In a case that can only be looked at as the pot calling the kettle black, former Fed chairman Alan Greenspan says that if Congress takes back some of its rightful constitutional authority to regulate monetary policy, the Fed will not be able to control inflation and the economy.
Come on Alan, it doesn’t take a rocket scientist to understand that the Fed has already inflated the money supply with its expansionist policies. Realistically the value of the U.S. dollar has dramatically decreased which requires the exchange of ever more increasing quantities necessary to execute transactions. The only thing keeping price inflation in check is the well conditioned belief by the American public that our dollar still holds value. We are experiencing inflation in the form of tax and fee increases on the part of local, state, and federal governments.
The rest of the world is questioning whether the U.S. dollar should continue as the global medium of exchange because of the Fed’s expansionist (read inflationary) policies and the increasing debt being accumulated by the U.S. government.
The Fed like Congress and the President claims that the free market can’t operate without the “leavening hand of government.” Yes, it’s true that more free markets might be a little more wild and woolly in some instances, the fact remains that profit/failure incentives rather than bail outs have a profound effect on the risk practices of businesses.
The Fed should be audited (287 members of Congress agree) and then Congress needs to get control of the monetary policy as well as the spending policy.
Alan Greenspan was at the helm during the build up to our current Great Recession, are we now supposed to heed his words as being wise or should we pat him on the head, say “that’s nice Alan, now go play with your little friends and leave monetary policy to those who haven’t messed it up so badly.”