Update on Value Vault
The gnomes are working overtime to upload the 17 videos and other materials. About 2/3rds completed.
Fed Joins Other Central Banks in Monetary Easing December 01, 2011
“The Federal Reserve and other major central banks moved on Wednesday to help foreign banks more easily borrow and lend money, seeking to forestall a breakdown of global financial markets and giving Europe more time to wrestle with its debts. The latest round of interventions by central banks, including the expansion of an existing Fed program that lets foreign banks borrow dollars at a low interest rate, reflects growing concerns that Europe’s financial problems are hampering growth.” (New York Times)
In light of the Fed’s record, this should fill us all with confidence.
We have a report card on the entire Fed era that strongly supports the view that we’d be better off without it. At the very least, as the authors suggest, the burden of proof is squarely on those who would retain the central bank.
The report card comes in the form of a working paper from the Cato Institute: “Has the Fed Been a Failure?” by George A. Selgin, William D. Lastrapes, and Lawrence H. White.
The authors state in their abstract:
As the one-hundredth anniversary of the 1913 Federal Reserve Act approaches, we assess whether the nation’s experiment with the Federal Reserve has been a success or a failure. Drawing on a wide range of recent empirical research, we find the following: (1) The Fed’s full history (1914 to present) has been characterized by more rather than fewer symptoms of monetary and macroeconomic instability than the decades leading to the Fed’s establishment. (2) While the Fed’s performance has undoubtedly improved since World War II, even its postwar performance has not clearly surpassed that of its undoubtedly flawed predecessor, the National Banking system, before World War I. (3) Some proposed alternative arrangements might plausibly do better than the Fed as presently constituted. We conclude that the need for a systematic exploration of alternatives to the established monetary system is as pressing today as it was a century ago.
The dollar has lost 95 percent of its value since the Fed came into existence.
More on how debasement destroys economies:
If Germany and France push the ECB to ease and buy (without sterilization) EZ government securities, markets in Europe will be very strong. If announcements along these lines do not occur, the Euro is history.
For those interested in European Stock Markets: http://www.scribd.com/doc/74371203/European-Stock-Market-Valuation