What would be the effect on coin prices (and the rest of the economy) if the following bill is enact

Ed62

Federal Reserve Board Abolition Act

Be sure to take a good look at Sect. 2 (c) (2) (A):

(A) - - - - - - - - The Director of the Office of Management and Budget shall liquidate all assets of the [Federal Reserve] Board and the Federal reserve banks in an orderly manner so as to achieve as expeditious a liquidation as may be practical while maximizing the return to the Treasury.

RWB

What is the stated purpose? That is, what is the bill supposed to accomplish and why is this an important thing to do?

Ed62

What is the stated purpose? That is, what is the bill supposed to accomplish and why is this an important thing to do?

You will have to ask its (only) sponsor: Rep. Ron Paul.

ricko

If it puts (as it seems) the control of monetary policy back in the hands of congress, then it could be disaster. Cheers, RickO

BillJones

This bill is utterly stupid. A modern economy needs a central bank to regulate the money supply, enforce sound banking practices and maintain economic stability. One can certainly make cogent arguments that some of the Federal Reserves actions have been wrong and misguided both currently and historically, but the concept of a central bank is sound and essential. One need only study the history of our economy in the 19th century to see that monetary policy chaos is not the solution to our economic problems.

Steve27

It's an attempt to shut down the Federal Reserve Banking system, which would throw us into chaos since there would be no way to regulate interest rates, the amount of cash commercial banks have to have on hand, and the trade of US Securities.

Ed62

"If it puts (as it seems) the control of monetary policy back in the hands of congress, then it could be disaster."

Please define "disaster" in this context - - - - -

Is "disaster": 1.) a tighter monetary policy; or 2.) an easier monetary policy, ??

291fifth

Ron Paul is becoming increasingly irrelevant. The bill has no chance of being enacted.

PerryHall

This bill has no chance of passage fortunately.

BillJones

<< <i>"If it puts (as it seems) the control of monetary policy back in the hands of congress, then it could be disaster."

Please define "disaster" in this context - - - - -

Is "disaster": 1.) a tighter monetary policy; or 2.) an easier monetary policy, ?? >>



The disaster is that you would totally politicize the setting of monetary policy. The problems with this are vast and numerous.

First, there would be endless debates and stalemates as what should be done, which would result in stalemates and inaction. And I really realize that SOMETIMES doing nothing is best policy.

Second, I think that Congress would most often call for increasing the money supply because that is the most politically expedient action to take. Limiting the money supply almost always results in hardships for someone, and that is never politically popular. The result would be massive inflation if the money supply were to be increased without limit.

Third, who says that the members of Congress are experts in monetary policy? Most of them are lawyers who are more interested in high fees, personal power and aggrandizement than economics. Too many lawyers think that they experts in everything.

Even the late economist, Milton Friedman, would not have supported this bill. While he believed that many of the Federal Reserve’s policies were misguided, he still believed that the money supply had be controlled and grown a rate in line with the real growth of the economy. This bill is an example of libertarian philosophy run amuck. It’s one of the reasons why I can’t qualify as totally doctrinaire libertarian.