# 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:** 9
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [December 17, 2018, 9:34pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/161 "2018-12-17T21:34:49Z")
> [@etasyde](#): > > 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. Interest rates were not zeroed out between the dot com crash and the financial crisis. > [@](#): > > Why do you think we’re facing _another_ Fed crisis now? > > 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. > > I do agree that credit rating organizations dropped the ball, but they were _not_ the primary cause of the bank’s behavior. They were gatekeepers that failed at their post. It seems that the market cannot self regulate. > [@](#): > > 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. Fraud. Fraud and complicity in fraud was the most logical course of action? Fraud was necessary to write all those bad mortgages. > [@](#): > > 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**. > > 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. For someone who isn’t an Austrian, you sure say a lot of things that mostly only Austrians say. ---
**Author:** ![foolsguinea](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/foolsguinea/32/14751_2.png) [@foolsguinea](https://boards.straightdope.com/u/foolsguinea)\ **Post date:** [December 17, 2018, 11:58pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/162 "2018-12-17T23:58:03Z")
> [@WillFarnaby](#): > > Yes it is “hard to retrieve” money when you can’t print money that anyone will accept. You actually need to do crazy stuff like produce goods and services. This is novel to nobody operating in society today. Capitalism is about finance, and finance tends to concentrate wealth. Show me how your free-market gold-users are going to do anything but put more assets into fewer hands. Hard money leads in downturns to liquidity failures. I can’t explain it well enough because I don’t understand it that deeply; but it does. Greece has had liquidity failures despite good capital assets and hard-working citizens. These fiscal problems have led to the movement of wealth out of the Greek state’s hands, and thus away from the Greek people, and into the hands of foreign investors. Were they providing goods and services, or just finance? :dubious: ---
**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 18, 2018, 12:17am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/163 "2018-12-18T00:17:43Z")
> [@Damuri\_Ajashi](#): > > For someone who isn’t an Austrian, you sure say a lot of things that mostly only Austrians say. Who was the first and only person in this thread to mention Austrians? > [@etasyde](#): > > This would matter if the amount of expansion weren’t vastly, overwhelmingly greater than the amount of contraction. The “fault” most Austrian economists believe most undermines Keynesian policy is that _they almost never shrink the money supply_. It’s politically untenable to do so. If it’s politically untenable to do so, they how have they been getting away with it for the past several years? Is it perhaps because they’re fighting inflation instead of fueling it, which is what etasyde keeps implying is exactly what he wants? Must be incredibly inconvenient to see the target of your ire doing what you fervently want to be done. Kind of makes your entire argument, um, untenable. ---
**Author:** ![Linden\_Arden](https://avatars.discourse-cdn.com/v4/letter/l/53a042/32.png) [@Linden\_Arden](https://boards.straightdope.com/u/Linden_Arden)\ **Post date:** [December 18, 2018, 3:14am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/164 "2018-12-18T03:14:11Z")
Much of what libertarians believe about The Fed comes from a book named ‘The Creature From Jekyll Island’ by G. Edward Griffin. - G. Edward Griffin (born November 7, 1931) is an American author, filmmaker, and conspiracy theorist. Griffin’s writings promote a number of false views and conspiracy theories regarding various of his political, defense and health care interests. In his book World Without Cancer, he argues that cancer is a nutritional deficiency that can be cured by consuming amygdalin, a view regarded as quackery by the medical community.[2][3][4] He is the author of The Creature from Jekyll Island (1994), which promotes false theories about the motives behind the creation of the Federal Reserve System.[2][5] He is an HIV/AIDS denialist, supports the 9/11 Truth movement, and supports a specific John F. Kennedy assassination conspiracy theory.[2] He also believes that the biblical Noah’s Ark is located at the Durupınar site in Turkey.[ \* (Wikipedia) Needless to say Griffin is a nutcase. ---
**Author:** ![John\_Stamos\_Left\_Ear](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/john_stamos_left_ear/32/3198_2.png) [@John\_Stamos\_Left\_Ear](https://boards.straightdope.com/u/John_Stamos_Left_Ear)\ **Post date:** [December 18, 2018, 4:43am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/165 "2018-12-18T04:43:15Z")
Just a quick note that this was something I brought up in 2012. > **[Why is the Federal Reserve a talking point for Ron Paul types?](https://boards.straightdope.com/sdmb/showthread.php?t=672077)** > > I hear this a lot. I see it a lot. Ron Paul supporters and other types prone to screaming fits against government and for conspiracy theories yelling that the Federal Reserve is unconstitutional, does a lot of nefarious things, is not answerable to... ---
