Tell Chris Dodd His Services Are No Longer Required

Just one more reason to send Chris Dodd home permanently and to vote against him in his upcoming election because of sheer stupidity, pandering to the banking crowd, his sweetheart mortgage deal, and lest we forget, punishing Americans with good credit ratings (pay attention at 2:33), but let’s go back a few years.

Congress’s Afterthought, Wall Street’s Trillion Dollars

Fed’s Bailout Authority Sat Unused Since 1991

On the day before Thanksgiving in 1991, the U.S. Senate voted to vastly expand the emergency powers of the Federal Reserve.

Almost no one noticed. (emphasis added)

The critical language was contained in a single, somewhat inscrutable sentence, and the only public explanation was offered during a final debate that began with a reminder that senators had airplanes to catch. Yet, in removing a long-standing prohibition on loans that supported financial speculation, the provision effectively allowed the Fed for the first time to lend money to Wall Street during a crisis.

That authority, which sat unused for more than 16 years, now provides the legal basis for the Fed’s unprecedented efforts to rescue the financial system.

Since March 2008, the central bank’s board of governors has invoked its emergency powers at least 19 times: to contain the wreckage of Bear Stearns and ease the fall of American International Group, to preserve Goldman Sachs and Morgan Stanley, to limit losses at Bank of America and Citigroup, to lend more than $1 trillion.

The repeated use of the once-dusty law has surprised and alarmed a wide range of people, including economists and members of Congress. It has even raised worries among presidents of the regional banks that make up the Federal Reserve system.

Many critics are concerned that an institution not accountable to voters is risking vast amounts of public money and choosing which companies get help. Others are concerned that the Fed’s new role will interfere with its basic responsibility for regulating economic growth.

Enter H.R. 1207, the Federal Reserve Transparency Act of 2009. Is this bill likely to pass? Probably not considering the NY Banks that we just bailed out ARE THE FEDERAL RESERVE!

There is also a question about the roots of the crisis: Did investment banks take greater risks in the past two decades because they knew the Fed could rescue them?

The 1991 legislation, authored by Sen. Christopher J. Dodd (D-Conn.), was requested by Goldman Sachs and other Wall Street firms in the wake of the 1987 market crisis, and it would save some of them a generation later.

Fed Chairman Ben S. Bernanke and other leaders of the central bank have argued that the emergency authority has allowed it to rescue the financial system and that without it, the economy would be in far worse shape. And they argue that they are using the power as Congress intended.

As Congress intended, but isn’t the Fed unconstitutional to begin with?  Were not the Founding Fathers against a central bank system from the very start?

“This provision was designed as a last resort to make sure credit flows when times are tough and credit isn’t being extended,” said Scott Alvarez, the Fed’s general counsel. “That’s exactly what it’s being used for today.”

Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, said that the actions taken by the Fed have been necessary and important but that those actions should have been taken by an agency accountable to voters. He said he was not aware of the Fed’s emergency power until September, and he favored removing much of that authority from the Fed once the crisis has passed.

Barney was not aware because he, like his peers in the House and Senate, DO NOT READ!

“This is a democracy, and there is a problem with too much power going to an entity that is not subject to democratic powers,” Frank said.

I thought the United States was a Republic?

“By necessity, the Fed was the institution everybody looked to because they had the balance sheet and the legal authority to act,” said Phillip L. Swagel, an assistant Treasury secretary in the George W. Bush administration who is to become a professor at Georgetown University’s business school.

See video below as to how their balance sheet is coming out…

But the government’s reliance on the Fed has roused critics.

“There’s no accountability,” said Walker F. Todd, a former economist at the Federal Reserve Bank of Cleveland whose writings raised some of the earliest questions about the 1991 law. “How much power do you want to concentrate in a few people who are not directly accountable to the political process?”

Those criticisms have been heightened by the Fed’s refusal to disclose which firms have benefited from many of the emergency programs, such as the names of the companies that have used the Fed’s “commercial paper funding facility” to issue short-term debt.

