Renewable Revolution

The Deliberate Erosion of Fixed Income Purchasing Power Engineered by Fed goosed INFLATION in the USA is NON-Democratic THEFT for the Elite.

Agelbert NOTE: The Federal Reserve is NOT a democratic organization. The very clever rationale for

Fed "Independence" (from we-the-people, but NOT from elite bias) was based on the alleged "Inflation Bias" of an elected Congress on monetary policy. 



An "Independent" (as in YOUR VOTES DO NOT APPLY) Fed would allegedly avoid panic and control Inflation better... 


Question 41 of a quiz on what the Fed does, why it can do it, what it isn't authorized to do but does anyway, and what the Congress can do about it (but since 1913, never does.  ).

The case for Federal Reserve independence does not include the idea that

A) political pressure would impart an inflationary bias to monetary policy.
 
B) the principal-agent problem is perhaps worse for the Fed than for congressmen since the former does not answer to the voters on election day.

C) a politically insulated Fed would be more concerned with long-run objectives and  thus be a defender of a sound dollar and a stable price level.
 
D) a Federal Reserve under the control of Congress or the president might make the so-called political business cycle more pronounced.

The correct answer is B). 

See below for OBJECTVE criticism of Fed independence (the correct answer is in bold):

45) Critics of the current system of Fed independence contend that

A) the current system is undemocratic.
 
B) voters have too much say about monetary policy.

C) the president has too much control over monetary policy on a day-to-day basis.

D) all of the above are true.


46) Critics of Fed independence argue

A) that it is undemocratic to have monetary policy controlled by an elite group responsible to no one.

 B) that an independent Fed conducts monetary policy with a consistent inflationary bias.
 
C) that the Fed, since it does not face a binding budget constraint, spends too much of its earnings.

 D) only A and B of the above.   


47) Critics of Fed independence argue

 A) that it is undemocratic to have monetary policy controlled by an elite group responsible to no one.

 B) that independence seemingly does little to guarantee good monetary policy.

 C) that its independence may encourage the Fed to pursue a course of narrow self-interest rather than the public interest.

D) all of the above.   

   

Banking: The fed and monetary policy
Study by dwkremer   

https://quizlet.com/75164696/banking-the-fed-and-monetary-policy-flash-cards/

The surreptitious theft/erosion of purchasing power from the wages of Americans is the MAIN cause of the inequality increase in the USA. The Fed did ALL of that. MKing might whine that we-the-people "voted" the Fed into existence in 1913  , but that would be a lie as well. Even a cursory examination of how that Christmas eve "vote" for the Fed came about would reveal that democracy and voting did not apply.

The Fed (see Alan Greenspan), in it's "Principal Agent" role (for you know who  ), also was instrumental in getting the BLS (Bureau of Labor Statistics) to modify the cost of living calculation formula in order to low ball "unnecessary items" like housing costs, food and energy  . I admit some voting was involved in that shaft job. But really, the COLA gaming was just the icing on the elite 'wealth transfer from the masses to the rich' welfare queen cake! 

WHY? Because, while Inflation SUBTRACTS from the average Joe or Jane's purchasing power, the Fed is GOOSING the purchasing power of the elite by setting margin rates UNDEMOCRATICALLY.

Those margin rates that allow for generous borrowing for speculation by the brokerage firms and big banks do NOTHING for the main street American economy.

But for Wall Street, it gooses speculation in stock market securities, while it wrecks normal price discovery mechanisms. That is, they iNFLATE the paper wealth of a tiny elite sliver of the US.

Then they claim "inflation is under control" because the COLA fun and games make SURE the masses have their purchasing power eroded at the same time.   

Do you understand what loose margin requirements really means? Loose margin requirements is like giving ALL potential borrowers an A+ top tier credit rating. Do you think everybody on wall street merits that? Of course not! But they get it. At the same time, we-the-people get less purchasing power.

The Fed works for the Elite. Voting isn't going to change that any time soon.   

Surly, I agree that union contracts, environmental laws and many other socially positive bits of legislation are the result of elected officials with a conscience. Yes, we need to vote, OKAY?

But the Fed has been an elite tool since it was founded in 1913. After we got off the gold standard, they got worse! And the royalist conspiracy that Thom Hartmann mentions often has taken apart much of the social progress made in this country.

When some duplicitous double talker like MKing brings voting into a discussion of Inflation cause and effect, he does so with exactly the same "we are all to blame" dissembling agenda BALONEY the mainstream media tried to sell us in 2008. I'm surprised you didn't see through that. 

Not only are we NOT all to blame, but 90% of us (at least!) are NOT to blame!

We-the-people DID vote Nixon in to become President. He pushed some great environmental legislation.   

But THIS action by him was totally undemocratic. THAT action should have required a referendum, but it did not. I suspect the Fed dictated that action to President Nixon.

The Nixon Shock was a series of economic measures undertaken by United States President Richard Nixon in 1971, the most significant of which was the unilateral cancellation of the direct convertibility of the United States dollar to gold.

https://en.wikipedia.org/wiki/Nixon_Shock

Surly, Today I have once again confirmed what I told you some time ago in a pm about talking to walls at the Doomstead Diner. The flexibility I observe here is like that of one year old cured concrete.