The Federal Reserve Bank controls the money supply and interest rates in the United States. How good, or bad, a job has it done over the last two years? Why? What could it or should it have done differently? Why? Please provide references to support your position. Thank you.
This is a huge topic, but here are the basics:
- The main Federal reserve policy idea is buying Treasury Bonds. About $1 trillion worth since late 2010.
- From this, the Fed has also pumped money into the stock market and bailed out banks. For the first time the Fed has also bought the bad loans of mortgage companies and other troubled non-banking institutions.
- All of this, as of November 2011, has crated no new jobs, minimal economic growth, and a massive increase in the debt, now financed partially by Fed money.
- The real issue is thus - the Federal Reserve prints money. This money is based on nothing. As of today, the money printing is really only to support the price of productive assets and bail out financial institutions of all types.
I follow this stuff regularly, and I know of no author who supports this general policy, or at the very least, who sees it as a success.
Senator Bernie Sanders of Vermont wrote that since Fed board members are also those who run the banks and institutions that are being bailed out, the conflict of interest there is immense. The corruption is shocking (look at my fifth reference below).
So the facts then are:
1. There has been a surge in interest rates in late 2010. the first few months of 2011, the Fed printed money, with which they bought over $1 trillion in T-bills altogether.
2. The purpose of this is to make Treasury bonds more attractive by artificially ...
The American monetary policy is scrutinized in a logical manner, showing cause and effect in cohesive steps. 919 words with 4 references.