Fearless at the Fed
Regardless of what you think of Austrian economics (your author is sympathetic, if not a full-fledged convert), you have to give credit for chutzpah to Robert Wenzel, editor and publisher of the site Economic Policy Journal and a sharp critic of the Federal Reserve. Last week, Wenzel, at the bank's invitation, delivered a speech at the New York Fed ... where he savaged the central bank's policies and called for the institution to be abolished.
That may be wise. It may be foolish. But this is undoubtedly one of the most audacious codas ever delivered in a policy speech:
The noose is tightening on your organization. Vast amounts of money printing are now required to keep your manipulated economy afloat. It will ultimately result in huge price inflation, or, if you stop printing, another massive economic crash will occur. There is no other way out.
Again, thank you for inviting me. You have prepared food, so I will not be rude — I will stay and eat.
Let's have one good meal here. Let's make it a feast. Then I ask you, I plead with you, I beg you all, walk out of here with me, never to come back. It's the moral and ethical thing to do. Nothing good goes on in this place. Let's lock the doors and leave the building to the spiders, moths, and four-legged rats.
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Mar '11
Re: Fearless at the Fed
Please, tell me there's an MP3 of this somewhere. The transcript isn't enough. I want to hear the Oooos and Ahhhs of the audience.
Sep '11
Re: Fearless at the Fed
Probably more like the stunned and stony silence.
Jun '10
Re: Fearless at the Fed
The man positively clangs when he walks.
Feb '12
Re: Fearless at the Fed
Casey Taylor
The man positively clangs when he walks. · 8 hours ago
So he sounds like a junk truck?
Dec '11
Re: Fearless at the Fed
I would agree with this as long as the basket of commodities are not they themselves considered money.
I put this in the catagory of potentially wise policies.
Dec '11
Re: Fearless at the Fed
Fricosis Guy: Hi Guru... Your statement below gets to a core argument of the Austrian critique, the knowledge problem. Let's grant that one should vary the money supply...let's even grant that the Fed doesn't want to manipulate it for political purposes.
How does one know "the monetary needs of the economy" to allow for money supply planning? Per the argument I linked to -- yes, I know it's Wikipedia -- Austrians would say that one can't. · 18 hours ago
All things are subject to this problem. Paralysis by analysis is worse than no attempt to achieve good policy. OK, lets consider your thought experiment, and also remove the toxicity of conspiracy theories:
Let us say that there is a council of people who are studied and wise. How wrong are they likely to be, and how destructive is that variance from the perfect likely to be?
We are in a pickle now, because the fed had to paper over the failure of the keynesians in regards to federal spending. The fed is no crap paying interest to keep banks from putting the money in circulation, so that they can also monetize our government spending.
Dec '11
Re: Fearless at the Fed
Dan Hanson: On the other hand, Monetarists have a problem in that it is very difficult to figure out how to manage the money supply while providing stability. The best idea is to set up hard rules that tie the supply of money to certain indicators, but it's hard to know what those should be and what their values are.
Monetarists have a further problem that once you put the kind of power the fed represents into the hands of individuals, it's very hard for them to resist the temptation to tinker. Even Alan Greenspan, who was a fairly hardcore free-marketer before joining the Fed, came to believe that he was smart enough to use monetary policy to manipulate the economy rather than to just maintain stability.
This isn't a simple problem.
Yes it is a problem in all systems governed by people, whereby the realization that tinkering at the edges can have some positive and negative consequences, but at some point the tinkering at the edges supplants the original purpose of policy as its existential purpose. Consider how much time we discuss fairness and incentives instead of raising revenues in our tax discussions.
Jun '10
Re: Fearless at the Fed
Natalie
Casey Taylor
The man positively clangs when he walks. · 8 hours ago
So he sounds like a junk truck? · 8 hours ago
Those things they hang off trailer hitches were modeled after Robert Wenzel. I hear groupies used to do something similar to Jimi Hendrix.
Edited on May 3, 2012 at 3:48amFeb '12
Re: Fearless at the Fed
Casey Taylor
Natalie
Casey Taylor
The man positively clangs when he walks. · 8 hours ago
So he sounds like a junk truck? · 8 hours ago
Those things they hang off trailer hitches were modeled after Robert Wenzel. I hear groupies used to something similar to Jimi Hendrix. · 5 hours ago
I am raising my lighter ablaze in solidarity...