From: Michael A. Hoffman II <hoffman@revisionisthistory.org>
Date: Fri, Dec 17, 2010 at 9:37 AM
The Hoffman Wire
Dedicated to Freedom of the Press, Investigative Reporting and Revisionist History
Subscribe: HoffmanWire-subscribe@topica.com
Michael A. Hoffman II: Editor. RevisionistHistory.org
***
Miserable times ahead for the Chairman of the Federal Reserve Bank
Ron Paul Appears Poised to Irk the Fed Chief
By Floyd Norris | NY Times | Dec. 16, 2010
[With an Afterword by Michael Hoffman]
http://revisionistreview.blogspot.com/2010/12/miserable-times-ahead-for-chairman-of.html
A congressman from Texas, long a dissident critic of the Federal
Reserve, is scheduled to become the chairman of a House panel with
jurisdiction over the central bank. It promises to be a miserable time
for the Fed chairman as he is peppered with hostile questions at
oversight hearings and with legislation to force complete audits of Fed
operations.
So it is now, with Representative Ron Paul about to take over as
chairman of the Domestic Monetary Policy Subcommittee of the House
Financial Services Committee. Mr. Paul campaigned against big banks,
arguing that concentrated financial power goes hand in hand with
concentrated political power.
If the Fed were abolished, he wrote last year, "the national wealth
would no longer be hostage to the whims of a handful of appointed
bureaucrats whose interests are equally divided between serving the
banking cartel and serving the most powerful politicians in Washington."
It is not hard to imagine Mr. Paul lecturing the president of the
Federal Reserve Bank of New York in a committee room: "You can
absolutely veto everything the president does. You have the power to
veto what the Congress does, and the fact is that you have done it. You
are going too far."
And so it was back in 1964, when that lecture was actually given by the
then-new chairman of the House Banking Committee, a Texas congressman
named Wright Patman. As Time magazine then wrote: "For three decades,
Wright Patman has fumed and fussed that the Federal Reserve system is
too secretive, too independent, too insensitive to the hopes of small
borrowers. A sharecropper's son, he often charges that it is a tool of
Wall Street bankers."
A joke during Mr. Patman's tenure was that the reason he chose a bright
red carpet for his office was to hide the blood stains after William
McChesney Martin Jr., then the Fed chairman, emerged from private
meetings.
Mr. Paul is well aware of the precedent. His 2009 best-selling book, End
the Fed, quotes Patman's lecture and then adds, "I actually consider
this an understatement, because in the past year or so during this
bailout process, the Federal Reserve has garnered an unbelievable amount
of power, making it much more influential around the world than the
Congress or the president has ever been."
Among the bills Patman pushed was one to audit the central bank. The
Dodd-Frank Act passed this year allows for limited audits, and extending
them is a centerpiece of Mr. Paul's agenda. Patman bitterly fought big
bank mergers, while Mr. Paul condemns allowing banks to become too big
to fail.
There are major differences between them, aside from the fact one is a
Republican, while the other was a Democrat. Mr. Paul is a sound-money
man who longs for the gold standard and thinks the collapse of paper
money is inevitable. Patman was far more sympathetic to printing money,
even voicing outrage during the Depression at the idea that government
would pay interest to borrow money. Why not just print it, he asked?
Mr. Paul denounces the Fed for causing inflation, saying that producing
inflation is the major reason for its existence. In 1937, Patman
proposed legislation to require the Fed to stabilize the purchasing
power of money, but he had something different in mind. He wanted to
restore price levels to what they had been in 1926. To do that would
have required inflation of about 25 percent to reverse the deflation of
the Depression.
Another difference is the role a landslide played in regard to both men.
In 1974, the Watergate wipe out produced a flood of liberal Democrats
who were determined to put aside seniority as a strict determinant of
chairmanships. Patman, who had been in the House since 1929, was ousted
in a move that no doubt pleased the Fed. He died in 1976, just before
Mr. Paul entered Congress.
The Republican landslide this year elected several representatives
sympathetic to Mr. Paul's views, and weakened the party establishment
that had previously kept Mr. Paul from being chairman of a subcommittee.
This week Representative Spencer T. Bachus of Alabama, the incoming
chairman of the Financial Services Committee, announced that Mr. Paul
would have the job.
