End the Fed?

Posted by: Michael Mandel on August 17

There I was on Sunday, strolling down the (small) main street of my (small and quiet) suburban town. And when I say quiet, I mean it—the dog days of August, and no one was on the street. I look down, and here’s what I see taped to the sidewalk.


endthefed.jpg

‘End the Fed.” I felt like I wandered into a weird movie.

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Reader Comments

jjw

August 17, 2009 01:00 PM

THATS RIGHT.
END IT TODAY !!!!
We need you now Ron Paul !!!

2000patriot

August 17, 2009 01:05 PM

The revolution will not be televised!

Squeezebox

August 17, 2009 02:04 PM

And just what would the right wingers replace the Fed with? More crooked banks?

JPier

August 17, 2009 03:03 PM

End the Business Week, for sleeping at the switch. When Fed was pumping money into the housing bubble, Business Week, Wall street journal and their networks were boosting about things like,"Las Vegas is the fastest growing region in the country and expected to grow 14% per year".
Business publication and newsletter should have run these End the Fed articles in the 90's. But then again they are essential part of this financial scheme. They are the false- confidence feeders.

Strategery

August 17, 2009 03:27 PM

I suggest the author and readers watch one or all of the following videos, available on Google Video (for free): "The Obama Deception" "Freedom To Fascism" "Money As Debt" and "Endgame" (Alex Jones). Once you know the TRUTH, your answer will be an overwhelming "YES!" It's no secret that the FED creates money out of thin air (stealing it from everyone via inflation), then lends it at interest! All money is created as debt, and more money is owed than exists to repay it! The PRIVATE FED uses its ability to create money to control the government, businesses and citizens, with NO accountability.

arquebus

August 17, 2009 03:32 PM

you might want to check out the movie "ZeitGeist" and "ZeitGeist 2"

Bob English

August 17, 2009 03:32 PM

The Fed is controlled by the Queen's bankers out of England, it's a freaking takeover by the Crown.

Don't be a foolbag, defend the constitution by ending the Fed

Ben 'BEER'nanke

August 17, 2009 03:55 PM

I believe that the FED is a crucial part of the U.S. economy because it sets the rate according to what's necessary for growth. In 2003 the FED lowered the rate to 1%. It allowed the tremendous growth we saw in the housing market in 2004, 2005, 2006, & 2007. Unfortunately, not everyone was able to pay for their ARM's when they adjusted. But we are now seeing a 'recovery' in the markets, thanks to the FED. Perhaps the 'Cash for Clunkers' program will be successful and it may be extended, and even branched-out into other industries. I can someday envision a 'Cash for Toasters' program where Americans can trade-in their old toasters & get a new one at the government owned & operated bank where they deposit all their money. We just need to start using our creativity in America. LONG LIVE THE FED!!!!!!!!!!!!!

Ben 'BEER'nanke

August 17, 2009 04:11 PM

Strategery, Do you actually BELIEVE those propaganda movies on the web? If they can't make it at the theaters, or on NBC, CBS, or ABC, they shouldn't be believed by anyone! The FED is a wonderful organization, in my opinion. Just because it has failed miserably since its inception, and wasn't able to stop the CRASH in 1929, doesn't mean that you should talk negative about it. And just because there's another documentary available on the web , which can be 'Googled', entitled- THE ASCENT OF MONEY PBS, doesn't mean that ANYONE should believe what was stated by the good Professor in that well made documentary. WHAT'S NEXT, Strategery? I guess you'll be telling everyone there's a poem entitled- FED POEM, at the BusinessWeek article entitled- A CREDIT CARD YOU WANT TO TOSS, in the comments section back in early 2008 along with a bunch of other poems, huh? Wake-up, Strategery! The FED will always be around. It's kinda like nose-hair, or ear-hair on an old man, wouldn't you agree?

Julian

August 17, 2009 06:02 PM

yes, "down with Satan!, down with Satan! he is bad! -he is bad!, Down with Satan!, down with satan!, he's so bad!, he's not "rad"!..." -comon guys let's all go down to Washington and so 'em all who the dang boss is K?!!! -We'll demand that ol' man Satan turn in his badge and change his ornry wayz!-and not only that we'll tell him to get the heck out of the financial system and to do it like Jesus said to in the bible, -and then....(sorry -reality cheque just bounced)...

