I don't think we should have actually done that

Irelands being pinned to the collar by the ECB to get rid the bonds they issued as part of their prom note last year due to the fact that the ECB are worried €25 billion of prom notes into sovereign debt equated to monetary financing, something that is forbidden by article 123 of the EU Treaty. The Central Bank of Ireland agreed last year to sell the bonds “but only where such a sale is not disruptive to financial stability”. The weighted average life of the long-term government bonds is 34 to 35 years, compared to seven or eight years for the promissory notes. ECB chief Mario Draghi said at the time that while the ECB had taken note of the transaction it would be reviewing the arrangement as part of its monitoring of monetary financing in euro zone countries.

But our banks are different

The ECB determination to subject the euro zone's largest banks to the same, rigorous checks is being tested, with countries lobbying for their banks to be treated differently and lenders asking for their workload to be eased.

Almost two weeks after the ECB published a 285 page manual spelling out how it will examine banks' trillions of euros of assets, lenders in Germany and Spain are leading the charge for special treatment, while banks across the eurozone have asked for changes to the process to make it less onerous.

The central bank is carrying out the wide-ranging tests so it can start with a clean sheet when it becomes the euro zone's banking supervisor in November. The tests are designed to banish lingering investor doubts about the health of the region's banks that have kept their valuations consistently below U.S. peers.

We shouldn't be too cosy and trusting with the banks.Thanks for stating the bleedin obvious

The Bank of England needs to abandon a culture of cosy chats and too much trust in banks following the latest financial scandal to hit London, former policy maker Adam Posen has said.

Mr Posen, who served on the central bank's Monetary Policy Committee from 2009 to 2012, said BoE staff had had too much confidence that banks would regulate themselves and would root out bad behaviour by their own traders.

 Adam Posen

"What is really most important is to see the Bank of England get away from being so trusting of the banks. That was the culture for a long time. It was not corrupt, it was just badly mistaken," he told the BBC.

Earlier this month the BoE suspended an official as part of an ongoing investigation into whether the central bank had turned a blind eye to the alleged rigging of exchange rates in London's $2.1 trillion-a-day currency market.

Mr Posen welcomed Ms Shafik's appointment, and the promotion of his MPC colleague, Ben Broadbent, to become deputy governor for monetary policy.

But he said that it would be more important to change a culture of too much trust in banks, which had also afflicted other central banks, including the US Federal Reserve.

"There has to be a top-down explicit statement that our bias is towards having market solutions, not cosy conversations with individual bankers, that the Bank of England is neither the friend nor the enemy of the banks," he said.

Mr Posen also criticised the forward guidance policy on interest rates that Mr Carney launched in August, calling it "irresponsible" for encouraging the public to focus on a single economic indicator - unemployment - as a guide to when interest rates would rise.

He welcomed a change to the policy last month, when the central bank said it would look at a wider range of data after unemployment fell to the 7pc threshold set in August.

Mr Posen, who now heads the Washington-based Peterson Institute for International Economics, also praised the open discussion at MPC meetings and joked that the biscuits served to policymakers were "cheap but fattening".

Inflations down,but its nothing we can't handel

Canada’s inflation rate slowed in February but stayed within the central bank’s comfort zone, news that may reassure policymakers somewhat but is unlikely to trigger a change in their neutral stance on interest rates.

Consumer prices rose 1.1 per cent in the year to February, down from a 1-1/2-year high of 1.5 per cent in January but above the market forecast of a 0.9 per cent increase, Statistics Canada data showed on Friday. Lower gasoline prices partially offset higher shelter and food costs in February, it said.

The Banks are actually sound-Who knew?

The Fed  has concluded that almost all of the country's biggest banks could withstand a severe economic downturn.

 29 of the country's 30 biggest banks -- excluding a regional bank in the western U.S. -- have enough money on hand to withstand a hypothetical deep recession. Such a downturn would include a sharp rise in unemployment, a nearly 50 percent drop in the country's major stock indexes and a steep drop in home prices.

