Friday, June 19, 2009

Oh, What a Tangled Web They Weave

The Federal Reserve's new power in the Obama plan will have some in house checks and balances--as in, in Obama's house.

The Fed will not be able to provide any bailout money in the future to any entity without the approval of the Treasury.

I have to think this was put in there in the unlikely event that Larry Summers does not become Fed chairman, or to prevent Bernanke from actually using some of his the Fed's new power between now and the end of his term in January 2010.

This also may be a bit of rear guard action against Ron Paul's call for an audit of the Treasury. The Obama Administration can now reply, "Hey, no audit is necessary. The Fed can't move without oversight and approval from the Treasury."

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