Why the Federal Reserve Controls So Much of the Economy | WSJ

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The Federal Reserve is central to the U.S. economy today, and it’s controlled by just 12 people. Its monetary policies can lower inflation or even spark a recession. The central bank says it’s dedicated to achieving its goals set by Congress to maximize employment and maintain price stability, but some of its decisions like raising interest rates are not always popular with Americans.

WSJ explains how the Fed became the power it is today and why it plays such a major role in the country.

0:00 Economic policies
1:02 The Fed’s creation
2:59 The FOMC’s creation
4:11 Great Inflation
6:18 Great Recession
8:07 Covid-19

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26 COMMENTS

  1. Our economy is like a flailing fish, fighting for its life. The normal state of the U.S. economy is actually very bad. Because of this it goes into convulsive spasms fighting to grow any way it can out of desperation. Tricks, gimmicks, rule changes try to stimulate the economy and prevent it from falling but they only bring temporary relief to people since, when you factor in inflation we are declining.

  5. The FED is created illegally disguising itself as the people by naming itself "Federal" in truth the FED is actually a privately own entity that no one has control over who prints what. Except the big bankers and corporation connected to them. This is why when smaller American own banks or business go bankrupt during an another "Great Depression" or "Great Recession" the FED will immediately abandon them, but when big banks and corporation fails. The FED will always ensure their survival. This isn't just a ploy or a scheme. This is the system that they created. A monopoly where they will win no matter what.

    Of course having an agency responsible of creating and distributing our money is a risky one. The FED can inflate our economy in an instant and force the people into paying large debt selling their possession and property in order to survive only to have that same possession sold back to them at an insane price. I don't think it should be the responsibility of a small collaborative group who decide when and how much currency they they need to fund their expenditures. It should be the people who decide what and how many is needed to get the job done. This Wall Street Journal is just another B.S piece.

  7. 1:26 "…although banks didn’t keep much cash handy". <- This is the root of the problem: banks didnt have to keep all their customers' money because at any given time only a small percent of people actually needed to withdraw their money. This enabled banks to lend out thr mo ey of their customers to other people, and charge interest to make money off those people's hard-earned money.

    This is called Fractional Reserve Banking, and it's the reason why so many banks would "fail" back in 1907, etc: their policy of only keeping a small fraction of their customers' money physically on hand only works if only a small fraction of peoole wanna withdraw their money. But if EVERYONE tries to withdraw their money at the same time, the bank doesn't have it bc they lent it out to make profits by lending that money and charging interest.

    So the only reason why so many bamks wpuld fail is because they were shady: only keeping a small fraction of their customer's money, while lending out 90% of it at interest. This is called fractional-reserve banking, and it is still practiced by banks today.

    If banks were forbidden from this kind of shady practice, there would never be any danger of a "run on the bank" and thus banks would never fail, and thus a central bank to bail out those bad banks wouldn't ever be needed.

    So the creation of the Federal Reserve was an attempt at putting a bandaid on a gaping bullet hole, trying to treat a symptom, rather than the root cause, which was the dangers that arose from this fractional-reserve banking.

    So it logically followas that if banks weren't allowed to profiteer by charging interest in people's money, there'd really be no reason to even HAVE a central bank lile the Federal Reserve.

    So in conclusion, the banks and their fractional-reserve lending are the root cause of why today your money is constantly devalued each year to inflation. Thanks, banks!!

  12. What a great idea. Done with the best of intentions. What could possibly go wrong? (Thank you Reason TV) Everything! The whole thing is a sham. Sure, there is some good to it, but is it "The Creature of Jekyll Island". Even Paul Warburg in the early 1930's admitted that they fooled the American law makers. Central Bankers control the world-private banks. It is un-Constitutional actually.

  16. Inflation is far more harmful to individuals than a collapsing stock or property market because it directly affects people's cost of living, which they immediately feel. It is not surprising that the current market sentiment is extremely pessimistic. In today's economy, assistance is critical if we are to survive.

  19. The Federal Reserve confuses monetary inflation with non-monetary inflation. Monetary inflation is caused by an increase in the money supply. The inflation of the 1970s was monetary inflation because the Nixon Shock happened during 1971. The inflation that happened during 2022. Non-monetary inflation was caused by supply chain issues that would have gone away even if interest rates were never raised in the first place. Therefore, interest rate increases were inappropriate during 2022, even if they appropriate during 1978. Also, the Federal Reserve should focus on the rate that the money supply increase rather than the inflation rate.

  20. I stoped half way the video,
    typical media propaganda,
    this time narrating half the truth where they never mention what the deposits of those banks back then, really were

  21. So conclusion of the video: the fed does everything they can for the people 🤣🤣🤣🤣. And after they say Russia is the master of propaganda.

    The fed printed 10 times as much in the last 15 years that they did in 100 years. And that’s normal? Who benefits? Isn’t it the cause of the inflation to make the richest even richer when most people suffer?
    And don’t tell me it’s not intentional. They have to know what they’re doing.
    And this printed money didn’t even go to the economy. The banks keep it at the fed that feed them with interests coming from the people’s taxes.

    But yeah, fed is good, serving the people. Please stop lying to the people, would be nice for a change

  23. 🖕
    Why people in Kentucky don't owe taxes. Walt Disney recently used the fact they are owned by the Crown to keep from paying taxes. Well so is Kentucky. Kentucky became part of the Indian Reserve of the Trans Appalachian land acquired by Britian. Established by the Royal proclamation of 1763. The Iroquois claim to much of the state was purchased by Britian in the Treaty of Fort Stanwix 1768. If Disney doesn't owe then neither do we.

  26. Wow, so many people think the U.S. federal government owns/controls the privately owned cartel called Federal Reserve. Education education.

    The U.S. government acts in partnership with this cartel. Cartels need either violence or legislation to beat out their competitors. They are a banking cartel like a drug or banana cartel.

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