The Election's Bearing on Monetary Freedom

No matter who wins this year ’s presidential election, believers in monetary freedom will have their work cut out for them.A newly-elected president Trump will quickly turn from making the Fed a scapegoat for his own campaigns ’ tribulations to blaming it for his economic policy failures — starting with the equities market nose dive that’s likely to follow his surprise victory. But instead of continuing to rail against the Fed’s supposedly easy policy stance, you can bet that president-elect Trump would soon be bl aming it for keeping money too tight.In any event, a newly-elected Trump administration, through its unveiled hostility toward the Fed, could not fail to make that already “political” institution even more so, for the Fed knows very well that, if it wants to preserve its vaunted independence, it had better heed the administrations’ wishes. That’s what former Fed Chairman William McChesney Martin, who understood the true nature of the Fed’s independence bette r than anyone, meant when he explained thatthe Fed was independent, not “from,” but “within,” the government.And if it doesn ’t? Then at the very least we can expect President Trump to make life very unpleasant for Chair Yellen, in the hope of making her resign before the end of her term in January 2018. Andeven if she resists, we can expect to have a Trump-appointed Fed chair in place for at least half of his term. If you think that might be an improvement, then presumably you beli...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs