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Rumor Mill News Reading Room, Current Archive

Deception and Abuse at the Fed

Posted By: oldmaninthedesert
Date: Saturday, 1-Aug-2020 10:08:25
www.rumormill.news/151711

These two had some epic clashes in the 80's and 90's

The amazing 1990s began with a recession, high unemployment, and victory in the first Gulf War. Soon, though, the economic good times trolled, as the promise of remarkable computer and Internet technologies was realized. The economy grew, unemployment dropped, the federal deficit changed to a rising surplus, and jubilant investors hung on to the stock market balloon that rapidly inflated until the end of the decade. The spotlight focused on one man, who was cast as the country’s economic “maestro.” Alan Greenspan achieved saint-like status as he led the country’s most powerful peacetime governmental bureaucracy: the nation’s central bank, the Federal Reserve, the Fed.

Meanwhile, a relatively little-known man from Texas, Henry B. Gonzalez, who had risen to the chairmanship of the House Banking Committee, decided to carry out the responsibility assigned to that committee for overseeing the Fed. The Fed had frequently waved its “independent from politics” flag to ward off congressional intrusion. Now, under an enshrined leader, it appeared safe, except that Gonzalez seemed determined, and in 1992 had made public his suggestions for requiring accountability from Fed officials—who were shocked. The chairman of the “politically independent” Fed sought political help. Greenspan traveled to Little Rock, Arkansas, to talk to the president-elect, Bill Clinton. On December 14, 1992, at a then-secret meeting, Greenspan reported back to Fed officials about his conversation with Clinton, ten days earlier (selections from the transcript of the Fed meeting are in Chapter 10). The powerful Greenspan Fed was determined to stop Henry Gonzalez.

Despite the low odds of success, Gonzalez would not retreat from carrying out the responsibilities that the U.S. House of Representatives assigned to its Banking Committee for overseeing the nation’s central bank. The Fed was so shrouded in mythology, and seemingly so guarded by its self-proclaimed need to act with absolute independence, that anyone aggressively poking it would be subject to trashing. Admiring politicians and a coterie of Fed watchers who earned their income by interpreting the Fed’s garbled announcements would voice their disgust for anyone intruding on the Fed’s advertised independence. Gonzalez compared his attempt to remedy severe problems at the Fed to hitting a Sherman tank with a stick. Those who knew Henry B., as he was called in his San Antonio district, knew that even later-model combat tanks would not have stopped him.
https://exploringrealhistory.blogspot.com/2020/08/part-1-deception-and-abuse-at.html



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AN EXPLANATION OF THE FACTIONS