Chuck Gaffney

August 17, 2009 06:29 PM

Listen, I'm someone who is pro-Obama, pro Democrat, and not being either R or D, but during this past (can I say past?) crisis, sadly the FED was needed. Ron Paul and others have it right that the FED needs to be audited and as the economy heals, we need to go to a gold standard and drop the FED like a bad habit. Like credit cards, the FED is more of a burden on us if we use them for too long, too much and for the wrong reasons. The FED was erased once before and since it's (re)start, the US dollar is worth only $.04 of it's original value. This is from all the devaluing we've done to it by printing fake money. Banks and the FED need to pay the piper like the rest of us and they should not have so much power over this nation. I'm the first person would gladly punch out one of those ridiculous Health Care reform town halls hecklers (and laugh at how their 'oh so great' private insurance won't cover the injuries) and I'm also a solid hater of Fox News, their attempts to hurt Obama physically as well as their feeding the stupid parts of this country to only hurt this nation and prove some west wing religious fairy tale. Yet, I feel that the FED should first be audited and went the time is right, remove them. The FED is a sign of weakness.

Chuck Gaffney

August 17, 2009 06:31 PM

Listen, I'm someone who is pro-Obama, pro Democrat, and not being either R or D, but during this past (can I say past?) crisis, sadly the FED was needed. Ron Paul and others have it right that the FED needs to be audited and as the economy heals, we need to go to a gold standard and drop the FED like a bad habit. Like credit cards, the FED is more of a burden on us if we use them for too long, too much and for the wrong reasons. The FED was erased once before and since it's (re)start, the US dollar is worth only $.04 of it's original value. This is from all the devaluing we've done to it by printing fake money. Banks and the FED need to pay the piper like the rest of us and they should not have so much power over this nation. I'm the first person would gladly punch out one of those ridiculous Health Care reform town halls hecklers (and laugh at how their 'oh so great' private insurance won't cover the injuries) and I'm also a solid hater of Fox News, their attempts to hurt Obama physically as well as their feeding the stupid parts of this country to only hurt this nation and prove some west wing religious fairy tale. Yet, I feel that the FED should first be audited and went the time is right, remove them. The FED is a sign of weakness.

Ajay

August 17, 2009 06:49 PM

While I agree with other commenters that the Fed causes more problems than it purports to solve, I think you have to have a healthy perspective on what the real problems were. Fannie and Freddie were dumping billions of dollars into subprime, further fanning the flames of the overheated housing market this decade, egged on by idiot congressmen who wanted to buy more votes. The idiot Wall Street financiers used all the easy money they were getting, mostly from the savings glut and not from the Fed, to go gambling on housing, which they lost big, rather than find real, worthwhile avenues for growth. The Fed plays a small role in all this, varying inflation a couple percentage points a year to try and spur investment or cool down overspeculation; obsessing over the Fed means losing focus on the real problems, though the Fed obviously needs to be killed off and it will be. :)

Alan 'GREEN'spun

August 17, 2009 07:14 PM

Why can't people discuss things in a civilized manner? The FED is, & was a necessary organization that was enacted in the early part of the 1900's. In 1913 Congress was tricked into voting for the Federal Reserve Act, and since then it's been a part of America- kinda like 'Monday Night Football', right? All was well when the former FED chairman was in charge, correct? Heck, he retired in early 2006, didn't he? There was no 'housing problem' or 'foreclosure problem', or any kind of 'meltdown' in early 2006, was there? All of 2006 was fine, wasn't it? The real problems started in 2007, didn't they? And remember- it WASN'T the FED that held a gun to people's heads & forced them into getting an ARM, right? 'BEER'nanke needs to have a 'cold one' & just CHILL OUT! I don't concern myself with the FED anymore. I'm simply waiting for the Chevy Volt to be introduced because I'm always thinking 'GREEN'. I can't wait to take it for a 'spin' around my neighborhood.

