Thursday, April 9, 2015

"I Don't Oppose the Fed Because..."

David Weigel, this morning, reminds us:
"I don't oppose the Federal Reserve because it is secretive, though it is," said Rand Paul at an April 25, 2009, "End the Fed" rally. "I don't oppose the Federal Reserve because it lacks congressional oversight, although it does. I don't oppose the Federal Reserve because it's a private cartel, though it is. I oppose the Federal Reserve primarily because it wreaks havoc on the economy. We need to understand that this is the most important question of the last 30, 40 years. What caused the panic of 2008? Was it capitalism or was it the Federal Reserve?"
Since then:
 Rand Paul, who won a Senate seat in 2010, has perennially introduced legislation to audit the central bank and give Congress power over its decisions; versions of this passed the Republican-controlled House of Representatives in 2012 and 2014....on Tuesday, the central bank's beleaguered supporters caught a small break. In his announcement speech, Paul did not mention the Fed even once.
Rand's new direction is a waste of time, an audit of the Fed that doesn't include an audit of Treasury held gold, will tell us nothing we don't already know and the Treasury gold supposedly sitting at Fort Knox is not going to be audited. Congressional control of monetary policy, where the likes of Elizabeth Warren and Nancy Pelosi sit, is insane. This will not bring Misesian monetary policy to the Fed. It won't even bring Paul Volcker policy discipline to the Fed.

The 2009 Rand Paul had it correct, not the 2015 muddier of the message.



  1. I am convinced that the banking cartel has regulatory, legislative, and executive capture. They are in charge. Anyone thinking that is going to change anytime soon is sadly mistaken. Rand Paul is just another example of an unelectable and extremely isolated minority. If Rand Paul had any kind of chance whatsoever- he'd have about a million banker lackeys searching his entire life looking for some incident which would discredit him. I fully expect this to happen anyway- that's how this country works.

    still trying to digest it

  3. RW, have you heard Salerno's latest on the topic? I may be wrong, but it sounds like MMT to me.

  4. “He Woke up on 3rd Base and Thought He Hit a Triple” – A Community Banker Responds to Jamie Dimon

    The recent shareholder letter by JP Morgan CEO Jamie Dimon provides a crystal clear example of why it's so dangerous to encourage and subsidize the corporate welfare babies know as the "Too Big to Fail" mega banks. The letter, which features a gigantic photograph of the executive seated casually with legs crossed in jeans, a shirt that appears almost uncomfortable around his neck in the absence of a tie, and all ten fingers touching flawlessly in what undoubtably took multiple takes to provide a sufficient creepiness factor (the presence of presidential cufflinks cannot be confirmed or denied), expounded on how well the mega banks performed during the financial crisis compared to the hundreds of small banks that failed.

    This was understandably too much to handle for Camden R. Fine, president and chief executive of the Independent Community Bankers of America. He wrote a scathing piece in American Banker in rebuttal titled, Dimon's Defense of Big-Bank Model: An Exercise in Hubris.

    Here are some choice excerpts: