I get to watch a lot of hearings in the Congress, and sometimes there are some odd things that happen, and yesterday, there was one of those during an exchange between Rep. Ron Paul (R-TX) and Federal Reserve Chairman Ben Bernanke.

Paul - who is well known for his distrust of the Federal Reserve - was questioning Bernanke during a hearing in front of the House Financial Services Committee.

The Texas Republican went through a series of different issues before moving to talk about transparency at the Fed, which has been one of his most popular legislative initiatives in this Congress.  That's when things went a bit off track.

"I would like to get more specific on the transparency bill because, it has been reported in the past that in the 1980s that the Fed actually facilitated a $5.5 billion loan to Saddam Hussein and he then bought weapons from our military-industrial complex," Paul said.

I was listening to two other things at the time, but that - shall we say - piqued my interest.

"A lot of cash was passed through, and a lot of people supposed it was passed through the Federal Reserve when there was a provisional government after 2003 invasion; that money was not appropriated money by the Congress as the Constitution says," Paul continued.

He wasn't done.

"Also there's been reports that the cash used in the Watergate scandal came through the Federal Reserve and when investigators back in those years tried to find out, they were always stonewalled and they couldn't get the information," said Paul.

It's not often that you hear a member of Congress pull together both Saddam Hussein and Watergate in back-to-back sentences.

"Would you grant that the American people deserve to know whether the Federal Reserve has been involved in this?" Paul continued, wondering aloud if the Fed was about to also move to bail out the country of Greece.

"It seems like if the Fed was not involved in this no matter at all, it would be to your advantage to say, 'No, we don't do stuff like that'.  Why don't we open the books ten years back and find out the truth of these matters," Paul concluded.

By now, I had turned down the volume on my other recorders to see what Bernanke was going to say.

And with his customary, somewhat flat demeanor, the Federal Reserve Chairman did not disappoint.

"Well, Congressman, these specific allegations you've made are absolutely bizarre, and I have absolutely no knowledge remotely like what you have described," Bernanke told Paul.

You just can't make this stuff up.  

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