4 ms·

>But when you consider the FED bad habits of "quantitative easing" (printing money), it make the US even less likely to be the originator. Regarding the Fed, Q

by nunb 13y ago

>But when you consider the FED bad habits of "quantitative easing" (printing money), it make the US even less likely to be the originator. Regarding the Fed, QE and USG. The Fed is a private bank (it pays its shareholders 6%, which no government department does!). USG is different, and currently in thrall to the Fed. Now _I'm_ going to sound like the conspiracy nutcase when I add "in much the same way European sovereigns were to the Rothschilds".

guylhem 13y ago
I'm not very familiar with how the FED operate, related to the US government. I just know the textbook stuff- that it takes order from the politicians (ex: obama and the congress could ask for a trillion coin, pretty please), can be forced to buy government debt, and as a goal of helping employment. I'm most familiar with the european ECB : by construction it follows a monetarist policy (M3 grows at a fixed 4.5%), is independent of political power (you can't ask it to mint a trillion coin for you), and doesn't care about employment. Before 2012, it also could not be forced by politicians to buy "toxic assets" like sovereign debt (greek debt anyone?), so they created the european stability mechanism, guaranteed by the "federal" EC budget to do this very same thing! It is even better : now they are not forcing the ECB to buy sovereign debt on political orders, they buy sovereign debt by themselves! http://en.wikipedia.org/wiki/European_Stability_Mechanism http://en.wikipedia.org/wiki/European_Stability_Mechanism Could you please elaborate on the US situation? (I'm checking wikipedia at the moment) If the Fed is a private bank, and I understand correctly your Rothschilds example, that makes the situation in the US similar to the one of the Bank of France prior to 1945 when it was nationalized - it was a private bank, with a monopoly on sovereign currency emission. Only it's even better and more lucrative, because the Bank of France had to deal with the gold standard (even in the 1929 great depression) while the present day FED is doing fiat money. Who are the FED shareholders who get to benefit 6% returns, backed by the US government? How do you compare that to the french situation before WW2?
- nwzpaperman 13y ago
  Few people ask where politicians obtain their insights, ideas and policy positions. More should. When the current minority leader HOR, and former majority leader HOR, stated, "we have to pass the bill to see what's inside" and the individual politicians base their policy votes on the testimony of industry captains and fed economists, I hardly call the politicians independent or objective. Politicians are mostly mouthpieces for constituent groups and don't understand any of the laws they pass at the granular, much less atomistic level. Their briefs, talking points and speeches are all prepared by others. The individual can only be as smart as his information input and analytical framework.
  - nunb 13y ago
    what's amazing is that laws are added as riders onto unrelated legislation. at least, that's my understanding[1,2]. i suspect that the only people who read the bills are those trying to sneak something in, or watchdog groups like the eff. everybody else in washington is there for the hookers n'blow. [1] Plenty of references: http://en.wikipedia.org/wiki/Rider_%28legislation%29 http://en.wikipedia.org/wiki/Rider_%28legislation%29 http://www.politifact.com/truth-o-meter/promises/gop-pledge-o-meter/promise/666/will-not-bundle-bills-into-must-pass-legislatio/ http://www.politifact.com/truth-o-meter/promises/gop-pledge-... [2] These last two are Monsanto and firearms related bills being snuck through via the "avoid government shutdown" scare: http://www.npr.org/blogs/thesalt/2013/03/21/174973235/did-congress-just-give-gmos-a-free-pass-in-the-courts http://www.npr.org/blogs/thesalt/2013/03/21/174973235/did-co... http://www.npr.org/blogs/itsallpolitics/2013/03/21/174969923/nra-driven-gun-provisions-pass-along-with-spending-bill http://www.npr.org/blogs/itsallpolitics/2013/03/21/174969923...
    - BrokenPipe 13y ago
      and obviously eff and alike are not enough. What we need is full decentralization in govs too
- utunga 13y ago
  The whole point of the trillion dollar coin idea was that it allowed the executive (aka the president) to create money without asking the Fed (and thus by pass the congressional deb-ceiling debate). This only illustrates the point that president doesn't directly control the Fed - he does appoint the chairperson (Bernanke, Greenspan et al) but he cannot order them to print money. The treasury however does have responsibility for minting actual coins, usually treated as a minor housekeping type matter (because the vast bulk of money is not actual physical coins and notes, of course) and even then only under congressional mandate. In the case of the trillion dollar coin they had passed legislation that the Treasury was to be given the leeway to print a new platinum coin - if they wished, and at their discretion as to its denomination. All of which is to say that this whole trillion dollar coin thing only emphasizes the extent to which the president does not control the Fed. FWIW this is very common in western democracies. Even when the central bank is not a privately owned institution it is almost always managed in a very hands-off way, ostensibly (though perhaps not practically) to stop short term administrations from playing with things in a way that might affect long term currency stability.
- etaio 13y ago
  *Fed(eral Reserve {System,Banks}), as opposed to E(uropean) C(entral) B(ank)

