Paulson to Urge New Fed Powers

[cal04]

Source: Washington Post

Bank Would Help Police Wall Street

Treasury Secretary Henry M. Paulson Jr. plans to call today for the Federal Reserve to be given new, explicit powers to intervene in the workings of Wall Street firms to protect the financial system, adapting his vision of how the financial world should be regulated to reflect the lessons of the collapse of Bear Stearns.

"Our nation has come to expect the Federal Reserve to step in to avert events that pose unacceptable systemic risk," Paulson plans to say in a speech today, according to prepared remarks obtained by The Washington Post. But the central bank "has neither the clear statutory authority nor the mandate to anticipate and deal with risks across our entire financial system."

"We should quickly consider how to appropriately give the Fed the authority to access necessary information from highly complex financial institutions and the responsibility to intervene in order to protect the system," Paulson plans to say, "so they can carry out the role our nation has come to expect."

Over the course of a few days in March, the central bank took unprecedented steps, with Paulson's support, to keep the rapid dissolution of Bear Stearns from causing an international financial catastrophe. The Fed provided financial backing for the acquisition of the investment bank by J.P. Morgan Chase and made emergency loans available to all major investment firms.

Read more: http://www.washingtonpost.com/wp-dyn/content/article/2008/06/18/AR2008061803225.html?hpid=topnews

[jwirr]

1. Disaster Capitalism at it best.

[Javaman]

2. okay mr wolf here is the keys to the hen house. nt

[Tandalayo_Scheisskopf]

3. Luckily for us...

This might be Paulson's last, great policy fart in a windstorm.

[soothsayer]

4. The people with the information have the power. The Fed is seeking more info,

and therefore more power---to manipulate markets, to consolidate wealth (remember the recent forced takeover of bear stearns? lots of folks started shorting that stock in the couple of days before). We should outlaw the central bank. The gov't should create its own currency, not borrow it from the Fed where you and I have to pay gobs of interest financing our national debt. We need to be a sovereign nation. Can't be sovereign when other folks control your money, run all your systems (the gov't outsources the running or at least building of most of its info systems). THOSE people control the destiny of the nation. Not us.

[dixiegrrrrl]

5. This was planned all along, you do know , right?

And who sits on the Board of the Fed?

J.P. Morgan
Lehman

but not Bear Stearns, who got gobbled up.

So the big banks, who run the Fed, decide to bail themselves out of their
ponzi scheme when it fails.
and no one reports it...

[Trillo]

6. So Dodd called for more regulation of financial services,

wanted more details of the Bear Stearns / Federal Reserve / JPMorgan deal, so called in the Treasury, Federal Reserve, and home-mortgage companies to talk. Now, we read that Dodd is being investigated for getting a special deal from "Friends of Angelo" at Countrywide, and the Federal Reserve wants more authority(!), and this is being coordinated by the Executive Branch that has just been accused by General Taguba of War Crimes.

Oh, yeah.... Something's happening.

[woodsprite]

7. Anybody feel that things are happening a bit faster than they can tread water? n/t