So does anyone understand the new powers that congress and the administration are planning to provide the Feds?  I know that in theory they want the Feds to antiicipate boom and bust cycles and have some kind of oversight / power to prevent companies from becoming “too big to fail.”  Given that the Feds are not formally part of the governmnet and that they represent the largest banks in the US, I don't see how this helps.  It is not something like the fox guarding the hen house or worse?

Well, I don't exactly agree.  My issue is not that the government is trying to expand its powerbase.  Quite the opposite.  If it were the government that would be exercising these new powers, then I would not be as concerned.  My concern is that the fed is NOT a government organization, but rather an organization that was created by the government, but made up of private banking interests.  The fed res will always act to support and protect a private money system.  Thus, I would argue the government should dismantle the fed and directly assume the responsiblity of the fed res through treasury/commerce department.  While I am not exactly sure what the porposed new powers were, I believe it had something to do with monitoring the economy and ensuring that no company or private interest would become “too big to fail” and to predict when the next financial bust cycle will occur (which I understand is an inevitable recurring event given how our current monetary system is set up). 

I don't believe that “free market enterprise” and capatalism works in a completely unregulated environment.  However, given the proper constraints like we generally have in place, I believe in letting business figure what is in their best interests and act accordingly.  The only exception is the financial industry because, as the book National Economy points out, money cannot be the basis of a nation's economic wealth.  It is the other side of the economic coin that allows wealth to be evaluated and distributed.  Hence, the financial industry should be the most regulated industry of all, and the issuance of new money should be kept within the purvue of the government and not private banking interests as it is now. 

So, where does that leave us? Unfortunately not in a good place, because the powers that be: government, finance, and industry do not have a vested interest in fundamentally changing the system.  As evidenced by the proposal to give the fed reserve more power, they are only interested in “band aids” that will keep the public mullified.