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How dare the Fed buy AIG?
16 Sep 2008 07:39 pm
A lawyer friend IMs "I would be fascinated to know on what authority the Fed is claiming the right to do this." It's probable that they don't actually have the legal right to do anything like this. Their authority is this: who's going to stop them? No one wants to take on responsibility for this mess themselves.
I would be fascinated to know on what authority the Fed is claiming the right to do this.
The Golden Rule - He who has the gold makes the rules.
The ability for the government to provide support to failing companies was set up during the FDR era. Companies had to have a large enough financial stake in the US economy that it became a better choice than to let come companies fail.
It's in section 13.3 of the Federal Reserve Act. They can pretty much lend money to anyone they want in "unusual and exigent circumstances."
If we're going to be bailing out every huge firm that gets into trouble, should we start taxing firm size?
Yeah, it really isn't that big of a deal.
I read in a Ben Bernanke interview that he has always been fascinated by the insurance industry and wished the Fed could own its own insurance company some day. These are exciting times for the Fed.
The Market Works!
"I'm always for less regulation."
-John McCain
"This is my master plan."
-Phil Graham
I understand Paulson and Bernanke went to see the president today. As in a war you need a good general, in a financial crisis you need a good investment banker. Bush has made what appears to be a good choice in Petraeus in the former situation and the former head of Goldman Sachs in the latter. He's our investment banker now. I hope he gets us a good deal.
If we're going to be bailing out every huge firm that gets into trouble, should we start taxing firm size?
On a different thread, someone posed the question that if something is to big to fail, is it not too big to exist. Could such a principle be operationalized in policy without severe social costs?
Just wait until next week when they buy the Redskins. Fred wants to be a waterboy.
Yes, some sort of progressive corporate tax rate is my suggestion. Once a company gets too big, there start to be negative externalities that should be taken into account.
This "too big to fail" is a major example. Political lobbying power is another.
(Of course, under the same theory, farms should also be taxed higher, on the grounds that they will always (in the USA) be getting a government bailout in the future.)
How dare they risk letting the largest insurance company go bankrupt? I don't have a huge problem with this deal. It probably staved off a huge global mess, and by diluting the crap out of AIG's existing shareholders, it should assuage concerns about moral hazard. My preference would have been for the Fed to get some foreign central banks to chip in, since the consequences of an AIG failure would have probably hit Europe hard as well, but there probably wasn't enough time for that.
See I'm all about the lemonade here. Sure let's prop up all these old bastards in return for 10 percent of the profits for 50 years. Let the glorious new era of post taxation begin.
"Yes, some sort of progressive corporate tax rate is my suggestion. Once a company gets too big, there start to be negative externalities that should be taken into account."
Not all big companies pose this sort of systemic risk. Exxon Mobil has $30 billion in net cash and a credit rating higher than that of most sovereign governments. There's not much chance it's going to be on the verge of insolvency anytime soon.
If it makes you feel better, think of the pound of flesh the Fed is taking in exchange for this loan as a sort of progressive tax: the Fed is taking 80% of the company in exchange for this loan. It is essentially wiping out the existing shareholders, a group that probably includes a lot of long-time AIG employees.
O.K. Boys and Girls,
You are all aware that the federal reserve isn't owned buy the goverment? Right, you are aware?
Cheer up, Comrade! Life has become more joyful!
Since the founding, necessity has had a place in the actions of the federal government. Jefferson thought that the constitution would be "blank paper" if we went forward with the Louisiana purchase without first amending the constitution. But he did it anyway, before Napoleon changed his mind. etc.
"It's probable that they don't actually have the legal right to do anything like this."
Respectfully: did you bother to inquire about the answer to your question before positing your view of its probability?
You can do better than this, and you should.
Eddleman
Megan, thanks for all the postings today. They are not unappreciated (at least not by me).
If we're going to be bailing out every huge firm that gets into trouble, should we start taxing firm size?
I'm pretty sure this poster's comment is tongue-in-cheek but countries with confiscatory tax systems (Sweden comes to mind) essentially made this argument.
The argument was that once a company became so large that it could have a large impact on the nation's economy, it should, in effect, be nationalized. Nationalization took the form of either straight confiscation by the state or through confiscatory taxes. Since "too big to fail" implies socialized risk, shouldn't the reward also be socialized?
