Dear Mr Bernanke, 

I certainly don’t envy your job lately.  Congratulations on surviving a tough initial period of your tenure.

 

As you probably already know in theory, it is unlikely that the decision-making role of the Federal Reserve will grow easier before it becomes more difficult.  Unfortunately, sir, this is in no small part your fault nor the fault of your predecessor Mr. Greenspan.  Again, you probably already know that, at least in theory.

 

Your predecessor slashed the Federal Funds Rate (FFR) to 1% after the dot com bubble broke.  Apparently, this was to serve as a sort of concession for interest rate escalation before the implosion.  However, in a free investment market, the implosion has to be felt by the investors that made unwise decisions; to bail them out with a generational low FFR only robs them of the same freedom we intend to enjoy.

 

Further inexplicable, though, was the Federal Reserve’s decision to sustain a 1% FFR.  I’ll grant you that it reinflated a newly bubble-less economy.  It also was a major factor in the skyrocketing of oil (which, as you know, trades in the dollar) and housing.  With this skyrocketing came speculation, and all of a sudden our dot com bubble became a housing bubble.  With the sustained low interest rate environment, the bond market was starved and savings was discouraged; what was previously a fairly liquid environment was cashed into unsustainably bountiful home equities.

 

And now, as you know, our economy is anything but liquid.  Your recent attempts to re-lower the FFR have proven futile in jolting the economy.  The credit crunch we now face is no doubt worse than the Savings & Loan collapse of the 1980s.  Our current climate of economic recession is probably overdue, yet you’ve turned a normal, healthy part of the economic cycle into a stagflation that will rob jobs and compromise Americans’ purchasing power.  This is all in large part caused by your bank’s practices.

To quote Presidential candidate Ron Paul…

“This decline in the value of the dollar is simple to explain. The dollar loses value as the direct result of the Federal Reserve and U.S. Treasury increasing the money supply. Inflation, as the late Milton Friedman explained, is always a monetary phenomenon. The federal government consistently wants to spend more than it can tax and borrow, so Congress turns to the Fed for help in covering the difference. The result is more dollars, both real and electronic – which means the value of every existing dollar goes down.

[You face] two basic ongoing choices: raise interest rates to prop up the dollar, but risk pushing the economy into a recession; or lower interest rates to stimulate the economy, but risk further declines in the dollar. This unfortunate dilemma is inherent with a fiat currency, however.”  Emphasis mine.

I’m sure that’s a review of your first Macroeconomics course.

 

If you continue your regulation of currency, you assume the burden of retarding the purchasing power of Americans everywhere without their consent.  This is, indeed, a cruel subversive form of taxation.  I quote your predecessor… 

“[U]nder the gold standard, a free banking system stands as the protector of an economy’s stability and balanced growth… The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit… In the absence of the gold standard, there is no way to protect savings from confiscation through inflation.”

At the FOMC meeting next Tuesday, please do
America a favor.  Resign.  Recommend to Congress a return to the gold standard or another commodity-backed currency, the dissolution of your office, and refer their borrowing needs to public bonds on Wall Street if they can’t balance the Federal Budget.

 

These are grave times indeed.  Please act wisely; my financial future is – gulp – in your hands.

 

Sincerely,

 

 

 

Thomas E Lyons

www.theonlyorthodoxy.com

credit card debt relief,card credit debt disabled relief,credit card debt relief nonprofitdebt reduction credit card consolidationbest balance transfer credit cardfixed rate credit cardcard credit debt negotiation,card company credit debt negotiation,credit card debt negotiationcard credit debt reduction solutioncard credit debt help xxasdfcircuit city credit card applicationconsolidate credit card paymentno credit cardcredit card reward program,card credit program reward,best card credit program rewardpay orchard bank credit cardmbna credit card applicationcard credit debt reduction services,credit card debt reduction serviceslow apr credit card,low apr credit card transfer,low rate apr credit cardcard credit hsbc philippinewashington mutual credit card apply,card credit mutual online washington,washington mutual credit cardbad card credit gas,bad card credit credit gas peoplechase visa credit cardcredit card bad debt ukcard christian consolidation credit debtapplication card credit visabad card credit credit ukmonogram credit card bankcredit card uk high riskcapital one credit card account,capital one credit card,capital one bank credit cardmerrick bank credit cardapplication card credit mbnabest card credit rate transferhigh school student credit cardcredit card debt reduction calculatorchase credit card servicescalculator card consolidation credit debtapply for discover credit cardcredit card services merchant accountcard consolidation credit loan,credit card consolidation loan,calculator card consolidation credit loanamerica application bank card creditbankruptcy card credit fraud,credit card fraud cases,credit card fraudinstant approval uk credit cardaccept credit card paymentcard consolidation credit debt getbest credit card debt helpconsolidate credit card billbad card credit debtpremier bank credit cardcash reward credit cardbest credit card ukguaranteed acceptance credit card ukcard credit machine wirelessbest airline miles credit card