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From Sen. Bernie Sanders:

Sen. Bernie Sanders went to the Senate floor to explain why he opposed the nomination of Ben Bernanke for a second term as Fed chairman. While Bernanke was confirmed later in the day, 30 senators opposed him, far more "no" votes than the previous most for a Fed nominee (16 against Paul Volcker).

We need more Bernie Sanders out there standing up for the working class in this country.

Despite Bernie Sanders' commonsense arguments, Bernanke squeaked through. Well, good luck with that, I guess. I find what comfort I can in Paul Krugman's prediction that if Bernanke wasn't approved, they'd end up giving in to the Republicans and picking someone who's even worse:

WASHINGTON — The Senate gave Ben S. Bernanke a second four-year term as the head of the Federal Reserve on Thursday after critics excoriated the central bank’s conduct in the years leading up to the financial crisis.

The 70-to-30 vote was the weakest endorsement ever extended to a chairman in the Fed’s 96-year history.

The confirmation was a victory for President Obama, who had called Mr. Bernanke an architect of the recovery, but also signaled the extent to which the Fed, once little known to the public, has become the object of outrage over high unemployment and bank bailouts.

Tim Geithener testified yesterday morning in front of the House Committee on Oversight and Government Reform, and I still don't know why we should give Geithner the benefit of the doubt. We shouldn't question him because we don't know how much worse it would be if he hadn't done all these things, right?

WASHINGTON — In heated questioning that at times took on the air of a cross-examination, Treasury Secretary Timothy F. Geithner on Wednesday defended his role and the government’s actions in bailing out the American International Group, saying Washington did what was necessary to prevent “a second Great Depression.”

But Mr. Geithner, who led the New York Federal Reserve Bank at the time, said he was not involved in the decision not to release information about deals that sent billions of taxpayer dollars from the bailout of A.I.G., the insurance giant, to big banks.

“I withdrew from monetary policy decisions,” Mr. Geithner said, “and day-to-day management of the New York Fed.”

The committee called Mr. Geithner, former Treasury Secretary Henry M. Paulson Jr. and other officials to explain, once again, the confounding results of an $85 billion rescue loan made to A.I.G. in September 2008. The loan sheltered big banks from any losses, but saddled A.I.G. with a debt so crushing that the Treasury soon had to step in and provide even more rescue money.

The questions aimed at Mr. Geithner focused almost immediately on his role in the A.I.G. bailout and why those negotiating on behalf of the taxpayers did not push the banks to make concessions, like returning the collateral to A.I.G. or accepting less than full value for their contracts with the insurer.

Throughout the morning, Mr. Geithner tried to persuade lawmakers that the government acted “in the best interests of the American people,” and not in the interests of big banks, in particular, as many lawmakers asserted, Goldman Sachs. Mr. Geithner, while keeping his composure throughout the questions, was forceful in his defense.

“I think the commitment to Goldman Sachs trumped the responsibility that our officials had to the American people,” Representative Stephen F. Lynch, Democrat of Massachusetts, told Mr. Geithner. His voice rising, his finger pointed at Mr. Geithner, Mr. Lynch expressed his frustration at the financial bailouts, and the bonuses now being paid by banks. “It stinks to the high heavens what happened here,” Mr. Lynch said. “I don’t like the obfuscation. And to top it all off, the disclosure was not there.”

In his comments, Mr. Geithner called for better controls on risk-taking by large financial institutions, and pointed out that more than a year after the near-collapse of A.I.G., the government still had no systems in place to cope with such failures. At times, the hearing took on a scolding, even berating, tone. One lawmaker, Representative John L. Mica, Republican of Florida, called upon Mr. Geithner to resign.

“I believe either you made a bad decision there, or there was the attempt to cover up one of the biggest bailouts, backdoor bailouts, in history,” Mr. Mica said. “Now, you’ve tried to frame it as you did it in the interest of the people and the failure of the system, I’m telling you, these are lame excuses. You were in the charge and did the wrong thing, or participated in the wrong thing.”

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Ed Schultz talks to Sen. Bernie Sanders about his opposition to Ben Bernanke being confirmed for another term as Chairman of the Federal Reserve. Sen. Sanders placed a hold on Bernanke's confirmation back in December and he reiterates some of the points he made in his press release at that time.

December 2, 2009

WASHINGTON, December 2 – Sen. Bernie Sanders (I-Vt.) today placed a hold on the nomination of Ben Bernanke for a second term as chairman of the Federal Reserve.

“The American people overwhelmingly voted last year for a change in our national priorities to put the interests of ordinary people ahead of the greed of Wall Street and the wealthy few,” Sanders said. “What the American people did not bargain for was another four years for one of the key architects of the Bush economy.”

