• Steve H. Hanke
    05/04/2016 - 08:00
    Authored by Steve H. Hanke of The Johns Hopkins University. Follow him on Twitter @Steve_Hanke. A few weeks ago, the Monetary Authority of Singapore (MAS) sprang a surprise. It announced that a...

The Fed - Independence, Yes; But Accountability And Limits?

Tyler Durden's picture




 
0
Your rating: None
 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Tue, 12/06/2011 - 12:18 | 1951027 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The Fed is unconstitutional!  It is run by a private clique of bankers!  It is a private, for profit "S" corporation!  The Directs profit directly (hence the name) and their bankers get bonuses from the loans made by the Federal Reserve. 

Tue, 12/06/2011 - 12:19 | 1951042 LeBalance
LeBalance's picture

let's dispense with the validity or applicability of that concept.

http://jim.com/treason.htm

Tue, 12/06/2011 - 12:20 | 1951055 Oh regional Indian
Oh regional Indian's picture

Teh Fed is simply the 4 or 5th charter of the infamous First American Bank from bank when. It took them a long time to get it all right.

I think it's coming demise is planned. It's work is almost done. And look at the thing, fortress.

ORI

of-un-polished-things

Tue, 12/06/2011 - 12:30 | 1951097 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The seed of the tree of knowlegde was planted long ago in the minds of men.  It went through many seperate times, some of radical science, some of art, and some of philosophy.  The most recent turn is a revolution of deceit; that money can actually grow on this tree.

The bankers have played the greatest con-game of all time:  They have tricked people into believing that money is beyond time.  They have taken Einstein's theory that time is relevant to the next level by creating money (by debt) at a moments notice without any work.  They have gotten rid of hard work, making themselves, once again, Kings of this Earth.

Before now they needed armies to protect their gates.  Now they use propoganda.  Propoganda by the Hegelian dialectic:  There are only two sides, two sides of the coin, and you must pick a side.  However, what they do not mention, is that there is ONLY ONE COIN.  You can take the whole coin for what it is.

This is like how we understand that there is no red party, no blue party, but one Royal Purple Party, and we do not want any part of it.  We want to be independant, we long to be free.

Take away the Fed, and you have taken away the greatest wall the oligarchs have.  Take back the money supply, and you have taken back your monetary freedom.  So do it.

BUY SILVER

Tue, 12/06/2011 - 15:14 | 1951693 TruthInSunshine
TruthInSunshine's picture

Aside from the constitutional question as to whether Congress can delegate its role of coining money to a surrogate such as the Federal Reserve, the practical issue is whether Americans have a more immediate means of petitioning government for redress in the event that the majority (or even a plurality of voters) is not in favor of circumstances brought about by whatever monetary policy vis-a-vis monetary policy are brought about.

If Congress is controlling the money supply directly, rather than the Federal Reserve, voters can resort to the democratic process and "vote out the bums" far sooner and with more directness than if "an independent body, sometimes claiming to be governmental, quasi-governmental, or non-governmental, depending on convenience of the moment (apparently), such as the Federal Reserve" is controlling the money supply directly. Whether voters do the right thing or not is part and parcel of whether one believes in democracy (either direct or more of a republic version) versus statism, and is willing to assume that risk rather than trade it for the risks inherent in usurping citizenry input/rights.

From a more general and philosophical perspective, having an unelected (although appointed by the POTUS and confirmed by the Senate) Federal Reserve Chairman (who can then vote with his co-members at the Fed to fill in the ranks of fellow regional Fed Member Seats), with such a collective, non-elected group being able to control something as fundamental to the U.S. economy as the money supply and interest rates, truly does grossly warp what appears to be the clear intent (based on a plain reading of the Constitution) of those who drafted our Constitution.

We, as a new nation, had just broken away from the British Crown, which itself was subject to the predilections and private interests of a private central bank (House of Red Shield), warping its economy and the general welfare of its citizenry for private, kleptocratic gain, when we drafted and enacted our Constitution.

But here is the real question that every American with a pulse need answer:

What good is a GUARANTEED Constitutional framework of law and government (i.e. NOT law  or rules or CONSTRAINTS on government as mandated by men) if any part of the Constitution providing said guarantee can be dismissed, thrown out, arbitrarily tossed, burned, ignored, abused to the point of meaninglessness?

