re: #44 ausador

Too many people just don’t get what the Fed does, the vast majority of time it simply keeps the banks operating smoothly.

Example:
You own a bank, one of your large corporate customers writes a check to pay $100 million to buy a factory, now you have to transfer $100 million to another bank.

The problem is that you don’t have $100 million sitting around in petty cash, it is invested in loans, in stocks, in bonds, in mutual funds, etc..

So you ask the Fed for a short-term liquidity loan at prime rate to cover the $100 million until you can cover it through a combination of new deposits and liquidating assets (usually called “overnight” loans).

The Fed covers your $100 million for you and in a day or two you pay them back with minimal interest.
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The vast majority of what the Fed does day to day is exactly that, it greases the wheels and allows the banks and other financial institutions to operate smoothly. But just like applying for any other loan the borrower has to provide all their current financial data to the person loaning them the money. How much in deposits, how much in assets, how much on loan, how much in default, etc, etc…

This entire ridiculous “audit the Fed” dance is simply meant to make all of this privileged and confidential information a part of the public record. The only ones who would benefit from that would be the monolithic big banks with giant cash reserves. Everyone would end up looking “risky on paper” when compared to them. :(

“Libertarian?” not fucking hardly…

All true. So how would you suggest educating the public about those facts?