Today I have a quote of former New York governor Eliot Spitzer, who whatever his former troubles, maintains credibility on financial matters. I have not confirmed this quote but it comes from a usually reliable source.
Gov. Spitzer's comments follow:
"The Federal Reserve has benefited for decades from the notion that it is quasi-autonomous, it's supposed to be independent. Let me tell you a dirty secret: The Fed has done an absolutely disastrous job since Paul Volcker left. The reality is the Fed has blown it. Time and time again, they blew it. Bubble after bubble, they failed to understand what they were doing to the economy. The most poignant example for me is the AIG bailout, where they gave tens of billions of dollars that went right through — conduit payments — to the investment banks that are now solvent. We didn't get stock in those banks, they didn't ask what was going on — this begs and cries out for hard, tough examination. You look at the governing structure of the New York Federal Reserve, it was run by the very banks that got the money. This is a Ponzi scheme, an inside job. It is outrageous, it is time for Congress to say enough of this. And to give them more power now is crazy. The Fed needs to be examined carefully."
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Many people feel the Federal Reserve has out-lived its usefulness, Ben Bernanke's publicity tour notwithstanding. I agree and believe it is time to abolish the Federal Reserve and replace it with a national bank which would have authority to directly over-see the nation's financial health, not through monopolistic control, but through serious oversight to ensure sound practices are being followed at all times. This oversight has been sorely lacking.
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