by nunb 13y ago

guylhem 13y ago

I'm not very familiar with how the FED operate, related to the US government. I just know the textbook stuff- that it takes order from the politicians (ex: obama and the congress could ask for a trillion coin, pretty please), can be forced to buy government debt, and as a goal of helping employment. I'm most familiar with the european ECB : by construction it follows a monetarist policy (M3 grows at a fixed 4.5%), is independent of political power (you can't ask it to mint a trillion coin for you), and doesn't care about employment. Before 2012, it also could not be forced by politicians to buy "toxic assets" like sovereign debt (greek debt anyone?), so they created the european stability mechanism, guaranteed by the "federal" EC budget to do this very same thing! It is even better : now they are not forcing the ECB to buy sovereign debt on political orders, they buy sovereign debt by themselves! http://en.wikipedia.org/wiki/European_Stability_Mechanism http://en.wikipedia.org/wiki/European_Stability_Mechanism Could you please elaborate on the US situation? (I'm checking wikipedia at the moment) If the Fed is a private bank, and I understand correctly your Rothschilds example, that makes the situation in the US similar to the one of the Bank of France prior to 1945 when it was nationalized - it was a private bank, with a monopoly on sovereign currency emission. Only it's even better and more lucrative, because the Bank of France had to deal with the gold standard (even in the 1929 great depression) while the present day FED is doing fiat money. Who are the FED shareholders who get to benefit 6% returns, backed by the US government? How do you compare that to the french situation before WW2?

nwzpaperman 13y ago
Few people ask where politicians obtain their insights, ideas and policy positions. More should. When the current minority leader HOR, and former majority leader HOR, stated, "we have to pass the bill to see what's inside" and the individual politicians base their policy votes on the testimony of industry captains and fed economists, I hardly call the politicians independent or objective. Politicians are mostly mouthpieces for constituent groups and don't understand any of the laws they pass at the granular, much less atomistic level. Their briefs, talking points and speeches are all prepared by others. The individual can only be as smart as his information input and analytical framework.
- nunb 13y ago
  what's amazing is that laws are added as riders onto unrelated legislation. at least, that's my understanding[1,2]. i suspect that the only people who read the bills are those trying to sneak something in, or watchdog groups like the eff. everybody else in washington is there for the hookers n'blow. [1] Plenty of references: http://en.wikipedia.org/wiki/Rider_%28legislation%29 http://en.wikipedia.org/wiki/Rider_%28legislation%29 http://www.politifact.com/truth-o-meter/promises/gop-pledge-o-meter/promise/666/will-not-bundle-bills-into-must-pass-legislatio/ http://www.politifact.com/truth-o-meter/promises/gop-pledge-... [2] These last two are Monsanto and firearms related bills being snuck through via the "avoid government shutdown" scare: http://www.npr.org/blogs/thesalt/2013/03/21/174973235/did-congress-just-give-gmos-a-free-pass-in-the-courts http://www.npr.org/blogs/thesalt/2013/03/21/174973235/did-co... http://www.npr.org/blogs/itsallpolitics/2013/03/21/174969923/nra-driven-gun-provisions-pass-along-with-spending-bill http://www.npr.org/blogs/itsallpolitics/2013/03/21/174969923...
  - BrokenPipe 13y ago
    and obviously eff and alike are not enough. What we need is full decentralization in govs too
utunga 13y ago
The whole point of the trillion dollar coin idea was that it allowed the executive (aka the president) to create money without asking the Fed (and thus by pass the congressional deb-ceiling debate). This only illustrates the point that president doesn't directly control the Fed - he does appoint the chairperson (Bernanke, Greenspan et al) but he cannot order them to print money. The treasury however does have responsibility for minting actual coins, usually treated as a minor housekeping type matter (because the vast bulk of money is not actual physical coins and notes, of course) and even then only under congressional mandate. In the case of the trillion dollar coin they had passed legislation that the Treasury was to be given the leeway to print a new platinum coin - if they wished, and at their discretion as to its denomination. All of which is to say that this whole trillion dollar coin thing only emphasizes the extent to which the president does not control the Fed. FWIW this is very common in western democracies. Even when the central bank is not a privately owned institution it is almost always managed in a very hands-off way, ostensibly (though perhaps not practically) to stop short term administrations from playing with things in a way that might affect long term currency stability.
etaio 13y ago
*Fed(eral Reserve {System,Banks}), as opposed to E(uropean) C(entral) B(ank)