# Why do libertarians always want to abolish the FEDERAL RESERVE **URL:** \ **Category:** Great Debates\ **Created:** [December 14, 2018, 4:06pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124 "2018-12-14T16:06:55Z")\ **Posts on this page:** 20\ **Page:** 7
**Author:** ![etasyde](https://avatars.discourse-cdn.com/v4/letter/e/9f8e36/32.png) [@etasyde](https://boards.straightdope.com/u/etasyde)\ **Post date:** [December 17, 2018, 1:54am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/121 "2018-12-17T01:54:59Z")
> [@Exapno\_Mapcase](#): > > Yes, everybody, do so. Please. We’re talking about the USD. However, there is a popular expression: the USD happens to be the fairest mare in the glue factory. Every fiat currency has been abused, this is true. > [@](#): > > The max chart starts in 1968. You’ll notice a very gradual rise until 2008, when the Fed started pumping money into the economy to keep it from going under in the Great Recession. You’ll also notice that the M0 peaked in 2014-15 and has been on a decline ever since. “Almost never” therefore includes the present. A reduction of less than 10% does not compensate for an expansion of over 400%. And this in less than a decade. > [@](#): > > And so what? Why should anybody object to this? The U.S. population has risen 60% since 1968. Because base money is just that, the _base_ of money. And the population _did not quadruple_ in 2008. Now, I say “base” money because you aren’t factoring in the _massive_ multiple caused by fractional reserve banking. The fed maintains an average of 0.15-01.5% reserve ratio. That means an increase of base money produces a 267x multiple in the M3 money supply (the level that actually represents your money in the bank. Now obviously that’s a range, and a range of averages at that. It’s not precise, but does 267x reflect a 60% population growth rate in your crazy world? Note that it starts at 68,000 and rises to ~1,000,000 by 2004. That’s not a sixty percent rise. > [@](#): > > The GDP is up a full 2000%. Nobody can possibly attribute that to Fed-caused inflation. A gigantic economy needs a larger money supply. A gigantic economy in freefall needs available funds when the bottom drops out. These are all good things. GDP has two definitions, which are equivalent. The first you probably know, GDP = net exports + gross investment + government spending + consumer spending. It’s also defined as the velocity of money times the supply of money (unless you reject Keynesian theory, in which case you should be howling for the Fed’s destruction). The two values are equivalent - that is, as you grow the money supply the nominal value of all those things in the first equation also grows. GDP being up 2000%, in light of the 100+ multiple in the money supply, means that the velocity of the dollar _must_ have decreased. That can only happen when _less people are able to use the same volume of money_. By definition. And yes, inflation accounts for quite a lot of your 2000% figure. Median home prices in the 1960’s were approximately $26,000. They’re now over $250,000. That’s a ten fold increase, or fully half of your 2000%. And that’s just home prices. > [@](#): > > They also have essentially zero to do with why the poor remain poor while the rich gets richer. A long list of societal reasons is to blame for this, and the Fed providing base money to banks is around reason #7265243986534. It’s true, there are a lot of reasons it happens. However, the largest injury suffered by the middle class in living memory was the 2008 crisis, which was directly caused by the policies of Ben Bernanke (specifically, his attempt to “save” the market from the DOT-COM crash lead to artificially low interest rates that drove aggressive malinvestment into mortgages which could safely be bundled into MBS and insured by CDS and etc etc I’m not explaining the entire 2008 crisis in this thread). A large percentage of families in the united states have _not recovered_ from 2008. That was a fed driven bubble - they created an environment that strongly incentivized the insanity the banks did, and being driven by the same profit motive as everything else in our system, they did the thing that was most sensible for their interests - that is, screw everyone. ---
**Author:** ![DrDeth](https://avatars.discourse-cdn.com/v4/letter/d/b487fb/32.png) [@DrDeth](https://boards.straightdope.com/u/DrDeth)\ **Post date:** [December 17, 2018, 2:23am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/122 "2018-12-17T02:23:40Z")
> [@etasyde](#): > > We’re talking about the USD. However, there is a popular expression: the USD happens to be the fairest mare in the glue factory. Every fiat currency has been abused, this is true. And so has the Gold Standard. ---
