posted on Jul, 28 2009 @ 09:23 PM
Hi ATS. Its 1021, I just got done working out and am checking my email before I go to bed.
I finally got a response from senator Casey on HR 1207. Here it goes:
July 28, 2009
Dear Mr. Holland,
Thank you for corresponding with me about support for H.R. 1207, The Federal Reserve Transparency Act. I greatly appreciate your input on this
matter, and I apologize for the delay in my reply.
As a Member of Congress, it is my responsibility to represent my constituents' concerns and interests and to provide them the honorable and
enthusiastic service they deserve. I truly value your thoughts and suggestions on issues before the House. In a representative government such as
ours, it is essential that I know what your views are on these issues.
The Federal Reserve System, often referred to as the Federal Reserve or simply "the Fed," is the central bank of the United States. The Federal
Reserve was created on December 23, 1913, with the enactment of the Federal Reserve Act by President Woodrow Wilson. It was created by Congress to
provide the nation with a safer, more flexible, and more stable monetary and financial system.
Today, the Federal Reserve's responsibilities fall into four general areas:
o conducting the nation's monetary policy by influencing money and credit conditions in the economy in pursuit of full employment and stable prices
o supervising and regulating banking institutions to ensure the safety and soundness of the nation's banking and financial system and to protect
the credit rights of consumers
o maintaining the stability of the financial system
o providing certain financial services to the U.S. government, to the public, to financial institutions, and to foreign official institutions,
including playing a major role in operating the nation's payments systems
The key components include:
o The Board of Governors of the Federal Reserve System in Washington, D.C. is a federal government agency, comprised of seven members appointed by
the President of the United States and confirmed by the U.S. Senate;
o Twelve Regional Federal Reserve Banks and their branches located in major cities throughout the nation act as fiscal agents for the U.S. Treasury,
operating a nationwide payments systems, supervising and regulating member banks and bank holding companies, and serving as banker for the U.S.
Treasury. Each Reserve Bank has its own nine-member board of directors, comprised of three Class A directors representing commercial banks that are
members of the Region, three Class B directors representing the public, but selected by member banks, and three Class C directors representing the
public, but appointed by the Federal Reserve Board of Governors.
o The Federal Open Market Committee (FOMC) is composed of the Seven members of the Board and five of the twelve Reserve Bank presidents - including
the President of the New York Federal Reserve Board as a permanent member with the other four positions rotating;
o Private U.S. member banks, which fall into two categories. All national banks chartered by the federal government are required by law to be
members of the Federal Reserve. Banks chartered by states are not required to be members of the Federal Reserve System, but may do so if they meet
the standards set by the Board. Member banks must subscribe to stock in their regional Federal Reserve Bank; however, this stock is merely a legal
obligation of the Federal Reserve and the stock may not be sold or pledged as collateral for loans.
As the nation's central bank, the Federal Reserve derives its authority from the U.S. Congress. It is considered an independent central bank because
its decisions do not have to be ratified by the President or anyone else in the executive or legislative branch of government, it does not receive
funding appropriated by Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms.
The system was designed out of a compromise between the competing philosophies of privatization and government regulation. In 2006, Donald L. Kohn,
vice chairman of the Board of Governors, summarized the history of this compromise going back to the original Federal Reserve Act of 1913.
o Agrarian and progressive interests, led by William Jennings Bryan, favored a central bank under public, rather than banker, control. But the vast
majority of the nation's bankers, concerned about government intervention in the banking business, opposed a central bank structure directed by
o The legislation that Congress ultimately adopted in 1913 reflected a hard-fought battle to balance these two competing views and created the
hybrid public-private, centralized-decentralized structure that we have today.
The Federal Reserve is subject to oversight by Congress, which periodically reviews its activities and can alter its responsibilities by statute. The
Full Employment Act of 1978 (PL 95-523), also known as the Humphrey-Hawkins Act set out the hearings and reporting requirements which established
Congressional oversight while maintaining Federal Reserve independence over monetary policy.
o Semi-annual hearings, in February and July, with Senate Banking Committee and House Financial Services Committee are the primary forum.
o The Fed Chairman presents the Monetary Policy Report to the Congress, testifies, and responds to questions from the Committee members.
o These were renewed in the American Homeownership and Economic Opportunity Act of 2000 (PL 106-569).
On May 20, 2009, President Obama signed into law S. 896, Helping Families Save Their Homes Act of 2009 (P.L. 111-22) which explicitly confirms the
General Accountability Office (GAO) authority to audit the activities of the Federal Reserve and the Treasury under the Troubled Asset Relief Program.
On July 22-23, 2009 in his semi-annual testimony before the Senate and House Committees, Mr. Bernanke made the following statements: "The Congress
should have the ability to oversee all aspects of our operations, including whether or not we have appropriate financial controls, whether we are
lending on a good basis of collateral, and so on. So we are willing to work with Congress on that. We do think that the Congress has the right to
see how we are using taxpayer money. Where we are concerned is that the Congress would be intervening in our specific poli