As head of the central bank since 2006, Bernanke could have demanded that Wall Street provide adequate credit to small and medium-sized businesses to create decent-paying jobs in a productive economy, but he did not.

He could have insisted that large bailed-out banks end the usurious practice of charging interest rates of 30 percent or more on credit cards, but he did not.

He could have broken up too-big-to-fail financial institutions that took Federal Reserve assistance, but he did not.

He could have revealed which banks took more than $2 trillion in taxpayer-backed secret loans, but he did not.

“The American people want a new direction on Wall Street and at the Fed. They do not want as chairman someone who has been part of the problem and who has been responsible for many of the enormous difficulties that we are now experiencing,” Sanders said. “It’s time for a change at the Fed.” Read on...

I hope this works. But we're facing a wave of commercial mortgage failures, and I don't think we have a stable enough economy to take it:

For more than a year, the government pulled out the stops to revive home buying by driving down mortgage rates.

Now, whether the housing market is ready or not, the government is pulling out.

The wind-down of federal support for mortgage rates, set to end in two months, is a momentous test of whether the Obama administration and the Federal Reserve have succeeded in jump-starting the housing market and ensuring it can hold its own. The stakes for the economy are massive: If the market again falls into a tailspin, homeowners could face another wave of trouble, and it would deal a body blow to President Obama's efforts to get the economy on track.

Keeping the mortgage rates at historic lows, which required a commitment of more than $1 trillion, was viewed within the administration as a central plank of the economic strategy last year, senior officials said. Though the policy did not attract as much attention as rescue efforts to bail out banks, it helped revitalize home buying in some parts of the country and put money in the pockets of millions of homeowners who were able to refinance into lower monthly payments, the officials added.

"We did what we thought was necessary to stabilize the market, but we don't think the government should continue special efforts forever," said Michael S. Barr, an assistant secretary at the Treasury Department. "As you bring stability, private participants come back in. We do expect this now that the market has stabilized. I'm not going to say there will be no effect on rates, but we do think you are seeing market signs and market signals that there should be an orderly transition."

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One of Glenn Beck's favorite claims about the Tea Party movement -- and the surge of right-wing populism that he's leading -- is that it isn't about parties, it's about being American. And being American, of course, means being conservative.

He was on this briefly again last night:

Beck: Well, the media may be surprised, but I'm not. I think the days when people vote for Democrats or Republicans no matter what -- you know, if it's an R or a D, I'm just gonna pull it -- I think we're seeing the end of those days. For so long, we've bought into the Rs and the Ds -- you know, we're really at a one-party system at this point. We needed to identify ourselves as one or the other, even though it didn't really make a difference. And that label was much more important than the real label we all should have been wearing, and that is, American.

Progressives have put their agenda now into hyperdrive, and it is so crystal clear that their final goal is anything but American.

This claim -- to represent the real America, one that transcends political parties -- is the historic claim of right-wing populists throughout history.

Compare Beck's rant last night with this remarkably similar rant from Father Charles Coughlin, the renowned anti-Semitic radio preacher, in 1936:

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And yes, Glenn Beck shares Coughlin's views on the Federal Reserve, too.

Not only did they want us to bail them out, they want to keep the names of the beneficiaries a big secret. While there's at least a theoretical chance that this information could affect stock prices, Wall Street seems to be doing quite well in spite of hanging by a thread, doesn't it?

Jan. 11 (Bloomberg) -- The Federal Reserve asked a U.S. appeals court to block a ruling that for the first time would force the central bank to reveal secret identities of financial firms that might have collapsed without the largest government bailout in U.S. history.

The U.S. Court of Appeals in Manhattan will decide whether the Fed must release records of the unprecedented $2 trillion U.S. loan program launched after the 2008 collapse of Lehman Brothers Holdings Inc. In August, a federal judge ordered that the information be released, responding to a request by Bloomberg LP, the parent of Bloomberg News.

“This case is about the identity of the borrower,” said Matthew Collette, a lawyer for the government, in oral arguments today. “This is the equivalent of saying ‘I want all the loan applications that were submitted.’”

Bloomberg argues that the public has the right to know basic information about the “unprecedented and highly controversial use” of public money. Banks and the Fed warn that bailed-out lenders may be hurt if the documents are made public, causing a run or a sell-off by investors. Disclosure may hamstring the Fed’s ability to deal with another crisis, they also argued. The lower court agreed with Bloomberg.

The Post has an in-depth look at how the Fed was oblivious to the nation's looming major banking crisis, and the political maneuvering that will determine its future operation:

The keynote speaker, Federal Reserve Chairman Ben S. Bernanke, assured the bankers and businessmen gathered at the Westin Hotel on Michigan Avenue that their prosperity was not threatened by the plight of borrowers struggling to repay high-cost subprime loans.

