Political cartoon from the early 1800's showing Jackson slaying the Bank---->.
iirc the name of the bank's president was "Biddle" --a name Dickens should have thought up.
At any rate, y'all know that Fed bashing is one of my hot buttons, but my thinking now is that we're better off with it than w/o it.
BS headline. I’d reckon that 90% of Americans don’t even know what the Fed does.
fwiw --something to browse thru after Sunday dinner...
Once again the elites telling us what to think!
People fear what they don’t understand. The question really is, if not the Fed then who?
Central Planning <> Free Market
Of course there was other demand for treasuries besides the Fed. There was a periodic unwinding of the carry trade and that drove up T-bill demand in spurts. There was a general worldwide demand for the perceived safety of US securities. There was a perception of deflation and demand for treasuries as good as cash. And there is the Fed's excuse of fighting deflation.
But those are useless and contradictory excuses. The Fed did not have to print money and give it to politicians, but they did. They did it because that is the side their bread is buttered on. That portion of their policy is 100% political.
I could also bore you with the fact that they didn't need to prop up big banks via mortgage churn by lowering mortgage rates by buying mortgage securities. I could also go on and on about the carry trade that props up big banks at the expense of smaller foreign economies done in by the boom and bust. Or you could deny those are true, but I don't really care, because what you are really arguing is that we need a central bank, possible or alleged warts and all, for a stable currency and long term benefit of the economy.
The fact of the matter is that we need a stable central currency and the Fed is the best way of doing that. We all remember the phrase "don't bet against the Fed" and I have done poorly a few times when I did not follow that advice. The Fed can't be replaced, for example, with a piece of software that responds to the velocity of money and similar indicators because those indicators are imprecise and the markets in large part will figure out how to game the software. The result would be booms and busts that the human-run Fed is trying to avoid.
The problem is that the human-run Fed does not have the data to preclude boom and busts either. The one thing the human-Fed has going for it is inertia. That means conservative decision-making even if one believes, as I do, that the policies are wrong. But because of that inertia and the general focus on the value of the currency, the Fed is the best we can do at this point.
9. The management of a great funded debt and a extensive system of taxes will afford a plea, not to be neglected, for establishment of a great incorporated bank. the use of such a machine is well understood. If the Constitution, according to its fair meaning, should not authorize it, so much the better. Push it through by a forced meaning and you will get in the bargain an admirable precedent for future misconstructions.
8. (4) A great debt will require great taxes; great taxes, many taxgatherers and other officers; and all officers are auxiliaries of power.
6. But the grand nostrum will be a public debt…
11. As soon as sufficient progress in the intended change shall have been made, and the public mind duly prepared according to the rules already laid down, it will be proper to venture on another and a bolder step toward a removal of the constitutional landmarks.
The Annals of America - 1784-1796; Philip Freneau
—That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.
https://www.youtube.com/watch?v=rEZH0t5Yozw
The Federal Reserve is a product of the Great Progressive Movement of the early 20th Century. Starting with that “great” Republican, Theodore Roosevelt, we were gifted with Income tax, direct election of Senators, Prohibition, Women’s Suffrage and The Federal Reserve.
How’s all that working out for Ya?
Stopped reading right there.
Here's Who Actually Owns The Federal Reserve
But the Fed is a weird entity when it comes to “ownership”. It exists due to an act of Congress. But it is also considered an independent entity because it is not part of the Executive or Legislative branches of government. The Fed exists because Congress created it, but it doesn’t enact policy measures with any Congressional or Presidential approval. Politically, this makes it a very independent entity.
Here is a bit from the piece to give you the author’s sympathies
Maybe this prompted the Fed’s creation. Imagine how humiliating to progressives that the banks had to turn to a capitalist pig (J. P. Morgan) to bail them out.
https://en.wikipedia.org/wiki/Panic_of_1907
The panic might have deepened if not for the intervention of financier J. P. Morgan,[3] who pledged large sums of his own money, and convinced other New York bankers to do the same, to shore up the banking system. At the time, the United States did not have a central bank to inject liquidity back into the market. By November, the financial contagion had largely ended, only to be replaced by a further crisis. This was due to the heavy borrowing of a large brokerage firm that used the stock of Tennessee Coal, Iron and Railroad Company (TC&I) as collateral. Collapse of TC&I’s stock price was averted by an emergency takeover by Morgan’s U.S. Steel Corporation—a move approved by anti-monopolist president Theodore Roosevelt. The following year, Senator Nelson W. Aldrich, father-in-law of John D. Rockefeller, Jr., established and chaired a commission to investigate the crisis and propose future solutions, leading to the creation of the Federal Reserve System.[4][5]
He left out the fact that the open market resolved the issues of the FEDRES via bank clearing houses, but that history would prove we don’t need a FEDRES. They don’t work for the country, but creditors and themselves.