The central bank said the annual survey of the banks shows broad improvement in their financial standing since the country's recession five years ago, its worst in seven decades.

Analysts say that the better outlook for the banks could allow them to again pay dividends to their shareholders for the first time in recent years. One survey of bank profits showed that the six biggest U.S. banks earned $76 billion in profits last year, close to their collective all-time high.

Meanwhile, the Fitch credit rating agency has issued a AAA rating with a stable outlook for the United States.

Fitch made the announcement Friday, saying the new action resolved the negative watch the U.S. received in October.

The agency noted that last year's U.S. debt ceiling crises had not negatively affected U.S. bond yields or reduced foreign holdings of Treasury securities. Fitch said, "therefore Fitch does not believe the role of the U.S. dollar, sovereign financing flexibility or debt tolerance has been materially damaged." The ratings agency said the U.S. has achieved "strong fiscal consolidation."

The agency said the U.S. economy is one of the most "productive, dynamic and technologically advanced in the world," underpinned by strong institutions, a favorable business climate and efficient product and labor markets.

Fitch said the U.S. has greater debt tolerance than its AAA peers, owing to the "unparalleled financing flexibility provided by being the issuer of the world's pre-eminent reserve currency and benchmark fixed income asset."

Fitch said the country's capital markets are "the deepest and most liquid in the world."

Some information for this report was provided by Reuters.

Investor confidence up but only because there is more of us to invest in.

The eurozone's current account surplus grew to 25.3 billion euros ($35 billion) in January, European Central Bank data showed Friday, incorporating new eurozone member Latvia for the first time. 

The monthly figure compared to a surplus of 20 billion euros for December, according to revised data. 

The current account on the balance of payments, which includes payments for imports and exports in both goods and services plus all other current transfers, is a closely tracked  indicator of the ability of a country or area to pay its way in the world. 

It is crucial for the long-term confidence of investors and trading partners, and an important factor in the value of a currency, in this case the euro, on the foreign exchange market. 

Over the 12 months to January, the current account showed a surplus of 227.9 billion euros, compared with a surplus of 135.4 billion euros a year earlier, the data showed. 

Give us back the cash lads.You didn't think it was a handout.

 Banks will return 18.90 billion euros (£15.79 billion) in crisis loans to the European Central Bank next week, a much larger sum than expected that will keep up the drain of extra cash out of the euro zone financial system.

The amount banks will repay on March 26 is more than this week's repayments of 10.075 billion euros and is also far above the 7 billion forecast in a Reuters poll. 

To help lenders ride out funding constraints, the ECB lent banks more than one trillion euros in three-year loans during the euro zone's debt crisis, in December 2011 and February 2012. Since January of last year, banks have repaid more than half of those loans.

The speed with which banks have been repaying the three-year loans has picked up over recent weeks again as confidence returns and banks start to rely less on central bank funding.

Banks seem keen to offload their LTROs to shape up their balance sheets ahead of the ECB's forthcoming asset review.

With banks repaying ECB crisis loans, the amount of excess liquidity - the amount of money banks have beyond what they need for their day-to-day operations - is falling.

It stood at 122 billion euros on Friday. Excess liquidity peaked in early 2012 at around 800 billion euros.

On Friday, the ECB said 12 banks would repay 6.411 billion euros from the first LTRO on March 26, and 15 banks would pay back 12.498 billion from the second LTRO.

(Reporting by Frankfurt newsroom)(Reuters) 

The markets are going to love you!

An Egyptian-born mother of twins who believes women are hindered by ‘a sticky door’ rather than a glass ceiling yesterday landed one of the biggest financial jobs in Britain.

Dr Nemat Shafik will become only the second female deputy governor of the Bank of England in August.

As well as helping to set interest rates, the Bank said Dr Shafik must also mastermind the ‘eventual exit’ from its £375 billion quantitative easing programme

Dr Nemat Shafik

It is the latest extraordinary twist in the meteoric career of a woman whose childhood experiences might have thwarted others’ ambitions.

