Talk:Federal Reserve
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conspiracy theory
What's with the conspiracy theory in the History section? It starts on March 22 with a single ip-address, and then blooms there after with a different ip-address.
other
Public domain article to incorporate http://memory.loc.gov/ammem/today/dec23.html
I may come back and do this...just trying to pitch in on the 100,000 article mark for now -- RobLa 23:07 Jan 18, 2003 (UTC)
From
http://www.federalreserve.gov/faq.htm
- The Federal Reserve System is not "owned" by anyone and is not a private, profit-making institution. Instead, it is an independent entity within the government, having both public purposes and private aspects.
As the nation's central bank, the Federal Reserve derives its authority from the U.S. Congress. It is considered an independent central bank because its decisions do not have to be ratified by the President or anyone else in the executive or legislative branch of government, it does not receive funding appropriated by the Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms. However, the Federal Reserve is subject to oversight by the Congress, which periodically reviews its activities and can alter its responsibilities by statute. Also, the Federal Reserve must work within the framework of the overall objectives of economic and financial policy established by the government. Therefore, the Federal Reserve can be more accurately described as "independent within the government."
The twelve regional Federal Reserve Banks, which were established by the Congress as the operating arms of the nation's central banking system, are organized much like private corporations--possibly leading to some confusion about "ownership." For example, the Reserve Banks issue shares of stock to member banks. However, owning Reserve Bank stock is quite different from owning stock in a private company. The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold or traded or pledged as security for a loan; dividends are, by law, 6 percent per year.
The earnings of the Federal Reserve System come primarily from interest received on the Reserve Banks' holdings of U.S. government securities (which are used in the conduct of monetary policy) and from fees they charge depository institutions for providing services (such as processing and clearing checks). The expenses of the System are paid from these earnings. Any net earnings are paid yearly to the U.S. Treasury. For 2001, the payment was $27.14 billion.
I think that in order to properly address this institution there should be at least some mention of the historic controversy over central banking in the US. The first one never had its charter renewed, the second was taken to pieces by Andrew Jackson. There has always been a contingent of American statesmen opposed to the idea of central banking as a corruptive influence. Congressman McFadden served as chairman of the house Banking and Currency commitee for 10 years and he denounced the Fed as being thoroughly corrupt and pressured the congress to correct the situation. His statements were dismissed as "belly-aching", but never otherwise addressed and he was eventually murdered after multiple failed attempts. The history of US central banking and of the Fed itself is thickly woven with opposition. This should at least be noted in the article. The current outside link (which I plan on changing as soon as I find a better target) marginalizes the amount of contention the Fed has historically generated and leads to a site that caters to eco-terrorists and other green militants. Other 13:11, 27 Oct 2003 (UTC)
I agree with Other. Yet, rather than adding a few short comments to the current page, I believe that the history of US central banking is so fascinating and extensive, yet relatively little known topic, that it deserves a page of it's own. The only problem is how to cover it in a neutral tone when the path is laden with assassinated/assassination attempted presidents. I'm fairly sure that just talking about the topic is going to raise an angry mob of POV! claims at Wikipedia:Votes for deletion. Finlander 20:24, 5 Jan 2004 (UTC)
This article (and many of the other articles related to the financial services industry) seems to have some serious POV issues, not to mention atrocious grammar and some errors of fact. 18.24.0.120 17:25, 24 Jan 2004 (UTC)
I agree. I tried to fix some of the worse POV problems and grammatical mistakes but more work is still needed (by someone with more knowledge of the subject than myself). Perhaps some of the... extremist talk can be put into an NPOV section about critisism of the Federal Reserve? Jacob1207 23:17, 18 Feb 2004 (UTC)
Removed a lot of a the conspiracy theory sections. The Fed is a government agency. It's subject to all sorts of laws (like the Freedom of Information Act and the Privacy Act) that government agencies are subject to. This has implications for copyright. If the Fed were private, its web pages would have an implied copyright, whereas as a agency of the federal government, they don't.
