Big shot across the bow back in 2007 was intended to silence Ron with a warrant to seize 2 tons of Ron Paul dollars, along with gold, silver, and platinum. This was back during the Liberty Coin pressings with an overt message being delivered that under no circumstances is there to an assault on Fed notes. This history makes for very interesting reading; the Fed Government had a role in the raid to help protect the viability of the Federal Reserve. It essentially seized citizens holdings of gold and silver they deemed a threat to the FED's viability.
Make no mistake, Ron Paul and the FED are in battle. Ron Paul has fired his own salvo as of last week, introducing a Bill to audit the Fed. Haven't heard anything much about this in the press but this would absolutely wrankle the powers that be -
111th Congress - 1st Session
H.R. 1207
A BILL
To amend title 31, United States Code, to reform the manner in which the Board of Governors of the Federal Reserve System is audited by the Comptroller General of the United States and the manner in which such audits are reported, and for other purposes.
1. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE. This Act may be cited as the “Federal Reserve Transparency Act of 2009″.
SEC. 2. AUDIT REFORM AND TRANSPARENCY FOR THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM.
(a) IN GENERAL. - Subsection (b) of section 714 of title 31, United States Code, is amended by striking all after “shall audit an agency” and inserting a period.
(b) AUDIT. - Section 714 of title 31, United States Code, is amended by adding at the end the following new subsection:
“(e) AUDIT AND REPORT OF THE FEDERAL RESERVE SYSTEM. -
“(1) IN GENERAL. - The audit of the Board of Governors of the Federal Reserve System and the Federal reserve banks under subsection (b) shall be completed before the end of 2010.
“(2) REPORT -
“(A) REQUIRED. - A report on the audit referred to in paragraph (1) shall be submitted by the Comptroller General to the Congress before the end of the 90-day period beginning on the date on which such audit is completed and made available to the Speaker of the House, the majority and minority leaders of the House of Representatives, the majority and minority leaders of the Senate, the Chairman and Ranking Member of the committee and each sub-committee of jurisdiction in the House of Representatives and the Senate, and any other Member of Congress who requests it.
“(B) CONTENTS. - The report under subparagraph (A) shall include a detailed description of the findings and conclusion of the Comptroller General with respect to the audit that is the subject of the report, together with such recommendations for legislative or administrative action as the Comptroller General may determine to be appropriate.”.
Sponsor
Rep. Ronald Paul [R-TX]
Cosponsors [as of 2009-02-27]
Rep. Lynn Woolsey [D-CA] Rep. Ted Poe [R-TX] Rep. Walter Jones [R-NC] Rep. Roscoe Bartlett [R-MD] Rep. Steve Kagen [D-WI] Rep. Dan Burton [R-IN] Rep. Bill Posey [R-FL] Rep. Dennis Rehberg [R-MT] Rep. Paul Broun [R-GA] Rep. Neil Abercrombie [D-HI] Rep. Michele Bachmann [R-MN]
I have no doubt in my mind that he is seeking transparency around several things, one of which is the Treasury's creation of the Supplementary Financing Program in September 2008. Through this program, "the Treasury sells interest-bearing securities to the public and deposits the proceeds at the Fed, thereby allowing the Fed to expand its balance sheet without altering the amount of money circulating in the economy. Thus, recent loans to the financial system have been financed through the issuance of additional federal debt — the same as if the loans had been made directly by the Treasury instead of the Fed".
Came across some interesting historical reading on the role of IMF and gold sales between 1976 and 1980 -
Background Gold sales then, as now, required an 85% voting majority of IMF members. Because legal title to the gold resides with the IMF, IMF gold sales do not have any budgetary implication for the United States, and no appropriation is, therefore, required. Under the Bretton Woods Agreement Act, however, the current proposal to sell 5 million ounces of IMF gold presumably would require congressional authorization. (As April 30, 1996, the IMF held 103,439,916 ounces of gold.)
With the market price of gold at $379.70 per ounce, sales to the world gold market would yield substantial profits.
The proposal is part of a joint IMF/World Bank proposal intended to provide debt relief to sub-Saharan Africa and other poor countries. Specifically, the funds would be used to provide loans or grants to pay back loans provided by the IMF itself. In this manner, debt relief would be provided, but the principle of non-forgiveness of IMF loans would, purportedly, be maintained.
In the wake of the international monetary turmoil of the late 1960s and early 1970s, the Interim Committee of the IMF4 agreed in August 1975 on a revised role in the international monetary system for gold. The IMF gold agreements were underpinned by a separate G-10 agreement on February 1, 1976, not to peg the price of gold or increase their holdings of gold. The gold agreements were incorporated in the Second Amendment of the IMF's Articles of Agreement, which became effective on April 1, 1978.
They were among the revised Articles' most controversial features. In general, it was agreed that gold should be removed from its central role in the international monetary system. The official price of gold was abolished. Gold ceased to be the international monetary system's numeraire, that is, par values for exchange rate were no longer set in terms of gold. IMF accounts were no longer denominated in gold.
