Herman Cain made it clear tonight in his answer to Ron Paul’s question about auditing the Federal Reserve that he simply doesn’t think it’s important.

Originally posted by Cloudsinthesky
In 2009, the Federal Reserve admitted it could not account for $9 trillion

Let me clarify a common misconception about my office's responsibilities. By law, we are the Office of Inspector General for the Board of Governors only. I am not the Inspector General for the 12 Reserve Banks.

The lending programs operated by the Reserve Banks expanded the Federal Reserve's balance sheet.

Reserve Bank audit and oversight is provided by:

•The Board of Governors through its supervisory and oversight functions;

•An independent public accounting firm that conducts the annual financial statement audit,
the results of which appear on the Board's website;

•Reserve Bank General Auditors, who report to the Bank's Audit Committee;

•The Government Accountability Office; and

•The Special Inspector General for TARP (for those lending programs that include TARP
funds).

Consistent with my authority, we cannot conduct a direct audit of Reserve Bank operations.
However, as the Board's IG, my office is reviewing the Board's supervisory and oversight
functions as they relate to the Reserve Bank's lending programs.

HOW THE FED CREATES MONEY

Creating Money through Open Market Operations. Unlike your bank, the Fed can create new bank reserves as well as money.

The Federal Funds Market

Creating Money through Repurchase Agreements

Multiple Expansions of Money through the Reserve Multiplier

Creating Money through the Discount Window

Creating Money through the Term Auction Facility (TAF)