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Complete nonsense. The Fed isn't supposed to address any "issues", but simply be neutral. Instead they've spent a century saving entities that socialized priv

• kube-system 4y ago
  The fed has a mandate to follow: https://en.wikipedia.org/wiki/Federal_Reserve_Reform_Act_of_1977 https://en.wikipedia.org/wiki/Federal_Reserve_Reform_Act_of_...
• viscanti 4y ago
  They're meant to use monetary policy to maintain price stability and keep the unemployment rate low. Lots of issues come up where monetary policy would need to react. There are many places where fiscal policy might be better (it can be more finely targeted) and we generally don't see it materialize. So we're left with central bank technocrats using monetary policy.
  • amluto 4y ago
    The alternative to monetary policy isn’t necessarily fiscal policy. The current situation seems to be a combination of fiscal (demand side) problems [0] and supply problems. Congress can, slowly, address supply problems. The Fed can only usefully affect the demand side. As examples that have come up, various shipping laws make shipping expensive. Energy should be cheap to improve economic output, but energy prices are quite high, especially in places like CA. Medical services, drugs, and drug development are wildly expensive and inefficient, and government policies help keep them that way. Various environmental laws, while well intentioned, raise costs of all kinds of things while providing little or even negative environmental benefit [1]. [0] Hello, Covid stimulus policies. [1] As an example in California, water is quite useful, and desalinating water is not fundamentally particularly expensive. But so many environmental groups have veto power over desalination that the cost of large scale desalination might as well be infinite. Never mind that CA has plenty of coastline, plenty of solar resources near the coast, and plenty of valuable goods that could be produced if cheap solar power and reasonably priced water were actually available. And never mind that actual peoples’ actual living expenses (hello, inflation!) would be reduced if their utility bills, their restaurants’ utility bills, etc weren’t so high.
    • mitthrowaway2 4y ago
      > The Fed can only usefully affect the demand side. The Fed's job is to control inflation. If supply decreases, the Fed has to see to it that demand does too.
• lokar 4y ago
  That is a pretty hostile reply to a neutral post. They have sought to prevent large scale economic crisis, which would dramatically impact unemployment. And they have commented while doing so that this is not the ideal way to manage things.
• LastTrain 4y ago
  What do you mean by “neutral”?
• atlgator 4y ago
  Independent and neutral are not the same thing. The Fed works in concert with the government (Treasury, policymakers) to balance monetary policy with fiscal policy.
• drewcoo 4y ago
  > The Fed isn't supposed to address any "issues", but simply be neutral. What the Fed is meant to do: https://www.federalreserve.gov/faqs/about_12594.htm https://www.federalreserve.gov/faqs/about_12594.htm > Instead they've spent a century saving entities that socialized private losses. Yes, they've been around since 1913, about a century. Don't get it mixed up, though, capitalism socializes elite private losses, not the blunt tool that is the Fed. Before that, feudalism did the same.