2 ms·

Yes, banks can join the federal reserve system and other banks can be FDIC insured. But how do you go from that to "the Federal reserve is not part of the gover

Yes, banks can join the federal reserve system and other banks can be FDIC insured. But how do you go from that to "the Federal reserve is not part of the government". It's the central bank of the United States. Its chairman is appointed by the government. All profits are paid back to the United States. Is about as independent from the government as the FBI. Saying that the Federal reserve system is not part of the government is as non-sensical as saying the FBI is not part of the government because similar degrees of independence from the executive branch exist. I get that the fact that government agencies can be independent from the executive branch is difficult to wrap one's head around but that sort of independence is not the same as "not part of the government". Here's yet another page from the federal reserve website that explicitly says that it's part of the government: https://www.federalreserve.gov/faqs/about_12799.htm https://www.federalreserve.gov/faqs/about_12799.htm > The Federal Reserve, like many other central banks, is an independent government agency but also one that is ultimately accountable to the public and the Congress. It says right there that it is a government agency. Independent, yes, but ultimately accountable to the government. It's leadership is appointed by the government.

geggam 8y ago
:) we are getting closer. Now... lets say a company was allowed to buy shares in the govt and be able to act as a govt agency while remaining a private company. So they contract themselves to do some work, pay themselves for setting up the contract, switch hats then do the work. Bonus if they don't do the job right they simply aren't liable.
- manfredo 8y ago
  Sure... But what you describe is not how the Federal Reserve works. The Federal Reserve is accountable to Congress. If they do their job poorly, leadership can be removed. The Federal Reserve is not a private company. They don't "buy shares in the government". I'm not even sure what that even means. Nobody can buy shares in the government because the government isn't a company. I guess you might be referring to government bonds. But those aren't shares, they're contracts to get paid a greater amount when the bond reaches maturity. The whole concept of "shares of the government" is just not valid because nobody owns the government. At least not in the US, there are some monarchies where all government assets are owned by the royal family.

geggam 8y ago

:) we are getting closer. Now... lets say a company was allowed to buy shares in the govt and be able to act as a govt agency while remaining a private company. So they contract themselves to do some work, pay themselves for setting up the contract, switch hats then do the work. Bonus if they don't do the job right they simply aren't liable.

manfredo 8y ago
Sure... But what you describe is not how the Federal Reserve works. The Federal Reserve is accountable to Congress. If they do their job poorly, leadership can be removed. The Federal Reserve is not a private company. They don't "buy shares in the government". I'm not even sure what that even means. Nobody can buy shares in the government because the government isn't a company. I guess you might be referring to government bonds. But those aren't shares, they're contracts to get paid a greater amount when the bond reaches maturity. The whole concept of "shares of the government" is just not valid because nobody owns the government. At least not in the US, there are some monarchies where all government assets are owned by the royal family.