The fed actually has more tools than the ones it currently uses, some of which have been used in the past.

Robert Hockett has written a lot about productive investments via the federal reserve banks, and how that could be used to transform the economy.

Here's one recent paper: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4023614

He wrote a short book about it as well: https://www.amazon.com/Financing-Green-New-Deal-Renewal/dp/3...

Thanks for the links. I'll pick up that book.

One thing I've been a long-time advocate for is States setting up their own banks akin to that of North Dakota's. If for no other reason than to have a way to leverage national monetary policy for regional aims, so that when the Federal government rushes to the aid of Wall Street (e.g. by flooding it with cheap liquidity) there's a way for State governments to more directly interact with those mechanisms themselves for their benefit.

I strongly suspect significant challenges in setting up effective and responsive governance and incentive structures to keep such things from not becoming their own instruments of abuse, but ever since watching 2008 unfold it's bothered me how easy it is to leave States twisting in the wind while the balance sheets of financial institutions are made whole by feeding at the Fed liquidity trough.

One of the basic premises of "States rights", as it were, is that it's supposed to offer lots of little "laboratories of democracy", but as it stands right now there's no good way to actually finance those laboratories to invest in ambitious things. So, what we mostly end up with instead is only the downside of using "States rights" in the only way that it's cheap to do so, which is usually by restricting or denying things. It's much harder to get the upside of investing in things without all the latitude that the Federal government enjoys financially.

If only someone reminded S Dakota of the rule against perpetuities at the same time.

Indeed, and since it is a privately owned entity [1] with a figurehead appointed by a politician to give the illusion of public accountability, the Fed has very little incentive to do anything but enrich its shareholders: private banks.

"Liberal Democracy" is all theatre, all the time. It is a plutocracy with an extremely advanced propaganda arm designed to fool even the most intelligent observer, as can be seen by the high degree of trust placed in the system by my esteemed colleagues here at HN.

Alas, we get the rulers we deserve.

1. https://publicbankinginstitute.org/money-banking-basics/

central banks all around the world, including the US Federal Reserve System are all public institutions.

completely controlled by presidential appointees. (they have the majority of the seats)

On the other hand, The Fed goes over the top with what they can do and Congress refuses to lean in on its supervision of The Fed.

Imagine that. You refuse to do your job and you still have a job.

Only in America.

Dear Down-voter

Congress has the power to monitor and "regulate" The Fed. That is, The Fed is not - or isn't supposed to be - completely autonomous. It has oversight, or should.

The reality is, it does not. Congress lets The Fed run wild. That might be the status quo, but it's not how it legally needs to be.

So yes, Congress isn't doing their job. And no one (read: the media) is questioning that negligence.

Again, only in America. << That's not editorial. It's a statement of fact.

Not a down-voter and I agree with your positions, but why stop at congressional oversight? Why should a private company [1] be controlling a nation's money supply?

1. https://publicbankinginstitute.org/money-banking-basics/

Oh. I agree. "End The Fed" was an eye opener for me. But what we got is what we got. For now?? Until that changes Congress is as guilty as The Fed.

Even more, Congress just elected Chairman of the Fed Jerome Powell to another term in office. If they were unhappy with him, they'd fire him

The fire him, Wall Street and the rest panics. They keep him and we get more insanity.

He was interviewed on Marketplace (NPR) this past week and he should be a politician. Tons of half answers and such. Another disconnected elite with zero affinity for accountability.

>only in America

I agree with everything else, but Europe is dealing with even worse inflation than the US and the ECB is being even more dovish.

I can't speak for Europe, but Congress does have the power to put The Fed on a leash and they don't. The conflict of interest is blinding. We The People in the darkest dark. Again.

That's the scope of Only in. America, in this case.