Of course, this creates perverse incentives. Companies that grew too large, simply pulled up stakes and left. Wealth creation had a ceiling.
I fear that bailing out these "too large to fail" companies will soon lead to calls for nationalization of large companies and a ceiling on wealth creation.
I have debts I can't pay. WHERE'S MY BAILOUT!!!!!!
The Fed isn't actually buying AIG as it did with Fannie and Freddie, right? Isn't the big-ass loan strategy more like what it did with Bear Stearns? I don't think there's a legal conflict here.
Yes, Methinks, outright ownership has obvious problems, and does create some major incentive problems clearly. But partial ownership (10 percent?) so that government revenues grow with the company revenues, as when any private entity buys a major stake in another company, what would that do? Finance government itself, somewhat, but what else? Good, bad, better than outright taxation, worse? I don't know.
Two further points. 1. The trouble with necessity is that it is legitimate sometimes. The trouble is that it is very hard to be sure exactly when that's the case.
2. AIG has not been baled out. But, Mars, you may have just been bailed out. If you have money in a bank or a 401K, or other investments, a failure of AIG might have led to a cascade of failures. (The trouble is that it MIGHT have. Perhaps yes; perhaps no).
3. Great posts today Megan.
Follow up to the follow up. AIG looks like it has been taken over, not saved. On second reading, it might be that it was given an emergency loan. We'll know soon enough.
Fed: "Nice to see yas. How's your sister?"
AIG: "She's fine, she's good. You're looking, ah, healthy, for a man of your...ah..."
Fed: "She always was a looker. So, see, I am giving yous a eighty-five billion dollar loan."
AIG: "Ah, thanks, Mr. Paulson, but, we think we'd like to work this out on our own, and -- "
Fed: "Maybe yous don't hear so good. I am giving yous a eighty-five billion dollar loan."
AIG: "That's very generous, but we think there still may be other partners who -- "
Fed: "Paulie, the kid don't understand English so good. How about we give him a lesson."
AIG: "That won't be necessary Mr. Paulson! I would be happy to accept your loan, and as for the conditions...what are the conditions?"
Fed: "We owns seventy percent of yous."
AIG: "Seventy percent!"
Fed: "Make it eighty percent. You got any further comments you wanna offer?"
AIG: "No, no, that sounds fine. Just fine. It's been a pleasure doing...seeing..."
Fed: "Paulie, give the kid a ride back to his sister's place. You can live in your sister's place, kid, we need your house for a little project we got going."
I remember in 2003, just out of college, watching the war unfold on TV. I was shaking my head while at the same thinking and hoping that there’s a chance this could all go as planned. It felt something akin to a secular libertarian prayer. Reading this, I can't help but feel the same way.
It seems like the Fed got a pretty sweet deal, really. An %80 stake for an 80 billion dollar loan? AIG turns over more than 100 billion/year in revenue, and aside from the current difficulties seems to have solid business.
I remember in 2003, just out of college, watching the war unfold on TV. I was shaking my head while at the same thinking and hoping that there’s a chance this could all go as planned. It felt something akin to a secular libertarian prayer. Reading this, I can't help but feel the same way.
True, but hopefully the difference between Paulson and Rumsfeld is the difference between making it through and a debacle.
Um, an entity would have to raise an objections for legal questions to become a concern at all. I'm pretty sure the folks at AIG were more or less on board with this, to put it mildly.
TW - Given that AIG had a market cap of 10B today, how is paying 85B for 80% a good deal? Oh, and let's not forget that they were offered a private buyout and turned it down. And 80% of their insurance business is outside the US. If the biggest investment banks didn't want to put money into this zombie, why on earth should the Fed?
Unless I'm misreading the fine print, the Fed has not as yet taken a controlling interest in AIG, but got warrants that would allow it to do so. Would be nice if someone with a little more visibility into this could divine who has what. (Is that how they side-stepped shareholder approval?)
But partial ownership (10 percent?)...Good, bad, better than outright taxation, worse?
Little Boots, partial ownership is merely partial nationalization. At the very least it's a slippery slope to total nationalization and the socialism that stagnate European economies.
They have the authority to issue "collateralized loans" per the cite Mark Shivers gave above... and clever lawyers who can turn a "collateralized" loan" into something that works as just about anything you'd like.