**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 18, 2018, 3:26pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/166 "2018-12-18T15:26:35Z")
> [@foolsguinea](#): > > Capitalism is about finance, and finance tends to concentrate wealth. Show me how your free-market gold-users are going to do anything but put more assets into fewer hands. > > Hard money leads in downturns to liquidity failures. I can’t explain it well enough because I don’t understand it that deeply; but it does. Greece has had liquidity failures despite good capital assets and hard-working citizens. These fiscal problems have led to the movement of wealth out of the Greek state’s hands, and thus away from the Greek people, and into the hands of foreign investors. Were they providing goods and services, or just finance? :dubious: There are “liquidity failures” because the malinvestment has been made apparent and profitable endeavors are hard to identify. You have a preceding boom period where capital is directed into unsustainable investments. The money managers are caught off guard. Unfortunately, they hold sway over government and whine for free money to prop up the failing industries Take the US example, The Fed was anything but tight after the last downturn (despite what the NGDP stat-jockey nutters claim). Liquidation is the proper course, but people were panicking. The bad managers were spared a hard lesson. Most of them are still controlling vast assets. Liquidation was thus prevented and we are on the precipice of another downturn. The bad managers will whine for looser policy, the NGDP nutters, who have gained influence, will provide the intellectual heft for the loose policy. Guess what? No amount of loose policy will accommodate the downturn. Rates will plummet, but the “liquidity trap” will again resurface. Of course it is not a liquidity trap, but the managers’ uncertainty in the face of disruption. After a few years, the assets will again inflate. The Greek public payroll is ridiculous. It doesn’t matter if you are working hard if all you are doing is digging holes and filling them back in. The Greeks should have defaulted and spared their private sector. They’d rather break the backs of their producers to keep the milk flowing to the “public” servants. I can’t promise you gold will result in a flatter distribution of resources. I don’t even know if such a distribution is optimal. I can tell you gold will bring discipline to finance and government. ---
**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 18, 2018, 3:42pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/167 "2018-12-18T15:42:43Z")
> [@Linden\_Arden](#): > > Much of what libertarians believe about The Fed comes from a book named ‘The Creature From Jekyll Island’ by G. Edward Griffin. > > - > > G. Edward Griffin (born November 7, 1931) is an American author, filmmaker, and conspiracy theorist. Griffin’s writings promote a number of false views and conspiracy theories regarding various of his political, defense and health care interests. In his book World Without Cancer, he argues that cancer is a nutritional deficiency that can be cured by consuming amygdalin, a view regarded as quackery by the medical community.[2][3][4] He is the author of The Creature from Jekyll Island (1994), which promotes false theories about the motives behind the creation of the Federal Reserve System.[2][5] He is an HIV/AIDS denialist, supports the 9/11 Truth movement, and supports a specific John F. Kennedy assassination conspiracy theory.[2] He also believes that the biblical Noah’s Ark is located at the Durupınar site in Turkey.[ > \* > > (Wikipedia) > > Needless to say Griffin is a nutcase. I haven’t gotten around to _Creature_, though i must admit it sounds like an awesome beach read. Could you point to some of its false claims or is this just one of those posts? There was something in the posthumous Rothbard collection _History of Money and Banking in the United States_ that lays out a claim that the Fed was sold to the public as a middle-American businessman’s movement, but it was actually an elitist gambit from the start at the Indianapolis Monetary Convention. I assumed that Griffin was going on along those lines, but I’m not sure. ---
**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 18, 2018, 4:04pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/168 "2018-12-18T16:04:43Z")
I will note that it is funny that “reformers” and progressives like Bernie Sanders are so upset about big banks. The progressive “experts” campaigning for a central bank were blaming everything on small banks. It was part of a drive toward centralization. ---
**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 18, 2018, 4:08pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/169 "2018-12-18T16:08:09Z")
> [@Exapno\_Mapcase](#): > > Who was the first and only person in this thread to mention Austrians? > > If it’s politically untenable to do so, they how have they been getting away with it for the past several years? Is it perhaps because they’re fighting inflation instead of fueling it, which is what etasyde keeps implying is exactly what he wants? Must be incredibly inconvenient to see the target of your ire doing what you fervently want to be done. Kind of makes your entire argument, um, untenable. Yes the Fed has backed off so price inflation won’t get out of control. The fact is, however, they are inflationary over the long term. This is kind of like global warming deniers point to a “pause”, as if that negates the overall trend. ---
**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 18, 2018, 5:03pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/170 "2018-12-18T17:03:37Z")
> [@WillFarnaby](#): > > Yes the Fed has backed off so price inflation won’t get out of control. The fact is, however, they are inflationary over the long term. This is kind of like global warming deniers point to a “pause”, as if that negates the overall trend. In our reality it’s more like exactly what an economist would predict would happen after the need for the increase had waned. ---
**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 18, 2018, 5:06pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/171 "2018-12-18T17:06:58Z")
> [@Exapno\_Mapcase](#): > > In our reality it’s more like exactly what an economist would predict would happen after the need for the increase had waned. You mischaracterized a claim that the Fed was inflationary. It is over the long term, short term stats are just that. ---
