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bacasper
Joined: 26 Mar 2007
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 Posted: Thu Aug 27, 2009 3:59 am Post subject: |
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From that link:
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| The interest earned on the debt created by the Fed is turned over to the Treasury (except for an amount to cover the Fed's operating costs), so that the revenue consequences of having the Fed issue Federal Reserve notes is essentially the same as having its own currency directly. |
OK, it says that, but I am not sure whether to believe it.
Where can I see the document that says how much the Fed turned over last year to the US Treasury and how much to its own banks? |
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bucheon bum
Joined: 16 Jan 2003
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| Posted: Thu Aug 27, 2009 8:17 am Post subject: |
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| The Congressional Research Service isn't legit of a source for you?? |
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jaykimf
Joined: 24 Apr 2004
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| Posted: Thu Aug 27, 2009 12:08 pm Post subject: |
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| bacasper wrote: |
From that link:
| Quote: |
| The interest earned on the debt created by the Fed is turned over to the Treasury (except for an amount to cover the Fed's operating costs), so that the revenue consequences of having the Fed issue Federal Reserve notes is essentially the same as having its own currency directly. |
OK, it says that, but I am not sure whether to believe it.
Where can I see the document that says how much the Fed turned over last year to the US Treasury and how much to its own banks? |
" The combined financial statements of the Federal Reserve Banks were audited by Deloitte & Touche LLP, independent auditors, for the year ended December 31, 2007, and by PricewaterhouseCoopers LLP, independent auditors, for the year ended December 31, 2006." http://www.federalreserve.gov/boarddocs/rptcongress/annual07/sec6/c3.htm
"The interest it earns on its loans and securities is almost pure profit, or �seigniorage,� most of which it remits to the Treasury." http://www.economist.com/businessfinance/displaystory.cfm?story_id=13579025
"After paying its expenses, the Federal Reserve turns the rest of its earnings over to the U.S. Treasury. " http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#6
The Board also requires that FRB profit in excess of what is required to pay dividends and maintain the surplus account be transferred in full to the United States Treasury on a weekly basis under the rubric �Interest on Federal Reserve
Notes.� http://www.imf.org/external/pubs/ft/wp/2009/wp09120.pdf |
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mises
Joined: 05 Nov 2007
Location: retired
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| Posted: Thu Aug 27, 2009 12:15 pm Post subject: |
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| As far as I know, this is true. They handover profits. But this conversation is misguided. The problem isn't who is profiting from the interest but who is profiting from the policy. Who benefits from 0% interest rates? Or 1.3-1.7% for 33 months after 9/11. Who profits? Not me. So who? And how much influence do those who do benefit have over the system. Forget about the question of profits. Forget about all of that. This is a classic situation of regulatory capture. |
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bucheon bum
Joined: 16 Jan 2003
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| Posted: Thu Aug 27, 2009 12:45 pm Post subject: |
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| jaykimf wrote: |
| bacasper wrote: |
From that link:
| Quote: |
| The interest earned on the debt created by the Fed is turned over to the Treasury (except for an amount to cover the Fed's operating costs), so that the revenue consequences of having the Fed issue Federal Reserve notes is essentially the same as having its own currency directly. |
OK, it says that, but I am not sure whether to believe it.
Where can I see the document that says how much the Fed turned over last year to the US Treasury and how much to its own banks? |
" The combined financial statements of the Federal Reserve Banks were audited by Deloitte & Touche LLP, independent auditors, for the year ended December 31, 2007, and by PricewaterhouseCoopers LLP, independent auditors, for the year ended December 31, 2006." http://www.federalreserve.gov/boarddocs/rptcongress/annual07/sec6/c3.htm
"The interest it earns on its loans and securities is almost pure profit, or �seigniorage,� most of which it remits to the Treasury." http://www.economist.com/businessfinance/displaystory.cfm?story_id=13579025
"After paying its expenses, the Federal Reserve turns the rest of its earnings over to the U.S. Treasury. " http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#6
The Board also requires that FRB profit in excess of what is required to pay dividends and maintain the surplus account be transferred in full to the United States Treasury on a weekly basis under the rubric �Interest on Federal Reserve
Notes.� http://www.imf.org/external/pubs/ft/wp/2009/wp09120.pdf |
jay, the IMF is just the Fed's proxy to spread its influence across the globe!
