Unhappy Birthday to the Federal Reserve
November 18, 2009 by Chip Wood
The Federal Reserve System was “born” on Nov. 16, 1914. That’s the day that marks the beginning of the long, slow decline in the value of the U.S. dollar.
Although this country had managed to survive without a central bank for the first 140 years of its existence, that all changed when Congress approved the Federal Reserve Act the previous December. (For an account of the conspiratorial manipulations that led to the passage of this bill and its consequences, see G. Edward Griffin’s masterful study, The Creature From Jekyll Island.)
The Fed’s friends in Congress promised that it would be a passive institution, working behind the scenes to prevent future bank panics. Instead, it soon adopted an interventionist policy. Today, it is actually praised in many quarters for controlling interest rates and regulating (read: increasing) the U.S. money supply.
Since the creation of the Fed 95 years ago the dollar has lost 98.5 percent of its purchasing power. Sadly, most Americans have been convinced that greedy businessmen cause the steady rise in prices. Tell them that higher prices are caused by a Fed that continues to flood the world with fiat currency and you’ll be greeted with blank stares and a change of subject.