Thread: Ron Paul introduces bill to cancel $1.6T debt held by Fed

Rep. Paul introduces bill to cancel $1.6T in debt held by Federal Reserve

Pete Kasperowicz
The Hill
Aug 2, 2011

Rep. Ron Paul on Monday introduced legislation that would lower the federal government’s debt by canceling the roughly $1.6 trillion in debt held by the Federal Reserve.

Paul has argued for the last few weeks that the idea represents a quick way to make the growing fiscal crisis more manageable. Under his bill, H.R. 2768, the $1.6 trillion that the Treasury owes to the Federal Reserve would disappear.

The Federal Reserve began buying Treasury bonds in earnest late last year as part of its effort to keep long-term interest rates down. But Paul has argued that Fed purchases of Treasury debt represent a debt that the government owes to itself, and one that also leads to an unwanted and inflationary increase in the money supply.Paul has also said the Fed is allowing the federal government to continue a spending binge it otherwise would not be able to afford, and is forcing the Fed to print money to keep up.

Paul has also said the Fed is allowing the federal government to continue a spending binge it otherwise would not be able to afford, and is forcing the Fed to print money to keep up.

http://www.infowars.com/rep-paul-introd ... l-reserve/

The Federal Reserve must be fixed.

It is corrupt to the core and works against the interests of Americans...

I think either Nationalizing it or doing away with it all together may be the only answer.

Where was he at when Bush went wild,in the house voting to let him do his fling.Wall street gambling on our money funding of 2 wars 1 legit 1 bogus based on lies that Bush cronies to sell Iraq to the people.Spent surplus and give rich tax cuts.This is why Paul will be like playing baseball in president run 3 strikes your out.The federal resrve is where money for SS and bank your money is insured.The resone treasery owes reserve is its been barrowing money from it since Reagan and putting iou in there if they dropped what was owed where would the peoples money go that was stolen?Paul dont have good walking around sense.

What about inflation? The bonds were created out of nothing by the Federal government. They were sold to the Federal Reserve. The Federal Reserve created money out of nothing and put the money into the Federal government's account. That money was spent by the Federal government. Interest is paid on the bonds. At the end of the year the interest paid is returned to the Federal government. What happens to the money the Federal government spent? It's in the economy obviously. What you have here is a razzle dazzle. The Federal government should have just created the money and injected it into the economy instead of piling up more debt. As for inflation, if it was going to cause more inflation it would have done so by now. But prices are falling due to other economic factors. But later on sometime in the future inflation might take off in part because of this.