And the economist? Please, that is just a propaganda tool of the Fed.
And lastly, the federal reserve isn't going to be honest! Come on, give me a break!
Excuse me, couldn't resist. I have a lot of time on my hands this month. |
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visitorq
Joined: 11 Jan 2008
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| Posted: Thu Aug 27, 2009 4:24 pm Post subject: |
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| jaykimf wrote: |
| bacasper wrote: |
From that link:
| Quote: |
| The interest earned on the debt created by the Fed is turned over to the Treasury (except for an amount to cover the Fed's operating costs), so that the revenue consequences of having the Fed issue Federal Reserve notes is essentially the same as having its own currency directly. |
OK, it says that, but I am not sure whether to believe it.
Where can I see the document that says how much the Fed turned over last year to the US Treasury and how much to its own banks? |
" The combined financial statements of the Federal Reserve Banks were audited by Deloitte & Touche LLP, independent auditors, for the year ended December 31, 2007, and by PricewaterhouseCoopers LLP, independent auditors, for the year ended December 31, 2006." http://www.federalreserve.gov/boarddocs/rptcongress/annual07/sec6/c3.htm
"The interest it earns on its loans and securities is almost pure profit, or �seigniorage,� most of which it remits to the Treasury." http://www.economist.com/businessfinance/displaystory.cfm?story_id=13579025
"After paying its expenses, the Federal Reserve turns the rest of its earnings over to the U.S. Treasury. " http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#6
The Board also requires that FRB profit in excess of what is required to pay dividends and maintain the surplus account be transferred in full to the United States Treasury on a weekly basis under the rubric �Interest on Federal Reserve
Notes.� http://www.imf.org/external/pubs/ft/wp/2009/wp09120.pdf |
I think this is quite easily debunked, just by common sense alone. From your second link:
Last year the central bank reported a whopping $43 billion in operating income. That was more or less the same level as in 2007, but meanwhile short-term interest rates had plummeted, ending the year near zero. That should have clobbered Fed income, as rate cuts did in the early days of the last recovery in 2002-04 (see chart).
How many dollars actually exist? Whether issued directly by the Fed to the gov't, or by commercial banks, or the untold trillions in the derivatives markets. That's a whole lot of dollars, probably hundreds of trillions, all of which are Fed notes, all of which have interest attached (correct me if I'm wrong). Then to say they only earn a pitiful $48 billion (less than most fortune 500 companies) seems just so obviously wrong.
Of course it would be nice if I could just cite the actual amount and not be forced to speculate - but the Fed has never been audited (in public view). |
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jaykimf
Joined: 24 Apr 2004
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| Posted: Thu Aug 27, 2009 6:57 pm Post subject: |
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| Yes, you're wrong. |
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bacasper
Joined: 26 Mar 2007
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| Posted: Thu Aug 27, 2009 10:15 pm Post subject: |
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| jaykimf wrote: |
| bacasper wrote: |
From that link:
| Quote: |
| The interest earned on the debt created by the Fed is turned over to the Treasury (except for an amount to cover the Fed's operating costs), so that the revenue consequences of having the Fed issue Federal Reserve notes is essentially the same as having its own currency directly. |
OK, it says that, but I am not sure whether to believe it.