Lord

August 17, 2009 07:30 PM

One can destroy the Fed but not the power it represents. Who do you want holding it? What makes you believe they would do any better? Based on ideology?

Karl

August 17, 2009 08:45 PM

What if, HYPOTHETICALLY, the FED was audited & it proved to be something similar to what Bernard Madoff had operated for many years? 'Google' this- FRONTLINE THE MADOFF AFFAIR, and watch it on the web.

Joe Cushing

August 17, 2009 08:45 PM

Strategery, arquebus,


I just wanted to point out that the Zeitgeist two misses one point that changes the whole point of the video. I think they miss this point on purpose. I remember studying the Fed as an undergrad and I learned that the Fed pays all of it's profits back to the treasury. This means the interest it collects is paid to the treasury. This means the treasury doesn't really pay net interest to the Fed. This means the whole video is based on a false idea. There is not more money owed than exists.

All that said, I don't think we need a fed. I don't' like the idea of a gold standard much better though. I'd like to see a currency backed by a market basket of commodities. How would you back the currency without having to hoard wheat, oil, etc like we used to hoard gold? Maybe you have commodity exchanges issue the currency backed by contracts. Then, you would have backing of real usable commodities. You could redeem your currency in the commodities in the index if you wanted to. Sense the currency in circulation is directly proportional to the commodities in circulation, inflation/deflation would be approximately 0. The money supply will grow and shrink as needed. Such a currency would be a true global currency the way gold used to be but without the hoarding and all the problems that causes.

One reason I don't like gold...

is that it gets most of its value the same way dollar bills get their value--they are valuable because they are valuable. It's faith. If you put 100 people on an island. You grant one person a wheat farm and another a gold mine. The other 98 fend for themselves in various other productive ways. It won't take long to figure out that the wheat farmer is the wealthiest person on the island.

Damian

August 17, 2009 10:17 PM

We live in a very melodramatic culture. I think deep-down, whoever printed that meant "Reform the Fed."

Mike Reardon

August 18, 2009 12:50 AM

The worlds GDP is now around $30 trillion annually, that's up from $23 trillion ten years back. And present world debt stands far, far beyond that.

If you take on the cumulative interest that debt will incurred out over the next 75 years, you are talking hundreds of trillions in returns that need an orderly disposition between trading nations.

Growth in productivity and the return from that cumulative interest can not be a stable fixed target. Keep the Fed it has its purpose.

I don’t believe in world conspiracies, only local elites who are changed in place from time to time by events and they know they are filling out their place where they hold local power. Bank managements and central bankers should know they all are only transitory in their power. Keep the Fed it matches other local players in other economic power zones.

Now to me the crash in world trade, was a realization by banking that the value of the derivative that Lehman Brothers held, would never return the values that matching real values could still gain.

Cut the lending cord and then demand open settlement against Lehman Brothers, was going to start the settlement dominos falling. Keep the Fed it has its purpose.

The projection today that 32% of housing loans will be underwater, means those still paying on that debt are paying against a negative equity valuation. That continuing debt service is taxing and robbing future personal investment in the hands of middle class citizens at a greater rate than any tax that would support Health Care.

The rich can afford the tax to pay for Health Care the interest for inflated 2005 housing prices is the real tax the middle class needs lifted to restart any real consumer demand.

Brandon W

August 18, 2009 09:21 AM

Joe,
You make a good argument and your island example is really excellent. My big fear with that is we might replace the Fed with Monsanto.

i.stalin

August 18, 2009 10:09 AM

Meet the new boss, it's the same as the old boss.

Marshall

August 18, 2009 10:57 AM

my gosh, where was all the trepidation when the housing boom was occurring, i don't recall not one tv or radio station making the cry of "hold the pressess the housing boom is out of control!" no, in fact just th eopposite happened and gold was off to the races towards the thousand dollar range we see today. presently we see the housing bubble bursting and all we are doing is accusing every financial vehicle for it's failure. well it's not failing it's correcting to where it should have been all along, 3-10% increase per year not the doubling of housing prices we seen a year and a half ago. greed and specualtion will end any democracy and it's financial well being is in constant jeopardy when allowed to run amok with the likes of lehman bros. and their downfall, bank of america (gobbling up small banks like it was their morning juice box), chase, citi, among others. and the fed was strangely quiet during all of this....and the next move is ???????? AMERICA time to get off your ass and get your "can do" attitude back.

