Jim Powell, Senior Fellow at the Cato Institute, contributed a timely and topical editorial to Investor’s Business Daily this week. Powell echoes a surging sentiment prevalent among the financial and economic “in crowds” that the Federal Reserve has done far more harm than good in its interventions to prop-up the flagging US (world) economy. From the editorial:
Intended to save our economy, the Fed has turned out to be perhaps the biggest single source of economic instability. It’s the big pig at the trough, and it’s unpredictable. It doesn’t follow any rules consistently. When it moves, everyone else can be badly knocked around.
The very unpredictability of the Fed causes uncertainty that discourages investors and employers from making commitments for the future — an important reason why we’re experiencing a sluggish, jobless recovery now.
It’s time to begin planning for an orderly dissolution of the Fed before it does us any more harm.
The piece is accessible and well-written and provides good context for the student of current affairs. As a side note, another interesting bit (albeit slightly differently themed) appeared at MarketWatch the other day. These notions are not at all unique. They have been, until recently, fairly clandestine though. The very appearance of editorials highlighting these themes in such mainstreams publications is foreboding evidence of strange days ahead.