The Fed has been a failure: Analysis

[Anarchist420]

http://www.cato.org/pubs/researchnotes/WorkingPaper-2.pdf

It's seriously time to get rid of it. I don't get why people think inflation is so cool. Nor do I get why so many people are comfortable with banks embezzling their deposits.

The fact that we let these bastards ruin our lives shows how stupid we are.

 

[MooseNSquirrel]

I believe you are posting this not because you have conviction in your beliefs, but because after careful analysis of both sides of the question are have concluded that your beliefs reflect reality.

 

[ericlp]

Time to give third party a try! :whiste:

 

[Scotteq]

/popcorn


(Interesting Paper, tho)

 

[PeshakJang]

This Thread will be a Failure: Prediction

 

[ElFenix]

since you just post the same thread over and over again can you just stick with 1? kthx

 

[LegendKiller]

Yeah, the Koch brothers (who started and currently fund Cato) would like nothing more than to have a completely free market so they can pollute all they want to maximize profit. After all, being worth 43bn together isn't enough money.

 

[KlokWyze]

Yeah, the Koch brothers (who started and currently fund Cato) would like nothing more than to have a completely free market so they can pollute all they want to maximize profit. After all, being worth 43bn together isn't enough money.

Yeah, but the monetary system doesn't regulate and enforce environmental laws. Right?

Other non-profits that have been funded by rich dudes. Greenpeace ------> Rockefeller. I always found it funny that rich corrupt mother fuckers (Rockefeller is a poster child) donate 1% of their ill-gotten wealth and they are considered generous philanthropists.

I say complete rewrite and simply US tax code while we are @ it. Good god.

 

[IHateMyJob2004]

http://www.cato.org/pubs/researchnotes/WorkingPaper-2.pdf

It's seriously time to get rid of it. I don't get why people think inflation is so cool. Nor do I get why so many people are comfortable with banks embezzling their deposits.

The fact that we let these bastards ruin our lives shows how stupid we are.

I see you chose ignorance over stupidity.

regarding inflation, you really must be an idiot. Please look up terms you don't know. Kinda expecting that Free Cash Flow is a new word for you. Assume that Free Cash Flow for ABC corp pre debt payments is $10,100. Of that, $10,000 goes to debt payments. So, there is $100 of FCF. But then we have deflation. So the next year revenues drop and FCF pre debt payments is $9,500. After debt payments, the company is $500 in the hole in regards to FCF. With inflation, this normally (seriously using the term normally in regards to the idea of normalization and not an assumption) would not happen. Instead, FCF pre debt payments would normally be $10,500 (or whatever). So the company made $500 in FCF!

Point of this is that many companies in a recession may be on the edge of collapse and deflation will push them over that edge. Deflation is NEVER a good thing. Hyper inflation (over 10% in a year) can also be bad (in general) due to the ability for a given countries fiat currency to loose value in the world markets.

Also, deflation would drop the floor on your home value. So if you were to sell, you could be in the red. Inflation is always a good thing. But you want it at about 2-3%. Maybe even 5%. But to say it is a bad thing is just right out idiotic.

 

[IHateMyJob2004]

Flaw 1, that paper is comaprieng the economic s of the year 1900 to today. Times have changed. WHere to start? Life expentancies? Quality of living? Cost of living? Tehcnologically changes? Improved efficiences in everythign around us.

The premise of the paper is just stupid.

 

[LegendKiller]

Yeah, but the monetary system doesn't regulate and enforce environmental laws. Right?

Other non-profits that have been funded by rich dudes. Greenpeace ------> Rockefeller. I always found it funny that rich corrupt mother fuckers (Rockefeller is a poster child) donate 1% of their ill-gotten wealth and they are considered generous philanthropists.

I say complete rewrite and simply US tax code while we are @ it. Good god.

The general push of Cato is small government, right where OP fits but no rational person.

 

[Rainsford]

Yeah, the Koch brothers (who started and currently fund Cato) would like nothing more than to have a completely free market so they can pollute all they want to maximize profit. After all, being worth 43bn together isn't enough money.

The problem with removing the fed, or similar schemes, is that the people pushing them aren't exactly wrong in saying that things like the fed DO limit some economic activity. The problem is that the concept of a free market, as portrayed by Cato and other libertarian organizations, is mostly about freedom for those big enough to control the market.

For the average person, an economy without the Fed would be no more free than the current setup, except that the control would be in the hands of people MUCH less accountable than the current system (namely, people like the Koch brothers). The big lie of the "free market" argument is that macro economic success applies equally well to the individual. In other words, that approaches that can broadly be argued to benefit the market as a whole ALSO benefit the individual. But macro economics explicitly disregards who benefits, only concerning itself with the health of the system as a whole. Which is worth considering, of course, but it should NOT be the entire basis for economic policy in this or any other country.

