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Thread: Mises Institute : Could Trump's Next Fed Chair (Judy Shelton) Be A "Goldbug?"

  1. #1

    Mises Institute : Could Trump's Next Fed Chair (Judy Shelton) Be A "Goldbug?"

    In 2017 I made a thread about Judy Shelton being an ally to some economic ideas Ron Paul stood for, she came up on my radar after hearing about her position as economic advisor for Trump. Now she has been nominated to be a FED Governor, a FED skeptic and big on sound money and market forces, I hope she uses her position well, if confirmed by the senate, and I suppose now is the time Rand can cash in some chips with McConnell.
    Still, though by no means an Austrian, Shelton's voice on the Fed would create some much needed ideological diversity to the central bank.

    In reacting to an interview with Ms. Shelton last June, Jeff Deist wrote:

    Her comments represent the most substantive attack on the Fed, and central banking generally, by any potential nominee to the Fed board in recent history. She not only challenges how Jerome Powell and Fed officials conduct monetary policy, but whether they can conduct it competently at all....

    So Shelton doesn't want to End the Fed. But in the parlance of woke America, she's an "ally." Recognizing the limits of central bank omniscience, and challenging its benevolence, are important first steps on the road to redeeming our money and our economy.

    More from Shelton

    Shelton on Trump policies and Gold Standard

    Last edited by eleganz; 01-18-2020 at 03:28 PM.
    @Ehanced_Deficit's real agenda on RPF :
    DNCIA-SB (Soros, Brennan)

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  3. #2
    Going back to a gold standard of course would require legislation from Congress- the Fed cannot do it. Not sure where she is on interest rates- she was critical of lower rates and also criticized the Fed raising them. She also favors getting rid of paying interest on reserves banks are required to keep at the Fed. One other potential problem- the Federal Reserve Act says that there should be no more than one governor from each district- there is already one from Richmond where she is. She also supports an international currency union.

    The Federal Reserve Act states that “In selecting the members of the Board, not more than one of whom shall be selected from any one Federal Reserve district, the President shall have due regard to a fair representation of the financial, agricultural, industrial, and commercial interests, and geographical divisions of the country.”

    Cowen analyst Jaret Steinberg said there are enough flash points to keep her from being seated.

    “Shelton would be a perfect fit as she would be a Trump loyalist who won Senate confirmation,” Steinberg said in a note. “We suspect there are enough Republicans who question her views on the gold standard and on excess reserves to put her confirmation in real doubt. To us, the Senate is unlikely to reject her nomination. The most likely outcome is that it just never votes to confirm her.”
    Shelton’s record on interest rates is somewhat complicated — she has criticized both the near-zero rates instituted during and for several years after the financial crisis, and the more recent moves to raise rates. Trump has pushed the Fed to cut rates and even urged the central bank to look at the negative rates pervasive in parts of Europe.

    Shelton also has spoken in favor of returning to the gold standard that backs the issuance of U.S. dollars, and opposes the practice of paying interest on reserves that banks store at the Fed.
    Favoring a gold standard should mean she favors a tight money policy but lowering interest rates as Trump wants would be a step in the opposite direction. She changes her position often.

    Like Trump, Shelton had criticized the Fed under former Chair Janet Yellen for keeping interest rates close to zero while the during the recovery from the 2008 recession. But Shelton flipped her views on monetary policy after Trump’s election, echoing his call for the Fed to cut rates despite a surge of growth in 2018.

    Shelton may also face skepticism from Republicans over her past support the gold standard and an international currency union. Neither idea is broadly supported by Democrats or Republicans.

  4. #3
    Her first action of being Chairman of the Fed should be to abolish the Federal Reserve.
    "Perhaps one of the most important accomplishments of my administration is minding my own business."

    Calvin Coolidge

  5. #4
    Quote Originally Posted by Anti Globalist View Post
    Her first action of being Chairman of the Fed should be to abolish the Federal Reserve.
    The current chairman- Jerome Powell- would have to resign or his term run out (2022) for her to take the job. But even then, she could not end the Federal Reserve. Congress would have to do that. (Powell's term as Chairman is for four years but can be renewed if the President desires but the President cannot fire him- his term as one of the Board Of Governors runs through January 31st 2028).

  6. #5
    Even a sound money advocate like Shelton needs to appear moderate in order to get passed the gate keepers. Too bad Rand is not on the senate banking committee.


    Of course, all of this was sharply—and at times uncivilly—criticized by duly elected economic midwits who sought to lecture to Shelton while desperately relying upon the prepared questions of legislative aides.

    Senator Richard Shelby, at one point the chairman of the banking committee, was particularly appalled at the notion of nominating a Federal Reserve candidate so outside the mainstream. His grilling of Ms. Shelton included sagely pointing out that the amount of gold in the world is worth less than the American GDP and suggesting that the gold standard was a product of the days when the US was a “barter economy.”

    Of course, it is a reflection of the dilapidated state of modern economics that Shelby’s ignorance would make him a safer choice for the Federal Reserve than either Shelton or her friend James Grant.

    It is also sad to see Shelton, obviously a very intelligent woman, take the strategy of trying to sing from a more traditional script rather than take the opportunity of the hearing to defend the ideas she has long supported. Although there were times when she offered clever outs to her testimony, such as declaring that she would never want to “go back” to any previously existing monetary system (which is not the same thing as seeing a potential use for a newly priced gold backing in the future), for the most part Shelton attempted to try to present herself as a more status quo figure.

    In one of the more entertaining exchanges, Senator John Kennedy of Louisiana pushed Ms. Shelton on what she would recommend if faced with an abrupt financial crisis. Her response, unfortunately, was more of the same—taking interest rates to 0, more QE. It was an answer so uninspired that it was basically repeated by Mr. Waller.
    @Ehanced_Deficit's real agenda on RPF :
    DNCIA-SB (Soros, Brennan)

  7. #6
    She wants a North American Union with a single currency and she wants higher interest rates and lower interest rates- depending on the day of the week. I guess that would be outside the mainstream. Even if she wanted to, she cannot put a gold standard in place. That would require legislation by Congress.

  8. #7
    Quote Originally Posted by eleganz View Post
    Even a sound money advocate like Shelton needs to appear moderate in order to get passed the gate keepers. Too bad Rand is not on the senate banking committee.

    This if confirmed as non-fakenews could be a game changer in fiscal policy and future Fed policy also potentially.

    This also may turn the so callled 'follow the money' theory on its head, who would have thunk that US fiscal policy would be restored to an America-First vision by an outsider businessman turned straight shooting politician funded by a globalist neocon. It's sort of a political miracle that should be celeberated by all critics of past QEs not based on gold reserves.

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