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Partisanship in government could limit the freedom of the Federal Reserve System to pursue policies that actually help the economy, according to a financial journalist who spoke at Virginia Tech yesterday.
Long-time Washington Post economic journalist John Berry spoke about the role of the Federal Reserve System, also known as Fed, in times of financial crisis.
Berry began his speech, which was held at the Skelton Conference Center, with dismal words about the economy.
“I wish I had a better message for you all today,” Berry said.
In contrast to previous recessions, Berry said, partisan opinions about what should be done about the economy have more influence.
“What really scares me is that our political system is breaking down,” he said. “Instead of passing laws that will increase jobs, many members of Congress are blocking efforts for purely political reasons.”
Berry worked at the Washington Post for 25 years covering the U.S. economy and the Fed, and since 2004 he has free-lanced for the Bloomberg News, Thomas Reuters and the Fiscal Times.
In all the time he has covered the economy and the Fed, Berry said he has never been more worried.
“Never before have I doubted that divided government will come together to meet the needs of the people — I have that doubt today,” he said.
Berry said each of the Republican nominees for president have criticized the Fed’s monetary policy at some point during their campaigns.
“Some said they would not reappoint (Federal Reserve Chairman Ben) Bernanke. Some said they would fire him right away,” Berry said. “While these comments are outrageous, they aren’t harmless.”
Berry said much of the criticism from politicians regard the Fed’s “Dual Mandate.” This refers to the two long-run goals of the Fed’s monetary policies, as mandated by Congress to increase the natural rate of unemployment and keep prices stable (limiting rapid inflation or deflation). However, these goals are often contradictory in the short run.
Berry said politicians who only care about the next election pressure the Fed to make policy decisions that expand the economy in the short run, but may be detrimental in the long run.
A version of this article appeared in the Oct 19 issue of the Collegiate Times.
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Boo Hoo. Spoken like an establishment hack. You guys want to know the truth about the Federal Reserve? Watch these.
America: Freedom to Fascism:
http://www.youtube.com/watch?v=lUpZhhbKUBo
Creature From Jekyll Island:
http://www.youtube.com/watch?v=bhMacPvc5qc
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Also, is Mr. Berry down for the Federal Reserve giving TENS OF TRILLIONS of dollars to foreign banks and private American companies over the past 3 years? How are these actions in line with the Fed's two mandates?
END THE FED.
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I also recommend the two aforementioned videos) Add to that list "The Money Masters" (just type in the title on YouTube, it will come up (this is a 22 part series of 10 minute segments) You won't be sorry that you took the time to watch. . . all are very educational and none will be taught through the public school system. Mark my words. The last thing the Fed wants is transparency or audits. They don't want the people to know their true role in the destruction of our economy.
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"Instead of passing laws that will increase jobs, many members of Congress are blocking efforts for purely political reasons" ...
well, not that I don't think we should have firefighters, policemen, and teachers, but quite frankly those jobs don't contribute to economic growth and hence would just be additional deficit spending without any reward for it. construction jobs help, but home sales are down and on the decline. infrastructure is important but should be invested in when the economy is booming and can more easily be paid for than when the economy. this kind of spending is more of kicking the can down the road than anything else and essentially creates government dependent jobs and not private sector jobs. though people think its unfair (and i'm not saying that i disagree), cutting taxes so that the relative corporate tax rate of the US-other countries is more competitive is the best way to bring capital back. we can tax more down the road when there is more of economic burden to shift already created jobs back to other countries.
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Exactly, hit the nail on the head.
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End the Fed!
It has devalued the dollar and is the cause of the boom and bust cycles instead of steady economic growth.
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I don't think we need to end the Fed, I think we need to depoliticize like the supreme court (at least used to be). say people are elected to 10 year terms with no possibility of reelection. dissallow election of new members in a depression, allowing an extension of current governors or board members until positive gdp growth is achieved.
the problem is politicians eat, sleep, and breath keynesian economics and abuse it for their own political purposes. it's been well established the maintaining interest rates too low for too long results in economic instability.
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depoliticize the government's magic money-making machine? Dream on. End the Fed.
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