**Author:** ![Exapno\_Mapcase](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/exapno_mapcase/32/1051_2.png) [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)\ **Post date:** [December 17, 2018, 2:42am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/123 "2018-12-17T02:42:41Z")
etasyde, your own cited chart shows that the rise in M0 took place _after_ the collapse of the banks. That makes it very difficult to use as a cause. I don’t doubt that the Fed was a contributor to the insanity of the 2000s. I do doubt that it was the main cause. I put it almost as far down the list as I do for the status of the poor. Heck, if the credit rating organizations had spent one minute doing their jobs the affair couldn’t have happened. But blaming the “profit motive” is really the last straw. Turn in your Austrian economics badge and slink away in shame. Austrians may hate governmental interference but they revere the profit motive. Take that away from them and they are a shadow on a cloudy day. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 17, 2018, 3:43am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/124 "2018-12-17T03:43:00Z")
> [@etasyde](#): > > And yes, inflation accounts for quite a lot of your 2000% figure. Median home prices in the 1960’s were approximately $26,000. They’re now over $250,000. That’s a ten fold increase, or fully half of your 2000%. And that’s just home prices. Ahem. If home prices rise by 1000%, and the market basket rises by 1000%, inflation does not rise by 2000%. It in fact goes up 1000%. > [@](#): > > It’s true, there are a lot of reasons it happens. However, the largest injury suffered by the middle class in living memory was the 2008 crisis, which was directly caused by the policies of Ben Bernanke (specifically, his attempt to “save” the market from the DOT-COM crash lead to artificially low interest rates that drove aggressive malinvestment into mortgages which could safely be bundled into MBS and insured by CDS and etc etc I’m not explaining the entire 2008 crisis in this thread). Ben Bernanke became Fed Chairman in 2006. Alan Greenspan is the name you are looking for. You know, they guy who used to sit at Ayn Rand’s feet? Who kept interest rates low for a long time in support of the Bush Administration. Who refused to recognize that something was happening in the mortgage market. Who said, after he retired, that he was shocked people on Wall Street were greedy. ---
**Author:** ![etasyde](https://avatars.discourse-cdn.com/v4/letter/e/9f8e36/32.png) [@etasyde](https://boards.straightdope.com/u/etasyde)\ **Post date:** [December 17, 2018, 3:48am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/125 "2018-12-17T03:48:48Z")
> [@Exapno\_Mapcase](#): > > etasyde, your own cited chart shows that the rise in M0 took place _after_ the collapse of the banks. That makes it very difficult to use as a cause. Yes, obviously! Why do you keep pointing out the obvious and thinking it’s somehow a refutation? The Fed responded to being unable to lower rates by instituting quantitative easing - in short, money printing. Of course that happened after 2008, that was the fed’s emergency solution to the bubble they created. But why couldn’t they lower rates? _They couldn’t lower rates because they had already lowered them to near zero after the previous crisis_. The fed has been _badly_ bungling the economy since before 1987 (and triggering a worse recession every ~10 years almost like clockwork), and each time they react to a self created crisis, they just create _another_ crisis. Why do you think we’re facing _another_ Fed crisis now? > [@Exapno\_Mapcase](#): > > I don’t doubt that the Fed was a contributor to the insanity of the 2000s. I do doubt that it was the main cause. I put it almost as far down the list as I do for the status of the poor. Then you disagree with every non-Keynesian economist, Alan Greenspan (former Chair of the federal reserve), Nomi Prins (managing director of goldman sachs and leman brothers), Danielle DiMartino Booth (also of the fed), a host of central bankers from the emerging markets and virtually anyone qualified to speak on the issue. The _only_ industry professionals who disagree are the people who are _currently_ on the chopping block for any market panic or loss of confidence (in the fed _or_ the markets) and even Janet Yellen (another former chair) is backtracking on her previous assessments. You are **completely** wrong. > [@Exapno\_Mapcase](#): > > Heck, if the credit rating organizations had spent one minute doing their jobs the affair couldn’t have happened. I do agree that credit rating organizations dropped the ball, but they were _not_ the primary cause of the bank’s behavior. > [@Exapno\_Mapcase](#): > > But blaming the “profit motive” is really the last straw. You aren’t paying a bit of attention and what I’m saying is flying straight over your heard time and time again. I didn’t blame “profit motive” - I said that given the set of circumstances created by the fed, the most sensible course of action was to do what the bankers did. Their actions were a perfectly logical response to a perverse market environment distorted by the fed’s prior intervention and their goal to get the best return for their stockholders - and they made untold billions of dollars for themselves and their company owners. The problem wasn’t that banks had a profit motive. It was that the fed had distorted the environment such that the best way to get a profit was to nuke the economy. They did, and they _won_. They won **big**. > [@Exapno\_Mapcase](#): > > Turn in your Austrian economics badge and slink away in shame. Austrians may hate governmental interference but they revere the profit motive. Take that away from them and they are a shadow on a cloudy day. I’m not an Austrian economist, so sure, have my “badge?” I wont be “slinking away in shame” however, as all you’ve done is highlight how little you understand the financial system. ---
