This is scary stuff folks---even though I'm not one for promoting any fear energy. We must be vigilant in remaining only in Love- especially when Fear is essentially promoted everywhere we turn. But this piece is stunning to me. Please keep in mind the Reserve is a PRIVATELY owned bank. A bank that noone is allowed to know who serves on its board and a bank that has caused enormous debt in the system. The Reserve has greatly benefitted from the so called "crisis" of our economy going back to the Depression like a beast that keeps wanting more.
Many economists feel the mortgage crisis could have been avoided but was largely a "controlled chaos" with the Reserve pulling the strings and adjusting the rates and the most oppurtune times. Now is the time to be vigilant and pay attention to whats being done underneath our noses- but not on mainstream media- thats a goner. Guardian (UK) is always an excellent source online. As is Free Speech Tv (we get it on Dish), Democracy Now (PBS), Link (Dish) and for radio NPR or National Public Radio. Don't bother with any 24 hour TV news channels that salvated the march to war with fancy jingles and graphics that practically handed over a free bag of popcorn with the "Shock and Awe" coverage- or DirectTv-thats owned by NewsCorp conglomeration (Rupert Murdoch).
Another great source is Catherine Fitts blog- which you can always link to here.
Catherine Austin Fitts is president of Solari, Inc. Ms. Fitts served as Assistant Secretary of Housing during the first Bush Administration, lead financial advisor to the U.S. Department of Housing and Urban Development during the Clinton Administration and is a former managing director and member of the board of Dillon, Read & Co. Inc. She has bravely exposed the so called "Black Ops" financial goings on of our government in the media and will be a regular guest when the Emergence pod cast is up and running.
Your media test of the week is to see if and where and how you catch this major story. The biggest overhaul of our currency system since the Great Depression. And keep in mind the vast amount of personal records/data they will be able to comb over when they can access the books of banks.
Federal Reserves powers to expand
The Bush administration today set out a blueprint for a wholesale overhaul of America's financial regulation system which proposes far-reaching new powers for the Federal Reserve to tackle potentially troublesome banks and brokerages.
Delivering a speech in the treasury's ornate Cash Room, treasury secretary Henry Paulson set out a plan to turn the Federal Reserve into one of three "super-regulators" to replace a diffuse network of public agencies.
"A strong financial system is vitally important not for Wall Street, not for banks, but for all working Americans," said Paulson. "When our financial system is under stress, millions of working Americans bear the consequences."
Under the plan, the Fed would be allowed to delve into the books of banks, brokers and insurance companies if it suspects they contained problems posing a risk to the overall financial system.
A second body called the Prudential Financial Regulatory Agency would specifically concentrate on banks with a government guarantee, while a third, the Business Regulatory Agency, would focus on consumer protection.
Meanwhile, several existing agencies would be merged under the plans. The Securities and Exchange Commission would be combined with the Commodities Futures Trading Commission, which oversees dealing in derivatives.
In an attempt to stave off future mortgage lending crises, the plan would create a Mortgage Orientation Commission that would establish uniform licensing and education standards for state mortgage brokers.
The commission would also study each state's mortgage regulatory system, determine which laws need better enforcement, and assess how effectively states are enforcing current laws. The plan would also clarify the states' role in enforcing federal lending laws.
The ideas were cautiously welcomed by Wall Street but they drew instant scepticism from consumers who questioned whether the Fed was the right body to sit on top of the regulatory tree. Critics pointed out that the Fed had proven ineffective in spotting warning signs of the present credit crunch.
"They missed the sub-prime mortgage crisis," said Greg Valliere, chief political strategist at the Stanford Financial Group. "This is like putting Eliot Spitzer in charge of the morals division."
The treasury secretary's Wall Street background as a former chairman of Goldman Sachs has prompted consumer advocates to suggest that he has an in-built dislike of tough regulation.
Paulson stressed that his ideas outlined a long-term vision and were not intended to be an instant reaction to the present financial turbulence.
Instead, he wants to kick off a broader debate about a modern replacement for a patchwork of regulatory structures which has been stitched together over the course of many decades.
"I am not suggesting that more regulation is the answer, or even that more effective regulation can prevent the periods of financial market stress that seem to occur every five to ten years," said Paulson. "I am suggesting that we should and can have a structure that is designed for the world we live in."
Big banks saw little to fear in the blueprint. Thomas Russo, chief legal officer of Lehman Brothers, told the Wall Street Journal: "Anything that moves the current fragmented regulatory system forward to a more coordinated structure is good."
But the Consumer Federation of America said the plan would only allow the Fed to exercise its new powers when it felt the entire system was at risk – in other words, when a problem had already become severe.
"This is a crisis management approach which is not conducive to market stability," said Barbara Roper, the federation's director of investor protection. "The Fed's record on recognising risk in advance is remarkably poor."
She said there was logic in a regulatory shakeup to change a system whereby banks, brokerages and insurance firms each have different oversight. The boundaries between these industries have become blurred as many Wall Street firms dabble in multiple areas.
But she added that there was little comfort for victims of the present sub-prime mortgage crisis: "It's like saying to Katrina victims stranded on the roofs of homes 'don't worry – if you can just hold on a few years, we've got a good plan for restructuring emergency response'."
Any proposals face a long road through Democrat-controlled Congress. In a background briefing with reporters, a high-ranking treasury official said the administration had consulted with "many members of Congress" but declined to say if any had been Democratic leaders.
Barney Frank, the Democrat chairman of the house financial services committee, described Paulson's proposals as "a very constructive step in this important debate".
But the influential New York senator Charles Schumer has already questioned the logic in Paulson's intention of creating three regulators.
Schumer has suggested that one overarching body could be more effective – along the lines of Britain's powerful Financial Services Authority.
The treasury official said the administration considered such a move, but said officials determined that US financial markets need a greater focus on consumer protection than the British system provides.
"Our markets and our approach to dealing with our markets is a little bit different that what they do in the UK," the official said. "The UK is much more comfortable regulating wholesale markets, and less on the retail side."