NIA Criticizes The Fed For Leaving Interest Rates Unchanged
October 12, 2009 by Special To Personal Liberty
Late last month, the Federal Reserve Open Market Committee said the economy was improving, but kept the benchmark interest rate target at all-time lows, a move that has drawn criticism from the National Inflation Association (NIA).
Some interpreted the decision to leave the rates effectively at 0 percent as indicative of the Fed’s determination to "nurture a budding economic recovery by providing liquidity to the financial sector," according to MoneyMorning.com.
However, the NIA has expressed doubts about the wisdom of this type of approach, drawing on past experiences where low interest rates fed boom-and-bust cycles in the U.S. economy.
"If the economy was truly rebounding, wouldn’t you think now is the time for Bernanke to raise interest rates to 1 percent or possibly even 2 percent?" it asks.
It has also called on Americans to "stand up now and express our outrage about the Federal Reserve’s destruction of our nation."
The organization says that Fed chairman Ben Bernanke caved in to political pressure in keeping the rates at 0 percent, and it believes the resulting flood of money on the market will lead to inflation and the collapse the U.S. financial system.
NIA has also warned Americans about impending hyperinflation due to the government’s level of spending which has led to a massive federal budget deficit. The White House Office of Management and Budget estimates the deficit will reach $9 trillion over the next 10 years.