07/22/2013 02:30 pm ET Updated Sep 17, 2013

Fix Federal Reserve Board Policies

The Federal Reserve Bank's Policies of Quantitative Easing and providing banks with unlimited, unconditioned, and practically interest free funding from its Open Window Facility and favorable discount rates have failed to create jobs and revenues, and stimulate the economy in proportion to need. These programs: merely further benefit and enrich the now recovered banking sector at public expense; dangerously increase the money supply and the probability of eventual inflation; fail to materially increase small and medium business and home mortgage lending; impoverish depositors, bondholders, and pensioners; dangerously grow the national debt and diminish the pressure for its reduction; subsidize bank gambling at public expense and risk; and dilute the quality and exposure of Federal Reserve assets.

Furthermore, the financial sector is pressuring Congress to emasculate the financial reform legislation and oversight and enforcement of regulations; forgo prosecution of miscreants and violators; minimize penalties; and avoid the ethical responsibility for banks to lower the interest and/or principle of their subprime mortgage victims, cleverly inducing a compliant federal government to assume this responsibility. Congress and the regulators must develop the integrity, will, skill, and backbone to protect the public and the economy from these greedy, selfish special interests. Crony capitalism must end and real transparent campaign reforms enacted.

Among corrective measures would be to condition bank access to the Federal Reserve Open Window Facility upon: (a) reducing interest rates on their subprime mortgages interest to 2% above the rate received from the FROWF and other government sources (whichever are lowest) and lowering their subprime mortgage principles in proportion to funds received from said sources; (b) increasing home mortgage , small and medium business, and consumer lending at fair and reasonable rates based upon minimum due diligence and borrower net worth and income sufficiency;

(c) restoring the former usury laws of 6% to 7% interest limits with caps on fees and penalties and the former personal bankruptcy laws (including college loans); and (d) requiring simplicity, full disclosure, and transparency in all personal and business contracts with severe penalties for non-compliance.

Banks now play an outsized role in the economy at the expense of the business and service sectors. Traditionally, the primary role of banks was to provide services to business and individuals who create the jobs and revenues and expand the economy. Banks have evolved into predators. They create few jobs other than their own staffing. Today, they use any and all means to siphon the money out of the economy; exploit and manipulate governments and their programs; gamble at public risk; use campaign contributions, lobbyists, and foster crony capitalism between Congress, regulators and agencies to influence, control, and shape legislation for their own benefit, maximize leverage, and minimize reserves (instead of minimum reserves of 10% Tier #1 assets and maximum leverage of 10:1 as a crisis cushion); and develop complex exotic instruments to maximize profits, fleece society, circumvent or minimize oversight and supervision at the risk of the national and global financial systems (like $Trillions in unlimited, unregulated derivatives). Derivatives must be controlled, limited, and regulated. Credit Default Swaps & Carried Interest must be eliminated. THE VOLCKER RULE MUST BE STRICTLY IMPOSED. BANKS CONSIDERED TOO BIG TO FAIL MUST BE REINED IN AND BROKEN UP. JOBS AND BUSINESS MUST RETAIN PRIORITY OVER THE FINANCIAL SECTOR. A uniform global transaction tax should be imposed on all stock, bond and derivative transfers. Said reforms must be universally adopted by the groups of 8 and 20 and regulated by the Basel Committee on Banking Supervision, and/or the IMF, OECD and WTO