Tue, 12/06/2011 - 16:03 | 1952213 mr_sandman
mr_sandman's picture

If the Constitution was in force, we would not be allowed to create currency in America, so the question of whether "a collective, non-elected group being able to control something as fundamental to the U.S. economy as the money supply and interest rates" is moot.  The constitution specifically bans Congress emitting bills of credit.  Any money they wanted to coin would first have to be created and transferred by someone else, meaning they're not in control of it.  They just define the 'weights and measures' of that gold and silver.

 

You mention that they can always "vote the bums" out if they print too much money.  That's a nice theory.  There's a problem with this though--it's never happened in history--ever, including in America under the Articles of Confederation.  The only time that this might have been somewhat true is with Volcker and Reagan vs. Carter, but that wasn't congressional control of the money supply.

 

Also, there's no such things as a republican democracy, but there is such a thing as a democratic republic.  The U.S. Constitution was explicitly designed to prevent democracy, which is why U.S. Senators were not directly elected.

Tue, 12/06/2011 - 16:08 | 1952250 akak
akak's picture

There is another term for those who are politically "independent" and unaccountable to the public: Dictator.

Tue, 12/06/2011 - 20:41 | 1953164 i-dog
i-dog's picture

There are no "guarantees" with political constructs. Each generation must defend (or reject) what the prior generation constructed. Franklin himself warned of this: "A republic ... if you can keep it".

Also, a historical correction: The House of Red Shield played no part in the creation of the United States or its Constitution (though the Jesuits did ... through Freemasonry).

The Bank of England had been chartered as a private bank 80 years prior to 1776 by William of Orange, and it wasn't until 22 years after 1776 that Nathan Rothschild, at age 21, set up in London and began his mission to take over the Bank of England.

Mayer Amschel Rothschild had neither money nor influence in 1776. Prior to 1789, he didn't even handle the Bills of Prince William of Hanau, let alone any other state business. Prior to 1794, he had less than an upper middle class income. But in 1795 his income doubled, and in 1796 it more than quadrupled again. Then, two years later in 1798, his son Nathan Rothschild set up in London with the capital equivalent of 100 upper middle class incomes. That is when the Rothschild dynasty actually began its inexorable march to untold wealth.

The Illuminati, on the other hand, was formed just 2 months before the Declaration of Independence ... by Jesuit Adam Weishaupt who, at the time, occupied the chair of Canon Law at the University of Ingolstadt - a Jesuit chair in staunchly Roman Catholic Bavaria. It was not until 6 years later, in 1782, that the Illuminati began its takeover of Freemasonry - at the Masonic Conference of Wilhelmsbad, held in a castle owned by Prince William of Hanau. By 1789, the Illuminati controlled Freemasonry throughout Europe.

Incidentally, it was Prince William of Hanau's father, Roman Catholic Frederic II of Hesse-Kassel, who rented Hessian soldiers to George III to fight the Americans in the Revolutionary War of 1775-1783.

Tue, 12/06/2011 - 12:23 | 1951064 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Whatever....

Then it is just stupid and masochistic to want to be enslaved by a ruling oligarchy that makes decisions based on their best interests.  If you don't believe that the constitution is adaquate then that is motive to start a revolution.  If you do believe that the constitution is formal law, then the fact that it is being disregarded is a cause for revolution.  The only reason people have for not making one last stand for freedom is if they love being a docile, masochistic servant of the monopoly powers that the Federal Resrve control by their issuance of the money supply, based on their need to maintain the status quo, which is a prison system of epic proportions. 

Tue, 12/06/2011 - 13:25 | 1951321 JR
JR's picture

Powerful arguments all around, LH. Markets are no longer driven by economic developments but rather clandestine cash injections.  It seems kind of simple -- the people have less money, the market is flush.  Where did the market get its transfusions? 

All Americans are better off with a sound currency; they need to jettison the current system which benefits the Fed and its banking cartel.

Tue, 12/06/2011 - 13:36 | 1951365 tempo
tempo's picture

Uncle Ben is unaccountable because the elite, super rich families want it that way. The USA fights endless wars based on flimsy excuses (9/11 airplanes could have been shot down if Chenny had not been in charge of air defenses on that day) because its a easy was for the billionaires to become trillionaires. Clinton was paid $50,000 per month to do PR for Corzine is another example of the corrupt system. However, its probably no worse than the past 200 years of Government. He who has the gold makes the rules.

