Why Bankers Created the Fed 100 Years Ago

The Market Oracle, UK ^ | 23 December, 2013 | Christopher_Westley

[Errant]

The Democratic Party gained prominence in the first half of the nineteenth century as being the party that opposed the Second Bank of the United States. In the process, it tapped into an anti-state sentiment that proved so strong that we wouldn't see another like it until the next century.

Its adversaries were Whig politicians who defended the bank and its ability to grow the government and their own personal fortunes at the same time. They were, in fact, quite open about these arrangements. It was considered standard-operating procedure for Whig representatives to receive monetary compensation for their support of the Bank when leaving Congress. The Whig Daniel Webster even expected annual payments while in Congress. Once he complained to the Bank of the United States President Nicholas Biddle, “I believe my retainer has not been renewed or refreshed as usual. If it be wished that my relation to the Bank should be continued, it may be well to send me my usual retainer.”

[Toddsterpatriot]

No, because the Fed buys debt instruments that surpass inflation.

They bought many bonds with yields below your supposed 3% inflation number.

Every year they can buy 3% more than the year before.

The money they get from those old bonds is worth 3% less each year. So they can buy less with that cash.

The person that borrowed the money has to pay more than inflation or else the bank wouldn't lend it in the first place

Inflation can't rise after a loan is made?

They paid back more than inflation. No, it's not them.

They increased the money supply, of course they caused inflation.

[Partisan Gunslinger]

They bought many bonds with yields below your supposed 3% inflation number.

I've made it clear that that is their target, not necessarily the exact number every year. Regardless, they buy many debt instruments that surpass inflation.

The money they get from those old bonds is worth 3% less each year. So they can buy less with that cash.

I'm sure most of their debt instruments surpass inflation.

Inflation can't rise after a loan is made?

Sure, but generally the bankers have a good idea where inflation is going and will make money on their loans.

They increased the money supply, of course they caused inflation.

The Fed increased the money supply with their 3% target inflation. They could just as easily target 0% and make our money act like gold, but that would defeat the purpose of their slavocracy, wouldn't it.