.
        My linguistic skills are fine in my native language but, since you would not understand a word of Dutch I tried to accommodate you by trying to write in English.
        I’m sorry if I got a little carried away but, I am trying to get a global perspective on the whole globalisation subject and saw for the first time someone like Bernanke experiancing some real heat and how he dealt with it. It gives someone like myself the hope we can change the world we live in.
        And then some dickhead like you comes along and tries to spoil my good mood. Seems to me you have a long way to go growing up and becoming aware of the world we live in. Don’t try to put people down that believe in the same cause you do. Don’t put people down because you might be better at something. It doesn’t help and it’s lost energy when you’re done.
        I don’t think you have a clue what this is all about. I guess you don’t know when the FED was even created let alone by whome or where Jeckyll Island is.
        If you don’t, do the research. If you do, get aquainted with topics related to it. Put your energy in something usefull instead off putting people like me down. I think you will learn that saying something like “I think i’ll stick with my boy from Texas.”, shows how ignorant you realy are.
        Try commenting on the subject instead off beating someones head in with your own stupidity. Get involved and talk about this stuff in your community.
        Try to understand what money is and how it enslaves you. Try to impress people with your knowledge on the subject without beeing an arrogant nitwit without any understanding of any other part of the world than Texas. There might be more.

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    • Fluidly Unsure

      But what constitutes a secret party?

      Is a “secret society” one with restrictive membership and is run by a small niche? Every ToastMaster club I’ve been to qualifies as “secret”.

      Does a society that openly advertises itself qualify as secret?
      http://www.trilateral.org
      Cecil Adams made a few good points over 20 years ago.
      Membership has been used as political ammunition against many like Ford, Carter, and Bush Sr.

      http://www.straightdope.com/columns/read/524/is-the-trilateral-commission-the-secret-organization-that-runs-the-world
      or
      http://tinyurl.com/67tcbk

      As long as the idea of secret societies exists (in real or just in some peoples heads), the claim of membership is ripe for abuse. How can someone defend themselves?

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  20. I cannot believe how patient and restrained Ron Paul is.The US has a bunch of criminals looting it’s economy by conjuring money from cyber space and then loaning to the Govt at interest!

    If we do it is called counterfeiting and we go to jail.Counterfeiting is theft since it dilutes everyone else’s assets through inflation.If the Fed does it,it is called monetary policy.Legalised theft?

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