Keith G.

August 18, 2009 01:22 PM

I feel like I've just read transcripts from a town hall meeting.

Thankfully, there are some people who can reason well. Thank you Joe Cushing and Mike Reardon.

I was beginning to think one of my favorite blogs was being taken over by paraniod, conspiracy-theory, fearmongering, far-right radicals.

It can be and should be improved but, the FED works. Our government can be and should be improved but it works.

Let's have a lively and passionate debate based upon valid concerns and REALITY.

Timothy Bledsoe

August 18, 2009 03:23 PM

"I felt like I wandered into a weird movie."

Do all of your feelings relate to television experiences? What rock have you been hiding under?

Ajay

August 18, 2009 04:23 PM

Joe, that's exactly my idea on what will replace the Fed, that you will find referenced in past comments of mine here about private digital currencies backed by commodities. The emergence of private digital currencies online is inevitable and they will kill off national currencies. I will note that they can also be backed by myriad other options, anything that has permanent value for people, such as groceries, timeshare vacations, real estate, technology futures, etc. When I said the Fed will be killed off, that's exactly how it will happen, it's only a matter of time. :)

Dominic

August 18, 2009 07:59 PM

Squeezebox

That is nonsense...who you think run the Fed??? Social Workers??
The Federal reserve is as Federal as Federal Express.

Dominic

August 18, 2009 08:11 PM

Michael

What is your point with your short blog entry?? An attempt to ridicule an issue then indeed need at the very minimum to be looked at??
Do you think that the Federal Reserve system should be left as it is??
Don't you agree that it would be a useful exercise at least trying to discuss potential alternatives or modification to the status quo??
Is the Fed a God given feature of the land??
Why don't you elaborate a bit rather than trying, as I suspect, to dismiss the whole thing as a rant by a bunch of economy illiterate people??
I do have issues with any entity (government or private) that has the power to create money out of thin air by decree.

Dominic

August 18, 2009 08:43 PM

Ben 'BEER'nanke

Who establish what is "necessary" for growth?? And based on what?? Should we have someone "deciding" that for us??
We really need an authority establishing the "right" rate of interest??

Alan 'GREEN'spun


Why the Fed was "necessary"?? Do you know who drafted the Federal Reserve Act?? And the events leading to it??
Do you know that since 1913 the dollar has lost more than 95% of its value??
Do you know what money really is??

Joe Cushing

You said

"One reason I don't like gold...

is that it gets most of its value the same way dollar bills get their value--they are valuable because they are valuable. It's faith."

Gold has a very important difference from a fiat currency..it cannot be manipulated, it cannot be created out of thin air. Nobody can create gold by decree...


I agree that we may find a better system than the archaic Gold Standard...however I refuses the main view of mainstream economists that the Fed is untouchable, it's taboo...a potential alternatives is not worth to be discussed.


Another thing you said

" If you put 100 people on an island. You grant one person a wheat farm and another a gold mine. The other 98 fend for themselves in various other productive ways. It won't take long to figure out that the wheat farmer is the wealthiest person on the island."

Bingo...that is exactly my point...the real wealth is from production and real growth comes from real productivity improvement....if you put in that island a money printer he would not be very wealthy either...

Another myth is that deflation is bad!! Is evil!! To be avoided at all cost!!

Well in the 19th century we had very robust growth in deflationary environment...why??? Because if dramatically rising productivity....rising productivity should lead to cheaper prices in the future.

A good example is the electronic equipment industry which is historically afflicted by chronic "deflation"...have you ever heard of the majority of people holding up a purchase of a flat screen TV or an MP3 player because in 2 years the price would be half??

Another issue that needs to be discussed is Fractional reserve Banking Vs. Full Reserve Banking

2 famous statements Remember from Sir Josiah Stamp, Director of the Bank of England (appointed in 1928) not exactly a conpsiracy theory nut...

