"The Fed Has a Serious Problem This Time...Raising interest rates high enough to dent inflation would bankrupt the US government."

submitted by iamonlyoneman from zerohedge.com

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[–]iamonlyoneman[S] 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (3 children)

The fed can't bankrupt the federal government. The entire board would lose their jobs and the party in power (Blue Team) would be voted out when people realize there's not enough money for their gibs.

What can't happen, won't.

So the fed won't hike enough to stop inflation, Q.E.D.

The only solutions are a tendency toward fiscally responsible government, or a complete reset of the financial obligations of the nation (which would probably lead to WWIII). I don't give the current government credit for being smart enough to make the smart choice here, which means I'm not super optimistic about the mid-term future of the USA.

edit: for those who miss it: the feds know they can't because it would mean losing their power, and power is the thing most desirable. They could of course but the outcome is unacceptable so they 'cant'

[–][deleted] 2 insightful - 2 fun2 insightful - 1 fun3 insightful - 2 fun -  (2 children)

The FED is a private entity. It is not beholden IN ANY WAY WHATSOEVER to the US government, just like almost every other central bank in the world. They do what they wish and then have the government cover for them. Same in the USA where there is this whole sham of the President choosing a governor for the Fed... From a list prepared by its owners. And "testifying" before congress. They only do it because it makes the sheeple believe the Fed is part of the government.

[–]iamonlyoneman[S] 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (1 child)

Who appoints the directors at the fed?

[–][deleted] 1 insightful - 1 fun1 insightful - 0 fun2 insightful - 1 fun -  (0 children)

The Fed's owners CHOOSE a number of candidates they will accept, and FROM THAT LIST AND THAT LIST ONLY is the POTUS given the meaningless "power" to "appoint" the governor. The directors are all chosen by the owners. These owners are private individuals.