You are not going to like my answer ( and it is the same as my answer for Treasury, HUD and multiple other agencies ). I would like FED to do less. I do not want it constantly engaged in trying ( and failing ) to follow signals it cannot or will not comprehend.
Frankly, if we are going to have politicians run monetary policy, we might as well move it back to congress where it belongs.
<<It’s creating was bought on in response to numerous banking panics in the 19th century.
I know the rationale, but isn't that FDIC's job now to basically say to people 'your money is fine; don't panic'? Oh, you say, 'yes, but that does not preclude general market panic.' And this is where I have a problem.
To a reasonable person, 2008 shockwaves for any other type of business, would have created a massive pain for everyone involved. Somehow, there were only few casualties from that event. Instead of actual wave of bankruptcies that would have made people think twice before putting entire system at a precipice of oblivion, we had government effectively reward bad behavior. I personally would argue that a system, where incentives reward dangerous behavior is a bad system.
And the most amusing piece is that we are still paying for it ( not in money either, but the bad system that encourages that dangerous behavior remains in place, which means we will eventually deal with another like market panic sooner rather than later ) edit: all while the original reason for the instability was never really addressed.
You are not going to like my answer ( and it is the same as my answer for Treasury, HUD and multiple other agencies ). I would like FED to do less. I do not want it constantly engaged in trying ( and failing ) to follow signals it cannot or will not comprehend.
Frankly, if we are going to have politicians run monetary policy, we might as well move it back to congress where it belongs.
<<It’s creating was bought on in response to numerous banking panics in the 19th century.
I know the rationale, but isn't that FDIC's job now to basically say to people 'your money is fine; don't panic'? Oh, you say, 'yes, but that does not preclude general market panic.' And this is where I have a problem.
To a reasonable person, 2008 shockwaves for any other type of business, would have created a massive pain for everyone involved. Somehow, there were only few casualties from that event. Instead of actual wave of bankruptcies that would have made people think twice before putting entire system at a precipice of oblivion, we had government effectively reward bad behavior. I personally would argue that a system, where incentives reward dangerous behavior is a bad system.
And the most amusing piece is that we are still paying for it ( not in money either, but the bad system that encourages that dangerous behavior remains in place, which means we will eventually deal with another like market panic sooner rather than later ) edit: all while the original reason for the instability was never really addressed.