"The government are very keen on amassing statistics. They collect them, add them, raise them to the nth power, take the cube root and prepare wonderful diagrams. But you must never forget that every one of these figures comes in the first instance from the chowty dar (village watchman), who just puts down what he damn pleases."


"Banking was conceived in iniquity and was born in sin. The bankers own the earth. Take it away from them, but leave them the power to create money, and with the flick of the pen they will create enough deposits to buy it back again. However, take away from them the power to create money and all the great fortunes like mine will disappear and they ought to disappear, for this would be a happier and better world to live in. But, if you wish to remain the slaves of bankers and pay the cost of your own slavery, let them continue to create money."

Bridgette Marshall

August 18, 2009 10:55 PM

Here's a funny but true take on the economy that I saw in the Washington Post. It cuts through the crap and gets to the point...the income disparity is killing us! http://www.washingtonpost.com/wp-dyn/content/article/2009/08/18/AR2009081803418.html

Bridgette Marshall

August 18, 2009 10:56 PM

Here's a funny but true take on the economy that I saw in the Washington Post. It cuts through the crap and gets to the point...the income disparity is killing us! http://www.washingtonpost.com/wp-dyn/content/article/2009/08/18/AR2009081803418.html

Joe Cushing

August 18, 2009 11:09 PM

Thanks for all the comments.

Dominic,

I agree with your point about gold not being creatable. I just figured we all knew about gold's most appealing aspects so I left them out. This noncreatable feature is why I went with a commodity currency.

Ajay,

one problem we have with our idea is that it is illegal to have competing currency in America. There are ways around this though.

Brandon,

The roll of government in currency would be that of antitrust. Monsanto could issue currency but so could lots of other companies. Also, that currency would be redeemable which limits the ability to manipulate.

Mike Reardon,

Weather or not the rich can afford more taxes is irrelevant. The fact is we can't tax them anymore because they won't pay anymore. We are on the right side of the peak of the Laffer Curve. Raise taxes on the rich and you will likely see lower revenue. You will also see higher unemployment, lower GDP growth, and wages for the middle class will slip compared to the rest of the world. Bush collected more taxes from the rich than any other president in history. He did so by lowering them.

All,

Today I listened to a podcast of the guy who runs the web site in the photo. (Alex Jones) He is a bit on the scared side--maybe even a bit nutty--but all the evil empire things he talks about have come true in the past. He sees us descending into fascism or some other non free from of government. There is no reason to believe they can't happen to America. The founding fathers expected it. That doesn't mean we can say these things are eminent though.

Dominic

August 19, 2009 12:28 AM

Joe

Lowering taxes for the rich by the Bush administration has not created one iota of a job (especially jobs you can live on) in the first decade of the 2000s.

Once lowering taxes has not created jobs just let's get back the loot.

However I agree with you that the tax issue is secondary nowadays...we have other bigger fish to fry and problems to fix.
One of them is make sure that playing in the casino of Wall Street is not more rewarding than being involved in real economic activity.

There are not real entrepreneurs in the Hamptons....you want to build a solar panel presearch roduction plant in the US?? Heck no taxes for 10 years...you like to play casino in the markets?? I blow you out of the water...

Lord

August 19, 2009 12:40 AM

Deflation is tolerable up to the point of productivity growth. It is evil beyond that point. Don't believe bull.

Ajay

August 19, 2009 12:56 AM

Bridgette, that article has nothing to say about income inequality, it merely mentions it in passing at the end and makes the obvious point that some people are better off in this recession. Meanwhile, that guy Milloy is a moron if he thinks the govt prints money for the stimulus: either that or he's lying, take your pick. As for income inequality, nobody seems to look at disaggregated data to find the real causes, but I suspect that it's because anytime there's a technology revolution- electricity in the 20s, the internet today- a small group of smarter people benefits disproportionately in the early stages. However, it doesn't take long for the benefits to be spread very widely, as the entrepreneurs who help it spread will make a lot more money. So not only do I not see a problem with income inequality, I don't expect it to persist for long.

