In response to:

Push the Fed Over the Cliff

LonfromPen Wrote: Dec 03, 2012 2:04 PM
Is Kieffer unaware that recessions were more common before the Fed was created than after? That sort of undercuts the idea that without the Fed we would have fewer recessions. But then she seems to be advocating more than booting the Fed, but getting rid of paper money. Admittedly we cannot go back to a time when this country was foolish enough to do that to give us a point of comparison. But the fact that we have become a very wealthy country while following policies that only existed in times when countries were impoverished does not suggest this is a very good idea.
nawlins72 Wrote: Dec 03, 2012 6:08 PM
"Is Kieffer unaware that recessions were more common before the Fed was created than after?"

This is a common claim by the pro-Fed crowd, but it isn't true:
JustMC Wrote: Dec 03, 2012 3:35 PM
Lon, are you aware that "recessions" are natural, healthy, corrections when they take place in FREE markets with SOUND money? Of COURSE the Fed, with the ability to create phony money out of thin air, can smooth out such natural, healthy corrections. The problem is, when they do so, the CORRECTION doesn't happen and the problematic misdirection of capital goes UNCORRECTED. Making a bigger problem.

The Fed was sold as maintaining the value of money and maintaining employment. From the start of the country to the Fed, the dollar GAINED buying power, which is the natural state of FREE markets. Since the Fed was created, the dollar has lost 98% of its value. The exact OPPOSITE of what the Fed was created to do.

Stop worrying about the ‘fiscal cliff.’ Spending cuts would feel therapeutic after watching Standard & Poor's and Egan-Jones downgrade our credit rating and seeing President Obama add $6 trillion to the national debt. The way to avert another recession and massive inflation is to eliminate the unconstitutional Federal Reserve.

There are two ways for politicians to “pay” for their spending. They can be transparent and raise taxes extremely high across all income levels. (This is not happening because politicians know Americans would riot.) Or, they can be sneaky and “monetize the debt,” which means allowing the Federal Reserve to print money...