More Bernanke, Mr. Issa, And The Media

I'm done being nice about this.

First, watch the following clip from CNBC.  It is quite clear, and explicit.

This set off a veritable firestorm on CNBC, with various commentators coming in to defend Bernanke.

None, however, was more odious than Jim Cramer, who said we need "a little less democracy."

What? 

LESS DEMOCRACY Jim?

Oh, I get it.  You think that The Federal Reserve should be able to break the law any time it wants?  That it should be able to, for example, buy Freddie and Fannie paper even though the clear black-letter law says it cannot?  The Fed should be able to set up "Maiden Lane" LLCs like candy for the explicit purpose of hiding deteriorating assets which it also cannot legally purchase?

And speaking of Bank of America, what happened about eighteen months ago?  You remember that little company called Countrywide Financial, right?  You remember that acquisition, yes?  Was "special pressure" brought to bear on that one?  That was "systemic risk" too, right?

I sure as hell couldn't figure out why Lewis would close that transaction a few months after it was announced, given that by then it was apparent that their credit book looked like something that had come out of the back end of a dog.  Was The Fed twisting arms on that transaction as well?

I believe the record is quite clear, even without the Bank of America/Merrill incident when it comes to The Fed.  I believe that the record documents that The Fed has committed to buy $1 trillion dollars of agency securities with printed money, monetizing them, in direct violation of The Federal Reserve Act as those securities do not have the full faith and credit of The United States.

The United States has not taken formal responsibility for Fannie and Freddie debt precisely because those MBS are stuffed full of toxic assets, specifically, "assets" like the Citibank mortgages that we discovered today are missing documentation (presumably that documentation is "missing" for a reason.)  Should the US take Fannie and Freddie formally onto their book the government would immediate book about $5 trillion dollars in additional debt (on top of the roughly $6 trillion of real, external debt we already have), almost certainly triggering an instant credit downgrade.  In addition it would make the US Federal Government directly responsible for all of the fraudulently-underwritten paper that institutions shoved at Fannie and Freddie through various deceptions and failures-to-disclose, said paper being exactly why Fannie and Freddie got in trouble in the first place!

So instead of the US Government taking care of these problems the right way, including investigating the fraudulent underwriting and jailing the responsible parties, The Fed simply "cheated", The Federal Reserve Act be damned.

Empowered with his "God Complex" Bernanke seems to think that he can not only buy things that The Fed Charter explicitly does not allow but that he can also twist around SEC disclosure rules and even lie under oath before Congress!  Remember, Bernanke was asked directly whether he pressured Bank of America to close that transaction in a Congressional hearing and he denied it - under oath.

Perjury is a serious and indeed can be a criminal offense, and I would hope that Congress will pursue this matter to the fullest extent of the law.

I will quote from President Obama's Inauguration Speech:

Our founding fathers faced with perils that we can scarcely imagine, drafted a charter to assure the rule of law and the rights of man, a charter expanded by the blood of generations.

Those ideals still light the world, and we will not give them up for expedience's sake.

REALLY, Mr. President?

It would appear that Mr. Bernanke is not the only one with questions to answer before The American People.  President Obama's continued defense of this man who, in my opinion, has defiled the office he holds and blatantly violated both law and regulation is outrageous and must stop now.

Those media outlets, including CNBC who spent all afternoon trotting out people like Cramer to DEFEND this apparent lawlessness, should have their advertisers BOYCOTTED by all Americans who are concerned about the rule of law and its even application.  After all, if you are unable to make your mortgage or credit card payments you don't get to cheat!

The Honorable Mr. Issa is a great American, and those such as Jim Cramer who argue that the law only applies to "the little people", able to be disregarded with wild abandon whenever it suits those in power, would do well to remember that such principles seem to be the order of the day in such shining examples of representative government as North Korea and Zimbabwe.