UPDATE: WASHINGTON DC PROTEST PRESS RELEASE

IS OUR GOVERNMENT ENCOURAGING FRAUD & EXCESSIVE RISK?

Billions in Bailouts for Speculators?

Bad Assets Hidden on Financial Balance Sheets?

Questionable Debt Accepted as Collateral by the FED?

Gas & Food Skyrocket but Inflation’s “Under Control”?

Mortgage Rates Continuing to Rise?

Your Dollar is Becoming More Worthless Each Day?

Is this even Legal?

Will the Bond Market Play Along with these Games or Repeat the 1930’s?

STOP THE THEFT OF YOUR TAX DOLLARS NOW!

The Federal Reserve has already accepted so much questionable debt as collateral that it only has $25 billion of treasury bills left to exchange, representing 3% of its balance sheet at the time it bailed out BSC creditors. It is in no position to orchestrate another bailout of a financial institution without calling into question the credit rating of the US, the dollar's status as reserve currency and viability of the US bond market. But it will do just that unless taxpayers demand that they stop. That is the reason for today's protest - To Prevent the Federal Reserve from destroying the US credit rating, dollar and bond market. The Fed and our elected officials should be forced to stop the following immediately:

1. Bailing out financial institutions, homebuilders, and homeowners with taxpayer guarantees
2. Exchanging liquid treasury paper for unmarketable mortgage debt
3. Witholding information about the unmarketable debt from taxpayers
4. Forcing taxpayers to pay for losses on the unmarketable debt
5. Failing to hold accountable those who committed fraud
6. Feigning transparency. As promised by Fed, Treasury, Congress and SEC during hearings, start telling taxpayers the truth instead of taking advantage of them.

Further Proof Our Legislators are working for the Banks NOT the Taxpayers:

A document, just released and originating from Bank of America, has been shown to have identical wording to the Dodd-Shelby addendum to the “FHA Housing Stabilization and Homeownership Retention Act of 2008” (# HR5830). This bill is now on the floor, poised for passage, and gives BAC a sweetheart deal while hiding the bailout from taxpayers. Should the BANKS be trusted to write a bill purported to help homeowners?

How did we get into this Mess? While most taxpayers lived within their means, a small minority managed to put the US financial system into a perpetual state of near meltdown. Just about everyone knew years ago that the real estate market was in its biggest bubble in history and that anyone with a pulse could purchase a home. Unfortunately, a minority took advantage of the lax credit standards to such an extent that it forced the Federal Reserve to recently bail out the creditors of private investment bank Bear Stearns (BSC). This minority included borrowers who applied for loans they knew they could not afford, lenders who approved loans to borrowers they knew could not afford, credit rating agencies who conferred AAA ratings based upon incomplete or nonexistent information about borrowers and investment banks that sold pools of mortgages as securities assigned the bogus AAA ratings. They were all milking the system through ignorance, greed and fraud, and without consideration to the US credit standing in the world. Unfortunately for this self-serving minority, the bankruptcies of two leveraged BSC hedge funds last August ruined their party. These bankruptcies signaled that this modern day Ponzi scheme, known euphemistically to the main stream media as a credit bubble, was over and as home values collapsed the de-leveraging was about to begin in earnest.

While home prices collapse, the mortgages on the homes do not. They remain the same and the difference between the debt and collapsed market value of the home represents a loss to the homeowner and the owner of the mortgage. Estimates of loss (existing debt minus actual market value), when you combine all homes across the US, range between $2 trillion and $5 trillion. When the Federal Reserve claimed it had to bail out the creditors of BSC to avoid a meltdown of the financial system, it created new agencies on its balance sheet to accept these illiquid mortgages as collateral for liquid treasury paper. This action was unprecedented, even in the Great Depression. The Fed also agreed to accept car loans, boat loans, student loans, credit card receivables and foreign assets as collateral. Instead of owning highly rated and liquid treasury paper, it now owns mostly illiquid debt of questionable value just described.

Why is this important to taxpayers? The Federal Reserve, despite pontificating about transparency, will not tell you the value of that debt or the collateral securing the debt when it was transferred onto the Fed's balance sheet. With the majority of Alt A and payment option ARM's due for resets over the next 12 months, another wave of foreclosures is almost certain, yet the Fed will accept this paper as collateral, transferring any losses to taxpayers, while proclaiming publicly that most of the credit problem is behind us. The Fed does all this without consulting congress and in the opinion of many, in direct violation of the constitutional powers granted to congress.

There are some unintended consequences of exchanging liquid treasury paper for illiquid, questionable debt. It "reliquifies" banks, i.e. banks could not lend against illiquid, questionable debt....but by exchanging it for liquid treasury paper, they can resume lending again to speculators. Wonder why gas prices are soaring? The "new" liquidity has found a profitable home. It also perpetuates the behavior that caused the problem....reckless lending. The moral hazard it has created permits banks to have no fear that they will ever have to face the consequences of their irresponsible lending since the Fed in essence has their back. While some lending standards have tightened, aggressively risky and sometimes fraudulent option ARMS and HELOC's, some even with FHA approval, are still being pushed on consumers. The Federal Reserve is the only reason these products are still in existence.

If We Do Not Act...

SOMEONE IS GOING TO PAY FOR THESE MISTAKES. Should it be YOU, or the people who created and profited from this mess? The minority who created this problem are now proposing "solutions" that will have you paying for their irresponsibility, ignorance, and greed. If we allow this to continue, we may even wind up re-living a repeat of the 1930’s, complete with soup kitchens and epidemic unemployment.

What Can You Do?

Call YOUR CONGRESSMEN & SENATORS TODAY. Tell them "NO TAX MONEY TO BAIL OUT RISKY SPECULATORS". Demand that the minority pay for the problems they created and be held accountable under the law. Demand that congress stop, immediately each of the above 6 practices. Ask them what they plan to do when the next investment bank or Fannie Mae needs a bailout. Most taxpayers had nothing to do with creating the credit bubble and shouldn't be asked to pay for its collapse. Go to http://house.gov and http://senate.gov to get contact information for your representatives.