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Comment by Frondo | Hacker News Reader

Of course we can decide how the central bank works in the U.S.--we vote for new politicians whose views on money more closely align with our own. They install new administrators, who set policy that more closely aligns with our views.

Do we vote on central banking policies directly? No, of course not. Does that mean nothing ever changes? No, of course not.

I'm not sure who, if Mitt Romney had won, he'd have named as Fed chair, but I suspect it wouldn't have been Janet Yellen. (Just like, had McCain won in 2008, we sure wouldn't have anything like the Affordable Care Act--which, flawed as it is, is a big improvement over the old status quo.)

That's how democratic access to money policy works; we vote, power realigns in accordance with our votes, and a few years down the road, we do it again.

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We decide how central banks work by electing a new president, hoping the current chair expires during their term, having a new chair approved, hoping the new chair has the authority to and does implement the policies we want.

How is that better and more likely to happen than allowing 51% of the network to just adopt a new protocol and cut out all the middlepeople?

The Fed was established by an act of Congress and can be changed or abolished by an act of Congress. Congress is democratically elected. That's the connection to the people.

The reason Congress has not abolished the Fed is that most people think that the Fed is pretty good at what it is supposed to do.

You assume there is any real democratic control of Congress, and that the whole game hasn't been rigged by a duopolist oligarchy.

America doesn't even have democratically elected presidents (just ask Al Gore). Hoping that Congress will even halfway represent the wishes of the people is bold.

Most people have no idea what the Fed does (let alone that it even exists) nor do they have any framework with which to evaluate its work.

I assure you, if inflation reached 10+%, most every voter in the US would know what the Fed does and what they wanted it to do instead.

The non-conspiracy fact is the Fed has stayed quiet during the past 7 years because it has done a remarkably good job compared to their conservative-to-the-point-of-incompetency European counterparts. Europeans are quite familiar with ECB policy, because it has handled the crisis so astoundingly badly.

Thanks for your assurances, but catastrophic failure does not an understanding make. Also, "not break the economy" is not an actionable (or, I'd argue, even comprehensible) framework.

Inflation, by the government's own numbers which tend to under report it, reached over %10 during the bush administration (and has been probably over %20 for most of the Obama administration.) "Inflation" as reported by CNN et. al. every quarter is a propaganda number that has all of the key inflation indicators taken out of it and is effectively watered down. (making it so that you can't even compare it from one administration to another.)

Even the most cursory analysis makes it obvious your numbers are ridiculous. 20% inflation during 6 years of Obama would make items, on average, 3x as expensive as they were in 2008-- is your food 3x as expensive? housing? gas?

Mine is. I don't know about the rest of the country, though.

I'm curious where in the country gas costs $9/gal now. In 2008, it was around $3 across the country.

I'm also curious where in the county a loaf of bread is now $3-4, and I mean the cheap white/wheat bread that used to cost a buck and change (and still does here).

Housing, I know it's gone up a lot, but even so, 3x?

Can you provide any hard numbers on the 3x increase in gas, housing, and food?

I'm not sure he was talking about an annualized rate.

On a sidenote, why is economics so wrapped up in astrology?

I moved to Canada. Due to NAFTA/CAFTA/SPP, Mexico, Canada and the US are the same country now.

The prices mentioned are exactly in-line with what I'm paying overall, though gas has gotten to around $3.10USD/Gal recently. Food prices are astronomical, and labor wages are flat/stagnating.

We were talking about the cost of goods in the US.

I guess if you want to compare the situation in the US in 2009 with the situation in Canada in 2015, then, ok, but it's hard to see what point you're actually trying to make then.

Canada is the US, post SPP. so yes, we're talking about the costs of goods in the US.

I think you're probably using an idiosyncratic meaning for "in," so we may be at an impasse for going further with this discussion.

it all depends on what the definition of "we" is, I suppose.

Since the federal reserve stopped reporting M3 data, we don't know the actual inflation levels, and haven't known them since 2005 [1].

On another note, we need a Godwin's law for "Conspiracy Theory". As soon as someone mentions the word, it's likely to set up a appeal to ridicule fallacy, such as used in the parent.

1. http://mises.org/library/death-m3-fifth-anniversary

"That's how democratic access to money policy works; we vote, power realigns in accordance with our votes, and a few years down the road, we do it again."

And therein lies a problem. Under a system like this, policy is geared towards affecting the short term in order to affect the next election cycle and no heed is given to how things play out in the long run.

I think the economy is something we can revisit every couple of years, to see, do we still like the direction it's going? Should we keep the old people in, vote for new people?

Maybe 4 years is too short a time to revisit the question. Maybe too long. I don't know if 4 years is the best length of time, but it doesn't make sense to make it too long a period of time; we've got to have a chance to change course every so often.

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