Hundred Years of Failure, Time to End The Fed

The Federal Reserve came into existence on Dec. 23, 1913, with President Woodrow Wilson’s signing of the Owen Glass Act. The purpose of its inception was to provide a sound dollar and minimize the shocks and panics of the business cycle in the market. Big oof!

The initiation of the FED coincided with the implementation of the Income Tax. But, of course, World War I broke out just over a year later. So the century of Central Banking and Central Planning has coincided with the century of war. War is a racket, and so is central banking. 

One can’t finance endless wars without a money printer and fiat. 

Four massive booms and busts have occurred over the century:

In 1970 the FED expanded its responsibilities to include maximum employment. The move to full Keynesian fiat came under “Tricky Dick” Richard Nixon in 1971. 

The Fed has failed for over a century, with the most blatant blunders occurring over the past two years. 

The Fed announced $700 billion in Quantitative easing just two years ago. The Fed extended its program in June 2020, promising to buy $80 billion worth of Treasuries and $40 billion of mortgage-backed securities until further notice.

That is an insane amount of money mainlined into the economy to chase a limited supply of products and services, thereby depreciating the "almighty" dollar.

The outcome is 40-year inflation records with no end in sight, despite a lower rate of change in July's CPI and Fed Chairman Jerome Powell's erroneous claim that inflation was "transitory."

The Fed's mandate to target 2% inflation is a significant challenge. However, come 2020, it started seeking more significant inflation to counteract below-target levels.

Inflation taxes Americans every year because their dollars are losing value. Instead of letting the market work freely, the Fed constantly manipulates it.

One erroneous action, especially when reinforced by political opportunism, can shift the economy drastically.

Joe Biden assures us that "Make no mistake about it," Vladimir Putin is mostly to blame for the current state of inflation. Similarly, Nancy Pelosi places the responsibility on Vladimir Putin, the ruler of Russia, stating that inflation "starts with Putin."

The current administration, the establishment, the rank-and-file, and the media parrots have been shouting about "Putin's Price Hike" and "Putin's gas price" in a perfunctory manner to explain why their fellow politicians in Washington are not responsible for inflation.

The fact is that they are responsible for the majority of the problems, which is why they choose to play the blame game as their approach.

Pelosi said, "It is important to dispel some of those who say, 'Well, it is the government spending.' No, it is not. The government spending is doing the exact reverse, reducing the national debt.”

“It is not inflationary," Biden has said, "The American people think the reason for inflation is the government is spending more money. Simply not true."

Surprising to see the lack of economic understanding that the control brokers consider acceptable. Mr. Biden's $1.9T stimulus spending, enacted in March 2021, set Uncle Sam on a new course.

It boosted an economy that had begun rebounding following many rounds of expenditure, bringing the total epidemic intervention to 25% of domestic product, the most in the affluent world.

In Washington, wonks in dingy offices incorrectly tracked and reported inflation. As a result, many Americans feel inflation is the country's worst concern; President Joe Biden withdrew oil from strategic stockpiles to lower gas costs; and the Washington establishment is looking for villains, from selfish CEOs to Vladimir Putin.

A violation of language comes in the phrase "quantitative easing," which makes expanding the monetary base via balance sheet games look like economic science. Investopedia defines inflation as "an unorthodox monetary strategy that involves a central bank buying relatively long-term securities from the market to stimulate lending and investment." After the 2008 financial meltdown, it became trendy. Unfortunately, it also influenced the Fed's approach to the coronavirus fiasco.

The Federal Reserve effectively put itself in a corner, partly because its members are ideologically homogeneous Politicians fixated on Party spending objectives and political conflicts such as defense spending, climate change and wealth redistribution schemes. Every American pays for this failure.

The FED has not just failed for the past two years; there is a century of failed FED policies to look back on. They have continued to violate trust while siphoning wealth from the middle and lower classes via the Cantillon Effect.

Written by @SatsforLife