In an editorial appearing in his eponymous magazine, Steve Forbes writes that the Federal Reserve’s new chairman, Jerome Powell will continue the same bad policies that have done so much harm to the American economy. Forbes lists a number of these misguided approaches, but the first is the belief in what he calls “funny money.” He writes:
THE FEDERAL RESERVE’S new chairman, Jerome Powell, recently presided over his first meeting of the Federal Open Market Committee, which sets central bank policy, most particularly the level of interest rates. Powell looks to continue the same destructive policy that has done so much harm to the economy.
The episode underscores that our central bank won’t rid itself anytime soon of its three fatal flaws:
–The belief in funny money, that is, an unstable dollar. The Fed never resists when the Treasury Department wants a weaker greenback, as happened in the early 2000s under President George W. Bush. No country does well with wobbly money. Our feeble dollar was the foundation of the disasters of 2008–2009. A floating currency is as helpful as a watch or clock that can’t keep proper time. It harms long-term investing, the crucial key to a higher standard of living.
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