Bernanke, who was in charge of regulating the nation's largest banks, told the audience that these firms were not at risk. He said most were not even involved in subprime lending. And the broader economy, he concluded, would be fine.

"Importantly, we see no serious broad spillover to banks or thrift institutions from the problems in the subprime market," Bernanke said. "The troubled lenders, for the most part, have not been institutions with federally insured deposits."

He was wrong. Five of the 10 largest subprime lenders during the previous year were banks regulated by the Fed. Even as Bernanke spoke, the spillover from subprime lending was driving the banking industry into a historic crisis that some firms would not survive. And the upheaval would shove the economy into recession.

Just as the Fed had failed to protect borrowers from the consequences of subprime lending, so too had it failed to protect banks.

The central bank's performance has sparked a great debate about its future as a regulator, pitting those who want to expand its role against those who want to strip its powers. It also has come under pressure from politicians seeking greater oversight of its primary job, adjusting interest rates to moderate economic growth. The battles have complicated Bernanke's bid for a second term as chairman. The Senate Banking Committee voted to approve Bernanke 16 to 7 on Thursday, setting the stage for a January battle on the Senate floor.

The Fed's failure to foresee the crisis or to require adequate safeguards happened in part because it did not understand the risks that banks were taking, according to documents and interviews with more than three dozen current and former government officials, bank executives and regulatory experts.

Regulatory agencies exist to lean against the wind. But rather than looking for warning signs, the Fed had joined -- and at times defined -- the mainstream consensus among policymakers that financial innovations had made banking safer. Bernanke said the economy had entered an era of smaller and less frequent downturns, which he and others called "the great moderation."

In October 2008, former Federal Reserve Chairman Alan Greenspan famously admitted during testimony before Congress that he was wrong about regulation of the U.S. financial system. Asked by Henry Waxman (D-CA) if "your ideology was not right, it was not working?" a humbled Greenspan lamented:

"I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity in the firms."

Now, with a Democrat in the White House and nearly nine years after he blessed President Bush's budget-busting 2001 tax cuts for the wealthy, Alan Greenspan has become a born-again deficit hawk.

In Senate testimony Thursday, Greenspan strongly endorsed the deeply flawed Conrad-Gregg proposal to create a deficit commission, warning that the need to curb the American budget deficits "is more urgent than at any time in our history."

In testimony prepared for delivery before the Senate Homeland Security Committee, Greenspan warned that the United States faces the threat of an unprecedented "fiscal crisis" because of record red ink.

Of course, when it really mattered, when he could have made a difference, Alan Greenspan gave George W. Bush a green light for red ink as far as the eye can see.

When he took office on January 20, 2001, President Bush inherited both a balanced budget and a CBO-projected 10-year surplus of $5.6 trillion from Bill Clinton. But just five days later on January 25, 2001, Chairman Greenspan gave Bush and his Republican allies the air cover they needed to proceed with the $1.4 trillion tax cut package passed later that year. Greenspan testified to the Senate Budget Committee that "having a tax cut in place may, in fact, do noticeable good." As CNN noted at the time, "the Fed chairman's backing of tax cuts as economically sound likely will provide a boost to the new administration's proposals."

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So nice of David Gregory to make sure we all got to hear what the man who's been wrong about everything, Alan Greenspan, thinks about what we should do now to fix the economy he helped to mess up, or whether or not the Fed should be audited.

MR. GREGORY: This is an interesting question about our role in the world, how the rest of the world sees us, our commitment to capitalism and, in corporate America, Dr. Greenspan, the notion of where is the certainty? Washington is a big question mark now when it comes to climate policy, healthcare policy. A lot of businesses saying, "Look, we don't know what's coming down the pike." There's no impetus to grow, to expand, to invest.

DR. GREENSPAN: That's the key problem; that is, investment occurs when you have a stable economy and when you can foresee what's going on in the future. Because, remember, you make a risky investment which may have 10 years or 15 years life to it, and unless you have some semblance of a notion as to what is out there...

MR. GREGORY: Hm.

DR. GREENSPAN: ...you're going to be reluctant to invest. And that is key. I mean, I agree with Jim in this respect. I think it's very critical that we get the uncertainties out of the system.

MR. GREGORY: Do you think additional stimulus for jobs makes sense at this stage?

DR. GREENSPAN: No. I think what is missing in this whole discussion is that the--what I presume to be the major source of the recovery, and that is the remarkable increase in the amount of stock market wealth that has occurred in the last six to nine months. People think stock prices are just paper profits. They are not. They create real purchasing power and, most importantly, they create a fluidity into the financial system which is the reason why even though banks are not lending freely at this particular stage, they are solvent and the problems that we had six to nine months ago have disappeared, because essentially $5 trillion worth of increased equity is pouring into the economy. And you can see it in the retail sales figures. 401(k)s, for example, have increased by half a trillion dollars.

