tag:blogger.com,1999:blog-8897997766931633186.post6441674864826297982..comments2024-02-14T03:21:37.506-05:00Comments on Monetary Freedom: Yes, the Fed is Breaking the Law!Bill Woolseyhttp://www.blogger.com/profile/06330232724290161369noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-8897997766931633186.post-76025870802551714742016-10-07T21:37:50.406-04:002016-10-07T21:37:50.406-04:00It’s something that’s going to continue for long t...It’s something that’s going to continue for long time to come, so that’s why we have to be wise and always focus on it instead of trying anything unwanted. I keep it all very simple which is ever easy with broker like OctaFX, it’s full of class with outstanding conditions applied which include having lowest possible spread from 0.1 pips to high leverage up to 1.500 while there is also smooth trading platform which makes the job easier to do.Kanenoreply@blogger.comtag:blogger.com,1999:blog-8897997766931633186.post-18875439971971377472011-10-12T08:33:29.482-04:002011-10-12T08:33:29.482-04:00Well put. But the concept is more encompassing tha...Well put. But the concept is more encompassing than you suggest. It involves the stoppage in the flow of savings thru the financial intermediaries (non-banks). This is the most important financial sector (the one where savings are matched with investment).Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8897997766931633186.post-10096109702209820302011-10-11T11:56:02.384-04:002011-10-11T11:56:02.384-04:00Bill,
I'm not sure I follow all of your post. ...Bill,<br />I'm not sure I follow all of your post. In particular, the discussion centering on the interest rate on reserves as a policy instrument. <br /><br />FYI, the Fed has only been paying interest on excess reserves since October 1st, 2008. The very first announcement on this said "The rate paid on excess balances will be set initially as the lowest targeted federal funds rate for each reserve maintenance period less 75 basis points." Then on December 16th, 2008, it was reset to 25bps.<br /><br />Among people talking about IOER, I was under the impression that Sumner is a big one and his main concern is merely lowering it now that rates are near zero. The IOER was originally meant to be the Fed funds minus 75bps, the only problem is that when rates went to zero, the Fed adjusted it. I would guess that when the Fed eventually raises rates to 1% or higher, the IOER will again be Fed funds minus 75bps.<br /><br />The whole point is that with IOER higher than the fed funds rate it creates stronger demand for base money than you would otherwise get. Banks might lend out that money or borrow from different sources instead.<br /><br />I don't understand why you get into a discussion about raising the IOER as a potential policy tool and I'm just sort of confused. Your solution seems to be selling off Fed assets (ie, the opposite of QE), but I thought you were in favor of QE.John hallnoreply@blogger.com