I think you got that backwards. We had 2 financial panics in the 2000s - .com bubble + 2008. Also the Great Depression happened under the Fed's watch. I suspect that the modern Fed might actually be successful in lengthening the expansion part of the business cycle mostly by suppressing interest rates, but the recession parts of the market cycle will be much more severe than in the past, mostly due to the amount of debt and leverage in the system -- low interest rates simply encourages companies and consumers to borrow more money. No way around that. That inherently increases the amount of risk in the market. Also due to the fact that the Fed has now blown it's interest rate tool on its attempt (so far successful) of lengthening the current expansion. When it comes time to fight a recession, the Fed simply does not have the 4-5% worth of interest rate cuts that it needed in the past to fight recessions (without going to negative interest rates which Powell claims he won't do). So all that is left is monetizing the debt, but I suspect that has limits. I don't think MMT will work and they would likely kill the dollar in the process.
US Fed to Print $425B for New Year’s — 3 Times Bitcoin’s Market Cap
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I think you got that backwards. We had 2 financial panics in the 2000s - .com bubble + 2008. Also the Great Depression happened under the Fed's watch. I suspect that the modern Fed might actually be successful in lengthening the expansion part of the business cycle mostly by suppressing interest rates, but the recession parts of the market cycle will be much more severe than in the past, mostly due to the amount of debt and leverage in the system -- low interest rates simply encourages companies and consumers to borrow more money. No way around that. That inherently increases the amount of risk in the market. Also due to the fact that the Fed has now blown it's interest rate tool on its attempt (so far successful) of lengthening the current expansion. When it comes time to fight a recession, the Fed simply does not have the 4-5% worth of interest rate cuts that it needed in the past to fight recessions (without going to negative interest rates which Powell claims he won't do). So all that is left is monetizing the debt, but I suspect that has limits. I don't think MMT will work and they would likely kill the dollar in the process.
The dotcom bubble bursting wasn't a panic. (or shall I say it was an investment panic not a financial one) Unless you call every ponzi collapse a panic.
Yes we could count 2008 as a panic, still one in every century or 2 in 95 years (so I was off 5%), much better than the every decade a panic through the 1800s.
Name a Western country without a central bank.
To be historically accurate, for the 1900s (after the Fed) we could count:
1. Great depression
2. Savings and Loans of the 80s.
3. LTCM 1998
Before the Fed:
1907, 1901, 1896,1893,1890, 1884, 1873, 1866, 1857, 1847, 1837, 1825, 1819
https://en.wikipedia.org/wiki/List_of_banking_crises#20th_century
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Why, that's not my point.
EU lowers rates and nada
US lowers rates and nada
Brasil took em from 14 to 6 and nada.
Yep. Massive multivariable equation and one variable controls it all, irregardless of everything else... The fed just follows the market and pretends it's the other way around.
Silly humans love their kool aid
Couldn't this listing also be used AGAINST a return to a gold standard or fixed currency exchange rate?
nah. Just coincidence.
There's a massive gap in logic among all the anti-fractional reserve posts here. You're all basically saying "The Fed has made mistakes.....therefore gold standard and abolish the Fed!" If you're going to advocate for completely overturning the world economy that has led to an unprecedented amount of prosperity and technology then you're going to have to explain why your system is not only better, but significantly better to make it worth the risk and cost of such a move.
No one here has even attempted to do that, much less mustered an even nominally coherent set of thoughts around what such a system would look like and why it is vastly superior. You've just thrown stones at the current system without proposing any reasonable alternative, emphasis on the "reasonable". While you're all working on that, keep in mind that if we'd stuck with your system you'd be typing your response on a typewriter because we certainly couldn't have developed and deployed the modern internet if an ounce of gold had to be discovered in order to increase the money supply by $20.67!
No one here has even attempted to do that, much less mustered an even nominally coherent set of thoughts around what such a system would look like and why it is vastly superior. You've just thrown stones at the current system without proposing any reasonable alternative, emphasis on the "reasonable". While you're all working on that, keep in mind that if we'd stuck with your system you'd be typing your response on a typewriter because we certainly couldn't have developed and deployed the modern internet if an ounce of gold had to be discovered in order to increase the money supply by $20.67!
That's a reasonable position I probably don't really disagree with; look forward to the details.Meh... my point is that a lot of what you attribute to the Fed is just the free market, and the Fed takes credit for what it is not doing, and cannot do. I'll explain in detail, eventually.
and as an FYI... I despise gold. Not a fan of purple either.
Under the Federal reserve, it took 25 years to recover from the Great Depression. How long did it take to recover from those financial crisis during the 1800s?
https://virtueofselfishinvesting.s3...ry_of_market_corrections2-hires.png?link=mktw
Look at what debt does to economies. Japan has massive amounts of debt relative to their GDP and the last time their market made a new high was over 30 years ago.