 

[Rainsford]

Yeah, but the monetary system doesn't regulate and enforce environmental laws. Right?

Other non-profits that have been funded by rich dudes. Greenpeace ------> Rockefeller. I always found it funny that rich corrupt mother fuckers (Rockefeller is a poster child) donate 1% of their ill-gotten wealth and they are considered generous philanthropists.

I say complete rewrite and simply US tax code while we are @ it. Good god.

Donating money is certainly more philanthropic when you don't stand to directly benefit from your donations. Funding a non-profit that's stated goal directly helps you shouldn't be considered a donation at all, IMHO.

 

[LegendKiller]

The problem with removing the fed, or similar schemes, is that the people pushing them aren't exactly wrong in saying that things like the fed DO limit some economic activity. The problem is that the concept of a free market, as portrayed by Cato and other libertarian organizations, is mostly about freedom for those big enough to control the market.

For the average person, an economy without the Fed would be no more free than the current setup, except that the control would be in the hands of people MUCH less accountable than the current system (namely, people like the Koch brothers). The big lie of the "free market" argument is that macro economic success applies equally well to the individual. In other words, that approaches that can broadly be argued to benefit the market as a whole ALSO benefit the individual. But macro economics explicitly disregards who benefits, only concerning itself with the health of the system as a whole. Which is worth considering, of course, but it should NOT be the entire basis for economic policy in this or any other country.

100% correct.

 

[KlokWyze]

Donating money is certainly more philanthropic when you don't stand to directly benefit from your donations. Funding a non-profit that's stated goal directly helps you shouldn't be considered a donation at all, IMHO.

Yeah good point TBH, but with Rockefeller, he HAD to donate a lot of money because he was so rich and everyone knew he was a shady business man. Mobs would picket outside his house, tons hateful articles were written about him, ec. So he benefited by not being lynched. :biggrin:

About the paper though... is it really propaganda like that? Or is it an unbiased study of the FED's success/failure?

 

[Rainsford]

Yeah good point TBH, but with Rockefeller, he HAD to donate a lot of money because he was so rich and everyone knew he was a shady business man. Mobs would picket outside his house, tons hateful articles were written about him, ec. So he benefited by not being lynched. :biggrin:

That is also true. Donating strictly for the PR/tax breaks isn't any better than donating to organizations that are helping you directly. I don't think they should be disallowed or anything, but donating because you believe in philanthropy and donating because you're a selfish son-of-a-bitch are two very different things.

About the paper though... is it really propaganda like that? Or is it an unbiased study of the FED's success/failure?

Well it's presented by an incredibly libertarian organization, and the problem with extreme advocacy groups is that their motives are suspect by default. The Cato Institute wants to enhance economic libertarianism as much as humanly possible, so while that doesn't make any facts they present in favor of that automatically wrong, it DOES make them somewhat less trustworthy than those presented by people with no agenda.

 

[Trianon]

Excellent video interview of a legendary investor Jeremy Grantham who has many fascinating things to say about the overall economy in general and the Fed specifically

http://www.businessinsider.com/jeremy-grantham-interview-bubble-2010-11

 

[bignateyk]

I'm all for getting rid of the Fed. Anything that shakes up the current system is a good thing.

Our entire government is broken. The more people who realize that, the better. Anything to shake up the system is good.

 

[Rock Hydra]

http://www.cato.org/pubs/researchnotes/WorkingPaper-2.pdf

It's seriously time to get rid of it. I don't get why people think inflation is so cool. Nor do I get why so many people are comfortable with banks embezzling their deposits.

The fact that we let these bastards ruin our lives shows how stupid we are.

"I believe that banking institutions are more dangerous to our liberties than standing armies . . . If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] . . . will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered . . . The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." -- Thomas Jefferson -- The Debate Over The Recharter Of The Bank Bill, (1809)

Enough Said.

 

[yllus]

It seems clear to me that each nation does need an arms-length group to manage monetary policy. It's not something best left directly in the hands of politicians, though they must have the ability to at least apply pressure to the group.

I think there is valid criticism in the Federal Reserve being this odd intersection of an immensely powerful government entity and also heavily staffed by people working for the nation's largest banks. Only a rather naive optimist would believe that the Federal Reserve always acts in the best interests of the nation, instead of mixing in the best interests of the member banks in as well. Sure, much of the time they have the same goals - but not always.

On the other hand, you would have the setup of a central bank that doesn't have intimate access to top industry people, which is probably even worse.

 

[Rock Hydra]

That is also true. Donating strictly for the PR/tax breaks isn't any better than donating to organizations that are helping you directly. I don't think they should be disallowed or anything, but donating because you believe in philanthropy and donating because you're a selfish son-of-a-bitch are two very different things.