She was born in Alexandria, Egypt but her family forced to flee at the age of four to escape General Nasser’s nationalisations of the 1960s.

Robbed of their possessions, they fled to America, and Dr Shafik has subsequently said the traumatic experience has left ‘a strong legacy’.

She said: ‘My father in particular, I think, never got over that, having lost everything.’

But her career has been spectacularly successful ever since, becoming the youngest-ever vice president of the World Bank at the age of just 35.

After leaving the World Bank, she moved to the Department for International Development, rising to become its permanent secretary between 2008 and 2011.

Since April 2011, she has been the deputy managing director of the International Monetary Fund. 

Dr Shafik, who speaks English, Arabic and French, used to be married to the super-wealthy Mohamed El-Erian, the former chief executive of Pimco, the world’s largest bond house.

In 2002, she married Raffael Jovine, with whom she had the twins, and is also step-mother to his three daughters.

Dr Shafik, who is a national of Britain, America and Egypt

We've Changed the Guideposts but not our methods

The US Federal Reserve on Wednesday said it could keep interest rates unusually low even after the US job market returns to full strength and inflation rises to the central bank's target.

Unsure it's a good Idea

In announcing its view on future rates after a two-day policy meeting, it also dropped a set of guideposts it was using to help the public anticipate when it would finally start bumping overnight borrowing costs up from zero.

It said, however, that dropping a promise to hold rates steady "well past the time" the US unemployment rate falls below 6.5 percent did not indicate any change in its policy intentions. Rather than relying on unemployment and inflation thresholds to guide expectations, it said would lean on a wide range of economic indicators in making its decision.

But what stood out in the central bank's statement was its embrace of easy money policies even after the Fed achieves its goals of full employment and 2 percent inflation.

U.S. stock prices fell after the statement was released, while yields on U.S. government debt rose.

The central bank also proceeded with its well-telegraphed reductions to its massive bond-buying stimulus, announcing it would cut its monthly purchases of U.S. Treasuries and mortgage-backed securities to $55 billion from $65 billion.

Minneapolis Fed President Narayana Kocherlakota dissented, saying that dropping the threshold could hurt the credibility of the Fed's commitment to return inflation to 2 percent.

The British budget lowdown

George Osborne was accused of compounding the problems facing Britain’s “jilted generation” of young people after he unveiled a “silver savers’ Budget” aimed at winning the over-50s vote at next year’s general election.


The Chancellor’s big surprise was a sweeping shake-up of pensions and savings which will allow people to draw down all of their pension pot in cash when they retire, instead of having to buy an annuity to provide an annual income.

George Osborne

The limit for tax-free individual savings accounts (Isas) will be raised to £15,000 a year and pensioners will be able to buy new bonds with above-market interest rates.

What Mr Osborne hailed as “a Budget for the makers, doers and savers” was widely seen as an attempt to target the over-50s before next year’s general election. The “grey vote” is a key group because it turns out in much higher numbers than young people. It includes many natural Conservative supporters, some of whom have been attracted by the UK Independence Party.

The Chancellor regards the biggest reforms to pensions since 1921 as his second most important measure after his drive to balance the nation’s books. However, the small print reveals that the pensions changes will bring in £1.2bn to the Treasury by 2018-19 because people will pay income tax on the money they take out of their pension pots.

Insurance shares plunged by £3bn after the Budget, with leading annuities providers including Legal & General, Aviva, Standard Life and Prudential seeing sharp share price falls.

Mr Osborne could bask in a much better outlook for the economy. The Office for Budget Responsibility (OBR) revised its growth forecast for this year to 2.7 per cent, up from its 2.4 per cent figure in December. It predicted growth of 2.3 per cent next year and 2.6 per cent in 2016. The OBR revised down its borrowing figure for the current financial year from £111bn to £108bn, saying it would fall to £95bn next year and predicting a £5bn surplus by 2018-19.

