IMPEACH  BERNANKE!

An open letter to Congressman Ron Paul of Texas

Antal E. Fekete

April 6, 2011

Dear Dr. Paul:

There are serious questions about the legality of Quantitative Easing. You are among the few who are well-qualified and well-placed to get to the bottom of it.

Most people believe, and the media confirm them in that belief, that the Fed can legally create dollars ‘out of the thin air’ in any quantity, and can do with them as it pleases. This may well be the pipe dream of Dr. Bernanke who is quoted as saying that the U.S. government has given the Fed a tool, the printing press, to stop deflation — but it hardly corresponds to the truth. The Fed can create new dollars only if some stringent legal conditions are satisfied, and then, it can only dispose of them in certain ways prescribed by law.

Contrary to a statement of Dr. Bernanke, made before he became the Chairman of the Board of Governors of the Fed, he could not drop freshly printed dollars from a helicopter, no matter how many reasons for such an action he may be able to cite. Another thing the Fed is not allowed to do legally is to purchase Treasury paper from the U.S. Treasury directly. It must be purchased indirectly through open market operations. If you don’t put the Treasury paper through the test of the open market before the Fed is allowed to buy it, the presumption is that the market would reject it as worthless, or would take it only at a deep discount. The law does not allow the F.R. banks to purchase Treasury paper directly from the Treasury because that would make money creation through the F.R. banks a charade, reserve requirements a farce, and the dollar a sham.

If that were the only problem with Quantitative Easing, it would be bad enough. But there is something else that is even more ominous. The fact is that the Federal Reserve banks can purchase Treasury paper only if they pay with F.R. credit that has been legally created.

F.R. credit (F.R. notes and F.R. deposits) is legally created if it has been issued in accordance with the law. The law says that F.R. credit must be backed by collateral security at the time of issuance, usually in the form of an equivalent amount of U.S. Treasury paper. The procedure is as follows.

The F.R. bank seeking to expand credit takes its Treasury paper, owned outright and free from encumbrances, and posts it as collateral with the Federal Reserve agent who will then authorize the issuing of credit. In other words, if the F.R. banks do not have the unencumbered Treasury paper in their possession, then they cannot create additional credit legally.

There is some evidence that the F.R. banks do not have F.R. credit available to make the kind of purchases Dr. Bernanke is talking about as part of his Quantitative Easing. Nor do they have unencumbered Treasury paper in sufficient quantity that they could post with the F.R. agent for authorizing the issue of additional F.R. credit.

The point is that the process of posting collateral first, and augmenting F.R. credit afterwards must under no circumstances be reversed. What the F.R. banks cannot legally do is to buy the Treasury paper first with unauthorized F.R. credit, post the paper as collateral, and justify the illegal issuance of credit retroactively. Nor can they borrow the bond from the Treasury, post it as collateral, and pay for the bond retroactively.

This is an important limitation separating the regime of market-based irredeemable currency from the regime of fiat money involving outright monetization of government debt — the graveyard where the Continental dollar, the assignat, the mandat, the Reichsmark, and the Zimbabwe dollar (among countless others) rest.

At any rate, retroactive authorization of F.R. credit, if that’s what the Fed is up to, would be a violation of both the letter and spirit of the F.R. Act. It would mean converting the dollar into outright fiat money through the back door, bypassing Congress. It would show absolute bad faith on the part of the Chairman of the Federal Reserve Board of Governors, Dr. Ben Bernanke, who certainly knows what the law is. Such a blatant violation of the law would make him totally unfit for the powerful office he occupies. It would call for his immediate and dishonorable discharge by the President, pending Congressional investigation of the matter.

The various violations of the law of which the Fed is accused point to a concerted effort to remove the shackles the law has put on the money spigots lest crooks help themselves to the public purse. These violations are not isolated incidents. They are aiming at the corruption of the monetary order of the nation and the world. Moreover, they would ultimately figure prominently among the causes of the financial instability the world has been suffering from since 1971 and, more recently, since 2008.

Without understanding this fundamental truth, all talk about stabilizing the monetary system and reining in the runaway budget deficit is an exercise in futility.

Yours very sincerely,

Antal E. Fekete
Professor (retired)
Memorial University of Newfoundland
Tel./Fax: +36-1-325-7996

Note: an identical letter has been sent to Congressman Mike Pence of Indiana

Australia Surprises With Rate Hike; Currency Jumps

Australia’s central bank surprised markets by raising its key cash rate to a two-year high of 4.75 percent on Tuesday, saying a modest tightening was needed as a pre-emptive strike against inflation.

