In 1913, Congress authorized The Federal Reserve (a private banking cartel) to regulate the money supply and set interest rates. Part of the act that created the private Fed allowed the Fed to buy debt if the debt is fully backed by the US government, thus prohibiting the Fed from speculating on debt that could potentially default.
This article from Reuters quotes a Fed governor (not really a "governor" - this is more subterfuge by the Fed to use government-sounding title in their private organization) says, "However, he [Kohn] did caution that the increase in the balance sheet was not without risks, and warned that if this led to credit losses at the Fed, it could force the Fed to go hat in hand to the U.S. government, compromising its policy independence."
The Fed isn't allowed to purchase debt other than from the federal government in order to ensure the Fed can't possibly have a credit loss. Why is the Fed now discussing the possibility of credit losses from the debt on their balance sheet? The Fed appears to be acknowledging they have stepped beyond the boundaries of their authority.
It's time to have a full audit of the Fed to find out what risks they are taking with our money.
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