Mr. Bachus has endorsed Fed audits that go beyond the limited review
called for by the Dodd-Frank Act, but he is anything but hostile to
banks. He told The Birmingham News last week that "my view is that
Washington and the regulators are there to serve the banks." The News
said he "later clarified his comment to say that regulators should set
the parameters in which banks operate but not micromanage them." His
press secretary said he was too busy for an interview.
Mr. Paul takes on the subcommittee post at a time when the Fed is far
better known than it was in the 1960s, and after its reputation has
alternately soared and plunged. It was given credit for the long booms
of the 1990s and earlier this decade, and for steering the economy out
of the mild 2001 recession. There was criticism of its role in the
technology stock bubble that preceded that downturn, but it was mild
compared with the excoriation the Fed received for its failure to
counteract the housing bubble that led to the recession that began in
2007.
In the end, neither Patman nor a later Fed-doubting Texas chairman of
the committee, Henry Gonzalez, had much impact on the Fed. "We did not
achieve a whole lot," Mr. Paul said in an interview this week, recalling
his work with Gonzalez. "But I think things are changing."
In the past, the majority in Congress, whether Republican or Democrat,
was generally supportive of the financial establishment. That is still
true, but the support has frayed amid resentment over big bonuses going
to bankers whose jobs might have vanished had the government not bailed
them out. Many Republicans embrace Mr. Paul's criticism of the Fed's
role in the bailout and in the current monetary easing, which involves
buying $600 billion in longer-term Treasury securities.
Fortunately, for both the Fed and the economy, the signs seem
encouraging. The retail sales report this week was stunningly good,
signaling a strong economy in the current quarter and into next year.
The tax deal worked out between President Obama and Republican lawmakers
will provide economic stimulus, even if it is not particularly
efficient.
One sign of economic optimism is surging interest rates on long-term
Treasuries. During the first 10 trading days of December, the yield on
10-year Treasuries rose from 2.8 percent to almost 3.5 percent. It has
been nine years since yields rose that much over so short a time. Then
markets were beginning to suspect the 2001 recession was ending, as it
was. Markets now seem to expect a much better recovery next year than we
saw this year.
There is another available interpretation. "Did these rates move higher
because the economy is getting stronger," asked Bernard Baumohl of the
Economic Outlook Group, "or because bond investors fear the Fed is about
to err by continuing to pump too much money into an economy that is in
the midst of accelerating? Our concern, after talking to clients, is
that it's the latter."
So far, however, you can't find much evidence of that in the markets.
The break-even inflation rate on Treasury securities the rate investors
seem to expect based on the relative yields of regular five-year
Treasuries and inflation-indexed bonds has risen only a little, to 1.7
percent a year. As the Fed said this week in announcing no change in
policy, "longer term inflation expectations have remained stable."
Mr. Paul was careful not to predict legislative success. "I'm not making
any rash promises," he told me. "I'm up against a lot of influential and
very powerful people. They've been able to work in secrecy since 1913,"
the year the Fed was established.
The idea of hostile Congressional hearings making a Fed chairman
miserable may seem surprising to those with memories that go back only
to the era of Alan Greenspan as oracle. But there is a rich precedent.
Paul Volcker took his share of lumps when he was driving up interest
rates to stop inflation, and bringing on a severe recession in the
process. Now he is revered, in large part because he was successful.
If the economy fails to revive and inflation surges in other words, if
Ben Bernanke's term as chairman looks like a failure pressures for
fundamental changes at the Fed could become irresistible. But for the
time being, it is likely that Mr. Paul's new post will provide more
entertaining hearings than actual legislation.
Floyd Norris comments on finance and economics in his new blog at
norris.blogs.nytimes.com
MICHAEL HOFFMAN'S AFTERWORD: Notice reporter Frank Norris's emphasis on
what works rather than what is Constitutional. If the Fed can get us out
of the recession, then Ron Paul becomes nothing more than entertainment.
But if it can't pull off some sort of financial prestidigitation, then
perhaps Paul is right. The danger inherent in the Federal Reserve Bank's
ability to manufacture money -- arguably one of the great powers on
earth -- is mostly ignored.
Rep. Paul meanwhile, is a well-intentioned and courageous legislator,
and "ending the Fed" is sufficient reason to support him tactically, but
not philosophically, and here's why: Paul subscribes to the antichrist
Austrian School of Economics, the most virulent branch of buccaneer
economics, with its avid advocacy of usury, the charging of interest,
including exorbitantly high rates, that was regarded as a mortal sin in
the West from Greek antiquity and through the dawn of Christianity up to
the early modern era. Ludwig von Mises, the dean of the Austrian school,
despised Jesus Christ for His attacks on mammon worship and for noting
society's obligation to the poor.
