pandabear wrote:
Orwell wrote:
The Federal Reserve really can not do much of anything to help economic growth. Nor do they have any power over inflation or unemployment levels- the Philips curve is a myth, and is not supported by the history of America's economy.
Okay, then, what does the Federal Reserve do?
By the way, our dollars used to be silver certificates
Yes, the silver certificates were in the days of bimetallism. We were never on a pure silver standard. The Fed is a central bank which prints money, sets interest rates, and in other ways influences the money supply. I tend to lean toward Austrian-school thought, so my biased view would claim that they don't do anything helpful. Neoclassical economists or Keynesians would argue that their monetary policy is an attempt to influence the economy, but they generally have to acknowledge that most if not all of those attempts fail. Much of their policy is based on the Philips curve idea that there is a trade-off between inflation and unemployment, but evidence from the US economy does not bear this out. The policy irrelevance proposition, based on the rational expectations hypothesis, maintains that monetary policy can't have any effects other than inflation.
Back to the thread's actual topic: as an update, Paul has announced that he will not make a third-party run, so it appears that his bid for the White House will stop with McCain's nomination. I am somewhat disappointed, since he ran as a Libertarian in 1988 and I would like to see him do so again (or rather, for the first time, as I was born in '89). Since McCain's got the Republican nomination, it looks like I won't be voting in the general election this year unless the Libertarians or some other minor party nominates a candidate I like. I will never vote for the lesser of two evils, so whether it's McCain/Hillary or McCain/Obama I won't have anyone to vote for.
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