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Dr Doom

Jon Stewart To Alan Greenspan: Why Do We Need The Fed?

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http://www.infowars.com/articles/economy/g...we_need_fed.htm

For most of the last many years that he served as Chairman of the Federal Reserve, the public heard very little from Alan Greenspan. His public utterances were usually short and devoid of content that might cause unintended consequences in the financial markets. Clearly, freed from the his role at the Fed as one of the most powerful men in the world, Greenspan no longer feels the same inhibitions. With the release of his new book, the former Fed Chair is even making the rounds on a publicity campaign. In one recent appearance he sat down with the Jon Stewart, host of Comedy Central's spoof news broadcast, The Daily Show.

This is an excellent video, Alan Greenspan with some amazing revelations.

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Thank you Dr Doom. Always enjoy Jon Stewart.

He asks some other insightful questions here e.g. why investors are treated more favourably than savers by interest rate decisions (unexpected cuts increase stockmarket values but reduce interest income). Greenspan failed to answer this clearly, muttering about having to keep stability in the economy, which suggests that this is purely a political choice.

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Jon Stewart is a Genius

He is a comedy genius. 100% correct, guaranteed. But honestly, he is an economic dullard. When he was asking Greenspan "funny" questions, it was great... but whenever he tried to be serious, it all went a bit cringeworthy. I mean, maybe he was just pretending not to understand the effect of interest rates on economic activity, but it didn't come across that way. I felt it was a bit of a missed opportunity, really!

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He is a comedy genius. 100% correct, guaranteed. But honestly, he is an economic dullard. When he was asking Greenspan "funny" questions, it was great... but whenever he tried to be serious, it all went a bit cringeworthy. I mean, maybe he was just pretending not to understand the effect of interest rates on economic activity, but it didn't come across that way. I felt it was a bit of a missed opportunity, really!

Whether or not he is an economic dullard, it is sometimes helpful to have our common assumptions about the economy (or anything else) challenged from time to time.

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Jon Stewart: Many people are free-market capitalists, and they always talk about free-market capitalism, and that is our economic theory. So why do we have a Fed? Is the free market – wouldn’t the market take care of interest rates and all that? Why do we have someone adjusting the rates if we are a free-market society?

Alan Greenspan: You’re raising a very fundamental question. … You didn’t need central bank when we were on the gold standard, which was back in the nineteenth century. And all of the automatic things occurred because people would buy and sell gold, and the market would do what the Fed does now. But: most everybody in the world by the 1930s decided that the gold standard was strangling the economy. And universally this gold standard was abandoned. But: you need somebody to determine –or some mechanism – how much money is out there, because remember, the amount of money relates to the amount of inflation in the economy. … In any event the more money you have, relative to the amount of goods, the more inflation you have, and that’s not good. So:

Stewart: So we’re not a free market then.

Greenspan: No. No.

Stewart: There’s a visible – there’s a benevolent hand that touches us.

Greenspan: Absolutely. You’re quite correct. To the extent that there is a central bank governing the amount of money in the system, that is not a free market. Most people call it regulation.

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How the US Monetary System Violates Jewish Law III Pt. 1

http://www.youtube.com/watch?v=TZP7dzfkkHA

Larry Parks: "...but before I get started I just want to comment on how Jon Stewart nailed Mr Greenspan the night before last when he asked Mr Greenspan that when the Federal Reserve lowers interest rates aren't savers getting the short end of the stick because savers get less interest on their savings - these are ordinary people - Greenspan did not have a good answer to that, he said to Mr Stewart he said "Why don't you read my book" and Stewart did not mention of course that not only when they lower the interest rate do ordinary people lose interest on their savings but also their savings depreciate, it becomes diluted by the extra money that the Federal Reserve turns out."

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