It seems that now that we are on the downswing again with the economy and about to head deeper into a recession, that the absolute wrong call would be stimulus. We’ve already seen how that worked out and you don’t even have to be an economist to understand that was a stupid idea from the start. But, stupid is as stupid does and so now we are actually being given hints by the Federal Reserve that that very idea of stimulus is on their minds again.
As The Hill reports,
Minutes from the last meeting of the Federal Open Market Committee (FOMC) released Wednesday reveal that a handful of its 12 members said further policy steps would “likely” be needed to push the economy in the right direction. “Several others” agreed that the Fed would need to do more for the economy if the recovery were to lose steam or additional threats to the economy were to arise.
At the last meeting, a few Fed officials said it would helpful if the central bank could determine how large a third round of purchases would need to be before they began to distort financial markets.
The minutes indicate that officials see the economic recovery as losing strength, as officials expect the economy to grow and unemployment rate to fall more gradually than they did earlier in the year. In addition, continued concerns about the crisis in Europe, as well as the potential for U.S. fiscal policy to be “more contractionary than anticipated.”
While Chairman Ben Bernanke has called on Congress to adjust their policies and cut spending, they simply have failed to do so, and yes even with a GOP led Congress. The federal government continues to spend way past its means and drive us and our children deeper into debt now than when Barack Obama first took office.
While the Republicans took the Fed on and claimed that they tried to recently boost the economy and what happened was that it put the U.S. at risk for inflation, the Fed shot back that inflation had actually declined.
I’ll be straight, the Federal Reserve is a monster created by the Congress. They shirked their Constitutional duty to do what the Constitution says and that is to coin gold and silver, not fiat money. Once they did that, all bets were off. Congress still has the authority under the Constitution to make things right, but since there is a lot of money at stake, so far only one representative of the people has stood up in our lifetime and called the Federal Reserve what it really is and why it needs to be dismantled and why we need to return to sound Constitutional money and that man is Ron Paul.