IMF members were no longer required to use gold in their transactions with the Fund. In short, gold was demonetized. The United States was the primary advocate of the demonetization of gold. The gold agreements embodied in the Second Amendment were, therefore, largely identical with U.S. policy at the time. In the run-up to the Second Amendment of the IMF's Articles of Agreement, the Interim Committee of the IMF reached understandings that 50 million ounces or one-third of IMF's gold would be sold beginning sometime prior to the effective date of the Second Amendment.
Specifically, the IMF was given authority to undertake the public auction of 25 million ounces of gold for the benefit of developing countries that were IMF members on August 31, 1975, plus Papua New Guinea, which was in the process of becoming an IMF member. This amounted to one-sixth of the IMF's gold holdings at the time. A further 25 million ounces were "restituted" or distributed to all countries that were IMF members as of August 31, 1975 at the official price of SDR 35 per ounce. In the event that the IMF did not complete disposition of the total 50 million ounces prior to the effective date of the Second Amendment, as, indeed, it did not, Schedule B, para. 7 of the revised Articles of Agreement provided for completion of the process.
The profits from the gold auctions were placed in a trust fund to be used for balance of payments loans to developing countries on concessionary terms. In addition, a share of the profits proportional to the size of a country's quota on August 31 was also transferred directly to each developing country. After the effective date of the Second Amendment on April 1, 1978, developing countries were permitted to take their share of the profits from gold sales in gold instead of currencies by submitting a noncompetitive bid in the gold auctions. The IMF held a total of 45 auctions over 4 years.
The exact terms of sale, including pricing method, place of delivery, minimum acceptable amount to be bid, and period allowable for payment, changed over the course of the 4-year auction program. The IMF's first gold auction was held on June 2, 1976; the last, on May 7, 1980. Initially, 780,000 ounces of gold were offered for sale at 6-9 week intervals. Beginning in March 1977, sales were set for the first Wednesday of each month, and the volume on offer was reduced to 525,000 ounces (16.3 tons). In June 1978, the amount for sale at each auction was reduced to 470,000 ounces (14.6 tons); in June 1979, to 440,000 ounces (13.8 tons). Bidders were major private gold market dealers, and the IMF's auctions became a regular feature of the gold market. The amount of gold bid at each auction exceeded the amount offered. The profits from the IMF's gold auctions of the late 1970s were deposited in a separate Trust Fund which was used for the benefit of the IMF's poorer members. In addition, voluntary contributions and loans from other members plus income from investments and repayments of past loans made up the balance of Trust Fund resources. Seven members of OPEC (The Organization of Petroleum Exporting Countries) -- Iraq, Kuwait, Libya, Qatar, Saudi Arabia, the United Arab Emirates, and Venezuela -- made irrevocable transfers of their share of the profits from the gold sales to the Trust Fund. Yugoslavia transferred one-third of its share of gold sale profits; Romania made a loan to the Trust Fund equal to 10% of its share of gold sale profits. The total value of these transfers amounted to $125 million. The Trust Fund was established on May 5, 1976.
Loans from the Trust Fund were disbursed in two periods: the first period extended from July 1, 1976 to June 30, 1978; the second, from July 1, 1978 to February 28, 1981. During the first period, SDR 841 million (over $1 billion) in loans were extended to 43 countries; during the second, SDR 2,150 million to 53 countries. The final loan disbursement occurred on March 31, 1981. Eligibility was based on per capita income. During the first period, the 61 countries that were eligible for Trust Fund loans had to have a per capita income of SDR 300 or less in 1973 (about $350). During the second period, a total of 61 countries were also eligible, but it was not the same 61 countries. A per capita income of $520 or less in 1975 was the income criterion for eligibility during the second period. Borrowers also had to have a 12- month economic program in connection with an IMF standby or extended arrangement.
Repayments on Trust Fund loans have been used to provide resources to the Supplementary Financing Facility Subsidy Account (established December 1980), the Structural Adjustment Facility (SAF, established March 1986), and, indirectly, the Enhanced Structural Adjustment Facility (ESAF, established December 1987) -- all concessional loan facilities.
Should the concurrent proposal to auction IMF gold be approved by the IMF's Board of Governors, congressional authorization presumably would be required under the Bretton Woods Agreement Act, as amended. It states: Unless Congress by law authorizes such action, neither the President nor any person or agency shall on behalf of the United States ... approve either the disposition of more than 25 million ounces of Fund gold for the benefit of the Trust Fund established by the Fund on May 6, 1976, or the establishment of any additional trust fund whereby resources of the International Monetary Fund would be used for the special benefit of a single member, or of a particular segment of the membership, of the fund.
The gold auctions that occurred in the late 1970s were authorized as part of U.S. acceptance of the Second Amendment to the IMF's Articles Agreement. This acceptance was contained in P.L. 94-564, signed by President Gerald Ford on October 19, 1976.
The IMF gold auctions that were authorized in 1976, however, had no budgetary implications for the United States. The gold was and is legally an asset of the IMF.
Thus, a similar action today would also not have any budgetary implications.