Tue, 12/06/2011 - 13:59 | 1951511 Stax Edwards
Stax Edwards's picture

The FED's profits are turned over to the treasury, not divied up among member banks.

Tue, 12/06/2011 - 14:13 | 1951600 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The Fed made, what, $10 billion last year?

The banks profit directly off of the actions of the Fed, and the Fed only turns over a few billion dollars.  The difference is in the hundreds of billions of dollars between what the Major Banking Houses make and what the Fed turns back to the Treasurie.

Tue, 12/06/2011 - 12:18 | 1951039 tmosley
tmosley's picture

Yeah, they are WAAAAYYYYY low.

Tue, 12/06/2011 - 12:27 | 1951086 lolmao500
lolmao500's picture

Last time I saw the numbers from Bloomberg, it was over 30 trillion... and that was like a year or two ago... so YEAH....

Tue, 12/06/2011 - 12:18 | 1951032 LeBalance
LeBalance's picture

Bee-man: "I have the *power.*"

Tue, 12/06/2011 - 12:22 | 1951060 old naughty
old naughty's picture

No only he has the *power**, he also has robots from Mars operating faster-than-light-speed algorithm.

Tue, 12/06/2011 - 12:20 | 1951048 Captain Kink
Captain Kink's picture

Is that Vodka that Geithner is guzzling?  Or perhaps Schnapps?

Tue, 12/06/2011 - 12:20 | 1951054 RobotTrader
RobotTrader's picture

The Fed will never be "abolished"

Not after pulling off one of the greatest financial miracles in financial history:

1) Plunging interest rates to 50-year lows while running insane deficits

2) Goosing stocks up 84% despite the worst economy in a generation

3) Allowing millions of homeowners to live "rent free" for 3 years, spurring the greatest consumer spending frenzy in 10 years.

4) Pulling all of this off, and have absolutely no inflation whatsoever

Tue, 12/06/2011 - 12:31 | 1951065 SeverinSlade
SeverinSlade's picture

Correction:

MINIMAL domestic inflation...Thanks to the USD being the world reserve currency, we've happily exported our inflation to China and other nations.

Make no mistake though, that inflation will eventually come home. 

Tue, 12/06/2011 - 12:24 | 1951069 old naughty
old naughty's picture

Robot, are you looking for these: ++++? There.

Tue, 12/06/2011 - 13:47 | 1951434 Bansters-in-my-...
Bansters-in-my- feces's picture

NO inflation,eh,RobotTrader...?

"Pulling all this off,and have absolutely no inflation whatsoever"

You FuckTard

Wipe the Bernank's keynesian cum off your face,we know you would give him an ass wash with your tounge,but thats in private.

This cum thing on your face,in public,is just a bit much.

Go wash up now,before more people have to see you like this.

Fool.

Tue, 12/06/2011 - 14:02 | 1951531 TheFourthStooge-ing
TheFourthStooge-ing's picture

He's been huffing gasoline with freddie.

 

Tue, 12/06/2011 - 14:11 | 1951596 Stax Edwards
Stax Edwards's picture

You forgot:

5) Looking the other way while their member banks blew up the world financial system merely to pad their year end bonuses.

6) Bailing out the banks that caused the mess, not even bothering to claw back any of the fraudulently earned bonus money.

7) Simultaneously watching the middle class who believed in the system get decimated, lose their homes, and wind up on foodstamps while living out of their cars, parents houses, etc.

8) Causing widespread inflation in all needs while touting bogus measures of such by excluding or reducing the weight of the most inflated items, to make themselves appear much more effective.

I could go on...

Tue, 12/06/2011 - 12:21 | 1951057 CvlDobd
CvlDobd's picture

Limits in government? Interesting idea. This just may be what we need to stop the debt growth.

Had anyone considered a debt ceiling to prevent over spending? I think thi is a good idea.

Tue, 12/06/2011 - 12:22 | 1951062 Robslob
Robslob's picture

 

 

The Fed is like the Board of any failed company...always the last to know...

 

Once banks have set their table THEN they tell the Fed "OMG...we just came across this huge problem and you have to fix it!".

