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Pastimes : Ask Mohan about the Market -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (7934)	11/15/1997 10:22:00 AM
From: tekgk	Read Replies (2) \| Respond to of 18056

Zeev, The real ownership of the federal reserve system according to the fed itself is posted below. Using the formula outlined below I have a lot of trouble seeing how one bank (or individual) has controlling interest. Even if they did they don't get to vote. bog.frb.fed.us "At the end of 1993, 4,338 banks were members of the Federal Reserve System-3,360 national banks and 978 state banks-out of 11,212 commercial banks nationwide. Member banks must subscribe to stock in their regional Federal Reserve Bank in an amount equal to 3 percent of their capital and surplus. The holding of this stock, however, does not carry with it the control and financial interest conveyed to holders of common stock in for-profit organizations: It is merely a legal obligation that goes along with membership, and the stock may not be sold or pledged as collateral for loans. Member banks receive a 6 percent dividend annually on their stock, as specified by law, and vote for the Class A and Class B directors of the Reserve Bank. The stock is not available for purchase by individuals." There is one thing that I think is criminal about the fed (see below)- foreign banks OK but the "certain actions" part and the close relationship with the commercial banks leaves an avenue for abuse and fraud IMHO. It also allows the fed to tinker with the markets which is counter productive if done in secret. "The Reserve Banks, like the Board, are subject to audit by the GAO, but certain functions, such as transactions with foreign central banks and open market operations, are excluded from au-dit."