The Federal Reserve: America’s Fourth Branch of Government

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Thu, 12/09/2010 - 00:06 | 791443 CEOoftheSOFA
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The FED has 16,000 employees?  Holy crap!  You would think they could screw up the economy with fewer employees than that!  And none of them saw a bubble?

Wed, 12/08/2010 - 23:28 | 791358 gwar5
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Not only an unelected 4th Branch of Government, arguably the most powerful.

Fed policy is driving US domestic and foreign policy.

Fed policy is also driving policy in Europe, as we found out last week.

Paging Ron Paul.... paging Ron Paul.....

Wed, 12/08/2010 - 23:23 | 791345 breezer1
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i think bill blkner  saId as Much mANY MONTHS AGO. HE ALSO SAID TO WATCH 30 year bonds???

Wed, 12/08/2010 - 23:12 | 791316 gkm
gkm's picture

It is obvious that bonds continue to be in a bubble.  Bernanke admitted that he was printing money.  Now he denies he is printing money - while doing exactly the same thing he was doing when he said he was effectively printing money.  Yet people haven't grasped this yet.  People still cling to a modicum of confidence in the dollar.  This is very bubble like behavior and will end very badly.

Thu, 12/09/2010 - 00:00 | 791420 gwar5
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The mother of all bubbles.

Wed, 12/08/2010 - 22:38 | 791244 David99
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Serious matter

Russian jets interrupt US-Japan drill
Japan's Sankei newspaper reported that Russian patrol planes this week entered airspace above the Sea of Japan where the United States and Japan were conducting drills, causing a halt to part of the exercises

Wed, 12/08/2010 - 22:35 | 791230 David99
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China is going to increase interest rates by 0.25 basis points this weekend and another 3 hikes on 11th Feb, 11th April & 11th June making total 100 basis rise in 6 months.

Make a note on your calender and get out of your longs before it is too late

Thu, 12/09/2010 - 00:04 | 791439 gwar5
gwar5's picture

Is that a de facto increase in the value of the Yuan for us here, or just cool down their economy?

I'm not clear how that plays out for our economy (I don't hold China equities)

Wed, 12/08/2010 - 21:17 | 791060 harveywalbinger
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Fed > gubmint in the power structure...

Wed, 12/08/2010 - 19:51 | 790788 merehuman
merehuman's picture

So my sudden lazyness this last year is a good thing. For a while now i have felt it pointles to form goals , feeling a certain fruitlesness in normal endeavores.


Wed, 12/08/2010 - 18:01 | 790310 Dick the dog
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"When the Fed manipulates our money what is does is upset our ability to plan about the future."

Thats candy-coating a turd. I can work a full year of 70hr. weeks and make maybe 90K. The Benbernanke can fabricate 9TR with the wave of a hand,severely degrading not only my money, but my time, sweat and skill. This is grossly immoral. End the Fed.




Wed, 12/08/2010 - 18:42 | 790465 Rotwang
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Your striving is their taproot.

Wed, 12/08/2010 - 17:53 | 790274 1fortheroad
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From a speech in Congress in The Bankruptcy of the United States Congressional Record, March 17, 1993, Vol. 33, page H-1303, Speaker Representative James Trafficant Jr. (Ohio) addressing the House states:

“...It is an established fact that the United States Federal Government has been dissolved by the Emergency Banking Act, March 9, 1933, 48 Stat. 1, Public Law 89-719; declared by President Roosevelt, being bankrupt and insolvent. H.J.R. 192, 73rd Congress m session June 5, 1933 - Joint Resolution To Suspend The Gold Standard and Abrogate The Gold Clause dissolved the Sovereign Authority of the United States and the official capacities of all United States Governmental Offices, Officers, and Departments and is further evidence that the United States Federal Government exists today in name only.

The receivers of the United States Bankruptcy are the International Bankers, via the United Nations, the World Bank and the International Monetary Fund. All United States Offices, Officials, and Departments are now operating within a de facto status in name only under Emergency War Powers. With the Constitutional Republican form of Government now dissolved, the receivers of the Bankruptcy have adopted a new form of government for the United States. This new form of government is known as a Democracy, being an established Socialist/Communist order under a new governor for America. This act was instituted and established by transferring and/or placing the Office of the Secretary of Treasury to that of the Governor of the International Monetary Fund. Public Law 94-564, page 8, Section H.R. 13955 reads in part: “The U.S. Secretary of Treasury receives no compensation for representing the United States...

