The leverage of the Fed is vanishing, from this laymans point of view. The only way interest rates are going is up… or put another way how much cheaper can the dollar get?

When something is deemed to big to fail…what of California?

How is the Fed to deal with the status of bankrupt States?
They are in California’s case “too big to fail” no?

I keep coming back to the tried and true principles of transparency and integrity. I am not impugning anybody’s personal motivations but I do believe we have seen extreme measures of “the ends justifying the means” throughout this ordeal.

The cost of that approach is unknown and currently immeasurable.

It does provide plenty of “grist for the Sense on Cents mill!!”

Thanks for the plug. Hope you like Sense on Cents!! In regard to the “owners” of the Fed . . . the Fed itself does not use that term. The Fed uses the term “members.” To that end:

How is the Federal Reserve System structured?

The Federal Reserve System has a structure designed by Congress to give it a broad perspective on the economy and on economic activity in all parts of the nation. It is a federal system, composed basically of a central, governmental agency–the Board of Governors–in Washington, D.C., and twelve regional Federal Reserve Banks, located in major cities throughout the nation.

These components share responsibility for supervising and regulating certain financial institutions and activities; for providing banking services to depository institutions and to the federal government; and for ensuring that consumers receive adequate information and fair treatment in their business with the banking system.

A major component of the System is the Federal Open Market Committee (FOMC), which is made up of the members of the Board of Governors, the president of the Federal Reserve Bank of New York, and presidents of four other Federal Reserve Banks, who serve on a rotating basis.

The FOMC oversees open market operations, which is the main tool used by the Federal Reserve to influence money market conditions and the growth of money and credit.

All this said, the buck ultimately stops with the Fed chair. Greenspan ruled the roost. Bernanke does the same.

I think a very LARGE problem in regard to the Fed and Congressional oversight of the Fed is the fact that members of Congress are extremely weak in their understanding of our banking, finance, and economic systems as a whole.

Visit and comment often!!

The over all situation is that we need to simplify the regulation and maybe putting it in the Fed allows concentration to address the problems and then congress can act.