Dear ,

I wanted to make sure you saw Dr. Paul's
recent column on the Federal Reserve's bailouts of the
repurchasing (repo) market.

The repo market is where banks obtain quick
cash via overnight loans.

Following a September "cash shortage," the
Fed started pumping as much as $75 billion a day into the repo
market in an attempt to keep interest rates from rising above the
central bank's target of around 2%.

And as Dr. Paul points out, the American
people are forbidden from learning which banks are benefiting
from the Feds latest bailouts -- or even if the Fed is planning
on further bailouts in the near future.

This is just the latest example of why
Congress must vote on -- and pass -- Audit the Fed!

That's why Campaign for Liberty is preparing
to ramp up our efforts to get a majority of the House of
Representatives to cosponsor Audit the Fed.

Dr. Paul will soon provide you details on our
plans. For now, please read Dr. Paul's column, and then, forward
it to your family, friends, and coworkers.

And chip in $100, $75, $50, or whatever you
can afford to support Campaign for Liberty's efforts to pass
Audit the Fed.
[link removed]

In Liberty,

Norm Singleton
President




Federal Reserve's Latest Bailouts More Proof
Bad Times Ahead
by Ron Paul, C4L Chairman

Since September 17, the Federal Reserve Bank
of New York has pumped billions of dollars into the repurchasing
(repo) market, the first such intervention since 2009. The Fed
has announced that it will continue to inject as much as 75
billion dollars a day into the repo market until November 4.

The repo market provides a means for banks
that are temporarily short of cash to obtain short-term (usually
one day) loans from other banks. The Fed's interventions were a
response to a sudden cash shortage that caused interest rates for
these short-term loans to climb to 10 percent, far above the
Fed's target rate.

One of the factors blamed for the repo
market's cash shortage is the Federal Reserve's sale of assets it
acquired via the Quantitative Easing programs. Since launching
its effort to "unwind" its balance sheet, the Fed had reduced its
holdings by over 700 billion dollars. This seems like a large
amount but given the Fed's balance sheet was over four trillion
dollars, the Fed only reduced its holdings by approximately 18
percent! If such a relatively small reduction in the Fed's assets
contributed to the cash shortage in the repo market, causing a
panicked Fed to pump billions into the market, it is unlikely the
Fed will be continuing selling assets and "normalizing" its
balance sheet.

Another factor contributing to the repo
market's cash shortage was a major sale of US Treasury
securities. Sales of government securities leave less capital
available for private sector investments, increasing interest
rates. This "crowding out" effect provides one more justification
for the Federal Reserve to pump more money into the markets.

The crowding out effect is just one-way
federal debt increases pressure on the Fed to keep interest rates
low. Increasing federal debt increases pressure on the Fed to
maintain low interest rates to keep the federal government's
interest payments from reaching unsustainable levels. The over
one trillion dollars (and rising) federal deficit is the major
reason the Federal Reserve is likely to keep interest rates low
or even adopt the insane policy of negative interest rates.

The American people are not even allowed to
know what banks benefited from the Fed's intervention in the repo
market, or what plans the Fed is making for future bailouts -
even though the people will pay for those bailouts either through
increased taxes, debt, or the Federal Reserve's hidden inflation
tax when the next crash occurs. Of course, the average people who
will lose their savings and their jobs in the next crash will not
be bailed out. This is one more reason why it is so important
Congress takes the first steps toward changing monetary policy by
passing Audit the Fed.

The need for the Fed to shove billions into
the repo market to keep that market's interest rate near the
Fed's target shows the Fed is losing its power to control the
price of money. The next crash will likely lead to the end of the
fiat money system, along with the entire welfare-warfare state.
Those of us who understand the Fed is the cause of, not the
solution to, our problems must redouble our efforts to educate
our fellow citizens on sound economics and the ideas of liberty.
This way, we can create the critical mass necessary to force
Congress to cut spending, repeal the legal tender laws to restore
a free market in money, and audit, then end, the Fed.

Because of Campaign For Liberty's tax-exempt status under IRC
Sec. 501(C)(4) and its state and federal legislative activities,
contributions are not tax deductible as charitable contributions
(IRC § 170) or as business deductions (IRC §
162(e)(1)).

www.CampaignForLiberty.org





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