As we have been talking about inflation coming many months ago, why would you be so surprised.  Commodities are skyrocketing, metals are too, and they are leaving the hallmarks of the beginning of inflation that will be here soon. In the grand scheme of things the lies are slowly unraveling so it will be interesting to see what happens at the elections and see if our forecasts from AUGUST Here proves true.

We feel that it is a constant barrage of the good verses evil out there. Many people are slowly waking up to what has been going on all these years, the creating of debt, deflation, stock manipulation, but these are just a sign of the times. Greed, lies, cheating and living a life of sin can be quite fun and enjoyable….but as the saying goes. All good things must come to an end. That is why it quite obvious to see many changes coming to many of the strong super power economies around the globe. There is a shift of equilibrium, and it even surprises us at how fast and strong this is coming forth.

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historical gold prices are playing havoc with investors. Some people are scared it is too late, and others are scared things are too too high and need a break. But as an investor you must remember 4 key important elements with investing in market or commodities.

1) Historical gold prices could mean history is repeating, so you have to sit tight and be patient.

2) Contrarily investing can sometimes make you good money. That is do the opposite to what the average man in the street is telling you to do.

3) Get top quality advice from an expert in the field with more than 10 years experience in what you are dealing with.

4) Normally the best time to look for opportunities is when the economy is in turmoil. Supply may dwindle, but demand is sky high!. That is why there were many millionaires created during the last great depresssion. They knew what to sell due to the demand.

Here is our latest video about a shifting in the economy we see coming further down the track.

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85% College Grads Move Back With Parents in a recent study conducted. Seems like it sure is reflective on a sign of the times.

One student reflected back over the last 5 years. “I worked hard for a degree but could not find a job in my field and became a truck driver make around 60grand a year what a waste of time/money.”

Getting a degree used to be a stepping stone to limitless career opportunities. Now it’s more of a hiatus from living under your parents’ roof.

Stubbornly high unemployment — nearly 15% for those ages 20-24 — has made finding a job nearly impossible. And without a job, there’s nowhere for these young adults to go but back to their old bedrooms, curfews and chore charts. Meet the boomerangers. …

“This recession has hit young adults particularly hard,” according to Rich Morin, senior editor at the Pew Research Center in DC.

So hard that a whopping 85% of college seniors planned to move back home with their parents after graduation last May, according to a poll by Twentysomething Inc., a marketing and research firm based in Philadelphia. That rate has steadily risen from 67% in 2006.

What happend to the messages of “The recovery is here” and other swakers on TV saying “Don’t listen to negative Nanci’s there is no recession!” Well sorry to say that us negative nancies are just telling like it really is. The Truth.

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Narcolepsy – People really are still asleep to what is going on out there. I thought this was an appropriate title for our latest video. Narcolepsy and people that suffer from this really watch their TV blindly without ever going outside to see the real world. Alot of narcolepsy suffers are starting to wake up. Hopefully they can watch this before it is too late.

I will be away on business so thought would post this quick video / audio update for you to chew on.

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Is the US Government ‘hiding true amount of debt’? ?. The only way to answer this is with a big fat YES! I was even suprised to see that they are now starting to report this in the Australian media Click Here To Read More. Hmmmm Very Interesting.

Well I know that a lot of my colleges were on their hands and knees praying that Bernanke would not get in. But unfortunately those prayers went unanswered today as Federal Reserve Chairman Ben Bernanke won Senate confirmation for a second term today. I can now safely say the US and its economy is DOOMED! Yes I know that My commentary on all this is comical at times and it is thrown around as a joke, but i think this is really getting serious now, and my most devastating forecasts are now on the verge of playing out.

Why does this man get a pat on the back for doing everything in the book pretty much wrong.  A man that is allegedly an expert on the depression has not only had helped bring the economy to its knees, but even admitted that he couldn’t even see the crisis in the first place. Yes, I know he should have a permanent L shape letter on his forehead. infact it should be tattooed on his forehead, to remind us of that yes…the great job that he has done…NOT.

I think it has come time to each bow our heads and say a little prayer.

Please pray for the Good and great people of America. The good men and women, and prey the blinkers will soon come off sooner rather than later….

Please Pray for Bank & Loan bailouts to stop!….

Please Pray that the criminally insane government and fraudsters criminals that are running this show are exposed and the real TRUTH to this matter will be shown to even the most unsuspecting victims in all of this….

Please Pray for the people when they ask questions and continually get shut down and told to go away…

Please Pray for the people that still believe the words that come from Bernankes mouth!….

Please Pray for the intensity of this things coming to be lessened!….

Please Pray for the criminals behind bars for petty crimes, when the real criminals are running our countries and are the ones that must be punished publicly….

