Breitbart Business Digest: 50-Year-Old ‘Confidential’ Fed Memo Reveals Secret Debt Ceiling Escape Hatch

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A formerly-confidential memo from half a century ago suggests that the Federal Reserve may have a failsafe in the event of a protracted debt ceiling fight.

from half a century ago suggests thatmay be able to play a bigger role than thought in easing the burden on the U.S. Treasury should the White House and Congress fail to agree to raise or suspend the debt ceiling before the government runs out of borrowing room this summer.that has echoes in the debates over the debt ceiling of 2011 and today. The White House in 1973 was seeking a clean bill that would raise the debt ceiling and allow the Treasury to continue to borrow money.

Burns convened a committee that consisted of the Federal Reserve Board’s general counsel, its senior economist, its secretary, and other Fed officials, including attorneys from the Federal Reserve Bank of New York. The memo says that the General Counsel such action was not inconsistent with any outstanding regulation, rules, or authorizations of the Federal Open Market Committee;

Around 11 a.m. on December 3, 1973, Burns told Volcker that, as the memo explains, “if warranted by developments relating to debt ceiling legislation pending in Congress, the System would refrain from tendering to the Treasury for redemption on Thursday, December 6, 1973, its holdings of approximately $1.6 billion of Treasury bills maturing on that date.” In other words,Paul Volcker, undersecretary of the Treasury for monetary affairs, on Feb. 10, 1972, in Washington, DC.

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Let's hope they don't pull that shenanigan again.

End the fed. Audit the fed.

Breitbart, always doing what they can to be the catalyst to US demise.

Federal Reserve definitely have fail safe to protect their money that the only reason it was established it controls the money,economy and the government

Nationalize the Federal Reserve Bank.

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