Kane can reduce him to tears!

I think Mr Paul is both ferocious and charismatic, to be honest. He’s one loud voice against an entire chorus of stupidity. It’s a shame.

That’s Bernanke’s answer: I don’t think anything bad will happen, none of your business, and trust me? What a patronizing ass.

As Ron Paul alluded to, the FED really is between a rock and a hard place. They will have to raise interest rates if they want to combat the inevitable double digit price inflation. This will wreak havoc on commerce and result in mass defaults on the staggering amount of personal and government debt. On the other hand, they can keep interest rates low and hyper inflation will severely disrupt commerce and result in a hyper-inflationary great depression. I think they’ll side with hyperinflation and price controls.

Our policy maker’s (Bernanke’s) ignorance will result in a severe decline in most American’s standard of living. It saddens me.

I don’t understand what you guys are riled up about. Bernanke answered his questions and was respectful.

Not to mention, the idea that the issues with inflation and such would be in any way even mitigated by Congress taking control of the money supply is laughable. I’m all for getting rid of the Fed, but we shouldn’t just give control of the printing presses over to Congress, that’d be as bad, if not worse.

Let’s face it. Interest rates should never be regulated to begin with. They are another commodity that responds to supply and demand. For this group, the Fed, of private bankers to presume that they can outthink the billions of economic decisions made daily by individuals and corruption is pure folly. Let rates float by individual banks and do away with the Fed.

morty says:
“I’m all for getting rid of the Fed, but we shouldn’t just give control of the printing presses over to Congress, that’d be as bad, if not worse.

i don’t agree. the monetary process would become overtly political, rather than the present sham “independence”. the more scrutiny, the better. lines of responsibility would become clearer. i don’t hope for less recklessness, just that the blame be correctly attributed.

newson,

The “independence sham” is only apparent and believable to economists and students who are currently taking a macroeconomics class. And idiot libertarians who use phrases like “the Federal Reserve is about as federal as Federal Express!” Most everyone else would never be able to tell the difference between the Federal Reserve running the central bank and Congress creating an agency to run the central bank.

There wouldn’t be more scrutiny, if anything, people thinking it was in the hands of elected representatives would make them less wary of it (rather than undemocratically selected governors, some of whom represent *GASP* the banks).

I don’t think we need to give the politicians any more access to the infinity-revenue well than they already have.

The independence of the Federal Reserve is a sham and at the very least an [actual] audit of would be a step in the right direction.

Indeed, congress would not any better at controlling monetary policy than the Fed. But I liken it too the difference between earmarks and appropriating a giant black box of funds to the treasury department.

Interesting comments on this one!

Just some facts:

In the “average year”, the sitting President has appointed 45% of the Fed’s Board of Governors. This should call into question the claims of an “independent Fed”.

On the other hand, it’s hard to believe that we’d ever see monetary policy like that of Paul Volcker if the government directly controlled monetary policy.

My guess is that direct political control of the money supply would do what it tends to do historically – result in hyperinflation. Generally, independent central banks prefer the bust over hyperinflation once they realize that that’s the tradeoff – it just takes them a long time to realize that. (Even Bernanke said, when prices start going up, it’s time to remove the “liquidity”, even if that does mean the economy doesn’t recover like we hoped.) Of course, there’s no obvious reason that it HAS to be that way.