Well it's presented by an incredibly libertarian organization, and the problem with extreme advocacy groups is that their motives are suspect by default. The Cato Institute wants to enhance economic libertarianism as much as humanly possible, so while that doesn't make any facts they present in favor of that automatically wrong, it DOES make them somewhat less trustworthy than those presented by people with no agenda.

Rockefeller is an international citizen I do believe, so him paying taxes...HA yeah right. He has no allegiance to anyone. I am speculating that his big oil money paid off the "Government" to allow corporations to charter without proof that they even help people who create/operate/affiliate with them. He wants to destroy freedom and sovereignty with Global Government. Also, those group of elites invented the philanthropy scheme.

 

[Scotteq]

Yeah good point TBH, but with Rockefeller, he HAD to donate a lot of money because he was so rich and everyone knew he was a shady business man. Mobs would picket outside his house, tons hateful articles were written about him, ec. So he benefited by not being lynched. :biggrin:

About the paper though... is it really propaganda like that? Or is it an unbiased study of the FED's success/failure?

That is also true. Donating strictly for the PR/tax breaks isn't any better than donating to organizations that are helping you directly. I don't think they should be disallowed or anything, but donating because you believe in philanthropy and donating because you're a selfish son-of-a-bitch are two very different things.

Well it's presented by an incredibly libertarian organization, and the problem with extreme advocacy groups is that their motives are suspect by default. The Cato Institute wants to enhance economic libertarianism as much as humanly possible, so while that doesn't make any facts they present in favor of that automatically wrong, it DOES make them somewhat less trustworthy than those presented by people with no agenda.

The problem being there are almost no organisations who either have no bias, or who wouldn't be painted as having such and subsequently discredited by those who *do*...



I'm of the opinions that:

- The original decision to abolish the Gold standard was *hugely* risky and made at least in part under pressure of global War

- That nobody really "knew" what would happen and/or how to manage it

- That therefore we have been living a gigantic experiment for the last 30~some years (when the last vestiges of the Gold Standard were swept away*)

- That the well intentioned efforts of the Fed are clearly not without failure

- And VERY clearly that: If we were to abolish The Fed, then we would have to create another Fed to replace The Fed.


So, of those points, my conclusion would be that abolishing The Fed for making mistakes would be much like giving yourself a Penectomy 'cos you caught a dose of the clap: Completely Unnecessary since there are better methods available to fix the issue at hand. The chosen Cure applied is Worse than the Disease. And you find out REAL QUICK that you actually needed the thing, despite it getting you into trouble from time to time.



*{Words specifically chosen for the Star Wars 'Rebellion' reference.}

 

[CycloWizard]

The general push of Cato is small government, right where OP fits but no rational person.

Yes, only irrational people support shrinking government. How could anyone rational support getting rid of even a small fraction of the big, beautiful mess running the show now?

 

[halik]

The problem with removing the fed, or similar schemes, is that the people pushing them aren't exactly wrong in saying that things like the fed DO limit some economic activity. The problem is that the concept of a free market, as portrayed by Cato and other libertarian organizations, is mostly about freedom for those big enough to control the market.

For the average person, an economy without the Fed would be no more free than the current setup, except that the control would be in the hands of people MUCH less accountable than the current system (namely, people like the Koch brothers). The big lie of the "free market" argument is that macro economic success applies equally well to the individual. In other words, that approaches that can broadly be argued to benefit the market as a whole ALSO benefit the individual. [n] But macro economics explicitly disregards who benefits, only concerning itself with the health of the system as a whole.[/b] Which is worth considering, of course, but it should NOT be the entire basis for economic policy in this or any other country.

You've essentially described the concept of an externality.

You can have efficient allocation of resources and at the same time issues like income gap, pollution, agent problems * and so forth. Those things are without doubt "bad", but the market doesn't address them.

 

[CycloWizard]

The problem with removing the fed, or similar schemes, is that the people pushing them aren't exactly wrong in saying that things like the fed DO limit some economic activity. The problem is that the concept of a free market, as portrayed by Cato and other libertarian organizations, is mostly about freedom for those big enough to control the market.

For the average person, an economy without the Fed would be no more free than the current setup, except that the control would be in the hands of people MUCH less accountable than the current system (namely, people like the Koch brothers). The big lie of the "free market" argument is that macro economic success applies equally well to the individual. In other words, that approaches that can broadly be argued to benefit the market as a whole ALSO benefit the individual. But macro economics explicitly disregards who benefits, only concerning itself with the health of the system as a whole. Which is worth considering, of course, but it should NOT be the entire basis for economic policy in this or any other country.

The Fed isn't practically accountable to anyone. It is essentially a bastardized version of the Platonic concept of a "philosopher-king," where some people who think they best understand how all of this works run the show due to a political appointment. If this is the approach we're going to take, why do we pretend to have a representative government when this organization probably has power on the same order of magnitude as congress?