 

Why else would they pick "academics" to run the money printing business...I mean really...how smart you got to be to just print money?

 

Tue, 12/06/2011 - 12:27 | 1951085 SeverinSlade
SeverinSlade's picture

You need PhD economists because it takes "economic geniuses" to attempt to centrally plan economic and monetary policies.  The alternative is a free market that governs itself which requires no PhD steering the ship.

Tue, 12/06/2011 - 12:27 | 1951083 Everybodys All ...
Everybodys All American's picture

The Fed out to save the world. Right. As if you should forget that they created all the "bubbles" and problems in housing and finance to begin with. We better put some limits on the Federal Reserve or otherwise we are heading for an IMF as the world's central bank with a one world currency and a one world government imo. Hope I'm wrong.

Tue, 12/06/2011 - 12:30 | 1951099 JustObserving
JustObserving's picture

"The Fed Chairman apparently could ride in a helicopter dropping $100,000 bills on the people “to further monetary policy” and it might be impossible to stop him or find out how much he is dropping and on whom. "

The Fed dropped $16.1 trillion during the last crisis and more than $3 trillion on foreign entities.  Can we find out how much of that money has been returned?  Apparently, not.

The Fed Chairman is far more powerful than the President and far less accountable.  If you are unhappy with the Fed handing out more than $3 trillion to foreign banks, there is nothing you can do.

Fiat money is a fraudulent game.  You have to embrace fraud to continue to play that game.  

One can expect a few trillion flowing to Europe soon - it's just electrons and required to keep the fiat game moving along anyway.

Tue, 12/06/2011 - 12:31 | 1951100 homer8043
homer8043's picture

I can't and won't go as far as many on this site calling for the end of the Fed and the fiat money system. The Gold Standard has many of the same issues as the Euro system with trade imbalances and lack of flexibility. Economies also benefit from having a central bank acting as a lender of last resort to get through TEMPORARY liquidity crises.

That being said, the current Fed has clearly gone rouge, and gone rouge a long time ago. The duty of the Fed or any central bank is not to save the economy from all pain and any recession at any cost. We've gotten here since we really didn't want to take our medicine from the internet bubble and that infrastructure over build, so we inflated the real estate bubble. Then we didn't take our medicine from the real estate bubble and that clear over build so we exacerbated a generational debt cycle that's ending any month now. All this while stealing from the middle class to enrich bankers and prop up the bottom quartile at barely subsistance levels.

Fed interest rate moves preventing any medicine taking from the late 90's forward has been rouge behavior. We'e now at the point that the consequences for further rogue behavior are exponential, not linear.

Tue, 12/06/2011 - 12:44 | 1951154 SeverinSlade
SeverinSlade's picture

"If the American people ever allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all their property until their children will wake up homeless on the continent their fathers conquered." - Thomas Jefferson

Nothing wrong with a central bank in theory...So long as it is owned by the American people and not a private banking cartel.

Tue, 12/06/2011 - 12:49 | 1951173 homer8043
homer8043's picture

I have to give you that Jefferson sounds prophetic with that quote.

Tue, 12/06/2011 - 12:58 | 1951196 LawsofPhysics
LawsofPhysics's picture

How does any of this tie economics back into reality?  Still believe in infinite growth do you?  Good luck with that.

Tue, 12/06/2011 - 13:54 | 1951477 Antifederalist
Antifederalist's picture

Infinite growth, no. More efficiency, yes . There is a difference. Think about it.

Tue, 12/06/2011 - 18:03 | 1952833 r00t61
r00t61's picture

This is a great quote, but it's not from Jefferson.  "Deflation" as an economic term didn't come into use until the 1920s.  The first recorded instance of this quote is from 1935.

If you want an actual Jefferson quote about banking, I really like:

"I sincerely believe...that banking institutions are more dangerous than standing armies..."

Tue, 12/06/2011 - 13:58 | 1951501 Bansters-in-my-...
Bansters-in-my- feces's picture

Hey homer8043...

No matter what number you give yourself,your just another homer.

Tue, 12/06/2011 - 12:31 | 1951104 BennyBoy
BennyBoy's picture

The private bank known as the FED needs debt to increase by the govt and everyone else.

That's the FED business model.

It will go bust if few borrow from the banks.

Federal Reserve NOTES (Aren't notes debt?) are debt based money.