Joe, from what I've read alternate currencies are not illegal in the US, they just may not reach the status of legal tender, meaning that a creditor HAS to accept them as payment for debt. I'm not entirely sure if even this tenuous difference is legally mandated, but even if it is, that's nothing. What matters is what people choose to use most of the time, what they're forced to use in rare situations is neither here nor there and won't have much of an effect.

Dominic

August 19, 2009 02:00 AM

Ajay


If an entrepreneur makes billions taking advantage of a technological breakthrough that improve the life of everyone more power to him...he deserve it.
The problem is the guy that makes $100M with bets on the energy derivative market (and maybe taxpayers have to bail him out if his bets go wrong because the fund poses a systemic risk...)
He contributes nothing to society.
Wall Streeters are not entrepreneurs.
That is the issue in America nowadays..too many fat cats that are parasites and actually drag resources from the economy...they make insane amount of money and their income are taxed as "capital gains"....probably a real entrepreneur pays more taxes in percentage than some of these folks.
Not enough innovation and real productivity improvement...if you do not contribute you do not deserve it.
I'm ok with income inequality for extraordinary productive people.
Bill Gates deserve his billions more than Lloyd Blankfein of Goldman Sachs deserve his millions.
Give me more of the former and less of the latter.
We turned from an economy of entrepreneurs to an economy of rentiers and speculators.

Ajay

August 19, 2009 03:15 AM

Dominic, I've readly admitted above that idiot financiers and congressmen helped cause this mess, along with stupid foreign investors and home owners/speculators. Many people got caught up in the mania, or it wouldn't have gotten as big as it did, but you have to be able to separate the housing boom from the real advances that happened this decade. Ebay went from $400 mil to $8.2 billion in revenues, Google from $50 mil to $22 bil, and Amazon from $2.8 bil to $20.5 bil, finally breaking a profit in '03, albeit on slim margins that benefit the customer. Globalization drove prices on many goods through the floor, so that the US consumer can live a much better life on much less work than they had to before. Wall Street has always had a casino element that waxes and wanes, obsessing about that when we saw much real progress this decade and are on the cusp of a great explosion of wealth is myopic.

Dominic

August 19, 2009 04:55 AM

Ajay

The problems is that Wall Street's share of official GDP grew enormously in the last 10-15 years and it did reach unealthy levels.
Google is great but, honestly, after the big boom of the crazy 90's which increased a lot of real productivity along with the "froth", in the first decade of the 21st century the US economy ha been increasingly running on the fumes of financial speculation...
Amazon and Ebay?? Great e-commerce sites but I would not exactly call them technology companies....Amazon took forever to turn a profit and in the current environment they would not get a penny in financing with that kind of profitability timeline...I could not believe during the years to the level of valuation reached by the stock for a company with no profits...
Selling merchandise on the web to each other is not exactly cutting edge stuff...
Facebook?? Twitter?? MySpace?? Better no comment....how much do they contribute to productivity?? How much money do they make??
Apple sold tons of I-Pod and I-Phones but, again, nothing really even remotely revolutionary.
We need breakthrough things to really move the needle for the US economy.
Michael is very right when he did talk about dearth of innovation (and I would add real, solid, consistent productivity growth) few weeks ago...
When there are too many incentives in playing the market casino who is going to invest in alternative energy?? Nanotech?? Revolutionary drugs?? Optical processors??
Even a colossus with enormous R&D potential like IBM wasted billions and billions in ridiculous stock buyback programs (one of the biggest volumes in Corporate America in the last 8 years)because evidently, in management's view, they could not invest their cash more productively...or maybe because the only thing they cared for was a short term boost in the stock price to cash on their options...
And I do not think the VC are the right venue to fund the really revolutionary stuff (takes time, lots of money and serious research)....time horizon is too limited and the mentality is still to find couple of kids with a brilliant web based idea, dump few milions on it and hoping that a big corporate sucker provides their exit strategy couple of years down the road buying the up the new venture....because there is not even the smell of IPO prospects.
We will see...

Dominic

August 19, 2009 05:04 AM

Ajay

Financiers and WS types definitely are not idiots.....they know perfectly how the game is played nowadays and they do play it very effectively.
Head I win, tail you lose.
The biggest the better...on the upside they buy their third Montecarlo villa, on the downside they send to you, the taxpayer, a nice fat "F You" note with a smile..bail me out baby because I pose a "systemic risk".... and they still buy that mansion..
Call them idiots....

