Sublime

Only Alan Blinder, once a Fed vice chairman and a former Princeton colleague of Bernanke’s, defended the Fed. Blinder told this tale:

Artificially-High Stock Prices Until very recently share prices, by general consensus, were set purely by market forces (though they were influenced somewhat by the Fed’s control of short term-interest rates and government tax and spending laws). Whether the market went up or down was not generally seen as a pressing policy matter for the federal g

It was a fear of the economic and social upheaval that might be caused by money losing its value that drove Britain to adopt "sound money" policies nearly 300 years ago. This move coincided with an unplanned switch to using gold instead of silver as the basis of money and, ultimately, to the accidental birth of the gold standard. Its &quo

Do we think the Fed will abandon its responsibility to control inflation and resort to total monetization of U.S. debt? No. But in the attempt to get mild inflation, it is possible the controlled fire they hope to kindle could get out of control, forcing them to act to take back the excess reserves and bring about a recession, as did Volcker. Let’s

The “boom-bust” cycle is generated by monetary intervention in the market, specifically bank credit expansion to business.