"TW - Given that AIG had a market cap of 10B today, how is paying 85B for 80% a good deal? Oh, and let's not forget that they were offered a private buyout and turned it down. And 80% of their insurance business is outside the US. If the biggest investment banks didn't want to put money into this zombie, why on earth should the Fed?"
The $85 billion is a loan that is supposed to be paid back. The 80% of equity is what the Fed gets in addition to being paid back.
TW,
If it really were such a sweet deal, a private loan would have been arranged relatively easily- that one could not be arranged strongly suggests that the loan is a losing proposition.
What truly puzzles me is how the creditors take a haircut without a bankruptcy declaration. If the creditors don't take a haircut, then this is just another bailout of bondholders.
And, where in line does the Fed stand in the creditor queue?
At the very least it's a slippery slope to total nationalization and the socialism that stagnate European economies. - Methinks
It looks very much more like the road to the total nationalization and Gaullist "commanding heights" mixed public-private economy that one sees in economies like China and Russia, each of which are growing faster than 10% per year.
None of these are really very useful issues to bring up. The US is not going to stop innovating in the field of insurance because a big insurer gets taken over by the government. What's more of a risk is the gradual development of cronyism and favoritism as the insurer works its way into the government system, which actually does look a lot like China and Russia, or like the overweening influence wielded in the US by big defense/construction/oil services contractors like KBR.
Yancey,
I could be a sweet deal that only the Fed could finance on such a short notice. $85B is a lot of money to come up with quickly.
I always thought our constitutional republic would continue to degrade into eurosocialism, but I didn't think it would get this far so soon. In a few weeks time we have essentially nationalized the loan industry, and the outside world has apparently realized that holding paper dollars hot off the press isn't such a sound investment after all. Only eight years ago Saddam made the bold move of moving Iraq's oil off US currency trading (and look where it got him), and now the Jenga block is about to completely fall down.
Within a couple years we could see full-on price controls as the last gasp of economic reality denial.
All I can say is, buy a gun. You will need it.
MnZ,
I don't believe that. If one entity couldn't come up with the financing, then a consortium would have been arranged. Easy profits are almost never left on the table.
Loaning $50+ billion to the automakers is now a sure thing- it is politically impossible not to.
Loaning $50+ billion to the automakers is now a sure thing- it is politically impossible not to.
I think you're right, and I think it's because there is something profoundly, fundamentally wrong with how we operate in this country. Economy: We're doing it wrong. Maybe, the weird amalgam of capitalist rhetoric, government intervention, constant bullshit from politicians and pundits, stagnation for most people, bankruptcy for too many, incredible and growing wealth for a very few, maybe we need to get off that treadmill. And maybe these bailouts are both a symptom of the problem and an opportunity to rethink how we do things.
If it really were such a sweet deal, a private loan would have been arranged relatively easily- that one could not be arranged strongly suggests that the loan is a losing proposition.
With the markets as illiquid as they are right now, I'm not sure that's the case. Scrapping together 85b on short order, in the current environment, may well be beyond the grasp of most any institution but the Fed at the moment.
As for the worth of AIG, my understanding is that the reason they need the bridge loan is that they're not going to be able to liquidate their (from what I understand substantial) assets soon enough to cover the increased capital requirements necessitated by the downgrading of their credit rating.
Loaning $50+ billion to the automakers is now a sure thing- it is politically impossible not to
Really? Seems to me just the opposite. Not only do I think there will be a limited public tolerance for more bailouts, but also, how can the Fed possibly afford it?
And unfortunately for Detroit (and fortunately for the rest of us), Ford/GM going out of business just doesn't have the same ability to drag down the rest of the economy as the AIG or other similar institutions going under.
On a lighter note, does anyone want to discusss how the Russian markets are melting down?
(A little schadenfreude always helps lift the spirits!)
Today their market trading was halted, and banks defaulted ...
Chris Weafer, chief strategist at Uralsib investment bank: “We’re in completely uncharted territory where the prevailing emotion is fear and numbness. No one knows where this could stop.”.
... and it didn't have anything at all to do with subprime loans!
It's all due to the collapse of the price of oil, which has been holding their whole kleptocracy together, combined with the nifty risk premium they added to their soveriegn debt with their little escapade in Georgia.
Go Putin! Welcome to the post-Soviet economic order, at long last.
mixed public-private economy that one sees in economies like China and Russia, each of which are growing faster than 10% per year.
