Michelle Bachmann: We need to pull back the curtain and take a look at the Fed

Congresswoman Michelle Bachmann comments on Ron Paul’s Bill to Audit the Fed.

Channel: Fox Business
Show: Happy Hour
Date: July 15, 2009

Robert Gray: I was just going through the board here and we had a comment from one of our viewers here who wanted to know if you would support Congressman’s Ron Paul’s bid to have the Fed under closer scrutiny, to put it mildly.

Michelle Bachmann: I am already a co-sponsor and I’ve been a speaker on that already in various places across the country. I firmly believe in auditing the Fed. I sit on the Financial Services Committee, I am a former Federal Tax Litigation Attorney myself, and I asked Chairman Bernanke about that when he came before our committee. I asked him why the Fed did not disclose the overnight loans that they made. They still do not make that disclosure, nor have we had a complete audit of the Fed. I am absolutely in total agreement with my colleague and that’s why I have joined 242 colleagues in asking for that audit of the Fed. It’s time.

Rebecca Diamond: Fed official Donald Kohn is saying that this is a bad move because it places the Fed squarely in the political crosshairs, it puts them under political pressure, and it could create inflation down the road, as if that was a concern right now with the Fed. But my point is that we have the Federal Reserve or any central bank closely aligned with the government, like we see in emerging markets or banana republics, it could cause more gutting of the printing presses which is happening now. Do you see that concern?

Michelle Bachmann: I think there is a very real concern and I think there is no excuse not to audit, not to have transparency and not to have accountability. We need to have all of this for the Fed, especially when we see the Obama administration and the treasury secretary in particular, putting forth a plan to have a super regulator over the financial services industry and potentially to put that individual housed in the Fed.

Rebecca Diamond: Right.

Michelle Bachmann: We need to pull back the curtain a little bit and take a look at what’s happening with the Fed.

Rebecca Diamond: You know, my colleague Robert Gray has been tracking you, and we’re getting an avalanche of emails since you’ve come on. Thank you so much, Congressman. But quickly… what I’m hearing on Wall Street is that the real issue with pulling back on the curtains on the Wizard of Oz is that the Federal Reserve does not want to disclose that it did make really questionable bailout money available to Wall Street firms and making their trades 100% whole, 100 cents on the dollar. For example, the AIG bailout, with Deutsch Bank, Credit Suisse and Goldman Sachs getting all of their money in those trades refunded back… tax payer money going towards them. They don’t want those decisions made public. So, are you hearing that as well?

Michelle Bachmann: Oh, we heard that when this was first being talked about when the bill was first coming forth before our committee before it even passed. We brought all those concerns up; that we would be looking at foreign banks and shareholders in foreign banks being made whole first before we’re dealing with taxpayers and with United States companies.

That is exactly what happened, what we were concerned about, and I think even more reason why the Fed needs to be held accountable to the taxpayer. Because when they’re busy printing money that’s impacting every taxpayer in the United States. We want a strong dollar, and I’m not here just to cast dispersions on the Fed, but to say that the Fed needs to have its doors opened a little ways so the American taxpayer can have some assurance about how our financial industry is being regulated.

Robert Gray: The secrets to the temple, as traders call it there. Representative Bachmann, we thank you so much for your time and for joining us today, and we hope to see you again.

Michelle Bachmann: Thank you.

Rebecca Diamond: We really appreciate it, Congresswoman. We’re really getting a lot of emails from your appearance.

Robert Gray: Yeah, you’re getting lot of attraction there. Lot of coments; pro, con and otherwise.

Michelle Bachmann: We’ll come back soon.

Robert Gray: Please do.