Tuesday, November 29, 2005
Educate Yourself About Central Banks
Congressman Ron Paul had this assessment of the Fed nominee. "Mr. Bernanke is a consummate Fed insider, widely seen by the financial press as the logical heir to Alan Greenspan. In fact, judging by his public statements he may be more like Greenspan than Greenspan himself."
"What I mean is that Mr. Bernanke appears to have embraced the idea that the Federal Reserve can create prosperity more than Mr. Greenspan ever did. Like his predecessor, Mr. Bernanke views our system of fiat currency as a tool for creating wealth out of thin air by producing more dollars, whether paper or electronic. But he seems to take things further than Greenspan by refusing even to consider the destructive consequences of monetary expansion."
"In fact, he earned dubious notoriety for this quote in a 2002 speech discussing the supposed threat of deflation in the American economy: 'The U.S. government has a technology, called a printing press, that allows it to produce as many dollars as it wishes at essentially no cost.'"
"But there is a cost, and it's a heavy one. It's called monetary inflation, which destroys the value of the dollar and punishes those who save and invest. The money supply, as measured by the Fed's own M3 figure, has increased about 5 times since 1980. Yet for years officials at the Fed have insisted that inflation is firmly in check."
"The fundamental question is whether a central bank can manage the supply of money and credit better than the free market otherwise would..Centralized planning of the money supply is a form of economic control that significantly affects prices, wages, and production levels. I encourage all Americans to learn more about the Federal Reserve System and what it means for our economic future."
"What I mean is that Mr. Bernanke appears to have embraced the idea that the Federal Reserve can create prosperity more than Mr. Greenspan ever did. Like his predecessor, Mr. Bernanke views our system of fiat currency as a tool for creating wealth out of thin air by producing more dollars, whether paper or electronic. But he seems to take things further than Greenspan by refusing even to consider the destructive consequences of monetary expansion."
"In fact, he earned dubious notoriety for this quote in a 2002 speech discussing the supposed threat of deflation in the American economy: 'The U.S. government has a technology, called a printing press, that allows it to produce as many dollars as it wishes at essentially no cost.'"
"But there is a cost, and it's a heavy one. It's called monetary inflation, which destroys the value of the dollar and punishes those who save and invest. The money supply, as measured by the Fed's own M3 figure, has increased about 5 times since 1980. Yet for years officials at the Fed have insisted that inflation is firmly in check."
"The fundamental question is whether a central bank can manage the supply of money and credit better than the free market otherwise would..Centralized planning of the money supply is a form of economic control that significantly affects prices, wages, and production levels. I encourage all Americans to learn more about the Federal Reserve System and what it means for our economic future."
# posted by Ben Jones @ 12:58 PM 
