Question Regarding the Fed
Posted April 21st, 2008 by Jon
output
Defenders of the Fed claim that profits earned by the Fed are for the most part funneled back to the U.S. Treasury rather than to certain powerful individuals. The claim is made here for instance:
Is this true and if so it would seem that the claim that the Fed is privately owned, while technically true, might be somewhat irrelevant. It would appear that rather than being an agent of private individuals to steal wealth in fact it would be a tool of the government to steal wealth.
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they are right
Fortune Favors the Bold
but they miss the point entirely. Creation of money as debt- the FED operates in the red. The interest on the bonds they sell is payed out when they inevitably have to buy the bonds back. The bond holders are lots of groups, but laregly sovereign wealth funds and large member banks. Ultimately, the burden of the interest payments falls on the taxpayer.
I agree too
What difference does it make if it is the government inflating the money supply or a gang of government-appointed bankers? The economic disaster is the same.
Very well said...
And to think that people get caught up over this issue...
Talk about a red herring (as noted below)!
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double post
I agree
I've always considered the "The Fed is privately owned!" argument to be a total red herring. Even if that were true, the Fed would not be one iota better if it were "publicly" owned. The fact is, it is engaged in the debasement of our currency, and its operations set the business cycle in motion. THAT is what matters, and these things are just as bad no matter how Fed ownership is apportioned. All other concerns are trivial.