From the May 2009 Idaho Observer:

Federal Reserve cannot account for $15 trillion

An estimated $15 trillion has disappeared from Wall Street over the last 18 months. In advance of 9/11, Defense Secretary Donald Rumsfeld admitted that the Department of Defense could not account for $2.3 trillion. Now, while people are preoccupied with pig flu, the Federal Reserve inspector general tacitly admits she cannot account for $9 trillion. If you had spent $1 million a day since the birth of Christ you will not have yet reached the $1 trillion mark and, counting one second at a time, it would take 31,710 years to reach 1 trillion. The point is that the $trillion figure is not even a real number in practical terms and indicates that our people and our nation are being looted.

By Julie Crawshaw

The Federal Reserve apparently canít account for $9 trillion in off-balance sheet transactions.

When Rep. Alan Grayson (D-Orlando) asked Inspector General Elizabeth Coleman of the Federal Reserve some very basic questions about the trillions of dollars that have come and gone from the Fedís expanded balance sheet, the IG didnít know.

Worse, nobody at the Fed seems to have any idea what the losses on its $2 trillion portfolio really are.

"I am shocked to find out that nobody at the Federal Reserve is keeping track of anything," Grayson says.

When Grayson asked Coleman if her agency had done any research into the decision not to save Lehman Brothers, which "sent shockwaves through the entire financial system," Coleman said it had not.

"What about the $1 trillion plus expansion of the Federal Reserveís balance sheet since last September?" Grayson asked.

"We have different connotations," Coleman replied. "Weíre actually conducting a fairly high-level review of the various lending facilities collectively."

Translation: Nobody at the Fed knows where the money went.

"Do you know what or who got the $1 trillion or more in the Fedís expansion of its balance sheet," Grayson pressed.

"I do not know. We have not looked at this specific area at the particular point on that specific review," Coleman answered.

"What about the trillions of off-balance transactions since last September?" Grayson asked.

Coleman demurred again, saying the IG does not have jurisdiction to audit the Federal Reserve.

Grayson pointed out that it was the inspector generalís job to audit such spending and asked again if the office had done any investigation at all.

Colemanís answer: Not enough yet to even respond. "We are not in a position to say if there are losses."

Grayson concluded, "I am shocked to find out that nobody at the Federal Reserve, including the inspector general, is keeping track of this."

Meanwhile, Federal Reserve Chairman Ben Bernanke says the bank is working on ways to rein in the massive balance sheet commitments.

"A majority of the members who made these projections just recently took two percent as being an appropriate number for inflation," Bernanke said May 11.

"Somewhere between 1-1/2 to 2 percent is basically the number that our committee has individually stated is the appropriate medium-term inflation rate.

"To achieve that we need to demonstrate that we will be able to exit from the balance sheet position that we currently have and have been working on this intensively," Bernanke said in response to questions after a speech to a conference organized by the Federal Reserve Bank of Atlanta.