Lying like a Central Banker

"Over at the Mises Economics Blog, Robert Blumen slams the door on boasting by Federal Reserve Bank flunkies so thoroughly, and with the maximum of pith, that it’s worth reposting it here:

From a presentation by Janet Yellin (of the San Francisco Fed) on June 30 to the Commonwealth Club of California,

“I will be the first to say that it is always difficult to get monetary policy just right. But the Fed's analytical prowess is top-notch and our forecasting record is second to none.”

The same Fed that thought there was no housing bubble? Second to none? What about all those Austrian economists who identified the bubble?

But Yellen didn't stop there. She followed up with:

“The FOMC is committed to price stability and has a solid track record in achieving it. “

Really? The same Fed that presided over a 90% depreciation in the purchasing power of the dollar?

And finally, she finishes up with:

“With respect to our tool kit, we certainly have the means to unwind the stimulus when the time is right.”

See my thoughts on that here.

You think NZ’s pseudo-banking inquiry is a farce? It’s no half as ludicrous as watching The Fed wriggling in the spotlight as more and more evidence emerges that The Fed’s (and the NZ Reserve Bank’s) efforts at price stabilisation have delivered only chaos. 

Well done to Blumen for so effectively and summarily dismissing the leading claims of its cheerleaders. Time to shut down the Fed (and by extension the local Reserve Bank) and head back to the system that delivered a half-century of genuine price stability before money was nationalised [head here and scroll down for a discussion of the chart below showing NZ’s gently declining price levels in the late nineteenth century as it became more prosperous].