In response to:

Prophets and Losses

Kirk72 Wrote: Feb 05, 2013 6:20 AM
Dr. Sowell, great column on the fed. My question is, what should be done with it. I agreed with Ron Paul on need to audit the fed reserve. But then what, the gold standard? Would like to read your thoughts on this.
Texas Chris Wrote: Feb 05, 2013 9:49 AM
A fed audit would be like the pebble that starts the avalanche.

Once people see the fraud, see the cronyism, and understand the rigged game, they'll just quit using dollars, and convert to... Whatever. gold, silver, bitcoin, shells, fingernails, iron hoe heads, tulips... Whatever.
AZhot Wrote: Feb 05, 2013 9:04 AM
Get rid of the Fed AND theb16th amendment. Ha! Fat chance.
Texas Chris Wrote: Feb 05, 2013 9:54 AM
We'll get rid of them eventually. And perhaps the rest of the federal boondoggle, as well.
dlynn4 Wrote: Feb 05, 2013 7:33 AM
Milton Friedman said the Fed should increase the money supply with population growth instead of the current crazy manipulation. I think the biggest problem is too much easy credit.

Too much borrowed money in the market caused the crash in 1929. People invested $100 with only $10 of it their own money. Then, a correction in the market resulted in margin calls people could not cover so they were forced to sell creating the disaster.

The 2008 crash was caused by too easy credit. IMHO, no one should ever be allowed to buy anything with less than 20% down. The owners and executives of businesses should not be able to hide from liability behind corporation law.
AZhot Wrote: Feb 05, 2013 9:07 AM
We are now a country of the lawyers, by the lawyers and for the lawyers, but forget the 'law'.
Texas Chris Wrote: Feb 05, 2013 9:53 AM
Friedman was wrong. He was wrong because he mistakenly believed government could be trusted with the value of money.

It can't.
Tacitus X Wrote: Feb 05, 2013 6:45 AM
A gold standard would certainly be preferable, but a better solution would be to get the government out of the money business, in other words, no fiat money standard - let the market decide what kind of money to use. That's essentially what American Express does. And unlike dollars, American Express will even replace lost money. Banks used to issue money as well. No one would be under any obligation to accept any money they don't trust. Warehouse receipts for gold or silver might become the most acceptable form of printed money.
Texas Chris Wrote: Feb 05, 2013 9:53 AM
I agree. Simply repeal legal tender. Done.

Congress has a constitutional mandate to define weight and measure of gold and silver. Do it. Done.

Now AmEx, Visa, Mastercard, Wal Mart, Toyota, McDonnalds, BFI, and any average Joe in his garage can make money that adheres to that standard.

But NOT the government. NEVER the government. Do not trust the government with your money. Ever.
Now that the federal government is playing an ever larger role in the economy, a look at Washington's track record seems to be long overdue.

The recent release of the Federal Reserve Board's transcripts of its deliberations back in 2007 shows that their economic prophecies were way off. How much faith should we put in their prophecies today -- or the policies based on those prophecies?

Even after the housing market began its collapse in 2006, Federal Reserve Chairman Ben Bernanke said in 2007, "The impact on the broader economy and financial markets of the problems in the subprime market seems likely to...