The Fed ‘loses’ $9 Trillion:

Rodgin Cohen, a partner at Sullivan & Cromwell, suggested to several of his clients the idea of modifying the 1932 law to allow lending to investment banks, according to people involved in the discussions. Cohen is a legendary figure on Wall Street, building a career as perhaps the preeminent legal adviser on banking mergers, in part through his command of the minutiae of federal regulations.

Dodd, at the time chairman of the securities subcommittee of the Senate Banking, Housing and Urban Affairs Committee, agreed to insert the language into a bill whose primary purpose was to reform the Federal Deposit Insurance Corp., which guarantees commercial bank deposits.

Dodd declined to comment for this story, but at the time, he said the legislation gave the Fed “greater flexibility to respond in instances in which the overall financial system threatens to collapse.”

The Fed has extensive regulatory authority over commercial banks, to keep them from needing its safety net. But after Dodd’s language passed into law, the Fed did not seek new regulatory authority over investment banks, nor did Congress move to provide new authority.

So not only do we have the Community Reinvestment Act being ramped up to give mortgages to people without jobs, but we have a Congress that did not regulate investment banks. (For those of you that have not seen the above linked video – take the time and vote it up.)

Instead, over the next two decades, federal officials would emphasize that investment banks had an incentive to be cautious because they were operating without a safety net.

Has the absence of a safety net has ever stopped any little kid from death-defying acts of insanity, or any capitalist on steriods from trying to make just one more buck because they lack a moral center, or any corrupt politician from making promises they won’t keep to get just one more vote?

I believe everything we are seeing today goes back to current and former congresses that DID NOT FOLLOW THE CONSTITUTION.  I do compare the people who are running our country to crack addicted fiends that are just looking for their next fix of financial kickbacks or votes for re-election.

The Community Reinvestment Act and Dodd’s part in it:

By Logistics Monster


  • History and the law are no longer alive these days.
    This is a time when I am seeing new Bank of America ads waxing poetic about HOMES and how they’ll get you one.

    This is a time I’m seeing the gov’t short-term loans at 3.5% being rushed through so people can take advantage of an $8,000 credit…and they can apply if they haven’t had a home during the last 3 years. (Wonder how many had trouble before that time frame?)

    This is a time when there are already rising deliquencies.

    Absolutely NOTHING has been learned or will change.

    Chris Dodd must go, but I’d say there will be someone in his place who can screw around just as well…

  • I sure would like to tell him this, and more! My wife just tried to re-fi her house (we have only been married 5 years and this was her house before and is in her name only) She has a great job, has a 800 credit rating, a 15 year history with CitiMort, and was only borrowing 60% of the house’s value, and the note would only be 25% of her worst month income (she is a paralegal and her income has fluctuated in the past). Guess what- they charged her $500 to process the loan then turned her down!!! Now they will not give the $500 back!

    I sure would like to tell ALL of them in DC to go take a very long walk on a very short pier. I told her she had 3 things against her:
    1) wrong color
    2) too responsible
    3) too self sufficient.

    If she were another color, borrowing more than she could afford, and needed a lot of assistance…they would have given her the loan and asked if she needed more!

    This country is so far gone! They all must go so we can start over!

    Dig your foxholes deep, keep your powder dry, and don’t fire till you see the whites of their eyes!

  • OT- Richard Gage on 911 Collapses.

    I have been one of those who had a hard time believing the conspiracy theory about 911 but this interview has me rethinking my beliefs. I guess all the knowledge that I have learned on the Monster and other truthfully sites has given me a different frame of mind. It scares the hell out of me.

    • Kathy,
      When the towers came down I KNEW our government was involved somehow, someway. How do four planes get that close to any building in that part of American Real Estate without fighter jets on their asses? Hmm? How does it work when jets are leaving Andrews and are told to stand down? Hmm? We will never know the depth the government was involved – but rest assured, they were. Think People! …and all of this for building 7.

    • Mahalos Kathy – put that link in the sidebar. Good video with great questions. I am sick to death of the Rockefellers, Bushes, and the rest of the aristocracy running this country for their own gain.

  • I guess I have always until this past year believed our government was basically looking out for us. I know that sounds very childish now but it just seems so unreal to think that your own government would want to bring you down. Those days are over for me and while I am glad that I see the truth it really is depressing.

    My adult children have seen me go from cheerleader to lets get all the bastards and they are quite amazed to say the least

    We all love our country and are trying hard to get it back but is it too crazy to wish for a government that really cares about those who they govern? I know most of you have been ahead of this for a very long time but for those who this is coming as a real kick in the gut it takes some time to wrap our heads around it.

    There was a time I thought Ron Paul was a little too much but he is looking like a little bit of sanity in a corrupt DC. I hope more will listen and heed his words.

  • NoTingles -

    I know just what you’re feeling, because like you I realize how gullible I’ve been. It’s very hard to accept that MOST of those people we’ve elected are scam artists and crooks. You must be feeling shocked about the scope of this scandal, I know I am. But, it’s been going on for over 100 years. And inspite of the constitutional limits, look at the damage they have done. It seems bloody ludicrous that the Fed would be bailing itself out, but apparently, that’s what’s happening. Only you and I both know who’s actually going to pay for it. I can hear G. Edward Griffin now, saying, “I told you so!” I’ve been reading his book, The Creature… It’s such a complicated mess, so tangled up in shady deals and unconstitutional laws, all intertwined into this monster that will take a decade to unravel and understand and then do something about. The Real Estate bubble is nothing new and we’ve been warned both from within Congress and in the press, but along side it, the bail out bubble has been growing too, since the ’70’s, and by now it’s unimaginably huge. We know it’s going to burst, because this kind of thing can’t keep up indefinitely. When it does, it will be catastrophic. And we know who did this; the blame goes equally to both parties. The scoundrels who perpetrated this against the people of the USA will be long dead while the effects of their corruption and greed and covetousness will continue to be felt bitterly for generations to come, and I myself can’t help feeling guilty because I didn’t do anything about it, although I’ve been complaining about it for 30 years or so. Something happens to them between when we elect them and when they get to Washington. It’s like they go to some kind of bootcamp where they learn how to avoid truly representing those who elected them. We don’t send them to Washington to get rich. Yet, for a lot of them, the ones who learn to play the game, that’s exactly what happens. And with their wealth is the insatiable appetite for more, along with a growing disgust and disrespect for their constituents. And don’t forget there’s complicity, in which they must do everything they can, tell whatever lies they have to in order to cover up their crimes, because once you’ve taken the deal with the devil, you don’t have any other choice except political suicide. The truth shows which side they have decided on.

    • I may have the answer to the question of the change that happens to representative once they get to DC, but am still reseaching. You guys will be the first to know.

  • DT, don’t waste your time researching…America doesn’t want to know!!! Conan is coming to late night prime time taking over from Leno! OOOOH, AHHHHHH….


  • I had read somewhere, do not remember where now, but the thinking is that TPTB makes sure that those who get elected have something to hide and they will use against them if they go off the reservation. Of course on occasion someone gets elected that is not corrupt to begin with so they either go against the wishes of the TBTB or be accused of something that they did not do. This then leads to the assisted suicide of that persons career or worse.

    I now take notes when I come across things like that , in the past I just did not want to think it was possible but I think I have learned more this past year than the rest of my life, at first I really was terrified, not so much for myself but my children, now I just want to know what is really going on and what I can do to change things.

    I am also done with the letter writing and phone calls, DC may think they have won this battle because I believe more people are backing off of that strategy but for those dropping in that just means we know there will have to be a different way to get our voices heard.

  • Some more tips would be great as real estate loans do change often. Plus more experiences are appreciated.

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