FED - It Causes Crises it Claims to Fix


#1

The Fed was created to prevent the cycles of boom and bust, but after 100 years or so, it can safely be said that it failed its job, not only did it not prevent the crises, but instead amplified them.


#2

The Federal Reserve has done a stellar job preserving and stabilizing our economy given the restrictions of their charter and the absolute idiocy of the voters who elect unqualified morons to Congress in perpetuity.

Thank you Federal Reserve for getting it as right as possible almost all of the time.

This piece starts with a fallacy and then proceeds to so many non sequiturs and zero substantiation for its “conclusions” that it plays like something from the New York Times editorial staff.


#3

It created the boom & bust credit cycle that F.A. Hayek talked about.

It destroyed the ability for us to have 50 or 100 year maturity bonds, which weren’t uncommon before it came around.

Alan Greenspan isn’t called the “architect” of the 2008 collapse for nothing – and keeping interest rates low into perpetuity has done our economy no favors.

It just destroys our savings rate, and makes us more like the Japanese. We aren’t as bad off as they are solely due to us being a reserve currency.


#4

You forgot to mention that our salvation will be illegal immigration and letting China have their way on all things.


#5

RET, it’s not my fault you haven’t kept up on this.

I get that your busy, perhaps too busy to delve into these things very far, but if so, you should be asking questions here.

The Fed has a deplorable history; there’s no salvaging that. Letting the State have a monopoly on money was a bad idea, even when they outsource the job to “chosen” oligarchs. The existence of the FDIC equally creates instability, that acts itself out about every 30-40 years.

My industry suffered from a similar problem created by oligarchy, and this industry would equally benefit from the same dose of deregulation. We need to allow for more consumer choice.


#6

The Federal Reserve has done a great job mitigating the destructive ideas of our ignorant Congress, I applaud them for this effort and mock the “Ron Paul mental midget brigade” that demonizes the Federal Reserve as the scapegoat for their own failures.

Fortunately, economics does not need to be understood in order for the right ideas to bear fruit, the right ideas bear good fruit and the wrong ideas stagnate and bear little fruit regardless of the ignorance of anyone.


#7

I’m quoting the Ludwig von Mises Institute.

I’ll grant RET that an independent Central bank is better than a non-independent one run by Congress; less blatant cronyism that way. But not having one at all would be best. That’s the gradient as I see it. We operated better, the value of our money was better, under free banking.

You’re right about the right ideas bearing fruit, because economies with no central bank, have prospered more than us.


#8

Cool, so you and all of the other Left will be moving soon to those places that have far greater prosperity than the US I suppose?

Imagine the mass exodus that will be occurring once people realize how inferior we are to these other economies, at least our immigration problem will be over!

With such compelling arguments I suppose we will be returning to the Obama ideas in November, how on earth can we hope to respond to such air tight arguments?


#9

Hong Kong, which is more free market than we are? To include banking?

Which is why Milton Friedman loved the place?

RET, if you don’t want to keep up on the issue, that’s up to you.

Meanwhile, Austrians are winning the argument on currency, because banks and countries are shifting to crypto, most of which by design, have no central authority. An end to the monopolies, to much of the power of oligarchs, and this should be welcomed.

Yeah yeah, everything is a political issue, actual discussions on economics don’t exist.

I get it RET. You’re just like progressives, with only one mode of focus.


#10

Be sure to pop in once in awhile after you get to Hong Kong, you better hurry though because I expect most of the world’s population is already packing their bags.


#11

RET, again, it’s not my fault you don’t keep up on this.

If you want to respond to the video I posted, feel free, I’ll listen.


#12

It seems that Alaska Slim would like this country’s economy to run on a bunch of crypto currencies. I’ve already explained to him that that was tried in the first half of the 19th century and failed miserably but to no avail.

The Federal Reserve has been a great improvement over the old system. Sure they have goofed it up from time to time, like 1937 when they put breaks on the monetary system, which helped to start another mini depression. Still it beats the “Wild West” currency system prior to the Civil War.

When I pay for a good or service or receive payment for something I supply or do, I don’t want to have to do a credit check on the bank, individual or whatever who issued the privately sponsored currency. Adding that complication to the economy in the name of “freedom” is just plain silly. That’s not freedom; it’s an unnecessary complication.


#13

They didn’t have cryptocurrency in the 19th century. The technology is called blockchain, or “smart-contracts”; it’s being deployed right now by BBVA and Santander as a way to eliminate error and corruption that comes from human intermediaries, or their own employees.

With Blockchain-as-currency, you own a share in this system, and its value goes up as usage does.

Currency was more stable in value in the 19th century, that’s why we could have things like 100 year-bonds.

Recessions have also become longer in the post WWII-era, on average by one month.

Send, your knowledge is built on flawed studies from the 1950s that more recent investigation have overturned-- to the point that we now realize the “Long depression” of the 1870s, wasn’t even that long, it was more like two years.

You should take another look at all this.


#14

If Alaska Slim wants to live under a system of privately run currencies than he has a perfect right to play with them on his computer. I don’t want any part of his monetary system.

I want a dollar that is reasonably stable, like the one we have had for most of time since the Great Depression. Making investment choices is hard enough without have to worry about the very currency you will use to buy the stocks and bonds, let alone worrying about what currency will be used to pay the interest and dividends. I don’t need unnecessary economic chaos.

That’s funny. The currency of every little bank had its own value, and the reporting was done in less than unbiased sources like Neil’s Bank Note Reporter which took ads from the banks they were supposed to monitor. Yea the currency was really stable in the 19th century … NOT

The only currency that held its value with any amount of stability in the 19th century was gold.

And “one month” is statistically significant? Please …

Here’s some data for you on the length of the economic Panics (depressions and recessions) in the 19th century. The first two were during you “golden age of wild west bank currencies.”

Panic of 1819, lasted two years until 1821
Panic of 1837 lasted eight years until 1844
Panic of 1873 lasted six years until 1879
Panic of 1893 lasted four years until 1897