In response to:

Can We Envision a World without a Central Bank?

Gatspy Wrote: Sep 21, 2012 6:05 AM
Keynesian economics cannot work on a global economic level. America imports much more than it exports. Money printed in the United States leaves the United States as cash and comes back as chinese t.v.s, computers, examples of finished products and raw resources like oil. The rest of the world is going to get tired fast of the funny money America is generating 40 billion dollars a month. Good thing we have debit cards or else we would need wheel barrels like the Germans after World War I to get a loave of bread.

I’ve expressed concern about QE3 and other decisions by the Federal Reserve about monetary policy, but I have also admitted that it’s difficult to know the right monetary policy because it requires having a good idea about both the demand for money and the supply of money.

But this raises a bigger issue. The only reason we expect the Fed to “know the right monetary policy” is because it’s been assigned a monopoly role in the economy. But not just a monopoly role, we also expect the Fed to be some sort of omniscient central planner, knowing when...

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