You can argue that the banks effectively control the Fed, but you simply can't plausibly argue that as a matter of law, the banks own the Fed or that the Fed is a private organization. Roadrunner 10:48, 22 Feb 2004 (UTC)
It's not so cut-and-dried. Conspiracy theories aside, it is not adequate to go to the Fed website and say, "see here it says XYZ therefore it is fact". Is it even possible that there is something out of the ordinary to the words "independent within the government" when used in this context? I can't think of a single (other) government agency that makes that particular claim.
- Sure there are several. The United States Postal Service, Amtrak, the Tennessee Valley Authority
Simply because the Federal Reserve has the word "Federal" in its name, or because they give a nod to the FOIA or don't assert a copyright on their pages. Hell I can start a private corporation called the "Federal Association of Butt" and do all the same, does that make my corporation an agency of the United States government as well?
- Yes but if a private corporation refuses to
hand over documents, then that's the end. If the Fed refuses to hand over FOIA then the issue goes to Federal Court.
http://www.usdoj.gov/oip/foia_updates/Vol_V_1/page7.htm
http://www.michbar.org/opinions/district/1999/111699/5730.html
I'd say issues like ownership, control, and purpose (nefarious or benign) make for an interesting article - if all you want to do is parrot or copy what is on the Fed website, why even bother making an article?
- Because it's a good rough draft text. I agree that
its pointless to just cut and paste, but once it has been cut and pasted, it can be edited. The other reason was that I was making a point. If the Fed was a private organization what I did was invalid as it would have been subject to copyright even without an explicit notice. Since the Fed is an agency of the Federal government, the presumption is that web pages are not subject to copyright.
Removal of sections that don't fit the perceptions that you have of the Fed after reading (and block copying large sections from) the Federal Reserve website does not make it NPOV - it simply makes the article your POV.
- So go ahead and start editing.
Roadrunner 15:17, 28 Apr 2004 (UTC)
>while the BCE has only to fight inflation. This is not true : the ECB can contribute to growth when inflation is low.
Move here as it asserts facts which are at least disputed. The Federal Reserve Bank asserts that it is part of the U.S. government, which at least makes disputable a bold statement that it is not....
"Federal Reserve" was carefully selected name - "Federal" implying that this is a government organization. "Reserve" implying that the Federal Reserve notes (i.e., all United States currency) issued is backed by gold and/or silver. In fact, the Federal Reserve is a private corporation, authorized by Congress but owned by private member banks. Federal Reserve notes are not redeemable in gold, silver or any other commodity, and receive no backing by anything. The notes have no value for themselves, but for what they will buy and because the government of the United States accepts these notes for payment of taxes.
Roadrunner 07:06, 28 Apr 2004 (UTC)
This needs to be rewritten.
The U.S. went on the gold standard in 1900, and it was actually the bankers that wanted a gold standard rather than a silver standard. The decision to go off the gold standard in 1971 was not a decision of the federal reserve.
Also, its not necessarily the case that wealthy people benefit from inflation. The decision to go on the gold standard in 1900 was backed mainly by business interests who wanted stable currency while debtors and farmers wanted inflationary policies. (re. William Jenning Bryan's cross of gold speech).
The Fed: Gold, Dollars, Inflation and Debt
America once had a stable dollar backed by gold deposits, a "gold standard" system. Central bankers do not want a gold-backed currency system, because it restricts their ability to stabilize the domestic economy and to avoid deflation.
America's gold-standard system was gradually undermined throughout the last century, until President Nixon finally severed the last tenuous links between the dollar and gold in 1971. Since 1971, the Fed has employed a pure fiat money system, meaning that it can create money whenever it decrees simply by printing more dollars (though of course the practice is more complicated). The "value" of each newly minted dollar is determined by the faith of the public, the total amount of dollars in circulation (the money supply), and the financial markets. It depends on the power of the Fed keep currency artificially scarce.
Since dollars have no intrinsic value, they are subject to currency market fluctuations and government policies, especially Fed inflationary or deflationary policies. Every time new dollars are printed and the money supply increases more than the real amount of production, the average price level rises.