The Chancellor said his spending cuts would have to continue after the election, adding: “The question for the British people is: who has the credibility to deliver them?” He tried to set a trap for Labour by imposing a £119bn cap on the welfare budget by 2015-16, covering all areas except the basic state pension and jobseeker’s allowance. But Labour said it would support the cap in a Commons vote next week.

Mr Osborne found room for some limited pre-election sweeteners – a 1p a pint cut in beer duty; freezing the duty on spirits and ordinary cider and halving bingo duty to 10 per cent. Business received help with energy bills, and new tax breaks and incentives to encourage companies to invest and export.

The Chancellor confirmed that the personal tax allowance would rise from £10,000 next month to £10,500 in April next year. As The Independent revealed on Saturday, he rejected growing calls from Conservative MPs to aid the middle classes by bringing in a higher than expected threshold for the 40p tax band. It will rise by 1 per cent, less than inflation, in each of the next two years – from £41,450 to £41,865 next month, and then to £42,285 next year, effectively dragging more people into the 40p band as their incomes rise.

The Liberal Democrats trumpeted the £10,500 personal tax allowance that Nick Clegg had demanded in November, going further than his £10,000 flagship policy at the 2010 election. In a Coalition trade-off, the Liberal Democrats approved Mr Osborne’s “savers’ package”, which was not their top priority.

Labour argued that the pensions and savings measures would provide most help to the rich and would not tackle the cost of living crisis. Ed Balls, the shadow Chancellor, welcomed moves to “empower” people to get a better deal on annuities amid low rates but warned that many could end up with a bad deal. “Will we have people disadvantaged or taken down the wrong road?” he asked. “Will we have people running out of money and forced to rely on the welfare state?” Mr Balls said the savings ratio, the proportion of people’s disposable income they save, would decline rather than rise.

Labour joined charities in highlighting a “generation gap” in the Budget. A Labour source said: “There was absolutely nothing to help young people, despite record unemployment. After this Budget, they are left even further behind.”

William Higham, Save the Children’s director of UK poverty, said: “The Budget was a missed opportunity to address the needs of families that are struggling to pay their food bill and children whose parents cannot afford to pay for uniforms and school trips.”

Osborne aides insisted that young people would benefit from the higher Isa limits; the rise in the personal allowance; an extension of the Help to Buy scheme and more apprenticeships. They denied that the savings shake-up would benefit the rich, saying that three-quarters of the five million people who currently saved up to their cash Isa limit were basic rate taxpayers.

Ros Altmann, a Downing Street pensions adviser under Tony Blair, said it was “a brilliant Budget for Tory election prospects.” Chris Sanger, the head of tax policy at Ernst & Young, said Mr Osborne’s “great granny giveaway” would “make saving for a pension much more attractive”.

But Nigel Green, the chief executive of the deVere financial advisory group, warned: “This policy of allowing a full drawdown [of pension pots] is extremely dangerous and ill-conceived for both individuals, who are considerably more likely to become financially dependent on the state, and the wider economy, which needs the population to be as financially independent as possible.”

Budget 2014: The key changes

* Level at which people start paying income tax to be increased to £10,500.

* Cash and shares Isas to be merged into single New Isa with £15,000 annual limit.

* All restrictions on access to pension pots to be removed, ending the requirement to buy an annuity.

* New Pensioner Bond available from January.

* Beer duty cut by 1p a pint while duty on spirits, whisky and ordinary cider is frozen. Tobacco duty to rise by 2 per cent above inflation.

* All long-haul flights to come under lower rate of Air Passenger Duty currently charged on flights to US.

* Help to Buy for new-build homes extended to 2020.

* Bingo duty halved to 10 per cent but duty on fixed-odds terminals rises to 25 per cent.

* Package to cut energy bills.

4 things to know about Janet's Fed

Get ready for Janet Yellen's first policymaking meeting as head of the Federal Reserve.
The Fed is set to meet this Tuesday and Wednesday to mull over the latest economic data, issue new forecasts and re-evaluate its plan for winding down its stimulus program. Here are the top things to look for:

1) Tapering will continue: The central bank has been buying trillions in bonds since late 2008 in an effort to lower long-term interest rates. The goal: Stimulate the economy by making it cheaper to take out loans.

But the Fed has determined it's time to start winding down that stimulus program. Since December, the central bank has been slowly reducing its bond purchases at each meeting, in a process Wall Street has dubbed "tapering." The Fed was previously buying $85 billion in bonds each month, then reduced the amount to $75 billion in January, and then $65 billion in February.
Economists expect a similar reduction in bond purchases will be announced at the upcoming meeting, especially given Yellen's comments before a Congressional committee last month. "We expect to continue reducing the pace of purchases in measured steps," she said.

2) The goalposts will change: The Fed has kept its key short-term interest rate near zero since 2008, also as a way to stimulate more spending.

Investors have become accustomed to low interest rates but are looking for signals about when the Fed might eventually raise rates as the economy strengthens.

So far, the Fed has said it wants to see the unemployment rate fall to around 6.5%, or inflation rise as high as 2.5%, before it will be ready to raise rates. But here's the problem: The unemployment rate, at 6.7% in February, is already nearing that point, and Yellen still thinks the economy is too weak.

She may want to abandon the numerical targets altogether and focus on qualitative information instead.

The unemployment rate alone is "not a sufficient statistic to measure the health of the labor market," she told Senators last month.

Meanwhile, New York Fed President Bill Dudley has said the 6.5% unemployment rate "is already obsolete." It's a "reasonable time to revamp" the Fed statement to take out that threshold, he said at a Wall Street Journal event last week.

3) Weather puts the Fed in wait-and-see mode: Severe winter storms throughout much of the country weighed on economic data over the last few months, making it hard to get a clean reading on the recovery. Retail sales, job growth, housing and manufacturing all seem to have been impacted, but it's unclear whether the slowdown was temporary.

"The question is how much of this activity comes back in the spring, how much is simply lost, and how much the slowdown reflects other factors..." Julia Coronado, chief North American economist for BNP Paribas, wrote in a research note.

Coronado expects the Fed will acknowledge the harsh winter in its policy statement and may even nudge some of its economic forecasts lower for the year.
That said, Yellen is still expected to express some optimism about the economy picking up in the spring.

4) Yellen is still focused on jobs, jobs, jobs: Following the Fed's meeting, Yellen will take questions from reporters in a press conference Wednesday afternoon. She's likely to emphasize that she remains deeply concerned about ongoing weakness in the labor market.
As of February, 3.8 million Americans were unemployed for at least six months, and 7.2 million workers were stuck in part-time jobs, even though they would prefer full-time hours. Yellen looks closely at both measures, and neither has improved much lately.

Meanwhile, inflation remains well under the Fed's goal for 2% over the long-run, so Yellen is unlikely to view rising prices as a major concern.  

 (CNNMoney)

We agreed to raise rates when it went under 6.5%

Janet Yellen

Another shift in that communications strategy is set to occur when the central bank’s interest-rate-setting committee gathers for two days of talks on Tuesday and Wednesday, as it’s the first meeting to be led by Janet Yellen, the new chairwoman. The Fed will release a policy statement and updated economic forecasts at 2 p.m. Eastern on Wednesday, and Yellen will hold a press conference at the end of the deliberations at 2:30 p.m.

With the Fed and the markets basically on the same page on the economy, the current near-zero interest-rate policy, and the rate of reduction in bond purchases, the central bank has an opportunity to revamp its forward guidance tool, now the chief policy instrument.

“They’ve got a little room to unanchor these things,” said Lewis Alexander, chief economist at Nomura Holdings Inc. in New York.

So-called forward guidance attempts to drive down long-term rates by promising to keep short-term rates low for a long time.

The Fed has reworded its pledge throughout the financial crisis. Alexander said the early forms of forward guidance were simpler as the Fed was simply saying that it was a long way from raising rates. 