Brooksfoe, your conflating cause and effect. Both Russia and China are desperately poor countries which are growing fast because of pent up demand and because they're growth is on a very low base.
The US is not going to stop innovating in the field of insurance because a big insurer gets taken over by the government.
I never claimed it would. I said that nationalization with size as an excuse puts a cap on growth.
What's more of a risk is the gradual development of cronyism and favoritism as the insurer works its way into the government system
I hate tell you this, but this is already the case. The government heavily regulates insurance and regulation is an indirect way to control industry. Of course, it's usually the industry that controls the regulator to its benefit and the detriment of consumers.
Yancey,
A consortium might be able to come up with the money. However, they have to agree to come up with an agreement for how to divide the risk and the rewards. I don't know if those could come together quickly.
Also, I would agree that the automakers might try to use this as precedent for their bail out. However, I don't know if the automakers are willing to submit to (i) replacement of the management and (ii) severe dilution of the shareholders.
On a lighter note, does anyone want to discusss how the Russian markets are melting down?
(A little schadenfreude always helps lift the spirits!)
It's not a lighter note for me. I'm Russian and my family is still in Moscow.
But thanks for trying to lift our spirits anyway.
please excuse my use of "your" instead of "you're" and "they're" instead of "their". poor editing.
please excuse my use of "your" instead of "you're" and "they're" instead of "their". poor editing.
So done.
MikeF:
You might end up owning it. Basically the Fed is first in line now. So the outstanding shares are pretty much worthless. Who knew that "B-52" Ben and Hank were socialists at heart. ;-)
If AIG was too big to fail, and AIG is now a property of the Fed, is AIG the new Fannie Mae/Freddie Mac?
And who, if there are any, gets future profits? Eyes on the Prize, dammit!
TW and Mzn,
I guess we will see in the coming months. If the Fed is really uncomfortable with this arrangement, and the deal really is sweet, it may be that they will spin AIG out to new owners once the immediate financing crisis has passed.
"You are all aware that the federal reserve isn't owned buy the goverment? Right, you are aware?"
What's ownership mean? Control and responsibility. If you own a car you get to control where it goes but are responsible for those who get run over by it. You also get to control the benefits the car produces. For instance you get income from your cab.
In the case of Freddy and Fanny the government didn't control but was still responsible for those it ran over. Which means us taxpayers foot the bill.
How is the Fed any different? Saying the Fed is privately owned is just a sham. It's not privately owned in the sense of any private company. It's like saying a slave is employed. Not quite the applicable term.
But partial ownership (10 percent?) so that government revenues grow with the company revenues, as when any private entity buys a major stake in another company, what would that do?
Give the government a seat or two on the board and serious influence in the future direction of the company. I for one would be hesitant to share ownership of an insurance company with the actuarial geniuses that brought us the Social Security Administration.
On the flip side, they might be more willing to bail "their" company out...
Give the government a seat or two on the board and serious influence in the future direction of the company. I for one would be hesitant to share ownership of an insurance company with the actuarial geniuses that brought us the Social Security Administration.
On the flip side, they might be more willing to bail "their" company out...
Although most people actually get an SSA check. As opposed to, yeah, Sorry, we'd love to give a shit, but current needs prevent us from actually paying out what we promised. See you in Court, in about 10 years. Toodles.
Rob Lyman writes: "I for one would be hesitant to share ownership of an insurance company with the actuarial geniuses that brought us the Social Security Administration."
I for one am sick to my stomach at sharing citizenship with the existential morons who voted for Dumbya Bush twice (or more) but then the SSA has worked and will continue to work long after you're dead, in one form or another.
And when national health insurance comes in your grandchildren will remember silly old Grandpa Rob and how he wanted poor people to just fucking die already, and they'll be glad his ilk lost the battle.
Or at least they will if they're not scumbags.
SSA has worked and will continue to work long after you're dead, in one form or another
Right. We're going to have more people drawing on the system than paying in in our lifetimes. If something can't go on forever, it won't.
Although, your statment could technically be true, since "paying retirees $10 a month" is theoretically working "in one form or another"
Poor ignorant foul-mouthed Moe doesn't know that it's countries with national health plans that refuse to treat Grandpa if he's fat or smokes or is just too old to be worth treating.
No doubt he will reply to this simple statement of fact with some 'witty' remark that grossly violates our host's proclaimed principles for the 30th or 40th time since she proclaimed them.
