*** THE FED HAS NO RESERVE LIMITS! ***

Emergency Economic Stabilization Act of 2008, H.R. 3997

This is huge, folks, and it is hidden in a small, seemingly innocuous paragraph buried within this bill:

http://www.govtrack.us/special/econstimbill/changes.xpd?id=3

SEC. 128. ACCELERATION OF EFFECTIVE DATE.
Section 203 of the Financial Services Regulatory Relief Act of 2006 (12 U.S.C. 461 note) is amended by striking ‘‘October 1, 2011’’ and inserting ‘‘October 1, 2008’’.

I wonder if this is the real meat of the bill. What is it referring to in the Financial Services Regulatory Relief Act of 2006?

http://www.govtrack.us/congress/billtext.xpd?bill=s109-2856

SEC. 202. INCREASED FLEXIBILITY FOR THE FEDERAL RESERVE BOARD TO ESTABLISH RESERVE REQUIREMENTS.

Section 19(b)(2)(A) of the Federal Reserve Act (12 U.S.C. 461(b)(2)(A)) is amended--
(1) in clause (i), by striking `the ratio of 3 per centum' and inserting `a ratio of not greater than 3 percent (and which may be zero)'; and
(2) in clause (ii), by striking `and not less than 8 per centum,' and inserting `(and which may be zero),'.

SEC. 203. EFFECTIVE DATE.

The amendments made by this title shall take effect October 1, 2011.

Here is the original bill to which this is referring:

http://www.federalreserve.gov/aboutthefed/section19.htm

2. Reserve requirements.

A. Each depository institution shall maintain reserves against its transaction accounts as the Board may prescribe by regulation solely for the purpose of implementing monetary policy--

i. in the ratio of 3 per centum for that portion of its total transaction accounts of $25,000,000 or less, subject to subparagraph (C); and*

ii. in the ratio of 12 per centum, or in such other ratio as the Board may prescribe not greater than 14 per centum and not less than 8 per centum, for that portion of its total transaction accounts in excess of $25,000,000, subject to subparagraph (C).

This was pointed out yesterday on Daily Kos, so I decided to look it up myself to confirm. Yes, this is legitimate. They are trying to free up the ability for the Federal Reserve to create credit with absolutely no limits.

They are removing the reserve ratio altogether. Consider that this bill has already been passed (and no one noticed) and was supposed to be enacted in 2011. This was the original timetable. That has been bumped up now. This is why the press and the leaders are so desperate to get this bill passed -- their entire plan is at stake.

We not only need to oppose this "Rescue" bill, we need to further repeal the "Financial Services Regulatory Relief Act of 2006".

Spread the word about the depths of the evil contained in this bill.

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Addendum:

For those curious about how the Financial Services Regulatory Relief Act of 2006 was passed to begin with or how their representative voted, here is the scoop:

http://www.govtrack.us/congress/bill.xpd?bill=s109-2856

Sep 27, 2006: This bill passed in the House of Representatives by the Yeas and Nays (2/3 required): 417 - 0 (Roll No. 494). A record of each representative's position was not kept.

Anyone surprised?