These facts are largely unknown among the Tea Party crowd, partly
because their avatar is Glenn Beck, who wholeheartedly endorses the
greed-is-good iniquity of the philosopher of money worship, Ayn Rand,
who made Von Mises look like Mother Theresa.
Hoffman's research, writing and broadcasting is made possible through
the sale of his books, newsletters, broadcasts and donations.
http://www.revisionisthistory.org/page1/page2/paypal.html
***
FOR FURTHER RESEARCH
Revisionist History Newsletter no. 51: Agents of the Money Power - Glenn
Beck and a Gang of Christ-Hating Shylocks Have Taken Over the
Conservative Movement in America
http://revisionisthistorystore.blogspot.com
***
The HOFFMAN WIRE is a public service of Independent History and Research, Box 849, Coeur d'Alene, Idaho 83816 USA
24 Hour Revisionist News Bureau:
http://www.revisionisthistory.org/page1/news.html
Subscribe: HoffmanWire-subscribe@topica.com
Disclaimer: The Hoffman Wire is a controversial and politically incorrect e-mail letter intended only for those who have requested it. We have a strict anti-spamming policy. The views expressed in the Hoffman Wire are the sole responsibility of the author(s) and do not reflect the views of advertisers or the transmitter.
Freedom of the Press: A hallowed right.
Responsible Dissent: A contribution to understanding and dialogue.
--^----------------------------------------------------------------
The Hoffman Wire
Dedicated to Freedom of the Press, Investigative Reporting and Revisionist History
Subscribe: HoffmanWire-subscribe@topica.com
Michael A. Hoffman II: Editor. RevisionistHistory.org
***
Miserable times ahead for the Chairman of the Federal Reserve Bank
Ron Paul Appears Poised to Irk the Fed Chief
By Floyd Norris | NY Times | Dec. 16, 2010
[With an Afterword by Michael Hoffman]
http://revisionistreview.blogspot.com/2010/12/miserable-times-ahead-for-chairman-of.html
A congressman from Texas, long a dissident critic of the Federal
Reserve, is scheduled to become the chairman of a House panel with
jurisdiction over the central bank. It promises to be a miserable time
for the Fed chairman as he is peppered with hostile questions at
oversight hearings and with legislation to force complete audits of Fed
operations.
So it is now, with Representative Ron Paul about to take over as
chairman of the Domestic Monetary Policy Subcommittee of the House
Financial Services Committee. Mr. Paul campaigned against big banks,
arguing that concentrated financial power goes hand in hand with
concentrated political power.
If the Fed were abolished, he wrote last year, "the national wealth
would no longer be hostage to the whims of a handful of appointed
bureaucrats whose interests are equally divided between serving the
banking cartel and serving the most powerful politicians in Washington."
It is not hard to imagine Mr. Paul lecturing the president of the
Federal Reserve Bank of New York in a committee room: "You can
absolutely veto everything the president does. You have the power to
veto what the Congress does, and the fact is that you have done it. You
are going too far."
And so it was back in 1964, when that lecture was actually given by the
then-new chairman of the House Banking Committee, a Texas congressman
named Wright Patman. As Time magazine then wrote: "For three decades,
Wright Patman has fumed and fussed that the Federal Reserve system is
too secretive, too independent, too insensitive to the hopes of small
borrowers. A sharecropper's son, he often charges that it is a tool of
Wall Street bankers."
A joke during Mr. Patman's tenure was that the reason he chose a bright
red carpet for his office was to hide the blood stains after William
McChesney Martin Jr., then the Fed chairman, emerged from private
meetings.
Mr. Paul is well aware of the precedent. His 2009 best-selling book, End
the Fed, quotes Patman's lecture and then adds, "I actually consider
this an understatement, because in the past year or so during this
bailout process, the Federal Reserve has garnered an unbelievable amount
of power, making it much more influential around the world than the
Congress or the president has ever been."
Among the bills Patman pushed was one to audit the central bank. The
Dodd-Frank Act passed this year allows for limited audits, and extending
them is a centerpiece of Mr. Paul's agenda. Patman bitterly fought big
bank mergers, while Mr. Paul condemns allowing banks to become too big
to fail.
