Mish Shedlock quotes and article today and then adds his comment:
“What I think is the lesson from this is that the Congress needs to clarify the boundaries of independent Fed credit policy,” Professor Goodfriend said. “There should be a mechanism so that the Fed doesn’t have to make these decisions on behalf of taxpayers.”
Boundaries are Not the Problem
The Fed does not care about boundaries or what is legal or not. The obvious implication is mechanisms to define Fed boundaries would be futile. We need to eliminate the Fed itself.
(Mish)
Now here is how it works. Shedlock is right. Prof Goodfriend likely knows and understands economics they way Mish does, but Prof. Goodfriend advises what the powers that be would like to do. Sincere people are perplexed as to how Prof. Goodfriend could be so obtuse. He is not at all obtuse. He knows there is a problem, and congress would like more power. So his advice is give congress more power. In the world of courtiers, the inevitable is the ideal.
When people who vote for change sit by docile as the agent of change just does the same, but worse than the last president, why bother pushing for a good answer, or even the right answer?
Confucius and Lao Tze both had ethical systems for the powers that be in China. Mo Tze thic was actually the ascendent system, until the ancient powers that be in China figured out of all the systems, the Confucian was best for the powers that be. In the realms of ethics and ideas, they way to succeed is to advise the powers that be what they CAN do, not what they should do.
When the fundamental organizing principle of the state is the monopoly on violence, it does not matter what they should do, what matters is what they can do. As they say “Yes, we can.”
The Fed does not care about boundaries or what is legal or not. The obvious implication is mechanisms to define Fed boundaries would be futile. We need to eliminate the Fed itself.
(Mish)
Now here is how it works. Shedlock is right. Prof Goodfriend likely knows and understands economics they way Mish does, but Prof. Goodfriend advises what the powers that be would like to do. Sincere people are perplexed as to how Prof. Goodfriend could be so obtuse. He is not at all obtuse. He knows there is a problem, and congress would like more power. So his advice is give congress more power. In the world of courtiers, the inevitable is the ideal.
When people who vote for change sit by docile as the agent of change just does the same, but worse than the last president, why bother pushing for a good answer, or even the right answer?
Confucius and Lao Tze both had ethical systems for the powers that be in China. Mo Tze thic was actually the ascendent system, until the ancient powers that be in China figured out of all the systems, the Confucian was best for the powers that be. In the realms of ethics and ideas, they way to succeed is to advise the powers that be what they CAN do, not what they should do.
When the fundamental organizing principle of the state is the monopoly on violence, it does not matter what they should do, what matters is what they can do. As they say “Yes, we can.”
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