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Milton Friedman (born July 31, 1912) is an American economist, known for his work on macroeconomics, microeconomics, economic history, statistics, and for his advocacy of laissez-faire capitalism. In Capitalism and Freedom (1962) he minimized the role of government in a free market in order to create political and social freedom. In 1976, he won the Nobel Prize for his achievements in the fields of consumption analysis, monetary history and theory and for his demonstration of the complexity of stabilization policy. His television series Free to Choose aired on PBS in early 1980. It became a book, co-authored with his wife, Rose Friedman. The book was widely read, as were his columns for Newsweek magazine.
In 1963, the University of Chicago economist had published with coauthor Anna J. Schwartz the magnum opus of his career. 'A monetary History of the United States, 1867 - 1960.' To professionals, Friedman's work was an awesome piece of scholarship, a dense tome that traced in meticulous detail the entire course of money, banking and U.S. monetary policy from Ulysses S. Grant to John F. Kennedy. To most politicians in Washington, Milton Friedman seemed just a figure with an odd obsession. He kept reappearing in academic and political forums, preaching the same profoundly conservative sermon: the Keynesian orthodoxy that had dominated economics for thirty years was wrong. Not just a little wrong, Friedman insisted, but totally, fundamentally disastrously wrong.
Milton Friedman...worried about inflation. He testified frequently before Congress and patiently instructed important committee chairmen on why they should worry too. At the time, it seemed an odd complaint, even cranky. The Consumer Price Index rose by modest increments each year, but never by as much as 2 percent through 1965. Wealthy bond investors might grumble when the inflation rate hit 1.5 percent, but the rest of the country was more impressed by the general prosperity. Friedman persisted, nevertheless, with his dire predictions.
"The FED's manipulation of the money supply, Friedman added, was consistently destabilizing and damaging."
"The seminal events that destroyed the old ideology were the Crash of 1929 and the Great Depression that followed......In the Great Depression, the American economy did not revive. Neither did the rest of the world's. Year after year, as the social misery deepened and massive unemployment stretched on for more than a decade, the popular faith in free markets was shattered.......This new idea - government's obligation to manage the economy - was legitimized by the national trauma of Depression, embraced both in public opinion and in scholarly theory.
By 1973, prices were escalating rapidly again and the CPI rose by a new postwar record, 8.8 percent. The following year, 1974, OPEC pushed up oil and the price level rose 12.2 percent
Who eactly was to blame? The standard explanations from economists seemed to blame everyone, a bit, and no one singularly. Milton Fiedman offered a much simpler answer to the question: inflation was caused by the Federal Reserve.
....Friedman said, the Federal Reserve swerved back and forth irresponsibly - supplying too much money and causing inflation, then tightening the money supply abruptly, which choked off the economy and produced recession."
"The Federal Reserve System is a political institution, and like every political institution, it is seeking to retain its own power, its own decisions, its own prestige. To what end do politicans want to maintain their positions? To what end does a CEO of a business concern want to run that concern for profit? Because the coin he is interested in is both income and power. In the same way, people who are in the Fed want to maintain their position. Their coin is influence and power."
Would you mind fixing the quote/external source tags? It's not completely clear which comments are your own and which are William Greider's.
Today the Fed doesn't have the power you describe
Originally posted by Excitable_Boy
The FED is a privately owned, for profit organization that nets $1 trillion per year for its 300 or so private stock holders. I would say that gives them an awful lot of power and plenty of room for corruption....don't kid yourself. Deny ignorance!
[edit on 9-11-2006 by Excitable_Boy]
Originally posted by cpdaman
btw what in your mind is real evidence a letter by the fed saying yes we are a scam?
seriously i am curious
Originally posted by nowthenlookhereAs such, one has to be caseful when judging the motivations of the players involved. Malice and incompetance are different things. Milton Friedman himself argued that it was lack of foresight that caused the Fed to tightewn the money supply as it did, causing the crash and depression.
If you can produce such evidence, I'd certainly like to see it! ( the letter that is, not just a link to a website that merely claims such a letter exists)
Originally posted by tazadar
Don't be ridiculous. What cpdaman is saying is that no such evidence exist.
All the evidence you need is common sense. This is not rocket science.
You are telling me that the Federal Reserve is that incompetent to not know reducing money in circulation is not going to hurt the economy
People keep saying that but it's simply not true,. The Fed actually nets around 30 billion a year, and pays 23 billion of that straight to the US government. The rest is running costs.
Each year the the Fed publishes a Full, audited report covering EXACTLY what money comes in and what money goes out.
Edit : you should also be aware that many of the "Federal Reserve is Scam" sites that are so often quoted as "evidence" of conspiracy, are actually set up and paid for by gold dealers. It's one of the oldest tricks on wall street... Create fear, then offer the perfect "safe" investment.
Nowhere will you see a balance sheet, an income statement, or any kind of real financial investigation.
That would appear to be the case yes, though I am happy to examine any evidence to the contrary. Evidence mind you, not just allegations. Anyone can make up allegations. the test is whether they stand up to close scrutiny.
Well, I've laid the evidence before you... including the accounts audited by Price Waterhouse Coopers, the well known accounting firm, disproving your alegation that no outside body audits the fed.
I've read the the thread you point to, and it's just the same old hearsay and mis-interpreted quotes. You show me numbers, objective facts, and I'll continue the debate. If you can't do that, you have no case. As I said before, allegations, however numerous, are not evidence.
I'll still contribute to financial threads, but I'm not getting into anymore arguments over this.
And don't forget President Andrew Jackson. Though he had alot of policies I didn't like, he did have one great accomplishment: He kicked out the Federal Reserve when their contract expired under his administration and then he actually balanced the budget to where we were 100% DEBT FREE - for the ONLY time in U.S. History.
Fervent free market believers lost a hero Thursday with the passing of Milton Friedman.
The Nobel Prize-winning economist, known for his strong laissez-faire views, died Thursday in San Francisco at age 94. The cause wasn't immediately known.
There you go. May God Bless and Keep Milton Friedman. My condolences to the family of this brilliant man.
His rational, functional approach to economics will certainly be missed.
"Inflation is the one form of taxation that can be imposed without legislation."
"Many people want the government to protect the consumer. A much more urgent problem is to protect the consumer from the government."
"Only government can take perfectly good paper, cover it with perfectly good ink and make the combination worthless."
"The most important ways in which I think the Internet will affect the big issue is that it will make it more difficult for government to collect taxes."
"We have a system that increasingly taxes work and subsidizes nonwork."