The Fed’s current pledge is to hold rates steady until “well past” the point when the unemployment rate falls below 6.5%.

But the unemployment rate has steadily dropped over the past year, before ticking up slightly to 6.7% in February.

We are not Japan

Euro-area inflation unexpectedly slowed in February, heaping pressure on the European Central Bank (ECB) to defend the region against falling prices.

The annual inflation rate in the 18 countries sharing the euro slowed to 0.7pc in February from 0.8pc in January, revised data from the EU's statistics office Eurostat showed.

This was the lowest annual rate of growth in four years, slowing down to the same pace that triggered a surprise interest rate cut by the ECB in November.

The latest figures pile yet more pressure on the central bank which has declined, thus far, to act.

A meeting of its Governing Council on March 6 decided to keep the benchmark interest rate at 0.25pc, still a record low, rather than drop it to zero.

Low interest rates encourage consumers to spend rather than save, pushing up demand and thus prices.

Four eurozone countries recorded negative annual inflation rates during the month – Portugal and Slovakia saw deflation of -0.1pc, Greece had -0.9pc and Cyprus saw annual deflation of -1.3pc.

The eurozone's rate of inflation has now been below 1pc for five months.

The ECB aims to keep inflation just below 2pc and has blamed the strength of the euro for helping to keep prices subdued. It expects inflation to only pick up slowly, to 1pc this year and 1.5pc in 2016.

The euro fell in reaction to yesterday's data, dipping against the dollar and paring gains against the yen. Yet the ECB considers the risk of eurozone deflation as "quite limited", its president Mario Draghi said last Thursday.

He rejected comparisons with Japan's experience of deflation which became so entrenched that companies and households held off on spending on expectations of lower prices ahead, leading to two decades of economic stagnation.

Mr Draghi did say, however, that the bank had been preparing additional policy steps to guard against possible deflation, and that the longer inflation remained low, the higher was the probability of deflationary risks emerging.

Also speaking on the matter in recent days was Bundesbank chief Jens Weidmann, who repeated the view that the risk of widespread deflation in the eurozone was very limited, adding that policymakers should not overload monetary policy to haul the bloc out of crisis.

Analysts don't expect action unless the situation deteriorates further.

"The downward revision to the February inflation figures is unlikely to be enough to trigger further near-term monetary easing," said Martin van Vliet, senior economist at ING.

"This will also require a deterioration of the activity and or a further significant strengthening of the euro."

Inflation could be "the new normal", he added.

"Today's CPI figures are a clear reminder that low inflation may have become the new normal for the eurozone – which certainly won't make it easy for some countries to reduce their debt overhangs," Mr Van Vliet said.

(Additional reporting by Bloomberg and Reuters)

25 Fast Facts About The Federal Reserve

#1 The greatest period of economic growth in U.S. history was when there was no central bank.

#2 The United States never had a persistent, ongoing problem with inflation until the Federal Reserve was created.  In the century before the Federal Reserve was created, the average annual rate of inflation was about half a percent.  In the century since the Federal Reserve was created, the average annual rate of inflation has been about 3.5 percent, and it would be even higher than that if the inflation numbers were not being so grossly manipulated.

#3 Even using the official numbers, the value of the U.S. dollar has declined by more than 95 percent since the Federal Reserve was created nearly 100 years ago.

#4 The secret November 1910 gathering at Jekyll Island, Georgia during which the plan for the Federal Reserve was hatched was attended by U.S. Senator Nelson W. Aldrich, Assistant Secretary of the Treasury Department A.P. Andrews and a whole host of representatives from the upper crust of the Wall Street banking establishment.

#5 In 1913, Congress was promised that if the Federal Reserve Act was passed that it would eliminate the business cycle.

#6 The following comes directly from the Fed’s official mission statement: “To provide the nation with a safer, more flexible, and more stable monetary and financial system. Over the years, its role in banking and the economy has expanded.”

#7 It was not an accident that a permanent income tax was also introduced the same year when the Federal Reserve system was established.  The whole idea was to transfer wealth from our pockets to the federal government and from the federal government to the bankers.

