BF2S Forums Presidential candidate questions Federal Reserve monopoly on money.

jonsimon wrote:

thanks_champ wrote:

Great post Jonsimon.

The one thing I don't quite understand is this:

Why is it better for a central privately owned bank (The Federal Reserve) to print and loan money at interest to the US government, than it is for the government to be able to print the very same money itself interest free?

That's the seperation that's probably the most important part of a central bank. Because the Fed has it's own mandate to control inflation it won't just buy all the US debt at no cost. When governments can simply print fiat currency they end up increasing the money supply whenever they need to pay for something and in extreme cases eventually create super-inflation. A central bank is, in western nations at least, the currently accepted solution to the conflict of interests created when the legislative or executive powers in a state are given the ability to print money at a profit.

Turquoise wrote:

Ron Paul is one of the most sensible Republicans out there.  Unfortunately, that pretty much guarantees he won't get the nomination.