There are major differences between them, aside from the fact one is a
Republican, while the other was a Democrat. Mr. Paul is a sound-money
man who longs for the gold standard and thinks the collapse of paper
money is inevitable. Patman was far more sympathetic to printing money,
even voicing outrage during the Depression at the idea that government
would pay interest to borrow money. Why not just print it, he asked?
Mr. Paul denounces the Fed for causing inflation, saying that producing
inflation is the major reason for its existence. In 1937, Patman
proposed legislation to require the Fed to stabilize the purchasing
power of money, but he had something different in mind. He wanted to
restore price levels to what they had been in 1926. To do that would
have required inflation of about 25 percent to reverse the deflation of
the Depression.
Another difference is the role a landslide played in regard to both men.
In 1974, the Watergate wipe out produced a flood of liberal Democrats
who were determined to put aside seniority as a strict determinant of
chairmanships. Patman, who had been in the House since 1929, was ousted
in a move that no doubt pleased the Fed. He died in 1976, just before
Mr. Paul entered Congress.
The Republican landslide this year elected several representatives
sympathetic to Mr. Paul's views, and weakened the party establishment
that had previously kept Mr. Paul from being chairman of a subcommittee.
This week Representative Spencer T. Bachus of Alabama, the incoming
chairman of the Financial Services Committee, announced that Mr. Paul
would have the job.
Mr. Bachus has endorsed Fed audits that go beyond the limited review
called for by the Dodd-Frank Act, but he is anything but hostile to
banks. He told The Birmingham News last week that "my view is that
Washington and the regulators are there to serve the banks." The News
said he "later clarified his comment to say that regulators should set
the parameters in which banks operate but not micromanage them." His
press secretary said he was too busy for an interview.
Mr. Paul takes on the subcommittee post at a time when the Fed is far
better known than it was in the 1960s, and after its reputation has
alternately soared and plunged. It was given credit for the long booms
of the 1990s and earlier this decade, and for steering the economy out
of the mild 2001 recession. There was criticism of its role in the
technology stock bubble that preceded that downturn, but it was mild
compared with the excoriation the Fed received for its failure to
counteract the housing bubble that led to the recession that began in
2007.
In the end, neither Patman nor a later Fed-doubting Texas chairman of
the committee, Henry Gonzalez, had much impact on the Fed. "We did not
achieve a whole lot," Mr. Paul said in an interview this week, recalling
his work with Gonzalez. "But I think things are changing."
In the past, the majority in Congress, whether Republican or Democrat,
was generally supportive of the financial establishment. That is still
true, but the support has frayed amid resentment over big bonuses going
to bankers whose jobs might have vanished had the government not bailed
them out. Many Republicans embrace Mr. Paul's criticism of the Fed's
role in the bailout and in the current monetary easing, which involves
buying $600 billion in longer-term Treasury securities.
Fortunately, for both the Fed and the economy, the signs seem
encouraging. The retail sales report this week was stunningly good,
signaling a strong economy in the current quarter and into next year.
The tax deal worked out between President Obama and Republican lawmakers
will provide economic stimulus, even if it is not particularly
efficient.
One sign of economic optimism is surging interest rates on long-term
Treasuries. During the first 10 trading days of December, the yield on
10-year Treasuries rose from 2.8 percent to almost 3.5 percent. It has
been nine years since yields rose that much over so short a time. Then
markets were beginning to suspect the 2001 recession was ending, as it
was. Markets now seem to expect a much better recovery next year than we
saw this year.
There is another available interpretation. "Did these rates move higher
because the economy is getting stronger," asked Bernard Baumohl of the
Economic Outlook Group, "or because bond investors fear the Fed is about
to err by continuing to pump too much money into an economy that is in
the midst of accelerating? Our concern, after talking to clients, is
that it's the latter."
So far, however, you can't find much evidence of that in the markets.
The break-even inflation rate on Treasury securities the rate investors
seem to expect based on the relative yields of regular five-year
Treasuries and inflation-indexed bonds has risen only a little, to 1.7
percent a year. As the Fed said this week in announcing no change in
policy, "longer term inflation expectations have remained stable."
Mr. Paul was careful not to predict legislative success. "I'm not making
any rash promises," he told me. "I'm up against a lot of influential and
very powerful people. They've been able to work in secrecy since 1913,"
the year the Fed was established.
