100 Years Later, The Federal Reserve Has Failed At Everything It's Tried
Key Excerpts from Article on Website of Forbes
Posted: December 30th, 2013
On Dec. 23, 1913, President Woodrow Wilson signed the Owen Glass Act, creating the Federal Reserve. As we note its centennial, what has the Fed accomplished during the last 100 years? The stated original purposes were to protect the soundness of the dollar and banks and also to lessen the jarring ups and downs of the business cycle. Oops. Under the Feds supervision, boom and bust cycles have continued. Three of them have been severe: the Great Depression, the stagflationary period of 1974-82, and the current Great Recession. Bank failures have occurred in alarmingly high numbers. Depending on what measurements are used, the dollar has lost between 95 and 98 percent of its purchasing power. (Amazingly, the Feds official position today is that inflation is not high enough, so the erosion of the dollar continues as a matter of policy.) Having failed to achieve its original goals, the Fed also has had a miserable record in accomplishing later goals. The 1970 amendments to the Federal Reserve Act stipulated that the Fed should promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates. In baseball parlance, the Fed has been 0-for-three. So, what has the Fed accomplished during its century of existence? Well, it has become adept at bailing out mismanaged banks. In the aftermath of the 2008 financial crisis, the Fed orchestrated the big bailout of Wall Street. Politically, the Fed is repugnant. Its chairman is commonly referred to as the second most powerful person in the country. In a democratic republic, should the second most powerful policymaker be unelected?
Note: How remarkable for Forbes to publish an article chastising the Fed! The times are a changin'! For an essay by noted financial researcher Ellen Brown on this occasion, click here. For more on the collusion between government and the biggest banks, see the deeply revealing reports from reliable major media sources available here.