Inflation acts as a hidden tax levied disproportionately on the poor and fixed-income retirees, who find the buying power of their limited dollars steadily diminished. The corporations, bankers, and wealthy Americans suffer far less from this inflation, because they can take advantage of the credit expansion that immediately precedes each new round of currency devaluation.
History Section
The History section still smacks of conspiracy theory. In particular, the gratuitous mention of some people's being Jewish has the stench of "the Jews are manipulating the economy to steal our money" hatefulness. Could somebody with knowledge of the history fix this? Josh Cherry 19:47, 27 Jun 2004 (UTC)
The gratuitous and patently transparent reference to religion in this article is not only crass and offensive, but is emblematic of a superannuated view of world events more suited for the Protocols of the Learned Elders of Zion than a teaching encyclopedia for the general public.
The "FED and the BCE" section said:
>while the BCE has only to fight inflation. This is not true : the ECB can contribute to growth when inflation is low.
from the BCE website:
Objectives "The primary objective of the ESCB shall be to maintain price stability".
And: "without prejudice to the objective of price stability, the ESCB shall support the general economic policies in the Community with a view to contributing to the achievement of the objectives of the Community as laid down in Article 2." (Treaty article 105.1)
The objectives of the Union (Article 2 of the Treaty on European Union) are a high level of employment and sustainable and non-inflationary growth.
in other words, this entire section of the article was basically wrong and therefore has been deleted.
19th century
"Americans at the time knew of the destruction to the economy the European central banks had caused to their respective countries and to countries who became their debtors. They saw the large-scale government deficit spending and debt creation that occurred in Europe."
Which countries and which central banks? David.Monniaux 08:50, 16 Aug 2004 (UTC)
Who owns the fed?
Does the Federal Reserve need to "claim" anything about its owners? Throughout this section, the author seems to use subtle undertones and "chatty" commentary, to promote his view that the organization is illegitimate. I don't think this is NPOV. Certainly the authority of the fed is derived from laws written by Congress. These laws should be enumerated with, perhaps, sections concisely quoted and links to their precise definition from official sources. In general, I did not find this section encyclopedic at all. It sounded more like someone with incomplete knowledge was providing his condensed perspective on the matter. I don't think this perpective should be deleted, however, but outlined in proper context.
POV and quality issues
This article in its current state is awful. The section on how money is created implies that the existence of fiat money is one massive conspiracy. If someone wants to create an article of criticism of fractional reserve banking, go ahead, but the mocking that goes on in the section explaining it in this article is rediculous. Tom3 01:28, 23 Nov 2004 (UTC)
I'm starting to work on it now. The problem with the Fed conspiracy theories, they are usually the most misinformed of all conspiracy theories, mostly by way of a process that is similar to the childrens game telephone. Some people make more valid criticisms of the Fed, such as the possibility of a hidden inflation tax, or the large foreign central bank ownership of treasury bonds, and then people hearing them get the issues confused and turn it into "foreign interests owning the fed", or other such things. I'm goign to keep the conspiracy theories in their own section, but I am cleaning up parts that obvious conspiracy theorists put into the body of the article. I should warn everyone that I've seen a large anti fed bias in a lot of other articles, a meme almost as big as game theory is throughout wikipedia.
However, I am ignorant about many topics. I need people to create these sections:
- Life before the fed (how did normal banks work back then, what was the state of economic cycles back then? what was inflation like? etc.
- I know that Volkner, in the 80's, changed something with the way Fed sets interest rates or something, so that its floating. This had a major and fundamental impact on the way the bond markets worked for example. I believe the change was that the Fed would only tamper with the fed funds rate, instead of tampering with that AND the reserve ratio. I am not sure though, but this is an important historical development for the Fed, and shold be talked about.
- are you referring to the abandonment of strict money supply targeting? The Fed started focusing primarily on interest rates under Voelker. Feco 03:44, 31 May 2005 (UTC)
Proposed Merge
I added a mergefrom tag to this article. It's not standard practice to split a criticism section from the main article about a topic. In this case, it's a recipe for POV forks and other problems. By merging the criticisms back into the main article, more editors will be able to work on it, and we'll hopefully see NPOV much more quickly. Feco 03:42, 31 May 2005 (UTC)
