Fed’s new Facebook page shows how badly public thinks of the the central bank…

Ryan McMaken of Mises points to this new Federal Reserve FB page. It was started on August 18 2016 amidst low fanfare.

There have been couple of posts trying to explain its objectives and functions to general public. What has followed those posts is some serious acerbic comments by one and all.

Read these couple of comments:

—–Can you guys please help me get some of that QE? I’m trying to buy 16 cars, 4 houses, 2 jets and a yacht.  I swear it will stimulate the economy. I’ll spend it all and cycle it back. I know velocity needs to pick up so I’ll make sure to pay lots of models to live in my houses and travel with me.  Thanks Fed! You are such a moral and upstanding institution!

—-Stop trying to convince people you are anything but a criminal organization and get back to your legalized counterfeiting. NOBODY is buying it anymore.

—–Central/Global banker Ponzi scheme that makes Bernie madoff look like a jellybean salesman. What a scam creating an economic system that has created a country of free range slaves. “Creature from Jykell Island”. Got to had it to the rothchilds, controlling 7 billion people with about 50,000 strategically placed scumbags!!

There are some few positive ones but most are really harsh and torrid. Though not a perfect one, but Facebook page reveals a lot about people’s perceptions of Fed. It just shows people think very poorly and are very angry. This is least Fed would have expected.

Mcmaken says this is a near 180 degree turn over the central bank fortunes. If the same page had come up 10 years ago, one would ahve hardly got these comments. Of course it was then manned by the maestro whose own image has been trashed:

Indeed, a quick visit to the page reveals more or less non-stop attacks on the Fed with each new post. The Fed has it’s defenders on the page, as well.  

It is interesting to consider, however, how the Fed feels it is even constructive or necessary to engage the public through social media. As little as ten years ago, it would be extremely difficult to imagine the Fed even bothering to address the public at all. At that time, the Fed happily remained hidden from public views, and the only scrutiny came from commentators in the financial sector. Most of those, generally gushed over what an excellent job the Fed was doing. 

Of course, during the time of Alan Greenspan, the Fed earned nearly universal praise among mainstream economics faculty, with some even declaring that the business cycle might even be abolished with careful leadership — such as Greenspan’s — at the central bank. Bob Woodward declared Greenspan to be “the Maestro” in his 2000 book. 

In his Presidential run in 2008, however, Ron Paul became the first national figure in decades to gain traction in questioning whether or not the Fed was all it was cracked up to be. Paul even suggested that the Fed might best be abolished. 

What followed was several years of declining legitimacy for the Fed as a growing number of people began to understand what a central bank is, and what it does — and as the US went through the worst recession in decades. The public began to understand also that the Fed functions primarily out of the public eye — and without any meaningful accountability — while making decisions that can have an enormous effect on public policy and the economy. 

…..Of course, just because the Fed now engages in direct communications with the public doesn’t mean it’s providing an accurate view of what the Fed does or why it does it.

Infact why just look at Federal Reserve whose history has always been murky. US polity has questioned the need for a central bank and Fed came up in very secretive manner. So, one can argue well US always doubted one and present sentiment is no different.

Look at Central banks of Europe, Japan, England etc whose history is not as murky. They were all set with aplomb and people managing them have usually been as those with magical powers to restore economies. Most of them are going through similar image crisis. Central banks have been more interested in inflation expectations but time is coming to gauge public perceptions as well. They are at rock bottom and are descending further lower.

As people begin to figure central bank operations they know they have been fooled over these magical powers. This is an idea which does not come across to most people that central banks are just central planners. Blame it on our textbooks and continuous media which never questions all this. Like most econ textbooks condemn govt agencies, they should do the same for central bank as well.

We in India are making the same set of mistakes that others made few years ago. What has been going on for the past three years is just such a new low for India’s financial journalism and experts. It is shocking we are making these mistakes despite seeing follies of central bankers in advanced economies right in front of our eyes. These are the very central banks which our own central bank has tried to imitate all these years.  But have failed miserably trying to micro manage their economies. We make huge news when someone from US Ivy leagues/IMF join our central bank ignoring the fact how all the advanced country central banks are just full of such so called pedigrees.

The last few years have exposed central banking like no other. But do we care?

2 Responses to “Fed’s new Facebook page shows how badly public thinks of the the central bank…”

  1. MS Says:

    Amol, I studied in a US university and have seen young students participating in rallies and carrying placards saying “End the Fed”. Atleast in US, Fed-bashing has always been a big part of populist right wing approaches that lack substance. Nowadays there is lot of smart commentary on the Fed’s role but it is still not intelligible to the public. Blogs like yours can /should do some occasional pieces for the layperson on the role of central banking

    • Amol Agrawal Says:

      Hi Madhusudan. Thanks for the kind comments. Right wing or left wing? I think Fed is attacked by all the wings and the centre. As I said in the post, US has its own troublesome history of a central bank. All was seen as fine till the 2008 crisis started. As history reopened, people are going back to roots and attacking the Fed system.

      Part of the problem is media. It has blown up the image of a central bank and its bankers way beyond anything. It is the media which people read/follow and remain in awe till we have a crisis. Most central banks have a history deeply connected to how government has seen as an arm to run its operations. Earlier it was mainly to do with currency and now their debt. But as we remain history averse, so I guess these issues will continue.

      I keep trying to do my bit but I am not even an insignificant part of the entire machinery…:-)

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