Where can I see the document that says how much the Fed turned over last year to the US Treasury and how much to its own banks? |
" The combined financial statements of the Federal Reserve Banks were audited by Deloitte & Touche LLP, independent auditors, for the year ended December 31, 2007, and by PricewaterhouseCoopers LLP, independent auditors, for the year ended December 31, 2006." http://www.federalreserve.gov/boarddocs/rptcongress/annual07/sec6/c3.htm
"The interest it earns on its loans and securities is almost pure profit, or �seigniorage,� most of which it remits to the Treasury." http://www.economist.com/businessfinance/displaystory.cfm?story_id=13579025
"After paying its expenses, the Federal Reserve turns the rest of its earnings over to the U.S. Treasury. " http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#6
The Board also requires that FRB profit in excess of what is required to pay dividends and maintain the surplus account be transferred in full to the United States Treasury on a weekly basis under the rubric �Interest on Federal Reserve
Notes.� http://www.imf.org/external/pubs/ft/wp/2009/wp09120.pdf |
If this be true, then what are the majority of Congresspersons who have signed on to Ron Paul's "Audit the Fed" (HR 1207) bill asking for? |
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visitorq
Joined: 11 Jan 2008
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| Posted: Fri Aug 28, 2009 12:29 am Post subject: |
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| jaykimf wrote: |
| Yes, you're wrong. |
You wish.
The Fed does NOT pay its interest back to the Treasury. This is just plain obvious. That money you're claiming is paid back (which is likely a near incalculable amount) is not accounted anywhere in the Treasury itself. If you were correct, it would be common knowledge, the Treasury would be raking in a huge profit each year, and there would be far less criticism of the Fed.
Fact of the matter is you are very much mistaken. I can post a thousand links saying the Fed keeps the interest earned, for that one you posted. |
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bucheon bum
Joined: 16 Jan 2003
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| Posted: Fri Aug 28, 2009 6:26 am Post subject: |
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| visitorq wrote: |
| I can post a thousand links saying the Fed keeps the interest earned, for that one you posted. |
So then why not provide us with one or two of them? |
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visitorq
Joined: 11 Jan 2008
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| Posted: Sat Aug 29, 2009 12:18 am Post subject: |
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Let me put it this way. The Fed provides the only legal tender used as reserves (its unbacked Federal Reserve Account Unit Dollars) to all the commercial banks (Citi, JPM-C, BoA etc. which are the shareholders of the Fed itself), which allows them, through legally mandated fractional reserve banking (which is literally, by definition, legalized fraud), to then create at least 9 times that amount of new money out of thin air, all backed by absolutely nothing, and then loan it out as debt to the public and the government, all at interest. The interest earned by these banks is most definitely kept by the banks themselves (don't think anybody would argue that).
Now whether or not the the Fed itself returns the interest earned on fraud-currency loans to the US gov't, there is simply no way of verifying it on the Fed side, because the books are closed. But you have to ask yourself the obvious question: why would the government allow the privately owned Fed to charge interest to the government, as well as pay all revenue from personal income tax, if all that money were just given right back? Why would they he government take the money collected from income tax to pay off the interest on debt owed to the to the Fed, if that interest were always just given back to the government anyway? Makes zero sense. And given that the balance sheets in the government are at least open, where is all that money to be found that was supposedly 'handed over' by the Fed? We are talking about obscene amounts of money, hundreds of billions of dollars per year, plus all the income tax revenue which is paid to the Fed. It's nowhere to be found. |
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bucheon bum
Joined: 16 Jan 2003
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| Posted: Sat Aug 29, 2009 7:12 am Post subject: |
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| So you're saying you can't find one of those thousand links? |
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jaykimf
Joined: 24 Apr 2004
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| Posted: Sat Aug 29, 2009 8:00 am Post subject: |
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| visitorq wrote: |
Let me put it this way. The Fed provides the only legal tender used as reserves (its unbacked Federal Reserve Account Unit Dollars) to all the commercial banks (Citi, JPM-C, BoA etc. which are the shareholders of the Fed itself), which allows them, through legally mandated fractional reserve banking (which is literally, by definition, legalized fraud), to then create at least 9 times that amount of new money out of thin air, all backed by absolutely nothing, and then loan it out as debt to the public and the government, all at interest. The interest earned by these banks is most definitely kept by the banks themselves (don't think anybody would argue that).
