Representative Ron Paul presses Fed chair Bernanke. Bernanke attempts to redefine inflation and suggests that an after the fact audit would hinder daily monetary decisions.
Bernanke stated: “I Don’t Know” Which Foreign Banks Were Given Half a Trillion."
Paul directly blamed the Fed for creating the financial crisis and systematically compounding the problems with its ongoing policies.
The Congressman stated:
“The Federal Reserve in collaboration with the giant banks has created the greatest financial crisis the world has ever seen.”
“The foolish notion that unlimited amounts of money and credit created out of thin air can provide sustainable economic growth has delivered this crisis to us.”The Congressman said.
“Instead of economic growth and stable prices, (The Fed) has given us a system of government and finance that now threatens the world financial and political institutions.”
“Pursuing the same policy of excessive spending, debt expansion and monetary inflation can only compound the problems that prevent the required corrections,” Paul added.
“Doubling the money supply didn’t work, quadrupling it won’t work either,”he said.
The Congressman implored that the only way out of a debt crisis is to pay off or liquidate the debt, “we are doing neither,” he concluded.
“Buying up the bad debt of privileged institutions and dumping worthless assets on the American people is morally wrong and economically futile,” Paul concluded.
During his five minute questioning window, Paul challenged Bernanke on quotes attributed to him that suggested The Fed chairman had said that HR1207, Ron Paul’s bill to audit the Federal Reserve, would interfere with the Fed’s interest rates decisions.
The Congressman maintained it would do nothing of the sort, while Bernanke attempted to suggest that giving the Government Accountability Office the power of audit over the Fed would inhibit and restrict the Fed’s ability to make decisions on monetary policy by politicizing it.
Paul fired back stating that it is preposterous to suggest that the Fed isn’t already overtly politicized:
“Just the fact that they can issue a lot of loans and special privileges to banks and corporations, that’s political. This idea that it would be political because we know what happened afterwards just doesn’t seem to add up.” Paul noted.
Paul then challenged Bernanke on the definition of inflation after he implied that buying debt and printing more money was not inflationary.
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