Sheldon Richman
While it is understandable that inflation hawks keep a close watch on the Federal Reserve’s money-creation activities, an equally worrisome Fed activity is taking place right under their noses. Whether or not the Fed is expanding the money supply, it has undoubtedly moved into a new activity under cover of addressing the financial crisis and recession: central planner of the allocation of credit.
As San Jose State University economics professor Jeffrey Rogers Hummel points out in The Independent Review (Spring 2011), Fed chairman Ben Bernanke “has so expanded the Fed’s discretionary actions beyond merely controlling the money stock that it has become a gigantic, financial central planner…. [The] Fed that emerged from the crisis is no longer the same as the Fed before the crisis.” It did not even have to expand the money supply to assume its new role.
Read more: http://reason.com/archives/2012/02/01/central-planning-at-the-federal-reserve
While it is understandable that inflation hawks keep a close watch on the Federal Reserve’s money-creation activities, an equally worrisome Fed activity is taking place right under their noses. Whether or not the Fed is expanding the money supply, it has undoubtedly moved into a new activity under cover of addressing the financial crisis and recession: central planner of the allocation of credit.
As San Jose State University economics professor Jeffrey Rogers Hummel points out in The Independent Review (Spring 2011), Fed chairman Ben Bernanke “has so expanded the Fed’s discretionary actions beyond merely controlling the money stock that it has become a gigantic, financial central planner…. [The] Fed that emerged from the crisis is no longer the same as the Fed before the crisis.” It did not even have to expand the money supply to assume its new role.
Read more: http://reason.com/archives/2012/02/01/central-planning-at-the-federal-reserve
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