Now whether or not the the Fed itself returns the interest earned on fraud-currency loans to the US gov't, there is simply no way of verifying it on the Fed side, because the books are closed. But you have to ask yourself the obvious question: why would the government allow the privately owned Fed to charge interest to the government, as well as pay all revenue from personal income tax, if all that money were just given right back? Why would they he government take the money collected from income tax to pay off the interest on debt owed to the to the Fed, if that interest were always just given back to the government anyway? Makes zero sense. And given that the balance sheets in the government are at least open, where is all that money to be found that was supposedly 'handed over' by the Fed? We are talking about obscene amounts of money, hundreds of billions of dollars per year, plus all the income tax revenue which is paid to the Fed. It's nowhere to be found. |
The real question I have to ask myself is how much time I want to waste arguing with a troll. Anyway, the books are not closed. All you had to do was click on the link I gave above and you could see the audit reports performed by Deloit and Touche and by Price Waterhouse. Of course you won't bother to read the reports because you can't be bothered by minor details like the actual facts and are too busy speculating. Of course you could cite any number of your fellow crackpots parroting each other's talking points. Instead of reading only crackpots why don't you go to your local college and take an introductory class on Money and Banking. Or at least check out their textbook from the library and read that. Of course trolls like you obviously won't bother. |
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bacasper
Joined: 26 Mar 2007
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| Posted: Sat Aug 29, 2009 8:42 am Post subject: |
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I have asked about HR1207 twice, and no one has answered, so I've had to do the legwork myself. 
The following summary was written by the Congressional Research Service, a well-respected nonpartisan arm of the Library of Congress. GovTrack did not write and has no control over these summaries.
2/26/2009--Introduced.
| Quote: |
| Federal Reserve Transparency Act of 2009 - Repeals the authority of the Comptroller General to carry out an onsite examination of an open insured bank or bank holding company only if the appropriate federal regulatory agency has consented in writing. (Retains the authority of the Comptroller General to audit a federal agency.) Directs the Comptroller General to complete, before the end of 2010, an audit of the Board of Governors of the Federal Reserve System and of the federal reserve banks, followed by a detailed report to Congress. |
Now my question is, is any of the foregoing being done now? I am guessing it is not if this bill is being introduced. |
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jaykimf
Joined: 24 Apr 2004
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| Posted: Sat Aug 29, 2009 10:11 am Post subject: |
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| bacasper wrote: |
I have asked about HR1207 twice, and no one has answered, so I've had to do the legwork myself.
The following summary was written by the Congressional Research Service, a well-respected nonpartisan arm of the Library of Congress. GovTrack did not write and has no control over these summaries.
2/26/2009--Introduced.
| Quote: |
| Federal Reserve Transparency Act of 2009 - Repeals the authority of the Comptroller General to carry out an onsite examination of an open insured bank or bank holding company only if the appropriate federal regulatory agency has consented in writing. (Retains the authority of the Comptroller General to audit a federal agency.) Directs the Comptroller General to complete, before the end of 2010, an audit of the Board of Governors of the Federal Reserve System and of the federal reserve banks, followed by a detailed report to Congress. |
Now my question is, is any of the foregoing being done now? I am guessing it is not if this bill is being introduced. |
Your guess is as good as mine. It is not at all clear to me from your quote what type of audit is being called for or how that audit would be any different from the audits that are already being done. Possibly as you guessed earlier they want more information about foreign exchange transactions, possibly as someone else suggested they want more information about the bailouts--exactly who got what, Posibly they want the type of audit that "review management efficiency and to evaluate the policy of an institution" . Or possibly they are responding to recent criticism of the Fed by passing meaningless legislation that gives the appearance of doing something while actually doing nothing.
Good job on doing your own legwork. Please continue. Obviously you'd like to get to the truth rather than blindly believing whatever some crackpot says. |
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