Biden Respects the Fed

We respect gold and silver!

We have the worst inflation in decades.  It is pounding the stock market.  It is whipping the bond market.  Mortgage rates are climbing fast to the dismay of both home buyers and sellers.  It is draining household budgets with every stop at the gas station.

And President Biden says the answer is to respect the Fed?  Who, pray tell, is responsible for the appalling state of our money, the US dollar?  Perhaps the monetary authorities, the Fed, might have something to do with it?  

And if not they, who?

Biden says that part of his job is to nominate people for the Fed and to “give them the space they need to do their job, not interfere with their critically important work.”  Indeed, it is Biden who reappointed Fed chairman Powell to a second four-year term.  

A bi-partisan Senate vote just last month confirmed Powell’s new term.  

That’s funny.  Despite his cluelessness about the advent of trouble — the US inflation rate was over 8 percent – Senators by a vote of 80 to 19 thought it best to continue entrusting our monetary affairs to Powell.  It reminds us Janet Yellen.  She admits she didn’t get it about inflation either – as she didn’t get it about most things while she was with the Fed – but that’s good enough for her to be US Treasury secretary.

Biden went out of the way to mention that his respect for the Fed is unlike that of his predecessor Donald Trump.  What did Trump do?   He sent some mean Tweets about the Fed.

Mean tweets?  Oh, my!

Congressman Ron Paul writes that presidents have tried to have a hand in monetary policy for a very long time:

It is hard to believe that someone who has been in DC as long as Joe Biden really thinks Donald Trump was the first President to try to influence the Fed’s conduct of monetary policy. Since the Fed’s creation, Presidents have used public and private pressure to “convince” the Fed to tailor monetary policy to advance their policy and political goals. When it comes to “demeaning” the Fed, Trump has nothing on Lyndon Johnson, who, frustrated over the Fed’s refusal to tailor monetary policy to finance the Great Society and Vietnam war, threw the Fed chairman against a wall.

By “passing the buck” on inflation, Biden no doubt hopes to deflect blame from himself and his party before the midterm elections. Unlike Biden’s previous inflation scapegoats — greedy corporations and Vladimir Putin — the Fed actually is responsible for creating and controlling inflation….

Treasury Secretary and former Fed Chair Janet Yellen and Chairman Powell have both admitted they were wrong to publicly dismiss inflation as “transitory.” The fact that the two most recent Fed chairs made such a huge blunder (or purposely refused to admit what was clear to many people for over a year), shows the folly of relying on a secretive central bank to manage monetary policy. Instead of “respecting the Fed’s independence,” President Biden should work with Congress to audit, then end the Fed.

The continuation of Powell and Yellen in positions of authority reminds us of the old expression that if you keep on doing what you’ve been doing, you’re going to keep on getting what you’ve been getting.

President Biden can respect the Fed if he wishes.  As for us, when it comes to money, we respect gold and silver.