Judy Shelton nomination as Fed Chair denied
dieseldub last edited by
The above is the Reuters story about her and the Senate vote.
When is the last time someone tried nominating a Fed chair with views as out of the box from normal as hers? I'm not even sure.
But one thing is for sure, I have a number of libertarian AND lefty friends who over the years have pointed out how out of whack monetary policy is, the fact that money is effectively created from debt. Money comes into existence when a loan is created, effectively. Banks didn't have the money to lend you in the first place, if you can wrap your head around that. They only have maybe 10% of the money they lend out.
On the surface that seems extraordinarily unfair, no? So, a Fed chair nominee who claims to be all about taking the U.S. back to the gold standard is something that certainly caught my attention. At the same time, I'm not educated enough on the topic to know what the full ramifications of such a move are, but most people who have at least gotten a couple basics on our current "fractional reserve banking" money-from-debt scheme would likely welcome the change, or really, ANY change.
Now, I also have my doubts that even as Fed chair she'd be able to make such a wholesale change to how the Fed "creates" and manages money, but it is definitely interesting to mull over if there was the possibility someone like her could pull it off.
jminer last edited by
@dieseldub Going to try to not get too weedy in my reply here - Monetary policy is a crazy complicated thing.
She wasn’t actually nominated as chair, but for a position on the board of governors. They’re more a steering committee that reports to the Chair (Jerome Powell) and has impact on monetary policy but one standout member like she would have been negligible impact. Trumps other nominee was Chris Waller, who was an existing official at the Federal Reserve Bank of St Louis and he’s a normal nominee for this sort of thing.
The Federal Reserve is probably the single most powerful institution in the US Economy. They’re also the only reason that the economy didn’t crash completely under a lackluster response from the rest of the federal government mid-summer on.
The federal reserve doesn’t actually have anything to do with government spending and they kind of manage the rest of the economy. Setting interest rates, managing liquidity in markets, stress testing financial institutions, enforcing regulations and performing outreach. Their official mandates are to manage inflation and full employment. During the Great Recession their powers expanded to bypass congressional gridlock and it’s the same now. When congress is unable or unwilling to act they will do what they can to keep things running.