The idea of hostile Congressional hearings making a Fed chairman
miserable may seem surprising to those with memories that go back only
to the era of Alan Greenspan as oracle. But there is a rich precedent.
Paul Volcker took his share of lumps when he was driving up interest
rates to stop inflation, and bringing on a severe recession in the
process. Now he is revered, in large part because he was successful.
If the economy fails to revive and inflation surges in other words, if
Ben Bernanke's term as chairman looks like a failure pressures for
fundamental changes at the Fed could become irresistible. But for the
time being, it is likely that Mr. Paul's new post will provide more
entertaining hearings than actual legislation.
Floyd Norris comments on finance and economics in his new blog at
norris.blogs.nytimes.com
MICHAEL HOFFMAN'S AFTERWORD: Notice reporter Frank Norris's emphasis on
what works rather than what is Constitutional. If the Fed can get us out
of the recession, then Ron Paul becomes nothing more than entertainment.
But if it can't pull off some sort of financial prestidigitation, then
perhaps Paul is right. The danger inherent in the Federal Reserve Bank's
ability to manufacture money -- arguably one of the great powers on
earth -- is mostly ignored.
Rep. Paul meanwhile, is a well-intentioned and courageous legislator,
and "ending the Fed" is sufficient reason to support him tactically, but
not philosophically, and here's why: Paul subscribes to the antichrist
Austrian School of Economics, the most virulent branch of buccaneer
economics, with its avid advocacy of usury, the charging of interest,
including exorbitantly high rates, that was regarded as a mortal sin in
the West from Greek antiquity and through the dawn of Christianity up to
the early modern era. Ludwig von Mises, the dean of the Austrian school,
despised Jesus Christ for His attacks on mammon worship and for noting
society's obligation to the poor.
These facts are largely unknown among the Tea Party crowd, partly
because their avatar is Glenn Beck, who wholeheartedly endorses the
greed-is-good iniquity of the philosopher of money worship, Ayn Rand,
who made Von Mises look like Mother Theresa.
Hoffman's research, writing and broadcasting is made possible through
the sale of his books, newsletters, broadcasts and donations.
http://www.revisionisthistory.org/page1/page2/paypal.html
***
FOR FURTHER RESEARCH
Revisionist History Newsletter no. 51: Agents of the Money Power - Glenn
Beck and a Gang of Christ-Hating Shylocks Have Taken Over the
Conservative Movement in America
http://revisionisthistorystore.blogspot.com
***
The HOFFMAN WIRE is a public service of Independent History and Research, Box 849, Coeur d'Alene, Idaho 83816 USA
24 Hour Revisionist News Bureau:
http://www.revisionisthistory.org/page1/news.html
Subscribe: HoffmanWire-subscribe@topica.com
Disclaimer: The Hoffman Wire is a controversial and politically incorrect e-mail letter intended only for those who have requested it. We have a strict anti-spamming policy. The views expressed in the Hoffman Wire are the sole responsibility of the author(s) and do not reflect the views of advertisers or the transmitter.
Freedom of the Press: A hallowed right.
Responsible Dissent: A contribution to understanding and dialogue.
--^----------------------------------------------------------------
--
Being happy–is it good for the Jews? "Before Professor Dershowitz accused me of being an anti-Semite (news to me), I was a happy person. Since then, I'm still a happy person". –Michael Santomauro
Most of us are mentally trapped to think Jewish. Actually, it is safe to say that virtually every mainstream publication or or other type of media organ is "nothing more than a screen to present chosen views." The great battle over the last century has been a battle for the mind of the Western peoples, i.e., non-Jewish Euros. The chosen won it by acquiring control over essentially the complete mainstream news, information, education and entertainment media of every type, and using that control to infuse and disseminate their message, agenda and worldview, their way of thinking, or rather the way they want us to think. Since at least the 1960s this campaign has been effectively complete. Since then they have shaped and controlled the minds of all but a seeming few of us in varying degree with almost no opposition or competition from any alternative worldview. So now most of us are mentally trapped in the box the chosen have made for us, which we have lived in all our lives. Only a few have managed to avoid it or escape it, or to even sometimes see outside of it, and so actually "think outside of the (Jewish) box." --Michael Santomauro
Thank you and remember:
Peace is patriotic!
Michael Santomauro
253 W. 72nd Street
New York, NY 10023
Call anytime: 917-974-6367
E-mail me anything:
ReporterNotebook@Gmail.com
__._,_.___
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