pooflinger1488
12-10-2007, 12:22 AM
I sent this video to a friend who knows alot about economics and this is the response I got. I was hoping to win over support, but it didn't work. Can anyone help me reply to his response. Thanks alot!
Pretty impressive by Paul actually. He seems to know more than most congressmen about economic issues. The thing to take from this clip though is that the Federal Reserve can only do so much about inflation and its underlying causes. Paul states that fixing the prices is not the answer and Bernanke replies that the Federal Reserve is following the mandate given to them by congress. That means that Bernanke is doing the only thing he is allowed to do. He can't fix the issues of the sub prime markets because the law states what the Federal Reserve can do, and doing anything besides fixing prices would be against the law. Paul tells Bernanke that increasing the money supply won't work and Bernanke can't do anything about that because all the Federal Reserve does is deal with interest rates. You may have seen President Bush address this issue earlier this year by making an order to help people with their sub prime mortgages. This is where the underlying issue of inflation is corrected, through the executive and legislative branch of government. Paul didn't necessary school Bernanke but rather try to place complete economic responsibility onto the federal reserve, which does not have full discretion over this issue.
Pretty impressive by Paul actually. He seems to know more than most congressmen about economic issues. The thing to take from this clip though is that the Federal Reserve can only do so much about inflation and its underlying causes. Paul states that fixing the prices is not the answer and Bernanke replies that the Federal Reserve is following the mandate given to them by congress. That means that Bernanke is doing the only thing he is allowed to do. He can't fix the issues of the sub prime markets because the law states what the Federal Reserve can do, and doing anything besides fixing prices would be against the law. Paul tells Bernanke that increasing the money supply won't work and Bernanke can't do anything about that because all the Federal Reserve does is deal with interest rates. You may have seen President Bush address this issue earlier this year by making an order to help people with their sub prime mortgages. This is where the underlying issue of inflation is corrected, through the executive and legislative branch of government. Paul didn't necessary school Bernanke but rather try to place complete economic responsibility onto the federal reserve, which does not have full discretion over this issue.