Please do what you said you would do and enforce your rules, Megan. Whether consciously or not, Moe is wrecking your site. He couldn't even pretend to abide by the rules for a single day, and his departure would be an unalloyed good.
[blockquote]Poor ignorant foul-mouthed Moe doesn't know that it's countries with national health plans that refuse to treat Grandpa if he's fat or smokes or is just too old to be worth treating.[/blockquote]
Every country? Really? I don't think so. And cherry picking a few restrictions from a few countries doesn't suffice, I'm afraid.
So you start with an outright falsehood, and then proceed to demand another poster be banned.
I would rather have Moe's profanity than your mendacity.
why 79.9%. what is the rule that limits holding to 80% by fed
The people that will actually have to depend on SS in the next 20-25 years for a retirement are going to be in for a really rude shock. The government is even more actuararily insolvent than Wall Street firms. The future workers will never tolerate the tax rates required to allow people to retire on SS.
And with the decline and fall of the dollar that we are seeing, and the likely economic realignment that is going to occur over the next decade, people had better make alternate plans for their golden years. The quality and ease of your retirement doesn't depend only on how much you save, it is how much more you save than everyone else- and it is going to matter how you have protected those savings against deflation/inflation. With the changes coming in relative prices, your SS check is likely to provide no more than a small supplement to the income you will need to live.
"why 79.9%. what is the rule that limits holding to 80% by fed"
At 80% it would have to consolidate AIG on its balance sheet. This is simpler, and it's a big enough peace to screw the existing shareholders sufficiently for going out on a limb and investing in a Dow stock.
"Every country? Really?" No, not every country. If I'd meant every country, I would have written that. But I didn't, and what I wrote was and is true.
So who's displaying "mendacity" here? Looks like 'James' to me. He also erects a false dichotomy, asking us to choose between mendacity and profanity. This website would be better off without either. That would mean doing without 'James' and Moe, but I wouldn't miss either one.
James quotes and writes: "[blockquote]Poor ignorant foul-mouthed Moe doesn't know that it's countries with national health plans that refuse to treat Grandpa if he's fat or smokes or is just too old to be worth treating.[/blockquote]
Every country? Really? I don't think so. And cherry picking a few restrictions from a few countries doesn't suffice, I'm afraid.
So you start with an outright falsehood, and then proceed to demand another poster be banned.
I would rather have Moe's profanity than your mendacity."
Lying is all the conservative movement has left, James. It's all they ever had, really. Now they're reduced to lying even to themselves, about everything, each and every day, while the strange and terrifying fruits of their ignorant, backwards policies crash and burn around them.
The Dumbya Bush Era is ending and the fact that it has been an unmitigated disaster from start to finish is now apparent to all but the dumbest sheep in the country. So a few of them now have nothing better to do but bleat about banning me on some message board.
Well, at least it keeps them off the playgrounds.
"Dr Anonymus" types: "So who's displaying "mendacity" here? Looks like 'James' to me. He also erects a false dichotomy, asking us to choose between mendacity and profanity. This website would be better off without either. That would mean doing without 'James' and Moe, but I wouldn't miss either one.
Posted by Dr Anonymus"
Kind of sad when you can't even spell your own username correctly. The word is "anonymous," chuckles.
So what sort of doctor are you, anyway? And why should anyone, anywhere, care what you would miss?
Here's what I won't miss - Dumbya Bush and the rest of his wretched, incompetent crew. Here's what I'll relish - the oinks and squeals of the right wing on election night as they realize their pathetic movement has been dismantled entirely.
According to the legislators quoted in the papers, the Fed has all of the statutory authority it needs to make this move (many were willing to provide it, if necessary), and the move was approved by the AIG board.
I find this entire thing horrifically hilarious. The free-marketers are all running around screaming about moral hazard and socialism as the fruits of an underregulated market threaten our entire financial system -- maybe our entire economy!
Unregulated industries will occasionally self-destruct at public expense.
The Fed saving AIG is not the beginning of a command economy.
We survived much worse 80 years ago. And history has been much kinder to the Roosevelts of that era that saved democracy for capitalism than the Hoovers who tried to save capitalism for democracy.
