Does the Fed Really Control Money Supply?
And if not, then who?
The Fed does not lend money to me, or probably most of you. It does not buy material goods and pump the economy as the "stimulus" does.
The Fed lends to member banks. Gatekeepers who control what gets out to the rest of us. If they do not lend, the Fed has delivered no new money out here in the real world regardless of where it sets interest rates. It is upon the Gatekeepers judgement and the judgement of those who influence them that we depend.
Additionally power to create money was surrendered to investment banks by the SEC. By not regulating the CDO and CDS markets and allowing increased leverage to investment banks, trillions of dollars were loaned into the "real" economy that previously would have taken thirty years of mortgage payments to be steadily repaid and steadily lent again. Trillions of dollars were created (taken from the future?) this way and used to buy house after house, cars, countertops, sinks, atv's, gold, equitys, etc.
So the question is in the last ten years has money supply been inflated and deflated more by the actions and advice of a select few investment advisors than the Fed?
See you in few hours.