Joe Cushing

August 19, 2009 08:39 AM

Dominic,

Europe has a lot higher unemployment that the U.S. Maybe one reason our recovery during the 2000s was jobless is because everyone had a job. You can't create jobs if there is no-one to do them. The you can kill jobs however and move us to a more European style 8,9, 10, percent unemployment in good times. Obama's tax increases are more than Bush's cuts. Bush only cut from 39% to 35%. With social security cap increases, Obama is talking about taking many up to 54%. At least he was in his campaign. That would be a game changer. The revenue that would kill, would force him to raise taxes on the rest of us. In Europe, the government takes about 50% of all people's money. That's were we are headed. It's far more radical than Bush. Bush only tweaked things.

Dominic

August 19, 2009 11:24 AM

Joe

The higher unemployment rate of Europe Vs. US is very misleading and is largely a statistical phenomena.
I can give you a very good example of this.
In my native Italy, in France and in Germany in order to be considered employed you need to work at least 20 hours a week....in US, if you work one hour a week your are "officially" employed....big difference.
During the 2000s the mass of discouraged workers (not officially counted in the rate of unemployment) grew dramatically and the average time needed to get a new job increased significantly as well.
Look at the U6 statistics to find the real rate of unemployment in the US.
If you lost your middle class good paying job and now you are a greeter at Wal Mart you have a "job"...in the US you can work full 40 hours a week and still not make enough to live on.
Some people in Germany make more money collecting government unemployment subsidy and trying to requalify themnselves than many Americans flipping burgers in steamy kitchens.
For example the IT sector, an industry that I know very well and a very important segment of the US economy, (in the 90s they were the jobs of the future remember???) never recovered from the 2000-2001 recession.

Lord

August 19, 2009 02:11 PM

Even though the depression was a disaster, income growth has been better since the Fed than it was in the 19th century as this shows.

http://graphs.gapminder.org/world/#$majorMode=chart$is;shi=t;ly=2003;lb=f;il=t;fs=11;al=30;stl=t;st=t;nsl=t;se=t$wst;tts=C$ts;sp=6;ti=2007$zpv;v=0$inc_x;mmid=XCOORDS;iid=ti;by=ind$inc_y;mmid=YCOORDS;iid=phAwcNAVuyj1jiMAkmq1iMg;by=ind$inc_s;uniValue=8.21;iid=phAwcNAVuyj0XOoBL_n5tAQ;by=ind$inc_c;uniValue=255;gid=CATID0;by=grp$map_x;scale=lin;dataMin=1700;dataMax=2007$map_y;scale=log;dataMin=240;dataMax=119849$map_s;sma=49;smi=2.65$cd;bd=0$inds=i239_t001790,,,,

Dominic

August 19, 2009 02:28 PM

Lord

The question that you have to ask is the purchasing power not nominal income growth...

Lord

August 19, 2009 02:41 PM

The biggest difference between US and European employment is people can live without work there whereas here they have to commit crimes and are incarcerated thereby removing them from the unemployed.

Lord

August 19, 2009 11:41 PM

This is real income growth, (real gdp per capita).

mik

August 26, 2009 03:06 PM

http://www.youtube.com/watch?v=e3zo7zjYk2E

I strongly believe we need a federal reserve audit. The recent stock market action suggests to me the federal reserve is intervening in a free and open market. I believe the biggest beneficiary of this TRILLION DOLLAR stock market move in a couple of weeks was Goldman Sachs. Goldman Sachs sells derivatives in our equity markets its apparent that Goldman Sachs Has Total Control Over our stock market using the unlimited capital available from the federal reserve. I believe Goldman Sachs doesn't have the best interest of our markets. They are misusing the federal reserve to manipulate the stock market and making huge 100 BILLION DOLLAR profits THIS IS ILLEGAL people expect our government to obey the laws just like citizen. Also this manipulation without regards for cost continues to put our government and the people more and more in debt

JUST THE FACT GOLDMAN SACHS HAS HAD SUCH IMPOSSIBLE SUCCESS AT TRADING IS ALL THE PROOF OUR GOVERNMENT NEEDS TO KNOW TO PROVE MANIPULATION!!!!!!


