The "Independent" Fed Admits The Truth

[traelin0]

It is not independent, it is an arm of Treasury.

Everything you were told was a scam and a lie - yet another time for

But the new rules have slowly begun to catch the attention of market analysts. Many are at once surprised that the Fed can set its own guidelines, and also relieved that the remote but dangerous possibility that the world's most powerful central bank might need to ask the U.S. Treasury or its member banks for money is now more likely to be averted.

The change essentially allows the Fed to denote losses by the various regional reserve banks that make up the Fed system as a liability to the Treasury rather than a hit to its capital. It would then simply direct future profits from Fed operations toward that liability.

www.market-ticker.org/akcs-www?post=178000

[fairlycrazy23]

I"m not really sure why the fed would have to ask anybody for money, the can just create any amount of money they need. So in that sense the FED can NOT go bankrupt. QE2 is all about the FED creating 600 million of new money and buy Treasury bonds.
This might have something to do with all the junk paper the FED bought (the massive secret bailout that dwarfed tarp), they are worth far less than what they bought them for (they bought them at 100%). BUt I didn't really follow all that the link was talking about.

But the part about the dept ceiling, is quite right, there is no fear the US won't be able to make its debt payment, revenue is more than 10x enough to cover the debt payment, it is other areas that would eventually have to go without. I think a bill has been introduced to make sure the US pays its debts first, so even if the debt ceiling is not raised no debt holder would miss a payment, and the full faith and credit of the US can go on.

[traelin0]

Raising the debt ceiling *could* have interesting impacts on the markets. At this point I am in favor of the debt ceiling being raised so that we can reset the system and get it over with. There is absolutely no way to pay off our debt, for many reasons.

[fairlycrazy23]

I was actually in favor of raising the debt ceiling, because the US can not default on its obligations, but then I heard that there is plenty of revenue to cover debt payments, not raising the debt ceiling simply means that cuts in other areas have to be made, and they might as well be made now. But if they do decide to raise the debt ceiling , it should be only a small amount, enough to cover the immediate need.

[traelin0]

Jan 23, 2011 0:27:38 GMT -5 fairlycrazy23 said:

I was actually in favor of raising the debt ceiling, because the US can not default on its obligations, but then I heard that there is plenty of revenue to cover debt payments, not raising the debt ceiling simply means that cuts in other areas have to be made, and they might as well be made now. But if they do decide to raise the debt ceiling , it should be only a small amount, enough to cover the immediate need.

I'd rather them just go for the gold so we can accelerate the inevitable. Plus, this has got to be the best time to invest, provided one invests with objectivity.