Prior to 1913, most Americans owned clear, allodial title to property, free and clear of any liens of mortgages until the Federal Reserve Act (1913) “Hypothecated” all property within the Federal United States to the Board of Governors of the Federal Reserve, in which the Trustees (stockholders) held legal title. The U.S. Citizen (tenant, franchisee) was registered as a “beneficiary” of the trust via his/her birth certificate. In 1933, the Federal United States hypothecated all of the present and future properties, assets, and labor of their “subjects,” the 14th Amendment U.S. Citizen to the Federal Reserve System. In return, the Federal Reserve System agreed to extend the federal United States Corporation all of the credit “money substitute” it needed.

Like any debtor, the Federal United States government had to assign collateral and security to their creditors as a condition of the loan. Since the Federal United States didn’t have any assets, they assigned the private property of their “economic slaves,” the U.S. Citizens, as collateral against the federal debt. They also pledged the unincorporated federal territories, national parks, forests, birth certificates, and nonprofit organizations as collateral against the federal debt. All has already been transferred as payment to the international bankers.

Unwittingly, America has returned to its pre-American Revolution feudal roots whereby all land is held by a sovereign and the common people had no rights to hold allodial title to property. Once again, We the People are the tenants and sharecroppers renting our own property from a Sovereign in the guise of the Federal Reserve Bank. We the People have exchanged one master for another.”

In 1944, Washington D.C. was deeded to the International Monetary Fund (IMF) by the Breton Woods Agreement. The IMF is made up of wealthy people that own most of the banking industries of the world. It is an organized group of bankers that have taken control of most governments of the world so the bankers run the world. Congress, the IRS, and the President work for the IMF. The IRS is not a U.S. government agency. It is an agency of the IMF. (Diversified Metal Products v. IRS et al. CV-93-405E-EJE U.S.D.C.D.I., Public Law 94-564, Senate Report 94-1148 pg. 5967, Reorganization Plan No. 26, Public Law 102-391.)

Wed, 12/08/2010 - 22:04 | 791172 Milestones
Milestones's picture

A very interesting post; I have read bits and parts of what you have presented but never this much in one piece. Man, we have one very complicated mess on the table if all this is correct.

Of course a couple of million AR-15's would make the end result kinda moot.

Thanks much for providing the information.   Milestones

Wed, 12/08/2010 - 23:40 | 791387 1fortheroad
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If shit hits fan and all hell breaks lose I would hope the Military would

act in a peace keeping role and actually help the common folks. I have heard

they are not about to back the present powers that be if their is a second choice.


Wed, 12/08/2010 - 23:02 | 791290 medicalstudent
medicalstudent's picture

Small virtual world, if you are the milestones I know of...

Lincolns greenback and gradual 100% reserve requirements are a solution, Bill Still is a genius.

How many understand that debt repayment to banx extinguishes currency, causes deflation?

That currency is borrowed into existence with credit cards?

The mathematic endpoint of our system is one man with all the currency.

Fortunately, milestones, we (and many others) are a step ahead.

Be well. Silver up.

Thu, 12/09/2010 - 11:42 | 792534 flacorps
flacorps's picture

"The mathematic endpoint of our system is one man with all the currency."

Umm, you do realize that the currency would then be worthless, even to the holder? Currency has value only so long as it remains a medium of exchange. If it becomes too concentrated in too few hands, people will no longer exchange it. They will exchange something else, or barter amongst themselves.

Wed, 12/08/2010 - 19:42 | 790746 flacorps
flacorps's picture

I almost junked this but I want to have people see it. The reality is bad enough without going off into never-never land. Land is still held by individuals and businesses in fee simple. The IRS and the IMF have little if anything to do with one another. Losing focus into oddball theories only hurts the cause.

Wed, 12/08/2010 - 21:20 | 791071 harveywalbinger
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Please visit this site.  Soak it up.

