Matt Taibbi, who promises major revelations next week, says Rep. Grayson (D-FL) is a freaking werewolf. Watch him smile like a shark as he batters the Fed official. The specific issues here are, does the Fed manipulate the stock market, do the investment banks who trade for them profit from this by front-running, and should the Fed be audited by the GAO?
Yes folks, peasants with pitchforks are now on the floors of Congress. They want transparency and the Fed to be audited. This will be a knock-down drag-out battle.
Alan Grayson: I would like to know whether it is within the Federal Reserve’s legal authority to try to manipulate the stock market or the futures market.
Federal Reserve GC Scott Alvarez: I don’t believe the Federal Reserve tries to manipulate the stock market…(Yoda: Do or do not, there is no try.)
Alan Grayson: Does the Federal Reserve actually possess all the gold that’s listed on their balance sheet.
Scott Alvarez, doing a classic poker body language tell, and taking his time: Yes…
Alan Grayson: Who actually executes the trades for the Federal Reserve in the markets?
Scott Alvarez: The Federal Reserve Bank of New York, which executes trades through Primary Dealers.
Alan Grayson: Can you name one Primary Dealer?
Scott Alvarez: JP Morgan Chase
Alan Grayson: Do you mind if we have a GAO audit to see if there has been front-running or insider trading by them? Do you mind? Is that ok with you?
Scott Alvarez: I am not sure if I have that authority…