From what I heard on Kudlow yesterday, it seems AIG refused a bail out offer from private sources over the weekend and into Monday that would have saved them at a level of 20 billion or thereabouts, but as it was rejected, and as the credit rating of AIG went further into the tank, it became a 80 billion dollar problem in just the next 24 hrs...
No time to lose - no time to linger when credit ratings are tanking, or so it seems.
How much did the esteemed CEO(s) get in their golden parachute for this performance?
A government that cannot respond to an emergency is not a government worth having.
Hard to know all the details at this point, but it looks like the Fed got a pretty good deal to me.
These are the details as I understand them.
Up to $85B loan with two year term.
Interest rate libor+850 basis points. Thats around 12% to you and me.
Fed is first creditor in line and has access to all of AIG assets. Also has say say on management of the company.
Fed gets Warrants (options) on up to 79.9% (this number chosen to allow fed to keep AIG off its balance sheet, ironic) of AIG shares outstanding. It is not clear where those strikes are but I am guessing pretty close to the money. So if AIG recovers the Fed gets most of the gain as the company is unwound.
CEO and upper management dismissed.
If you are going to bail out a company this is the way to do it. Make them pay dearly.
As I understand it AIG is actually fairly solvent (relative to say Lehman) but it cannot access some of its assets quickly because they are in insurance subsidiaries. The only way to access them is by selling the subsidiaries which will take time.
The fed gives them that time, but essentially wipes out all the value of the company and retains almost all of the upside for taking the risk.
If you believe that AIG is too big to fail then this is as good of a "bailout" as you could hope for. Really it is the bond holders and derivative holders of AIG who are being bailed out.
You may be right as a pragmatic matter, but it’s a sad day for the rule of law—not to mention small government—when the government lawlessly nationalizes a private company and people just shrug.
We haven't yet been told any of the legalities concerning the ownership the Fed has gotten in the 79.99% stock or stock options or whatever they are.
@Steve Bainbridge:"but it’s a sad day for the rule of law—not to mention small government—when the government lawlessly nationalizes a private company and people just shrug."
What's your basis for calling it "lawless"?
Are you claiming that the Fed didn't have the statutory authority to buy AIG?
Or that it's "lawless" for a government entity to purchase a private concern as a matter of philosophy?
Or that AIG wasn't purchased so much as appropriated? How do you know, and how do you distinguish?
Poor Moe is so ignorant he thinks 'Anonymus' is misspelled, and so stupid he can't be bothered to check even the most obvious sources before displaying his ignorance. Apparently he's one of those ugly Americans who thinks words in foreign languages aren't really words.
He's certainly the kind of ass who can't tell the difference between a "message board" and someone else's weblog. Anyone with even a minimal sense of common decency would have either behaved the way Megan has repeatedly asked her commenters to behave or gone away, but not Moe. He's determined to force her to ban him, as if that would give him some kind of moral victory.
People, People! THE FED IS NOT THE GOVERNMENT! THE FED IS OWNED BY BANKERS! THE GOVERNMENT DOES NOT CONTROL THE FED! THE BANKERS CONTROL THE FED! ONLY THE FED WILL MAKE MONEY ON THIS DEAL! NOTHING THE FED DOES IS FOR ANYONE BUT THE BANKERS THAT OWN IT! THE NEW WORLD ORDER IS WHAT THEY WANT! THEY WANT TO BE IN CHARGE, AND HOW DOES THAT HAPPEN? OWN EVERYTHING! WHEN THEY OWN EVERYTHING YOU WILL BE SLAVES TO WHAT THEY WANT! AND WHAT DO THEY WANT? EVERYTHING FOR THEM AND NOTHING FOR YOU! YOURS AND MY LIFE IS OVER, SLAVES!!!
m
Economic Situation*****
We need a mathematically perfected economy. These recent developements in our economy are not mistakes or crimes perpetrated by a few renagade millionares. It is a purposeful, planned theft of the wealth of the people of the United States.
As Thomas Jefferson warned: "If the American people ever allow banks to issue their currency, first by inflation and then by deflation [by having to maintain a vital circulation by perpetually re-borrowing principal and interest as subsequent sums of debt, the banks and corporations which will grow up around them will deprive the people of all property, until their children wake homeless on the continent their fathers conquered." Thomas Jefferson
The Federal Reserve needs to be replaced with a computer and the Central Banking System needs to be striped of its power.
The States and Congress and the Senate need to take back the power of the people now before we lose everything.