Wesley123
11-16-2010, 04:47 PM
Abolishing the Federal Reserve
Every day each of us goes through life and we use money to buy our food, our clothing, and to pay our bills, but do any of us even know where that money comes from? The money we use, the dollar bills, are Federal Reserve Notes issued by the Federal Reserve Bank. During the research for this speech I have been educated on the flaws of the Federal Reserve System. I have come to the conclusion that the only way to have a healthy economy in this country is for the United States Congress to repeal the Federal Reserve Act of 1913. It is a system that hampers the ability of the nation’s economy to grow at natural levels. It is a bank that causes inflation and doesn’t control it. It is an institution that doesn’t even answer to the people of the United States of America, but controls our economy. The most obvious result of the Federal Reserve’s policies is the slower growth of our economy.
The Federal Reserve was instituted to stabilize the economy of the United States, but the economy has, since the creation of the Federal Reserve System, grown at a slower pace than before. Many economists theorize that the act of the Federal Reserve lowering interest rates during a recession amounts to causing the so called “boom and bust” economic cycles the nation has seen since even before the Federal Reserve was created. According to many economists in the Austrian school of thought, the free market sets interest rates, and it is disastrous to decrease them or increase them away from normal levels. It makes loans and other things cheaper or more expensive than they actually are. Thus, important financial institutions or people taking out loans are forced to take undue risk, negatively affecting the economy. In addition to causing slow growth of the nation’s economy, the Federal Reserve is also the cause of inflation.
The Federal Reserve is able to manipulate the country’s money supply through interest rates and credit. Supporters of the Federal Reserve say that these powers are used to stop the economic cycles, but that is not the case. If the supply of money is increased, money is worth less because the supply is higher, but the demand stays the same. Thus, with money being worth less than it was before it takes more money to buy goods and services. A dollar today may be worth even less than it was yesterday. At one time this couldn’t be done because the value of the dollar was tied to the value of gold, this was called the gold standard, but today our money only has the value people attach to it. That is the trust that it will buy them goods and services. According to the Cato Institute, by 1919, the US inflation rate, which had stayed near zero ever since the Civil War, was close to 20 percent after the Federal Reserve Act of 1913 was instituted as law. This madness was caused by the Federal Reserve. Not only has the Federal Reserve caused inflation, but it you would be surprised at how it is run.
The Federal Reserve is an institution that doesn’t even answer to the people of the United States of America, but controls our economy. The Federal Reserve maintains a level of independence from the oversight of Congress, and has been called “semi-private” by some economists. There have been efforts made to audit the Federal Reserve, but they haven’t come to fruition. One of these efforts was HR 1207, a measure that was struck down in the House of Representatives that would have audited the Federal Reserve. The Congress, however, has not acted, and today the Federal Reserve performs many of its functions behind closed doors.
In order to maintain a healthy economy in this country, the United States Congress must repeal the Federal Reserve Act of 1913. The Federal Reserve is a system that hurts the ability of the nation’s economy to grow at natural levels. The system exacerbates inflation, and it has too much independence from the people of the United States and their elected representatives. As young people, we need to educate ourselves about how the economy really works and how a free market is the best way to do business. We are the future of this nation, and need to know how to run it when we are thrust into adulthood. Our opportunities may be hurt, however, if the Federal Reserve Bank is not abolished.
So, what do you think? I think it shows too limited an understanding of the economic system. Also, I wonder if I got anything completely wrong? I already said this in front of class months ago, before summer break, so don't think you are saving me from embarrassment. Besides, it's not like anybody knew enough to correct me. I just want opinions.
Every day each of us goes through life and we use money to buy our food, our clothing, and to pay our bills, but do any of us even know where that money comes from? The money we use, the dollar bills, are Federal Reserve Notes issued by the Federal Reserve Bank. During the research for this speech I have been educated on the flaws of the Federal Reserve System. I have come to the conclusion that the only way to have a healthy economy in this country is for the United States Congress to repeal the Federal Reserve Act of 1913. It is a system that hampers the ability of the nation’s economy to grow at natural levels. It is a bank that causes inflation and doesn’t control it. It is an institution that doesn’t even answer to the people of the United States of America, but controls our economy. The most obvious result of the Federal Reserve’s policies is the slower growth of our economy.
The Federal Reserve was instituted to stabilize the economy of the United States, but the economy has, since the creation of the Federal Reserve System, grown at a slower pace than before. Many economists theorize that the act of the Federal Reserve lowering interest rates during a recession amounts to causing the so called “boom and bust” economic cycles the nation has seen since even before the Federal Reserve was created. According to many economists in the Austrian school of thought, the free market sets interest rates, and it is disastrous to decrease them or increase them away from normal levels. It makes loans and other things cheaper or more expensive than they actually are. Thus, important financial institutions or people taking out loans are forced to take undue risk, negatively affecting the economy. In addition to causing slow growth of the nation’s economy, the Federal Reserve is also the cause of inflation.
The Federal Reserve is able to manipulate the country’s money supply through interest rates and credit. Supporters of the Federal Reserve say that these powers are used to stop the economic cycles, but that is not the case. If the supply of money is increased, money is worth less because the supply is higher, but the demand stays the same. Thus, with money being worth less than it was before it takes more money to buy goods and services. A dollar today may be worth even less than it was yesterday. At one time this couldn’t be done because the value of the dollar was tied to the value of gold, this was called the gold standard, but today our money only has the value people attach to it. That is the trust that it will buy them goods and services. According to the Cato Institute, by 1919, the US inflation rate, which had stayed near zero ever since the Civil War, was close to 20 percent after the Federal Reserve Act of 1913 was instituted as law. This madness was caused by the Federal Reserve. Not only has the Federal Reserve caused inflation, but it you would be surprised at how it is run.
The Federal Reserve is an institution that doesn’t even answer to the people of the United States of America, but controls our economy. The Federal Reserve maintains a level of independence from the oversight of Congress, and has been called “semi-private” by some economists. There have been efforts made to audit the Federal Reserve, but they haven’t come to fruition. One of these efforts was HR 1207, a measure that was struck down in the House of Representatives that would have audited the Federal Reserve. The Congress, however, has not acted, and today the Federal Reserve performs many of its functions behind closed doors.
In order to maintain a healthy economy in this country, the United States Congress must repeal the Federal Reserve Act of 1913. The Federal Reserve is a system that hurts the ability of the nation’s economy to grow at natural levels. The system exacerbates inflation, and it has too much independence from the people of the United States and their elected representatives. As young people, we need to educate ourselves about how the economy really works and how a free market is the best way to do business. We are the future of this nation, and need to know how to run it when we are thrust into adulthood. Our opportunities may be hurt, however, if the Federal Reserve Bank is not abolished.
So, what do you think? I think it shows too limited an understanding of the economic system. Also, I wonder if I got anything completely wrong? I already said this in front of class months ago, before summer break, so don't think you are saving me from embarrassment. Besides, it's not like anybody knew enough to correct me. I just want opinions.