Wed, 12/08/2010 - 17:43 | 790214 MrBoompi
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"they are, de facto, completely controlled by the federal government"


I agree they may be inclined to help or hurt an administration, but I have to disagree.


The Owners sit at the top of the Pyramid, the Central Banks come next, the rest of the banking industry comes next, THEN the Federal Government.  That's the pecking order as it exists today.

Wed, 12/08/2010 - 17:18 | 790071 tom
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I can understand thinking of the Fed as a fourth branch as a way of emphasizing its power or its relative independence, but de jure, the BOGFRS and the FOMC are simply part of the executive branch. The entire BOGFRS and seven of twelve members of the FOMC are directly presidentially appointed, and the BOGFRS can veto the appointments of reserve bank presidents, who take turns filling the remaining five FOMC positions. Most of the decisions you are talking about are executive branch decisions. Bernanke is a federal government executive branch employee.

De jure, the Federal Reserve banks are gongos, government-organized NGOs. They are nominally owned by their bank members but those members must agree appointments of their presidents with the BOGFRS. In practice, the BOGFRS chooses the powerful NY president and lets the far less important other reserve banks choose their own presidents. This is because the NY Fed has responsibility to carry out monetary policy as set by the executive branch committees, so the BOGFRS keeps that on a tight leash. William Dudley and Tyler's favorite antihero Brian Sack are gongo employees, but they do pretty much nothing without Washington approval.

Wed, 12/08/2010 - 17:00 | 789927 Popo
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Econophile, What you say is true, but it's actually worse: The Fed is not just the fourth branch of government, they have effectively killed the legislative branch. Don't forget that the PRIMARY check-and-balance of the legislative is the "power of the purse".

All spending bills MUST originate in the House.

The creation of fiat effectively overrules (and vastly outweighs) the legislative's ability to control spending.

Furthermore, the power of the Fed to create and allocate money via the Treasury, creates an unholy alliance between the executive and the fourth branch (the Fed) which the Constitutional framers never intended.

Consider that the Executive's/Treasury's power is *supposed* to be contained by the legislative branch's 'Power of the Purse'. But via the Federal Reserve, the Treasury (ie: the Executive) now has potentially unlimited authority -- and the essential checks-and-balances of government have been destroyed. Arguably, the Fed isn't responsible for adding an additional branch of government -- they are responsible for reducing the number of branches to two.

Wed, 12/08/2010 - 17:16 | 790056 Sean7k
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+1000 .

This is the destructive nature of all governments. To study the efforts by the Morgans and Rockefellers to create the Central Bank is all you need to know about criminal behavior. This was done for the benefit of banks and then for the purpose of cartellization of all major industries in America under Eccles. They had to have the ability to inflate the money supply. 

As long as we tolerate government, liberty will be a dream, captured and caged, left to slowly die in our hearts and memories, as we realize the weight of the chains we have worn since 1913.

Wed, 12/08/2010 - 17:08 | 790002 Rasna
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Don't forget that the PRIMARY check-and-balance of the legislative is the "power of the purse". All spending bills MUST originate in the house.

With the Fed monetizing the debt by Treasury purchases,  the House can spend without apparent consequence.  Given this, the congress gets to fund ALL projects and look good to their constituents by bring home the dollars for local projects, funding a huge defense budget that "keeps us safe" and sends $B to their masters on Wall Street...

In the end they'll try to kill SS and Medicare to "balance" the budget while their masters sip champaigne up in the Hamptons while the less fortunate travel to Cuba or India for health care and burn the furniture for heat in the winter.

The Fed has removed accountability from the check and balance you mentioned.

Wed, 12/08/2010 - 16:44 | 789899 Village Idiot
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...and fuck the fed.

Wed, 12/08/2010 - 17:48 | 790241 RockyRacoon
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Eloquent as usual.  Bravo!

Wed, 12/08/2010 - 16:37 | 789866 boeing747
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Remember Freddie, Fannie&Ginnie is the 5th branch of government which still pumps thin air to real estate bubble, which causes people making bad decision. I know many people who are debts free before, now buy forclosured home with endless remodelings, tax, payment, unable to find a tenant.