**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 19, 2018, 7:24am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/172 "2018-12-19T07:24:58Z")
Gently stubbing one’s toe is not the same as having a limb whacked off. In other threads we ask people to admit there’s a difference between forcible rape and complimenting someone on their clothing. Is it too much to ask that we distinguish the 25,000% inflation rate in Venezuela from the 2% rate in the U.S.? > [@WillFarnaby](#): > > You mischaracterized a claim that the Fed was inflationary. It is over the long term, short term stats are just that. The crucial question — and perhaps we should start a new thread to focus on this explicitly — is: _ **Is 2% annual inflation good or bad?** _ Sure, 2% annual inflation looks very scary over long time frames: $1000 will be worth only $2.63 three centuries from now, if inflation is 2% every year. But does that statistic lead to understanding? Sure, you could buy a quart of quality ale for a farthing in 1338; this stat might make some yearn for “the good old days.” _But a working man’s wage at that time was less than a farthing per hour._ You want to look at inflation **long-term**? Here are the average annual inflation rates of the U.S. dollar, by decade. 1920s – 0.05% **deflation** 1930s – 2.06% **deflation** 1940s – 5.56% inflation 1950s – 2.05% inflation 1960s – 2.32% inflation 1970s – 7.06% inflation 1980s – 5.51% inflation 1990s – 3.00% inflation 2000s – 2.57% inflation 2010s – 1.68% inflation (1st 8 years) There might be wide agreement that the 1930s was the “worst” decade economically. What do you note about its inflation rate? There was a sharp inflation from 1973 to 1982. The Fed, rather than being the cause of, is _given credit for combating that inflation successfully_. Price stability is good for economic efficiency. If you graph the price, in dollars, of a basket of groceries (or a basket of producer goods) over time you’ll see a smooth line. (Use a logarithmic scale on the y-axis for heaven’s sake!) Plot the same prices using grams of gold instead of dollars, and the curve will be erratic. @ **WillFarnaby** — is it your contention that zero inflation would be preferable to a predictable 2% inflation? If so, can you succinctly explain why? ---
**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 19, 2018, 11:24am UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/173 "2018-12-19T11:24:07Z")
Your question is a fair one. It is the wrong one, but I understand where it comes from This is a bit of a sidetrack, but the only way to answer the question is to look at the history of the term “inflation”. Originally, “inflation” was a term to represent the introduction of money into the money supply. Over time, it came to mean one of the potential consequences of that introduction. Modern Austrians draw a distinction by referring to the latter as “price inflation”. They view this as a consequence of policy. You, and mainstream economists, don’t even have a word for the former “inflation” as far as I know. In any case you view the latter “price inflation” as a variable to be manipulated rather than as a mere consequence or symptom (to a certain degree, you know how to manipulate it using policy so to that degree you understand it as a consequence) A lot of people think that Austrians are so concerned with price inflation. They are concerned, but to them the enemy is the old-style inflation. This inflation can occur in a free market money regime when gold is mined. This is not a concern as the production of money occurs on a profit/loss basis. When caused by artificial credit expansion, old style inflation results in malinvestment because there is a discoordination between what the market signals are saying about savings and the realities of what has been saved. Specifically, artificially low interest rates tell the market that there are more savings than there actually are. The old style inflation can result in price inflation as measured by CPI. It can not result in that. Austrians will not come out and say it certainly does. They will state it as a counter factual. They will say price inflation as measured by CPI will be greater than it would have been in the absence of credit expansion. This is important because there are so many moving parts in an economy. Chief among these for this discussion is productivity. In the absence of old style inflation, prices go down in a healthy economy because of gains in productivity. Think late 1800s when even Friedman admits it was a great time of growth even though there was no price inflation and sometimes price deflation. The Fed has expanded and enables the expansion of the money supply greatly. From that standpoint it is definitely inflationist in the old sense. It is also inflationist in that it has created price inflation that is higher than it would have been absent its policy. Think about the 80s, 90s, 00s, and 10s. I mean really think about the leaps in productivity that have occurred. There are tech people that could better explain how computing and the internet have so increased productivity as to boggle the mind! Japan and the growth of the Toyota production system. Billions of Chinese deployed in ever more efficient occupations. Krugman could tell you about how great the fax machine was. The point is we should have had the most glorious deflation in world history. We didn’t because the Fed has been busy pumping dollars out like crazy. So back to your question. There is no preferable rate of price inflation to be manipulated. Allow inflation to occur with the production of money on the market. What comes will come. The benefits would be avoiding rampant malinvestment and glorious deflation. ---
