Derivatives: The $600 Trillion Time Bomb That's Set to Explode

[SparrowHawk]

Congratulations, you can regurgitate. As I said before history has shown that the gold standard is not going a mean to an end to the roller coaster ride that is the economy. You are still going to have recessions, depressions and debt. And when you get rid of the Fed then what? Not that it would happen since no president has the power to do such a thing. Something all the constitutional scholar Ron Paul supporters seem to be ignorant of.

My understanding is that it would take an act of Congress to audit the Fed. It would also take an act of Congress to eliminate the Fed. An act of Congress created it, ergo it seems reasonable that an Act of Congress to eliminate it would be all that's required.

The Federal Reserve Act (ch. 6, 38 Stat. 251, enacted December 23, 1913, 12 U.S.C. ch.3) is an Act of Congress that created and set up the Federal Reserve System, the central banking system of the United States of America, and granted it the legal authority to issue Federal Reserve Notes (now commonly known as the U.S. Dollar) and Federal Reserve Bank Notes as legal tender. The Act was signed into law by President Woodrow Wilson. source:Wikipedia

Further there is a significant body of evidence that the Federal Reserve caused the Great Depression.

In 1928 and 1929, the Fed raised interest rates to try to curb Wall Street speculation (otherwise known as a "bubble"). Brad DeLong believes the Fed "overdid it" and brought on a recession. Moreover, the Fed then sat on its hands: "The Federal Reserve did not use open market operations to keep the money supply from falling.... [a move] approved by the most eminent economists."

There was not yet a "too big to fail" mentality at the public policy level.

There's that word "bubble" again. This is the end result of fiat currency and central banks.

All this talk: the state should do this or that, ultimately means: the police should force consumers to behave otherwise than they would behave spontaneously.
Ludwig von Mises

BTW, I read and educate myself. I do not spew party rhetoric or drink kool aid from the Ron Paul fountain. It just happens that we are of like mind.

A great book to start with is Hayek's, "Road to serfdom" Here is a bit of history on it courtesy of Wikipedia

The Road to Serfdom is a book written by the Austrian-born economist and philosopher Friedrich von Hayek (1899–1992) between 1940–1943, in which he "warned of the danger of tyranny that inevitably results from government control of economic decision-making through central planning,"[1] and in which he argues that the abandonment of individualism, classical liberalism, and freedom inevitably leads to socialist or fascist oppression and tyranny and the serfdom of the individual. Significantly, Hayek challenged the general view among British academics that fascism was a capitalist reaction against socialism, instead arguing that fascism and socialism had common roots in central economic planning and the power of the state over the individual.

The Road to Serfdom is among the most influential and popular expositions of market libertarianism and remains a popular and influential work in contemporary discourse, selling over two million copies, and remaining a best-seller.[2][3]

The Road to Serfdom was to be the popular edition of the second volume of Hayek’s treatise entitled “The Abuse and Decline of Reason,”[4] and the title was inspired by the writings of the 19th century French classical liberal thinker Alexis de Tocqueville on the “road to servitude.”[5] The book was first published in Britain by Routledge in March 1944, during World War II, and was quite popular, leading Hayek to call it “that unobtainable book,” also due in part to wartime paper rationing.[6] It was published in the United States by the University of Chicago Press in September 1944 and achieved great popularity. At the arrangement of editor Max Eastman, the American magazine Reader's Digest published an abridged version in April 1945, enabling The Road to Serfdom to reach a wider popular audience beyond academics.

The Road to Serfdom has had a significant impact on twentieth century conservative and libertarian economic and political discourse and is often cited today by commentators.

 

[777 fixer]

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BTW, I read and educate myself. I do not spew party rhetoric or drink kool aid from the Ron Paul fountain. It just happens that we are of like mind.

You surely sound like you drink the Ron Paul Kool aid by the gallon.