The independence of today’s Fed is supported by its unusual institutional framework. But the primary bulwark against interference is psychological, driven less by laws and regulations and more by the convictions of key players that the economy is better off with a central bank that can exercise broad discretion in monetary policy. Hence a president inclined to dismiss Bernanke’s “careful empirical studies” who is abetted by a Congress unwilling to resist meddling could reverse the four-decade precedent.
But, but...
All of the debt held by the Fed is government debt, none of it private sector. The member banks are doing all the deposits. There was no way Ben was independent. He was in contact with Treasury the whole time offering more QE when Congress was running huge deficits.
Not only that, Mark, if the Fed is independent, then why to interest rate cycles fall on regime change boundaries?
No, Mark. You are just faking it in the service of Magic Walrus.
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