**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 19, 2018, 4:24pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/174 "2018-12-19T16:24:25Z")
Isn’t the counter to this from mainstream economists that none of the productivity increases in recent decades could possibly have happened under a hard money economy because there isn’t enough hard money in the world to underwrite it? ---
**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 19, 2018, 5:04pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/175 "2018-12-19T17:04:51Z")
> [@Exapno\_Mapcase](#): > > Isn’t the counter to this from mainstream economists that none of the productivity increases in recent decades could possibly have happened under a hard money economy because there isn’t enough hard money in the world to underwrite it? So prices adjust downward. They adjusted fine in the late 1800s. Is there a period in which productivity driven deflation has caused financial problems? No. When people are afraid of deflation, they point to recessions and depressions in which inflated asset prices fall and malinvestment is cleared out (if govt stays out enough). This is a different beast than productivity driven deflation that consumers love. Even if you fear deflation, there was no deflation under Bretton Woods despite big productivity gains. The US had to trash Bretton Woods in order to inflate. They couldn’t even manage to maintain that. ---
**Author:** ![Hellestal](https://avatars.discourse-cdn.com/v4/letter/h/3ab097/32.png) [@Hellestal](https://boards.straightdope.com/u/Hellestal)\ **Post date:** [December 19, 2018, 5:22pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/176 "2018-12-19T17:22:28Z")
> [@WillFarnaby](#): > > So prices adjust downward. They adjusted fine in the late 1800s. Do you know what a regression is? If I were to run a regression on the change in the price level, year over year, to the change in real production for the late 1800s, do you know what the result of that regression would be? If were to regress changes in total spending on changes in real production, do you know what the result would be? ---
**Author:** ![foolsguinea](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/foolsguinea/32/14751_2.png) [@foolsguinea](https://boards.straightdope.com/u/foolsguinea)\ **Post date:** [December 19, 2018, 5:45pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/177 "2018-12-19T17:45:41Z")
I am not an expert in the latter half of the Nineteenth Century, but I don’t know that the [Long Depression](https://en.wikipedia.org/wiki/Long_Depression) was “glorious.” Certainly by 1900, inflationary monetary policy was a feature of populist politics. I think the 1970’s taught some of us that inflation is bad, so we imagine deflation to be good. I don’t know what to tell someone who insists a liquidity failure is good. I’m out of my depth there. Read some Krugman, I guess; he’s pretty accessible, and what I understand of liquidity failures (not a lot) I get from him. I guess I can give the Germans this much credit. At least they’ve been shooting for stability and near-zero inflation, and not so much “glorious deflation.” Well, so far. If they get enough of Europe’s wealth, they might see if they can con the EU into 5% deflation so they can then pick through the wreckage. ---
**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 19, 2018, 6:51pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/178 "2018-12-19T18:51:36Z")
No significant relationship for the first one. Idk for the second. I can only imagine why you think total spending is relevant. ---
**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 19, 2018, 6:57pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/179 "2018-12-19T18:57:22Z")
> [@foolsguinea](#): > > I am not an expert in the latter half of the Nineteenth Century, but I don’t know that the [Long Depression](https://en.wikipedia.org/wiki/Long_Depression) was “glorious.” Certainly by 1900, inflationary monetary policy was a feature of populist politics. > > I think the 1970’s taught some of us that inflation is bad, so we imagine deflation to be good. I don’t know what to tell someone who insists a liquidity failure is good. I’m out of my depth there. Read some Krugman, I guess; he’s pretty accessible, and what I understand of liquidity failures (not a lot) I get from him. > > I guess I can give the Germans this much credit. At least they’ve been shooting for stability and near-zero inflation, and not so much “glorious deflation.” Well, so far. If they get enough of Europe’s wealth, they might see if they can con the EU into 5% deflation so they can then pick through the wreckage. The Germans are good at producing goods and services. If they get Europe’s wealth it is because of this, and because European citizens have been sold up the river by their respective governments for the benefit of the politically connected. The long depression has become a myth. Even Friedman knew the late 1800s was great for economic growth and productivity. If you would like to suggest that today’s advocates of inflation are on the same intellectual level as the Bryanites, I’m ok with that. I never said a liquidity failure was “good”. Idk what you’re talking about. ---
**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 19, 2018, 7:55pm UTC](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124/180 "2018-12-19T19:55:51Z")
> [@WillFarnaby](#): > > The long depression has become a myth. Even Friedman knew the late 1800s was great for economic growth and productivity. If you would like to suggest that today’s advocates of inflation are on the same intellectual level as the Bryanites, I’m ok with that. Who are these people that advocate inflation today? The Fed, along with most other central banks, sets an inflation target of 2% to account for the effects of increasing population. That makes it effectively zero. Who doesn’t advocate this? [Previous page](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124.md?page=8) [Next page](https://boards.straightdope.com/t/why-do-libertarians-always-want-to-abolish-the-federal-reserve/826124.md?page=10)