**Author:** ![Mr.Nylock](https://avatars.discourse-cdn.com/v4/letter/m/77aa72/32.png) [@Mr.Nylock](https://boards.straightdope.com/u/Mr.Nylock)\ **Post date:** [December 17, 2018, 5:17am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/126 "2018-12-17T05:17:07Z")
> [@EscAlaMike](#): > > It’s also the monopoly aspect of Central Banking that libertarians take issue with. > > The Federal Reserve has a government-protected monopoly on issuing currency. > > That explains why so many libertarians have jumped onto the cryptocurrency train. Your statements contradict each other. ---
**Author:** ![Kamaski](https://avatars.discourse-cdn.com/v4/letter/k/9d8465/32.png) [@Kamaski](https://boards.straightdope.com/u/Kamaski)\ **Post date:** [December 17, 2018, 5:33am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/127 "2018-12-17T05:33:43Z")
Ok, some of the people in this thread are WAY smarter than me and making me feel a little stupid, lol. Can someone tell me this, has monetary policy/federal reserve played any part in the United States becoming the strongest country in the world? Bretton Woods? 1944? Morganthau? Basically after ww2 the US reorganized the world monetary system? Sound correct? I’m interested in learning more about this. freidman, Hayek, von misis, Keynes, etc ---
**Author:** ![septimus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/septimus/32/410_2.png) [@septimus](https://boards.straightdope.com/u/septimus)\ **Post date:** [December 17, 2018, 9:13am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/128 "2018-12-17T09:13:19Z")
> [@etasyde](#): > > You’re clearly ignorant of how base money works. While yes, as other’s have indirectly pointed out, banks amplify base money through fractional reserve banking, but base money is created by the fed…After base money, individual banks then further expand the money supply, but all base money is originally produced from thin air by the fed and it is first put directly in the hands of a bank. Confused. Fractional reserve banking exists with or without the Fed. The Fed itself creates money in conceptually the same way as private banks do. The money created by regulated private banks is 100% backed by their assets; is also backed by 8%\* of bank capital; and is backed by 10% of “base money.” The money created by Federal Reserve Banks is 100% backed by their assets, is backed by 1% of capital — this is low because the FRB turns its profit over to the U.S. Treasury each year, and the Treasury is in turn obligated to meet any FRB shortfall. It would make no sense for the base money created by FRB to be backed by its own base money, but the FRB owns gold or gold certificates with a market value of roughly 35% of all the Federal Reserve banknotes in circulation. > [@etasyde](#): > > How does this keep flying over your head? > > … if you look at a chart of base money, you’ll notice they almost **never** do this to any degree that matches the expansion… What’s flying over whose head? The chart you link to shows M0 decreasing by about 20% from its high a little over 4 years ago. Perhaps “almost **never** ” was a sub-optimal word choice? > [@](#): > > Zoom the bloody chart out to maximum. Ooooh! Scary! We’ll know you’re serious if/when you can find graphs with a logarithmic y-axis. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 1:03pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/129 "2018-12-17T13:03:21Z")
> [@foolsguinea](#): > > [cryptocurrencies] I’m going to blow your little mind. First, taxes are levied on income in all forms, not just on little green pieces of paper. Second, a specie-based economy is dysfunctional and contractionary without massive taxation to keep the cash recirculating into the economy. Under a gold standard, taxes would _have_ to go up. > > And the tariffs would be amazing. And you couldn’t take gold out of the country. Granted, that’s not what you, an anti-coercion, anti-government anarchist type, are proposing; but what you’re proposing is leaving the country’s money supply undefended and unreplenishable until people get a clue and start doing the things they have to do to keep it. There are problems with a government managed standard, no doubt. That is not what I advocate for. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 1:07pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/130 "2018-12-17T13:07:59Z")
The “problem” with the Euro is that the governments of the economic backwaters are shot-through with overspending and cronyism. They want to keep the milk flowing for the unions and other politically connected groups. Yes this is hard to do with real constraints, and independent currencies could help them pull off shenanigans on bond holders and citizens. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 1:16pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/131 "2018-12-17T13:16:54Z")
