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Ben Bernanke: Federal Reserve audit would constitute “takeover” by Congress, threaten the “financial system, dollar and economy”

June 26, 2009

By tmartin • June 26, 2009

When asked by Rep. John Duncan on Thursday about the fact that a majority of Congress is co-sponsoring Ron Paul’s HR 1207 bill to audit the Federal Reserve, Ben Bernanke responded:

Ben Bernanke: “My concern about the legislation is that if the GAO is auditing not only the operational aspects of the programs and the details of the programs but making judgments about our policy decisions would effectively be a takeover of policy by the Congress and a repudiation of the Federal Reserve would be highly destructive to the stability of the financial system, the dollar and our national economic situation.”

While many viewers interpreted Bernanke’s statements as a “threat”, we would not rule out the possibility that he was merely stating an opinion that is indeed shared by many economists who grew up under the notion that the autonomy of the Federal Reserve and its mission to centrally manage the economy is sacrosanct and not open to debate.

Fortunately, times have changed and serious questions are being raised as to…

  • what the Federal Reserve has been up to in recent years,
  • its role in the current economic crisis and the creation of the housing bubble through artificially low interest rates,
  • its secret agreements with foreign powers and foreign banking institutions with no oversight whatsoever
  • its disastrous effect on the dollar, which lost 96% of its value since the Fed was established in 1913
  • whether the Fed should have as much unchecked power as it currently does, and
  • the safest way to abolish the Fed if it is established that it has in fact outlived its usefulness.

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