Trump victory poses challenges for Fed's independence

You can't appoint someone 180 degrees out of the mainstream...because the bond market will reject that immediately," Englander said.

"The bond market is a guardrail,"

Really, those responsible for 2008 were all in the mainstream..the central bank in each and every country should be under the elected.

 those responsible for 2008 were all in the mainstream.

They weren't policymakers. "Those responsible" were in the private sector -- the sub prime snake oil salesmen, Wall Street investment banks that peddled billions of dollars of their toxic debt and private credit rating agencies that gave triple A ratings to securitized junk in exchange for basically bribes. The policymakers were the ones who had to step in to rescue the economy.

The policymakers were the ones who had to step in to rescue the economy.

One problem was that the American people ended up bailing out these same snake oil salesmen thanks to the cosy relationship between the government and the banksters. The even bigger problem is that the Fed is a law unto itself, and has been ever since it was created in 1913. Read G. Edward Griffin's The Creature from Jekyll Island for background on how it was established.

mrtinjpToday 09:49 am JST

Really, those responsible for 2008 were all in the mainstream..the central bank in each and every country should be under the elected.

I suppose you think all judges should be elected, too? There is something to be said for positions to be filled by actual qualified people.

I suppose you think all judges should be elected, too? There is something to be said for positions to be filled by actual qualified people.

Who determines that, liberals?

potentially weakening its ability to fight against inflation and unemployment free from political interference.

this is the same org that said inflation that eventually peaked up at 9% was going to be “transitory”, and went a long way to ensuring the Biden administration would be a one--termer?

It is time for the media to take a break from bashing Trump, and instead take a hard look at their unbalanced reporting over recent years.

"If someone is nominated and appointed and are seen to have political leanings, and it allows them to influence their monetary policy decisions, then that would become quite messy for the Federal Reserve," she said.

Yellen, Brainard spring to mind as examples of ex FOMC members that walked into big Government roles.

We are supposed to believe they were politically neutral?

There is a good case to be made for eliminating the dual mandate. Economic prosperity and people working (and producing) is not inflationary.

One problem was that the American people ended up bailing out these same snake oil salesmen thanks to the cosy relationship between the government and the banksters. 

The US Government was repaid every penny it loaned the banks. Same for the money loaned the auto makers.

Here is a point you are missing. When the broad market came to the conclusion that those securitized debt obligations were essentially valueless something on the order of $16-$20 Trillion, with a capital T, disappeared from the US money supply. Poof, gone. Before I go further please read up on what the definitions of M1, M2 and M3 are. That loss came out of M3. Yes it was money on paper only but it still mattered.

Nonetheless when that much money and wealth suddenly disappears the threat is a deflationary death spiral. Everyone knows that when you flood an economy with money you get inflation, but by the same token when you remove Trillions of Dollars from the economy you get deflation. The only way to prevent a deflationary death spiral is to re-inflate the economy, add money. Since Congress was reluctant to engage in fiscal stimulus the Fed was pretty much forced to resort to what they gingerly called "Quantitative Easing". Nobody at the Fed wanted to talk openly of deflation fearing that if deflationary expectations took off they might not be able to counter them with the monetary tools available to the Fed knowing Congress was reluctant to do the right thing.

this is the same org that said inflation that eventually peaked up at 9% was going to be “transitory”, and went a long way to ensuring the Biden administration would be a one--termer?

Well, guess what? The were correct. It was transitory, just as I was saying right here two years ago. Inflation is down to around 2.1% today.

There was nothing any arm of the US government could do when China shut major seaports down for weeks at a time. The disruptions to shipping schedules and factory production schedules on both sides of the Pacific were rooted in actions taken by a sovereign state the US has no leverage to with. Then before the pandemic had subsided there was a major war in Europe that led to the disruption of global energy and food supplies. There are the causes of inflation.

And just as the Fed said, those causes were transitory and so too was the inflation they caused.

Now just as the dust is finally settling Jupiter is going to impose tariffs on all and sundry and inflation will take off again.

There are the causes of inflation.

You conveniently missed the effect of the stimulus package rolled out by the Biden administration in 2021.

https://www.forbes.com/sites/stuartanderson/2024/11/12/bidens-mistakes-on-the-economy-help-explain-the-2024-election/

They weren't policymakers. "Those responsible" were in the private sector..

Well they all flip-flopped between pvt sector and policy making, no wonder nobody did time...