by Karl Denninger, Market-Ticker:
I refuse to entertain any sort of discussion on a so-called “Convention of States” or anything similar until and unless I see The Rule of Law mean something once again.
The Federal Reserve is one of the most-flagrant examples of an institution that willfully, intentionally, publicly and repeatedly violates black letter law on a daily basis and yet nobody is arrested, charged, jailed, nor does Congress even amend or threaten to pull their charter if they don’t cut it out.
In this post, I focus on the inflation-targeting portion of the Federal Open Market Committee’s (FOMC) broader mandate of promoting maximum employment, stable prices and moderate long-term interest rates, and why I dissented on the proposed amendments to the “Statement of Longer-Run Goals” at the FOMC’s January 2016 meeting.
The FOMC has an inflation target of 2 percent, which it made explicit four years ago in its January 2012 “Statement on Longer-Run Goals and Monetary Policy Strategy.”
The admission of intentional violation of the law is right there in the first two paragraphs. A 2% inflation rate means that over the space of 30 years a cumulative rise in prices of 81% occurs.
That is, quite-obviously, not “stable.”
It is one thing to have a realized rate of inflation that does not end in “stable prices”, since the Fed Mandate is to promote stable prices. That is, they probably could argue that their intent was stable prices but failed; that would be a failure to perform but not a violation of the law so long as it wasn’t intentional.
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