#8 Within 20 years of the creation of the Federal Reserve, the U.S. economy was plunged into the Great Depression.

#9 If you can believe it, there have been 10 different economic recessions since 1950.  The Federal Reserve created the “dotcom bubble”, the Federal Reserve created the “housing bubble” and now it has created the largest bond bubble in the history of the planet.

#10 According to an official government report, the Federal Reserve made 16.1 trillion dollars in secret loans to the big banks during the last financial crisis.  The following is a list of loan recipients that was taken directly from page 131 of the report…

Citigroup – $2.513 trillion

Morgan Stanley – $2.041 trillion

Merrill Lynch – $1.949 trillion

Bank of America – $1.344 trillion

Barclays PLC – $868 billion

Bear Sterns – $853 billion

Goldman Sachs – $814 billion

Royal Bank of Scotland – $541 billion

JP Morgan Chase – $391 billion

Deutsche Bank – $354 billion

UBS – $287 billion

Credit Suisse – $262 billion

Lehman Brothers – $183 billion

Bank of Scotland – $181 billion

BNP Paribas – $175 billion

Wells Fargo – $159 billion

Dexia – $159 billion

Wachovia – $142 billion

Dresdner Bank – $135 billion

Societe Generale – $124 billion

“All Other Borrowers” – $2.639 trillion

 #11 The Federal Reserve also paid those big banks $659.4 million in fees to help “administer” those secret loans.

 #12 The Federal Reserve has created approximately 2.75 trillion dollars out of thin air and injected it into the financial system over the past five years.  This has allowed the stock market to soar to unprecedented heights, but it has also caused our financial system to become extremely unstable.

#13 We were told that the purpose of quantitative easing is to help “stimulate the economy”, but today the Federal Reserve is actually paying the big banks not to lend out 1.8 trillion dollars in “excess reserves” that they have parked at the Fed.

#14 Quantitative easing overwhelming benefits those that own stocks and other financial investments.  In other words, quantitative easing overwhelmingly favors the very wealthy.  Even Barack Obama has admitted that 95 percent of the income gains since he has been president have gone to the top one percent of income earners.

#15 The gap between the top one percent and the rest of the country is now the greatest that it has been since the 1920s.

#16 The Federal Reserve has argued vehemently in federal court that it is “not an agency” of the federal government and therefore not subject to the Freedom of Information Act.

#17 The Federal Reserve openly admits that the 12 regional Federal Reserve banks are organized “much like private corporations“.

#18 The regional Federal Reserve banks issue shares of stock to the “member banks” that own them.

#19 The Federal Reserve system greatly favors the biggest banks.  Back in 1970, the five largest U.S. banks held 17 percent of all U.S. banking industry assets.  Today, the five largest U.S. banks hold 52 percent of all U.S. banking industry assets.

#20 The Federal Reserve is supposed to “regulate” the big banks, but it has done nothing to stop a 441 trillion dollar interest rate derivatives bubble from inflating which could absolutely devastate our entire financial system.

#21 The Federal Reserve was designed to be a perpetual debt machine.  The bankers that designed it intended to trap the U.S. government in a perpetual debt spiral from which it could never possibly escape.  Since the Federal Reserve was established nearly 100 years ago, the U.S. national debt has gotten more than 5000 times larger.

#22 The U.S. government will spend more than 400 billion dollars just on interest on the national debt this year.

#23 If the average rate of interest on U.S. government debt rises to just 6 percent (and it has been much higher than that in the past), we will be paying out more than a trillion dollars a year just in interest on the national debt.

#24 According to Article I, Section 8 of the U.S. Constitution, the U.S. Congress is the one that is supposed to have the authority to “coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures”.  So exactly why is the Federal Reserve doing it?

#25 There are plenty of possible alternative financial systems, but at this point all 187 nations that belong to the IMF have a central bank.  Are we supposed to believe that this is just some sort of a bizarre coincidence?