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Home Publications Blogs Beat the Press Leonhardt Gets it Right on the Fed

Leonhardt Gets it Right on the Fed

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Wednesday, 30 March 2011 05:05
David Leonhardt has a nice column making the point that the Fed faces a lot of pressure to keep inflation under control, but it does not have the same lobby pushing it on unemployment.
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Banks Uber Alles
written by Ron Alley, March 30, 2011 8:19
For reasons I cannot comprehend or support, the Obama administration has steadfastly pursued a policy of favoring banks over all others. The Fed has complemented that policy with its actions throughout the tenure of the Obama administration. The excellent piece by Neil Barofsky highlights the effects of the Banks Uber Alles policy. [url=(http://www.nytimes.com/2011/03...l?src=recg)
Until the Obama administration shows the backbone of the Tea Party, standby for more of the same stuff.
Banks Uber Alles
written by Jeff Z, March 30, 2011 3:24
Just another piece of the puzzle.

http://www.opensecrets.org/pres08/contrib.php?id=N00009638&cycle=2008

This lists the top 20 campaign contributors to President Obama's 2008 presidential campaign.

Goldman Sachs is No. 2, but Morgan Stanley, Citigroup, J.P. Morgan, and UBS are all part of the top 20.

Given this, his appointments and actions seem more understandable from the point of view of politics, not from the point of view of doing what is necessarily right for the economy as a whole.

Ron is right that the Fed tends to make the problem worse.
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written by S.D. Jeffries, March 31, 2011 1:13
If this country has to depend on the Fed to increase employment, we may as well all learn to grow our own food and begin bartering for the goods and services we need. The only tool they have is interest rate manipulation, which is useless as long as manufacturing capacity is already underutilized and aggregate demand is at a virtual standstill. What little domestic investment is being made by businesses taking advantage of those low rates seems to be in IT and automation which actually reduce the need for employees. The employer of last resort, the federal government, is precluded from taking the steps necessary to put people to work by a congress more concerned with the deficit than whether 20 million+ people are left with no way to make a living. The same lobbyists are apparently both paying off congress and lunching with the Fed governors.
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written by ellis, April 01, 2011 7:57
No, Fed policy's real goal is to help the banks make more money again. And it looks like they have. There has been a big rebound in bank profits, dividends and CEO compensation. In the real world, that's all that counts. All the talk about "inflation" and "growth" is ridiculous nonsense meant to divert us little people from looking at the Fed's one and only mission: to help banks increase their profits and wealth. Only a highly trained economist could think otherwise.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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