No debt, no money.

Tue, 12/06/2011 - 12:31 | 1951107 mick_richfield
mick_richfield's picture

Some have argued whether the Fed should even exist.  I won’t go that far (it is beyond my scope), and I even understand why the Fed needs some independence.

Then you need to extend your scope if you want to be relevant to the people of this country.

The Fed is illegal, unconstitutional, and treasonous.  They are undeclared agents of a foreign power.  It's 'independence' is blatantly undemocratic.  The destruction of the Fed and the arrest of its members will be the first step toward the restoration of the American republic.

 

Tue, 12/06/2011 - 12:36 | 1951123 Shizzmoney
Shizzmoney's picture

I always found it quite a bit of mockery that they put Andrew Jackson and Abraham Lincoln on Federal Reserve Notes, considering both tried to establish currencies AWAY from central banks (and both were shot at). 

Jackson himself often referred to them as "snakes in the grass" as well as his usual Jesus-filled rants on usury (which you won't hear today from hypcritical K-Street Republican assholes because the central banks and corporations line their pockets.

If jackson was alive today, he'd buy a shotgun and hunt Bernanke+Company down.  He was the Charlie Bronson of Anti-Central Banking freedom. 

Tue, 12/06/2011 - 13:20 | 1951291 Manthong
Manthong's picture

I never realized until recently that what is believed to be a tribute is in fact, a farce.

Tue, 12/06/2011 - 12:37 | 1951125 TheSilverJournal
TheSilverJournal's picture

Thanks to the Fed, the world has been brainwashed into thinking that inflation is the normal state of an economy, when in fact deflation is the normal state of an economy. The reason the US has experienced inflation over the last 100 years is because the Fed is printing money at a much faster rate than gold is being mined. In a normal economy, prices would fall as technological gains improve productivity, allowing the amount of goods to increase faster than the money supply. To simplify, with the same amount of gold chasing more goods, prices fall.


Tue, 12/06/2011 - 13:45 | 1951421 Antifederalist
Antifederalist's picture

Amen brother. Well said. Refreshing.

Tue, 12/06/2011 - 12:38 | 1951133 Snakeeyes
Snakeeyes's picture
"Timmy the Weasel" sidesteps question on Fed but admits the IMF (a subsidiary of the US Federal Government) will continue to fund European bailout. FED will bailout Europe, but hide the bailout like they did in 2008. S&P Places EFSF On CreditWatch Negative – EuroSov Reaction is “Meh.” Geithner Sidesteps The Fed Bailout Question, But Admits to Continuing IMF Bailouts

http://confoundedinterest.wordpress.com/

Tue, 12/06/2011 - 12:39 | 1951134 LongSoupLine
LongSoupLine's picture

 

 

The Fed Is simply the greed and power shadow policy of our govt's elected officials and their banking industry puppet masters.  It's a tangled, and multiple backdoor ridden web of utter corruption.

Until the perverse money-to-politics-and-policy-chain is broken by cultural shift, (only via revolution by the masses), nothing will change.

Period.

Tue, 12/06/2011 - 14:16 | 1951625 Stax Edwards
Stax Edwards's picture

Yup

Tue, 12/06/2011 - 12:41 | 1951138 SheepDog-One
SheepDog-One's picture

End the Central Bank that the Founders warned would be far more dangerous than any standing army...all spending must be done by 3/4th congress approval, and any congressman found taking bribes from bankers is immediately arrested and tried for treason...all politicians pay from city council to US president comes only upon certified budget surpluses, and maximum terms for all politicians is 4 years then you have to go back to the private sector.

Tue, 12/06/2011 - 13:57 | 1951493 francis_sawyer
francis_sawyer's picture

all politicians pay from city council to US president comes only upon certified budget surpluses

Great... I'm going to get elected to office, then immediately triple everybody's taxes and do nothing with the revenue except INWEST it with RoboTrader & some high rolling hedgies (to max my pay before they kick me out after 4 years where I go to work for the other side)...

I can't wait until 'Government 2.0' starts... Count me in...

Tue, 12/06/2011 - 12:42 | 1951142 YesWeKahn
YesWeKahn's picture

You want hold someone with unliminited resources accountable? They never count or account.

Do NOT follow this link or you will be banned from the site!