AND MOST OF ALL…

PLEASE PRAY FOR THESE THINGS TO COME TO PASS,

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The Fuse Has Been Lit…and there is no way to put it out!!

I have had mass amounts of emails this week and had some serious talks with our FFT members about what is happening in the economy at the moment. It has been nearly a whole year since the last market crash of 2008, and people are going to talk about that horrific event for many years to come I am sure.

This October will be a bit different. Like a big night on the town and a bad hangover, you could call the last 12 months a bad hangover for big banks, retirees, and those still unemployed and looking for work. And you feel every time the government talk they are the new 21st century ROBBIN’ HOOD… Robbin’ as in stealing for the poor and giving to the already rich.

YES…YES… DON’T GET ME STARTED!

They lit the fuse but they are also are sitting on the bomb that they call FAST SEEDED RECOVERY.

When the fuse runs out, and we hear the big BANG, the explosion will be immense they will be obliterated and the shock wave will travel long and far, to all demographics and many households that are unsuspecting….

Our latest video is below and explains more about what is happening at the moment.

Feel free to pass this important message on to your friends.

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The $7 Dollar Hamburger

Well, I hope you had an interesting weekend as I. I must tell you a story, that is simply amazing.

I was at the beach and a bit peckish. So I go up over the dunes to a surf snack shack. I use to frequent the same shop with a different greasy owner when I was a youngster. I remember I use to pay about $2 for gigantic whopping burger, that even as a young man in my 20’s was hard to scoff down. They were delicious, ANYWAY… I got to the counter and see the menu very different and burgers have gone up to $7. I thought to myself INFLATION IS A B&^TCH!

I had $10 in my pocket and thought what the heck, its going to be a whopping burger, so I gave this old greasy lady my ten, and by the state of her weathered greasy hands I was afraid to receive my change.

OH HOW TIMES HAVE CHANGED!

When the burger was cooked she handed me this small pancake looking burger, wrapped up with grease dripping everywhere. I looked up at her with a weird expression and said “errrr, thanks!” She smiled at me, like she just spat in the burger and in her croaky voice said “Enjoy!” and then she cackled like a dirty old witch.

I wasn’t sure what to do, but I just paid $7 for this damn thing so I sat down and started eating. I must say, it looked like something out of a bad 70’s horror film but it didn’t taste to bad. But changing $7 for a meal fit for a raccoon, was a bit steep i thought.

I have never paid $7 for a hamburger in my life and probably never will again, as I felt completely robbed. But you live and you learn. I thought for $7 the lady behind the counter was going to shaprone me round, wash my car, and shout out nice compliments to me for 24 hours.

But things are tight at the moment, thought you would enjoy this and reminder to all that we gotta help each other out as time moves on. Was a good lesson of inflation for me. Things dont always stay the same price forever.

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Most people today look beyond the truth to find facts.  When in fact truth is what the real facts are just hidden.

When I walk down the street there is alot of moaning and groaning from shop owners, about how this recession is killing them. when you walk into a shop and hear how their business is dwindling, their family is stressed, and financialy they are doing it tough you tell them that they are not alone.

The truth of the matter is, that young or old, rich or poor, everyone if feeling the effects of this credit crisis. We can sit here and blame the rich bankers or the ‘the higher in authority’ people but at the end of the day, is that going to make you feel better? is it going make you financially better off???

When you go back and study economics 101, it seems that every depression comes around about every 80 years or so. So that tells me, we are well overdue and yes we are very close to this happening again. I sat down with my grandma two nights ago and she remembers being a young girl of about the age of 10 when the stock market collapsed (1929) and the great depression kicked in.

For about and hour or two I sat listening about how her mum and dad classed as middle class parents struggled to survive. Stories of kids walking 5 miles without shoes, and how kids rocked up to school with no food to snack on for lunch. Those must have been some rough and tumble times!!. But I would imagine many families will soon face the same fate.

Most people are on the verge of feeling like they are playing the part of Old Yeller,“ wondering if he will survive
financially or perhaps just be put out of his misery, like the fictional dog.

Now we are in the second half of 2009 expect things to warm up a soon!!! While I am not surprised i really do feel for people that are not aware of it. It really is incredible, some people will get through all of this unscaved and cant say whether or not that will be you or not….but  I can say to you is try to do whatever you can to ensure things will be OK…..and they will be!

I remember sharing this stuff wayyyy back in 2006 and people thought I was a nutter. Fast forward say oh, 3 years and LOOK WHAT HAS PLAYED OUT….those that thought I had a point are in quite a good position today. Good for them! Some I decided to share some of their stories in the VIDEO below.

Enjoy.

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