> [@Voyager](#): > > Ahem. If home prices rise by 1000%, and the market basket rises by 1000%, inflation does not rise by 2000%. It in fact goes up 1000%. > > Ben Bernanke became Fed Chairman in 2006. Alan Greenspan is the name you are looking for. You know, they guy who used to sit at Ayn Rand’s feet? Who kept interest rates low for a long time in support of the Bush Administration. Who refused to recognize that something was happening in the mortgage market. Who said, after he retired, that he was shocked people on Wall Street were greedy. Why do you think Bernanke was chosen? He gave intellectual heft to what the Fed has been doing for decades, I.e. suppressing rates and creating bubbles. Unfortunately he was embarrassingly wrong and claimed the economy was in great shape right before the crisis. I’m glad that you agree the interest rates were suppressed under Greenspan, even if you must bizarrely try to tie that to Ayn Rand in a hackneyed way. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 1:19pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/132 "2018-12-17T13:19:46Z")
> [@DrDeth](#): > > And so has the Gold Standard. The gold standard was abused in that it was abandoned or governments abrogated contracts during crises and allowed suspension of specie payments. This is why libertarians do no advocate for a government standard, but prefer the government simply allow gold to compete in the marketplace. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 1:25pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/133 "2018-12-17T13:25:56Z")
> [@Hellestal](#): > > I’m not sure I’ve ever seen the assertion that the rich are bigger debtors than the poor. But hey, there it is. > Not _to_ a bank. _By_ a bank. > > Every dollar is a debt instrument issued _by_ a bank. That much is true. > > But it doesn’t back up your assertion that “the rich are bigger debtors than the poor”. Dollars are debts issued by banks. Yes. But that tells us nothing about net indebtedness. Banks are intermediaries. They are both creditors and debtors simultaneously. That is the entire business of banking. Dollars are bank debts, yes, but banks are not huge _net_ debtors, else they’d be doing their business in ass-backward fashion. Banks borrow from their depositors, and lend to their loan applicants and other borrowers like the government, and those two sides of the transaction tend to balance out. > > Banks lend money. Who borrows? Well, the government for one, directly and indirectly, in the form of reserves and government bonds on bank balance sheets. Who else borrows from banks? Is it… rich people? Is it people who _already_ have a lot of wealth who are borrowing? Well, that’s certainly not impossible, given tax incentives to hold debt. But who else is borrowing money from the banks? What about the people _who don’t have money_? Isn’t it plausible that a good chunk of people borrowing from a bank are doing so because they don’t have enough money themselves? > > Banks borrow money. Who lends to banks? Well, the people lending to the bank have money. Pretty much by definition, in fact. That’s the entire reason why they’re lending to banks: because they have wealth, and they keep at least some portion of that wealth in deposit at banks. What class of people have extra money sloshing around that they can lend to banks? Is it… poor people? > > I don’t actually have any data on this. I’d be curious to see if anyone has a cite. But if we wanted to know the net indebtedness of different classes of the population, the banking system is _the last place we should look_ when doing that, because bank borrowing goes hand-in-hand with bank lending. It tends to balance. Banks are basically neutral on the whole debt thing. The earn money by having a higher rate of return on their debt assets than their debt liabilities, and they manage _that_ by offering monetary services on their liabilities. If we want to understand the debt demographics of the economy (so to speak), the best place to look is _everywhere outside the banking system_, because outside the banking system, debts going in and going out don’t have to match each other so closely as they must do within the banks. > > Like I said, I don’t know the data. Maybe if you count corporate borrowings (outside the financial sector), and the ownership of “the rich” (top percentile? decile? quintile?) of those corporations, it’s easy to imagine the rich borrowing a lot of money, “through” the corporations they own. But they’re still rich. They are, simultaneously, lending massive amounts of money in other fashions. Who is _buying_ all of those corporate bonds? Is it poor people? _Really?_ I’d guess the rich in general lend more than they borrow. Why? _Because they’re rich_. They’ve got the wealth, might as well lend it to get a return. > > Who are some clear, unequivocal examples of net borrowers in our society? Some of these are very easy: People who just borrowed money for a house, but don’t have a lot in savings. People with massive credit card debt, and no savings. People who are hounded by collections calls. What about people with negative net worth, meaning few assets and big debts? There is literally no possibility that that subgroup is a net lender, because they don’t even have positive net worth. This is pretty simple, actually: we know that people with big mortgages, and relatively little in savings, are net debtors. We know that people with large credit card balances, and no money, are net debtors. More generally, we know that people with negative net worth are net debtors. Every last one of them. > > In case you’re not aware: about 14% of households in the US have negative net worth. Every single one of these households is a net debtor. So… are these people rich? Or poor? And if these people are net debtors, there must be another group of people they owe money to. Net creditors. This is a different class of people. > > It is not, in fact, mathematically possible for the entire population to be net debtors, with no class of people being net creditors. There must be _some_ class of people who are lending more than they are borrowing. So, what class of people is that? Do you think it’s… poor people? I have already admitted that I don’t actually have data on net debt holdings of the population by income quintile or anything on those lines. But I’m also not the person arguing that rich people – the peeps with all the wealth – are major-league debtors. I mean, that’s… mathematically possible, I guess. They could have major non-debt asset holdings, which exceed their debts. (Still positive net worth, i.e. rich.) And it just so happens that all of the people in the world with _less wealth_ than the rich could be lending the rich people money at interest. > > In this case, indebtedness would necessarily be U-shaped, where the poorest and the richest are net debtors, with the middle class lending simultaneously above and below. Mathematically possible. But really? Is that your argument? Really? Because if so, I for one would like to see some data backing that up, not some irrelevant comments about the banking system. > > To make the point again: if this is actually the case, the banking system is exactly the wrong place to answer this question, because the banks borrow as they lend. We would need to look at household indebtedness by wealth level. That’s the only data that could actually answer this question. And in talking about this, I haven’t even gotten into this weird stuff in other parts of the post about the “Cantillon effect” or “banks buying stocks”. > Commercial banks, in the US at least, are not even allowed to buy stocks. Even the big mega-banks, with commercial and investment banking divisions, cannot-not-NOT finance any risky assets like stocks with an expansion of their monetary (deposit) liabilities within their commercial bank section. > > That was an interesting link to the post about the Cantillon effect. I don’t have any problems with that cite. It’s the highly idiosyncratic interpretation of that cite that I’m having issues with. The rich hold the most debt. The rich lend more than they borrow. Your error is believing the second comment negates the first. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 1:30pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/134 "2018-12-17T13:30:37Z")
> [@foolsguinea](#): > > To expand on this: > > The Euro has been terrible for Greece (and Cyprus, and Spain) since about 2009. They’re effectively dollarized to what is functionally run as a German currency, and the Germans want _no_ inflation. Drastic as it sounds, some economists thought that Greece would actually be better off defaulting on their debts to the other European nations, leaving the Eurozone, and muddling through with a new and somewhat inflationary drachma. (I am not a trained economist and I don’t know; but it’s a plausible argument to me.) But the Greek populace has explicitly rejected the idea of going back to their own currency for fear of losing the international stability and respectability of the Euro—even though the European Central Bank despises and abuses them. > > If humanity went to shekels of silver as the respectable international medium of exchange, we’d see the same kind of thing happen all over the globe. Entire nations would watch their money supplies leave the country, and yet their populace and politicians would still insist that hard money is the way to go, because it would _seem_ right. We know this because it happened that way before, and that’s roughly how the Long Depression happened. Even a hundred years ago, H. L. Mencken was breathing venom and fire against anyone who would back money with anything but gold, pure gold; and he was, apparently, not tossed in a rubber room where that nonsense belonged. > > National currencies are manageable and sane. Someone who really wants to be paid in shekels of silver or Krugerrands or what have you can still try to get his fees in that fashion (and complain about Gresham’s Law when those aren’t available). But having one central bank per nation-state is probably for the best, because the bank’s monetary policy can be complemented by the state’s fiscal policy. (That means budgets, with taxes, tariffs, and even redistribution if necessary.) > > What’s incredibly dangerous is _international_ currency. The money supply then exists outside the control of the national government and with no coordination with fiscal policy. At that point, governments very much have to do things in self-defense . Yes what the gold haters and libertarians both realize is that private money represents a threat to the progressives’ ability to control society through “policy”. Let’s just be up front about it. ---