AUDIT THE FEDERAL RESERVE

http://www.auditthefed.com/

a person

August 30, 2009 08:24 PM

if you end the fed....
then what?

Lefteris Kritikakis

September 5, 2009 11:10 AM

Back in 2002, during a discussion with university professors, I said:

"Democracy is a system for small communities. It is impossible for everyone's voice to be heard in large communities or huge countries".

Now I say:

"It is impossible to invent an economic or financial system that will work well for everyone in a huge country, since needs between different people and groups are very different themselves."

You may say "but economies of scale benefit the overall economy... where would the average American be, if the dollar was not a reserve currency?"

To which I reply: Merely boosting consumption through reserve status did not benefit the mom and pop shops, deprived small American towns of a personality (they' re all Wal-Marts) and made them all employees, subject to swift corporate movements.

I would not hesitate giving up my ability to consume worthless Chinese-made gadgets in order to have a stronger local economy, more local jobs, more free time, more character and personality in my neighborhood, and more critical and enterpreneural spirit among the people in my area.

It is not smart to use a reserve currency as a tool to make Americans "no-thinkers, but consumers" and destroy their local enterpreneurs for the benefit of "economies of scale".

We have seen the negative consequences in the cost of health care, college, and in the demise of the creative powers of ordinary people.

Finally, the FED is used by Congress and Large Corporations to serve their interest and to destroy the one and only power of the ordinary people: savings.

CitizenPete

September 10, 2009 02:10 PM

Congress (House) is FINALLY bringing HR1207 (AUDIT THE FED BILL) to a hearing... With over 280 cosponsors in the House, if it makes it to the floor, it should pass. The FED shills in the Senate will block it (e.g.: Tim Johnson) if we let them -- speak up America. I wish every sidewalk in america had that letter taped to it.

nick kryzo

September 23, 2009 04:39 PM

END THE FED!!!!!!!!!! AUDIT THE FED!!!! It's nothing but a private bank out to control the US (which it does) and the world. Have you people never heard of the BILDERBERG GROUP?! Educate yourselves!

INFOWARS.COM / PRISONPLANET.COM

BancheroMedia

October 4, 2009 07:41 PM

The assumption behind all of this end the fed stuff is that existing "anti-fraud" laws would prevent banks from misusing deposits and running our economy into the ground. These laws failed the citizens of this nation -- and the world -- time and again, and actually helped give rise to the worldwide socialist movement. So this is not a panacea. It makes for great campaign sound bites and Dr. Paul will sell a bunch of books. But history belies this oversimplification of how the economy of the 19th century responded to greed and knavery.

greg

October 12, 2009 10:24 AM

People that support the fed don't understand it. They only know the hype that the fed itself started putting out years ago. The difference between a fed supporter and a fed detracter is about a months worth of research.

Scott Bennett

February 28, 2010 07:52 AM

I'm a concerned Australian (That's different to Austrian;-).

Are you aware that Australia has a central bank, the Reserve Bank. The difference is that it is run by the Government and all profits go back to the Government. This is important because the interests of the bank are the interests of the people.

I am very worried for America for many reasons but I think every one of you should go out onto the streets right now and demand transparency, demand an audit at the least.

The Federal reserve in your country is owned by private interests who profit at your expense. They control the supply of money and it is in their interests to keep you in debt.

Yes "End the Fed", but that means, take back control of it. Put it back in the hands of the people.

I can't believe anyone in there right mind would suggest otherwise! The sovereignty of a country is in its control of the money supply!!! Otherwise who's interests are you serving?

BTW. Australia also produce gold coins, that are legal tender. They are not widely used, but they are available none the less.


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Michael Mandel, BW's award-winning chief economist, provides his unique perspective on the hot economic issues of the day. From globalization to the future of work to the ups and downs of the financial markets, Mandel-named 2006 economic journalist of the year by the World Leadership Forum-offers cutting edge analysis and commentary.

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