Believe those who are seeking the truth. Doubt those who find it. Andre Gide


Tuesday, April 26, 2011

Meet the FOMC

From CNBC News, a nice little snapshot of the people who currently make up the Federal Open Market Committee.
When people think of "the Fed," they might picture a monolithic building in Washington, D.C., or the serenely smiling, bearded face of its chairman, Ben Bernanke.
But the reality is, the group making decisions about raising or cutting rates or pumping money into the economy through so-called quantitative easing is made up of several highly educated, opinionated individuals with sometimes-conflicting ideologies, personalities and policy specialties.
Meet the Federal Open Market Committee.
Read more: Infighting at the Fed? 

12 comments:

  1. David,

    You omitted an important descriptor - "made up of several highly educated, clairvoyant, opinionated..."

    Can a group of people, no matter how highly educated and well intentioned, determine the correct course of action for our $14T economy without being clairvoyant?

    What unabashed arrogance these mere humans must exude thinking they possess the combined knowledge to predict the future with enough accuracy as to know what rate of interest appropriate for the present. Moreover, what plain foolishness that politicians place faith in these mortals insisting that an economy must be steered in this direction or that direction lest all be lost.

    Welcome to the real FOMC.

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  2. Anon:

    You omitted an important descriptor - "made up of several highly educated, clairvoyant, opinionated..."

    I did not omit anything; I was not the author of that article.

    Can a group of people, no matter how highly educated and well intentioned, determine the correct course of action for our $14T economy without being clairvoyant?

    Could they do so even if they were clairvoyant?

    What unabashed arrogance these mere humans must exude thinking they possess the combined knowledge to predict the future with enough accuracy as to know what rate of interest appropriate for the present.

    If you read the FOMC statements carefullly (which I doubt you do), you will see all manner of humble references to uncertainty. I think that the FOMC members are genuinely trying to do what's best for the country, given the mandate they have been saddled with by Congress (and the limited tools they have to meet that mandate).

    Moreover, what plain foolishness that politicians place faith in these mortals insisting that an economy must be steered in this direction or that direction lest all be lost.

    Well, now you're getting warmer. And to go one step further, what plain foolishness on the part of citizens to vote for these politicians. So much better to let these same (foolish) citizens run their own private monetary policies. Is this the point you are trying to make? If so, I think I detect a contradiction...

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  3. The Fed's openness does nothing to address the fundamental complaints that have been leveled at the institution. The Internet has combined with the economic crisis to form an atmosphere that is noxious to the Fed and to central banking in general.

    In front of millions – billions – of people, central banks began to shovel trillions of dollars into the marketplace to provide "liquidity." Gradually it dawned on the average person struggling with debts and trying to make ends meet that the "system" itself was giving very wealthy people lots of money – and basically for free. These people and institutions had no more right to free money than anyone else, but they were getting it and others were not.

    This is the fundamental unfairness that central banks – and the Fed – have to grapple with. The trouble is that it is hard to counteract a perception of unfairness because central banking IS unfair. It is based on a fundamentally illiterate financial presumption and providing more "openness" about the process is only going to remind people that the process is an illegitimate and fraudulent one based on "legalized" counterfitting.

    Close to two years ago, we wrote several articles explaining why we thought central banking in general and the Fed in particular were going to have a tough time in the 21st century. Exposed by the Internet, the mystique of central banking no longer holds sway. People are not upset about central banking's secrecy. They are upset that central bankers have given away trillions to their already rich cronies and then attempted to justify it by maintaining that the current system would collapse had they not done so.

    Apparently those behind these public relations moves do not see the rhetorical trap they are creating. To justify giveaways of US$10 trillion or more (not including short terms loans from what we can tell) by explaining that the West's economic system would otherwise have collapsed does not alleviate anger. Rather, it brings the entire financial system into question.

    ...from The Daily Bell

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  4. Hey Gabe,

    Do you ever take that tinfoil hat off, even during thunderstorms? Or do you just where rubber soled shoes?

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  5. Aaach! Please substitute "wear" for "where" above.

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  6. Gabe, can you give me the link to that column from the Daily Bell? Thanks.

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  7. The Daily Bell -- is this run by Art Bell? It sounds a lot like him. Greg is a seriously disturbed person in any case, and might want to consider some elective confinement.

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  8. Seems to be some contention in this post! I guess money matters do that to people, don't they? I just hope things get better soon. :/

    Sandy

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  9. Well I guess it's nice to know that they are educated and opinionated, nothing wrong with some conflict. I'd rather have that then have it be a group that sways strictly one way or the other.

    -Rosie

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  10. How do people get onto that committee? Are they appointed? Elected? Do they apply for it a like a normal job? I'm assuming not, but not sure how they get there.

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  12. what plain foolishness that politicians place faith in these mortals insisting that an economy must be steered in this direction or that direction lest all be lost. China sourcing

    ReplyDelete