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Tag Archives: End the Fed

The counter summit to the Fed meeting in Jackson Hole

Calls to reform, audit, and even eliminate the Federal Reserve have been growing in recent years. We certainly call for an end to the Fed and I encourage anyone interested in monetary policy and the Federal Reserve to read Free Prices Now by ACC co-founder Hunter Lewis. Hunter is a scholar of the highest order and a remarkably successful financier. If you want to understand the sins of the Federal Reserve read his book.

But many people already understand the sins of the Fed and many of these people gathered in a counter summit to the party the Federal Reserve was having this week in Jackson Hole Wyoming. One of the people criticizing the Fed was Benn Steil who, believe it or not, is a director of international economics at The Council on Foreign Relations.

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The Federal Reserve is Not Your Friend

Regular readers of ACC already know this both because we often make the case against the Fed but also because, in our opinion our readers are just a particularly smart bunch. But that the Fed is no friend is a point which deserves to be made often.

The Fed is not on your side. It is on the side of the big banks. Always keep this in mind. In most cases Yellen and Company really couldn’t care less about you or me. But they care quite a lot about Goldman, and JPMorgan, and Citibank.

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Fed’s worst nightmare: The ‘ghost of 1937′ (Will the “Great Recession” be given new life soon?)

In 1937 after years of a meager “recovery” the economy slumped again as artificial economic props were taken away. The Great Depression was born anew. 4 years later we were in a global war.

Let’s see, depression, then mediocre growth underpinned by artificial economic stimulants, sounds pretty familiar.

This is what happens when interest rates are set by a politburo instead of by the market.

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Bernanke says don’t blame him (or the Fed) for the rising inequality

The key drivers for the increased inequality (as we have said many times before) are the financialization of the economy and the emergence of a truly crony capitalist system. The two are of course entwined. The cronies enjoy bailouts and bonuses from banks which get bailed out. The unconnected get to do the bailing. (In various ways.) That’s basically the gist.

Ole’ Helicopter Ben put this long emerging trend into overdrive. But don’t blame him for inflating the assets of the already wealthy while the rest of the country was left behind. And don’t blame him for waging a war on savers. (Basically the prudent middle class.) Nope, he’s not to blame at all for the gulf in the economy. That just happened. Ben explains that over the long term monetary policy is neutral.

Man, if only.

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No more ‘Backdoor Bailouts’ from the Federal Reserve?

This bill is probably a step in the right direction, but the focus should be first on auditing the Fed under a bright burning magnesium fueled light. We need to know what’s really going on in the institution before we can chart the best way forward. Open the beast up. Let’s see what happened in 2008/2009 and during the QE binge. Then we can tinker, or hack away, or blow up as needed.

It should be noted that Senator Warren, who is co-sponsoring this legislation in the Senate with Senator Vitter, opposes an audit of the Fed.

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Townhall: Libertarians Outnumber Both Liberals and Conservatives

Many of our readers are probably aware that Townhall Finance regularly features our work. John Ransom, the editor there does an excellent job and we encourage everyone to check out the site if you have not visited. It’s a very good mix of free market thinkers from different schools. Though it is generally not “libertarian.”

That is why I was particularly pleased to see this article in Townhall. A new and broad political disposition is clearly emerging. Though many longstanding libertarians would probably take issue with some of the people calling themselves “libertarians” these days, what we see is clearly progress. In the face of a very activist government (going back long before Obama) and a renaissance of constitutional understanding (largely facilitated by the Internet) more and more people are actually embracing the concept of “live and let live.”

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Fed’s Regional Banks Are ‘Unconstitutional,’ Brookings Paper Says

What is of particular note is that this paper comes from a Brookings Institution scholar. Brookings is generally liberal in its disposition.

I am not keen on the prescription. Notice that the author comes short of calling the Fed itself unconstitutional. But at least there is some criticism of the Fed coming from the lefty camp. The excuses for the Fed have gotten embarrassing of late.

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Gold “Terrifies” the International Monetary System

Indeed it does. Gold is a little bit of power you can put in your pocket. It is a direct and ongoing challenge to the current system of fiatism. (And by extension crony capitalism.) Central Banks can’t print gold. Gold limits the power of the Fed and its brethren. Gold limits the power of the banks which suckle at the teat of central banks. Gold limits the power of governments to indebt their peoples. Gold limits the ability of governments to wage war.

Gold encourages discipline.

Is it any wonder why gold is often called God’s money and why some people despise it so?

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Why the New York Fed Annoys Republicans and Democrats Alike

By far the most secret and least accountable operation of the federal government is not, as one might expect, the CIA, DIA, or some other super-secret intelligence agency. The CIA and other intelligence operations are under control of the Congress. They are accountable: a Congressional committee supervises these operations, controls their budgets, and is informed of their covert activities. It is true that the committee hearings and activities are closed to the public; but at least the people’s representatives in Congress insure some accountability for these secret agencies.
It is little known, however, that there is a federal agency that tops the others in secrecy by a country mile. The Federal Reserve System is accountable to no one; it has no budget; it is subject to no audit; and no Congressional committee knows of, or can truly supervise, its operations. The Federal Reserve, virtually in total control of the nation’s vital monetary system, is accountable to nobody – and this strange situation, if acknowledged at all, is invariably trumpeted as a virtue. – Murray N. Rothbard from The Case Against the Fed

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Former Fed Chief at Odds With How Central Bank Now Makes Policy: “you have a feeling now that we are committing suicide” if any inflation gauge turns negative

End the Fed. But Volker at least had the guts to raise rates to insane levels and effectively crushed 1970s inflation. If we had sound money he would not have had to do that of course. (Nor would he have had the power.)

Of the 4 chiefs still alive Volker is my favorite. Or at least the one I dislike least.

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