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From The Colbert Report--Bernie Sanders, wonderful as always.

Democracy Now's Amy Goodman and Juan Gonzales had a really terrific interview today with Eliot Spitzer on why Bernie Sanders is right and Ben Bernanke should not be confirmed for another term as Federal Reserve Chairman and that Tim Geithner should be replaced as Treasury Secretary. One question Amy Goodman asked I found particularly interesting was this one along with Spitzer's answer:

AMY GOODMAN: Do you think you were partly taken down by the very entities you were going after?

ELIOT SPITZER: I have been very careful in saying that I resigned because of what I did. And I have no doubt that there were many people whom I had—was on the—were opposed to me, very powerful forces, who were happy to see me go. Whether they participated, I’ll let others figure that out. I resigned because of what I did. And whatever they’re involved in doesn’t excuse what I did.

I'm sure a lot of others like myself were left wondering after the prostitution scandal broke if Spitzer was set up. He didn't say no.

Full transcript available here.

The interview is way too long to put on our servers, but way too good not to share all of it, so I'm using their embed player.

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Sen. Bernie Sanders joined Dylan Ratigan on MSNBC's Morning Meeting to discuss his decision to block the confirmation of Ben Bernanke for a second term as Chairman of the Federal Reserve. From Sen. Sanders site--Sanders Blocks Bernanke Confirmation:

December 2, 2009

Sen. Bernie Sanders Wednesday placed a hold on the nomination of Ben Bernanke for a second term as chairman of the Federal Reserve. “The American people overwhelmingly voted last year for a change in our national priorities to put the interests of ordinary people ahead of the greed of Wall Street and the wealthy few,” Sanders said. “What the American people did not bargain for was another four years for one of the key architects of the Bush economy.”

As head of the central bank since 2006, Bernanke could have demanded that Wall Street provide adequate credit to small and medium-sized businesses to create decent-paying jobs in a productive economy, but he did not. He could have insisted that large bailed-out banks end the usurious practice of charging interest rates of 30 percent or more on credit cards, but he did not. He could have broken up too-big-to-fail financial institutions that took Federal Reserve assistance, but he did not. He could have revealed which banks took more than $2 trillion in taxpayer-backed secret loans, but he did not.

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MSNBC's Dylan Ratigan talks to Rep. Alan Grayson about the amendment passed by the House Financial Services Committee to allow an independent audit of the Federal Reserve. If Alan Greenspan is not happy about it, I take that as a good sign they did the right thing. It only took putting this country on the edge of financial ruin that we're not out of yet for the S.O.B. to ever admit he might be wrong about anything.

Ratigan: Alright first big newsmaker of the Meeting, Democratic Alan Grayson, better known for some of his fiery comments on Republicans and health care, now taking aim at the Federal Reserve along with so many others. He says the Federal Reserve is more secretive than the CIA, and his new amendment co-sponsored by Republican Ron Paul would allow the first ever independent audit of the Federal Reserve. The amendment edged out a competing proposal from North Carolina Congressman Mel Watt who wants to limit those very audits.

Congressman Grayson now joins the Morning Meeting. Your amendment approved by the House Financial Services Committee—a huge step forward. Where do you go from here and what’s your level of confidence Representative that you can continue to addendum behind this piece of legislation?

Grayson: Where we go is to stop the secret bailouts. There have been hints and hints now for more than two years that the Fed’s been conducting huge bailouts on the scale of hundreds of billions of dollars to favor large failed banks. Now we’re going to find out all about it, and we’re going to decide whether it’s good or bad.

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Ryan Grim at Huffington Post has the details on the intrigue going on in the House yesterday with efforts to finally audit the Federal Reserve and find out where all those trillions of dollars are going.

In an unprecedented defeat for the Federal Reserve, an amendment to audit the multi-trillion dollar institution was approved by the House Finance Committee with an overwhelming and bipartisan 43-26 vote on Thursday afternoon despite harried last-minute lobbying from top Fed officials and the surprise opposition of Chairman Barney Frank (D-Mass.), who had previously been a supporter.

The measure, cosponsored by Reps. Ron Paul (R-Texas) and Alan Grayson (D-Fla.), authorizes the Government Accountability Office to conduct a wide-ranging audit of the Fed's opaque deals with foreign central banks and major U.S. financial institutions. The Fed has never had a real audit in its history and little is known of what it does with the trillions of dollars at its disposal.

The amendment expressly blocks Congress from interfering with the independence of monetary policy decision-making, but opponents of the measure said that the political pressure would inevitably follow.