Wed, 12/08/2010 - 16:37 | 789864 XRAYD
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The two faces of Ben about printing .. err .. not printing money. Must see Jon Stewart video:


Wed, 12/08/2010 - 16:27 | 789828 kaiserhoff
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Good post, but I would like to see more focus on specific damage done to the economy and individuals by Fed policy in the last decade.  The list is not short. 

1 Transfer of hundreds of billions of dollars of interest income from savers to corrupt and broke banks.

2 Maintaining real estate and rents at artificially high levels, for the sole purpose of saving the TBTF

3 Perversion of the economy and free markets by creating the very concept of TBTF

4 Massive job destruction by misallocation of capital.  See 1-3

5 Delaying badly needed reforms and cost cutting by all levels of government.

6 Deliberate, treasonous destruction of the dollar.

7 The systematic rape of main street for the benefit of wall street.

Ladies and Gentlement, have at it.

Wed, 12/08/2010 - 16:23 | 789818 gerd
gerd's picture

now playing, Ben Bernank in A Few Good Men-

Wed, 12/08/2010 - 15:53 | 789699 gs_runsthiscountry
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Bernanke's lost quote:

"Read my quivering lip, i am in control. I am 100% confident, i can re-fund the banks till the cows come home, and you will like it."

That is all....


Wed, 12/08/2010 - 15:30 | 789625 Ripped Chunk
Ripped Chunk's picture

I thought there were five when The Department of Homeland Security is considered.

Wed, 12/08/2010 - 23:06 | 791302 Kali
Kali's picture

Fer sure.

Wed, 12/08/2010 - 15:19 | 789577 Catstor
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Crazy talk.  That's what this is.  Enemy Of The State-style crazy talk.

The Fed is owned by the Banks?  And Bernanke and company's vast authority has essentially no Constitutional basis?  Mr. Econophile better make sure he double bags his dangerous weapon and there is no alleged condom failure from this point forward.  

Wed, 12/08/2010 - 15:15 | 789562 Mr Lennon Hendrix
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The Fed and the Fed alone has the power to determine how much money should be in the economy. Such vast power over our lives makes the Fed a de facto fourth branch of government.

Great point.

Great article.

Wed, 12/08/2010 - 15:13 | 789553 The Franchise
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The government is a branch of the Federal Reserve.. and we all know who controls das Fed.

Wed, 12/08/2010 - 15:11 | 789547 weinerdog43
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The Fed will have to be the 5th branch as the 4th is already taken.  (see Cheney, Dick)

Wed, 12/08/2010 - 15:06 | 789512 flacorps
flacorps's picture

The Fed does not deserve to make it to its centennial. The ostensible

reason for its adoption, which was to stop "panics" has proven chimerical time

and time again. So what are we paying these guys for, we can have panics

on our own. And we can plan better, knowing that there's nobody out there

with the hubris to claim that they're acting in our best interests and preventing


Not to mention, the propping up of businesses that made bad decisions in a way

that put the suffering disproportionately onto ordinary Americans.

Plutocronyistikakistocracy at its most disgusting. Nevermind Pecora, where's Robespierre!?

Wed, 12/08/2010 - 14:59 | 789479 tony bonn
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"they are, de facto, completely controlled by the federal government "

absolute horse crap...banksters control and own the fed lock stock and barrel....the illusion that the government controls the fed is the fallacy of collinearity....

on the other hand the fed is unconstitutional and is lethally dangerous to freedom and economic well being. it should be abolished. it has powers which no republic can bear - unless of course you are something like the people's republic of china - as much a misnomer as pravda...

Wed, 12/08/2010 - 23:29 | 791365 essence
essence's picture

Yes indeed, great observation by tony bonn.

Does anyone think that a candiate fed chairman gets anwhere
close to the perfunctory government approval unless he fully
has been vetted by the bankster overlords. More than that...he'll
likey be one of the clan. An insider that the owners of the fed
will know that they control... completely, like a dog, an obedient dog.

Woof, woof....
"good boy ben. You're such a good doggie. So faithful to your masters".

