Paul goes on to rant about how perhaps the Fed bought assets at inflated prices from cronies and we can't possibly know if it did or didn't. Again, the Fed will tell you in excruciating detail exactly what it bought and for how much. And it buys only government guaranteed assets and holds no subprime auto loan or mortgage-backed securities that Paul seems so worried about.
If you want to read more problems with Paul's arguments you can do so here. I've challenged the senator to a debate on the issue. Will see if he responds.
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But the larger question is whether Paul can sell his "bash the Fed" routine beyond Iowa and make a serious run at the GOP presidential nomination or whether he will remain the kind of beloved but marginalized political icon his father was. It's hard to imagine it will be the former if he continues to advocate for direct congressional intervention of Fed monetary policymaking under the guise of "auditing" an institution that is already subject to multiple levels of exhaustive audit.
The "audit the Fed" question is likely to come up for other 2016 hopefuls as well.
Sen. Marco Rubio of Florida, for instance, is a co-sponsor of Paul's bill. Perhaps the biggest question is what former Florida Gov. Jeb Bush will have to say. Bush is raising huge sums on Wall Street, where the "audit the Fed" movement is widely despised. But Bush is already sideways with the activist GOP base on immigration and education. Can he afford to alienate them on the Fed as well? Chances are Bush will come up with a middle ground that calls for even greater central bank oversight while stopping short of endorsing Paul's bill.
But it will be another interesting moment to watch as Bush and other establishment-wing Republicans try and navigate an early primary process where the Federal Reserve is widely viewed as a scary, secretive monster that, in Paul's words, is "out to get us."
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—Ben White is Politico's chief economic correspondent and a CNBC contributor. He also authors the daily tip sheet Politico Morning Money [politico.com/morningmoney]. Follow him on Twitter @morningmoneyben.