House Democrats defended Fannie Mae and Freddie Mac before current meltdown, but who is really at fault?
This video shows beyond a shadow of a doubt that Democrats covered up the looming problem with Fannie Mae and Freddie Mac.
Despite Republicans wanting more regulation for the two companies (which somehow dodged Sarbanes Oxley), which seems great in light of the current crisis, who is really at fault in this whole mess? The answer lies with the root of the credit problem, the Federal Reserve Bank. The Federal Reserve, which is not federal at all, but rather a privately owned and controlled bank owned by member banks, makes loans to the federal government and banks who are members of the Federal Reserve System. This system of monetization of debt in effect attempts to create wealth out of thin air, which is an impossibility that will ultimately result in a devastating collapse. When the Fed monetizes debt and prints money out of thin air to give out as loans, not only does this increase the money supply which causes inflation, it encourages malinvestment because credit is too easy to get; therefore the market does not operate in its most efficient manner. Market determined interest rates and a gold and silver backed currency would fix this problem permanently and stop the unrelenting madness of the fed and the boom/bust cycle they create.
Tags: fannie mae, Federal Reserve, freddie mac