As we know, politicians (with few exceptions) are bought off
by bribes ... errr   'campaign donations' in polite-speak.

And who has more money than the bankster owners of the fed.
The fed, an enity that can create money out of thin air.
An organization that can funnel invaluble insider information
to its owners so that they can be one step ahead of markets
(and profit handsomely).

Congress gives cover for to the fed because it'll bankroll their excesses.

After all... that's how congress gets elected. Big money provides the bulk
of the funds...but congessmen still need the actual votes. They get that
by dispensing 'swag'. You know, 'bennies' to the 'common' folk.
Sure it's pennies on the dollar compared to what the bankster class gets,

nevertheless, that's how the system works in the U.S.





Wed, 12/08/2010 - 16:58 | 789953 Rasna
Rasna's picture

It can be argued that the Federal Reserve Board is a "quasi-governmental" agency with members appointed by the president and confirmed in the Senate.  House and Senate "kind of" have oversight, but I'm not sure what kind of teeth that has... My take is the Fed chairman regularly testifies to congress but is under no obligation  to provide them with any kind of information.  How far has the audit gotten, and how long has it taken?  We still don't know the collateral that was provided to the Fed for all of the loans made around the world. 

If they are a "quasi-governmental agency", what does that mean?  Would they be part of the executive?  If they have no constitutional authority, then why go through the charade of nomination and confirmation?  The president is essentially given a name to nominate and the Senate rubber stamps it.

Obama was told to renominate Bernankenstein and he did it with no thought.

The Regional Federal Reserve Banks are private corporations owned by the regional member banks.  The RFRB's implement the Board policies.  Kind of Murky.

Wed, 12/08/2010 - 15:14 | 789558 flacorps
flacorps's picture

Collinearity my eye! The Fed's people make a few phone calls and Congress "tells" the Fed to do whatever the Fed's people dictate. Or else the campaign contributions dry up, at best.

Rep. Brad Sherman claims congresspeople were threatened with martial law if the bailout wasn't passed in 2008. That is, martial law in the streets. Then-speaker Pelosi had already invoked House Rule 136A, which put the lower chamber into so-called 'martial law'.

Wed, 12/08/2010 - 21:18 | 791066 Milestones
Milestones's picture

Where in the U.S. Constitution is the power of MARTIAL LAW granted to any of the 3 branches of government, including the military? Do not confuse the Milita, which is the CITIZENRY of the nation with martial law.

The founding fathers never envisioned a standing army for the United States of America.

Martial law is nothing other and can only be called a Coup D e'dat.    Milestones

Wed, 12/08/2010 - 23:19 | 791336 cosmictrainwreck
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you are, of course, completely correct....however....

Wed, 12/08/2010 - 23:22 | 791339 cosmictrainwreck
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[funky burps in this posting] "however.....PTB get to do whatever the fuck they want to....that's the point

Wed, 12/08/2010 - 14:54 | 789462 Careless Whisper
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ron paul's most recent interview (bailing out foreign banks is an afront to the American people)


Wed, 12/08/2010 - 15:42 | 789665 MarketTruth
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The Fed is NOT part of the government, it is a PRIVATELY OWNED for profit entity.


"Give me control of a nation's money and I care not who makes her laws." Mayer Amschel Rothschild, the man behind the current USA PRIVATE central banking scheme.

Wed, 12/08/2010 - 21:26 | 791089 Billy Shears
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But everybody here knows most all of this stuff already, just sitting and waiting! The MoneyMasters video is a must see. Please watch it if you haven't yet, and visit the Moneymasters website and see their program for retiring the national debt and eliminating fractional reserve banking.


Wed, 12/08/2010 - 18:17 | 790366 TBT or not TBT
TBT or not TBT's picture

And anyway, the "fourth branch" moniker is already taken, as we have an enormous, unelected unfirable permament federal bureaucracy in that position, making law in a thousand domains without review by any elected official, just designated authority, do nearly what they hell they want to whoever they want, within the wide open boundaries of what enabling law allows them.   Private entities bow to the fourth branch's every whimsical ruling because they know the fourth branch has thousands of ways to get them, whether they win or not contesting some particular new cumbersome or even business-ending intrusion.

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