Last Friday, President Trump announced his pick for one of two vacant Federal Reserve board of governors seats.
If the candidate, Stephen Moore, gets through the vetting process and is confirmed by the Senate, he could be the ultimate infiltrator who upends the Fed, meaning he’ll brings about its destruction.
That would be great because the Fed’s a private central bank that owns the United States’ currency, sets interest rates that affect every aspect of the economy, and bails out its constituent big bank owners when they implode themselves chasing profits.
Only the remedy could be worse than the disease.
Not Your Typical Technocratic Fed Sycophant
President Trump knows Stephen Moore. Moore was a senior economic advisor to the would-be president.
He’s a senior fellow at the conservative Heritage Foundation, founded and served as president of the Club for Growth, and is a former member of The Wall Street Journal editorial board.
The President wants Moore as a member of the Fed’s seven-member board of governors, who, along with the president of the New York Federal Reserve and four of the eleven regional Fed presidents, make up the Fed’s rate-setting committee.
That’s because Moore’s been a harsh critic of Fed Chairman Jerome Powell’s interest rate increases, which President Trump chastised Powell for, threatening to “fire” him for causing the stock market to tank and the economy to sputter.
Echoing the President’s disapproval of the Powell-led Fed raising rates, Moore, in a Wall Street Journal interview last December said, “The Fed is a disaster. We should have a discussion in this country about whether we need a Fed.”
The fact that a potential Fed governor is on record questioning the need for, or very existence of, the Federal Reserve System is nothing short of explosive.
Moore also said in the interview that he believed Mr. Powell should resign. “He’s totally incompetent,” he said. “Everyone’s saying he has to be independent. Well, what do we do when we have someone at the Fed who doesn’t know what he’s doing? If he’s not responsive to the president, then who’s he responsive to?”
Mr. Moore said the President should be allowed to fire Powell. “The law says he can replace the Federal Reserve chairman for cause. I would say, well, the cause is that he’s wrecking the economy,” he said.
Though it’s, relatively speaking (relative to the power the Fed wields over politicians), improbable that a single Fed governor embedded in the private institution’s inner circle could be an agent of its destruction, anything’s possible.
Legally, the only way the Fed’s going anywhere is if Congress legislates it out of existence, since they legislated it into existence in 1913, under questionable circumstances and electioneering.
That fact notwithstanding, if, as a member of the Fed’s board of governors, Moore was to reveal its inner workings, who really controls the Fed, what it’s real purpose is, and why its inordinate power over politicians and the economy, to the benefit of the country’s biggest banks and bankers’ oligarchy is undemocratic, unconstitutional and an affront to free markets, a public-led revolution could shut the powerful central bank down.
There wouldn’t be a problem with the Fed being unwound as America’s private central bank. It could easily be replaced by a comprehensive set of rules, many of which have been proposed by economists, academics, and Fed critics for decades.
Mechanically, there’s nothing the Fed does that couldn’t be done by other means, meaning, not controlled by bankers.
The Fake Fed Needs to Unravel
However, short of legislating the Fed out of existence, giving politicians more control over Fed policy decisions, specifically, printing money to monetize growing government deficits (exactly what the MMT, Modern Monetary Theory, crowd is advocating) and controlling interest rates, would be a disaster.
Mr. Moore’s supporters said the pick would help shake up entrenched thinking.
“The results of the Fed’s consensus-driven approach over the last 20 years have yielded poor results,” said J.W. Verret, a law professor at George Mason University, who is friends with Mr. Moore.
That’s a fact, too.
The country needs to unwind the Fake Federal Reserve and not punt its direct powers to politicians.
If Stephen Moore gets a seat at the table – a longshot for sure – and manages to precipitate a revolution that unravels the Fed, America’s economy, free markets, and democracy would all be better off.
If Mr. Moore gets onto the board and precipitates the transfer of power from the Fed board to the President, or equally as idiotic, to politicians of any stripe, we’re in for a world of hurt.
At least the battle’s going to be fun to watch.
One thing is for sure, we’re looking at some rocky roads ahead, and I’m not just talking about the markets.
Politically, financially, even socially, things are changing, and the stock market is far from immune. In fact, we’re facing the same market signals we saw before the Great Recession, the dot-com crash, and even Black Tuesday in 1929.
This latest battle with Stephen Moore and the Fake Federal Reserve is only another wrinkle in the sheet of the American economy. We need to prepare for the worst, so when things come crashing down, and they will, one way or another, we will be prepared.
Click here to learn how to safeguard your wealth.