**Author:** ![Brayne\_Ded](https://avatars.discourse-cdn.com/v4/letter/b/e9bcb4/32.png) [@Brayne\_Ded](https://boards.straightdope.com/u/Brayne_Ded)\ **Post date:** [December 17, 2018, 2:31pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/135 "2018-12-17T14:31:25Z")
> [@WillFarnaby](#): > > The “problem” with the Euro is that the governments of the economic backwaters are shot-through with overspending and cronyism. They want to keep the milk flowing for the unions and other politically connected groups. Yes this is hard to do with real constraints, and independent currencies could help them pull off shenanigans on bond holders and citizens. Uh, name names. Do you mean economic backwaters in the Eurozone? Or in Europe as a whole? What you describe certainly applies to Greece. To some extent France, although that is not exactly a backwater. Macron is catching the long-overdue flak aimed at an elitist system, of which he is a part, albeit an anomalous one. As I stated before, the problem with the Euro that it is the currency of countries with very disparate economic strength. The only way Greece, for example, could devalue is to go back to the drachma, and the changeover would be at a massive cost. Greece and the other suffering countries in the Eurozone are not in the headlines at the moment, but the problems are still there and are not being addressed. ---
**Author:** ![Alessan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/alessan/32/465_2.png) [@Alessan](https://boards.straightdope.com/u/Alessan)\ **Post date:** [December 17, 2018, 2:38pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/136 "2018-12-17T14:38:26Z")
> [@WillFarnaby](#): > > The rich hold the most debt. > > The rich lend more than they borrow. > > Your error is believing the second comment negates the first. Please explain how someone can be a net debtor and a net creditor at the same time. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 3:01pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/137 "2018-12-17T15:01:14Z")
> [@Alessan](#): > > Please explain how someone can be a net debtor and a net creditor at the same time. Why would I explain a false statement that I didn’t make? ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 3:07pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/138 "2018-12-17T15:07:57Z")
> [@Kamaski](#): > > Ok, some of the people in this thread are WAY smarter than me and making me feel a little stupid, lol. > > Can someone tell me this, has monetary policy/federal reserve played any part in the United States becoming the strongest country in the world? > Bretton Woods? 1944? Morganthau? > > Basically after ww2 the US reorganized the world monetary system? Sound correct? > > I’m interested in learning more about this. freidman, Hayek, von misis, Keynes, etc A good start: What Has Government Done To Our Money? Murray Rothbard ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [December 17, 2018, 3:13pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/139 "2018-12-17T15:13:03Z")
> [@Brayne\_Ded](#): > > Uh, name names. Do you mean economic backwaters in the Eurozone? Or in Europe as a whole? What you describe certainly applies to Greece. To some extent France, although that is not exactly a backwater. Macron is catching the long-overdue flak aimed at an elitist system, of which he is a part, albeit an anomalous one. > > As I stated before, the problem with the Euro that it is the currency of countries with very disparate economic strength. The only way Greece, for example, could devalue is to go back to the drachma, and the changeover would be at a massive cost. Greece and the other suffering countries in the Eurozone are not in the headlines at the moment, but the problems are still there and are not being addressed. It’s not only that Greece and Germany are of disparate “strength”, it’s that this is coupled with rampant crony spending by Greece. If they had Germany’s fiscal discipline, their sharing a currency with Germany would not be a problem. ---
**Author:** ![Hellestal](https://avatars.discourse-cdn.com/v4/letter/h/3ab097/32.png) [@Hellestal](https://boards.straightdope.com/u/Hellestal)\ **Post date:** [December 17, 2018, 3:15pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/140 "2018-12-17T15:15:36Z")
> [@WillFarnaby](#): > > The rich hold the most debt. > > The rich lend more than they borrow. > > Your error is believing the second comment negates the first. | | | | v > [@Hellestal](#): > > They could have major non-debt asset holdings, which exceed their debts. (Still positive net worth, i.e. rich.) And it just so happens that all of the people in the world with _less wealth_ than the rich could be lending the rich people money at interest. > > In this case, indebtedness would necessarily be U-shaped, where the poorest and the richest are net debtors, with the middle class lending simultaneously above and below. Mathematically possible. But really? Is that your argument? Really? Because if so, I for one would like to see some data backing that up, not some irrelevant comments about the banking system. ^ | | | | It might help you find the relevant section of a long post by quoting the relevant section specifically, rather than quoting an entire long and nuanced post in order to write only a very short reply. [Previous page](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124.md?page=6) [Next page](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124.md?page=8)