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Showing posts from July, 2020

Steven Rattner is Wrong on Judy Shelton, Gold, and the Federal Reserve

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The New York Times recently published an op-ed by Steven Rattner on Dr. Judy Shelton's nomination to the Federal Reserve Board of Governors. Rattner is sharply critical of Shelton, starting with his headline: "God Help Us if Judy Shelton Joins the Fed." Steve Rattner Rattner's anodyne byline describes him as the "counselor to the Treasury secretary in the Obama administration." I am not one to disqualify people simply because they served at the behest of a political appointee, but this is cause for further investigation. (Lest there be any misunderstanding, I am just as skeptical when reading editorials from Republican political appointees and their subordinates.) I am also not keen on using Wikipedia as a source. However, this snippet from Rattner's biography is important to keep in mind as we consider his criticisms: "In the mid-1990s, he began to work actively on behalf of Democratic candidates, beginning with President Bill Clinton.&qu

Judy Shelton and Congressional Powers

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In my 21 July 2020  editorial endorsing Judy Shelton's candidacy for the Federal Reserve Board of Governors, I argued that monetary policy should not be completely walled off from the political process: Shelton is correct to assert that "the Fed's power over the economy needs to be reined in," as the Post puts it. Though the president should not be able to order the production of money at whim, monetary policy ... is hardly an exact science. Connecting it with the political process would ensure more accountability for irresponsible technocrats promulgating arbitrary decrees. In my piece, I mainly contemplate the issue of political interference from a practical, not a constitutional, perspective. However, the  New York Sun reminded me that Congress has the Section-One power "to coin Money, regulate the Value thereof." The Sun notes: Contrary to nearly two centuries of American law, the dollar is no longer defined by statute today. That ended in t

Is the Gold Standard Reentering the Mainstream?

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Yesterday, the Senate Banking Committee advanced the nomination of Judy Shelton, who is vying for a spot on the Federal Reserve Board of Governors. She is a lifelong supporter of the gold standard, perhaps more ardently so than any Fed candidate in recent memory, and I have written  at length about her nomination. Today, Michael Hsueh -- a Deutsche Bank research analyst -- declared that "fiat money will be a passing fad in the long-term history of money." Hsueh's full remarks, as quoted by FXStreet, are as follows: Although I’m a gold bug since I think fiat money will be a passing fad in the long-term history of money, in my long-term work I’ve always found many commodities difficult to recommend on a buy and hold basis as most underperform inflation over the long run -- probably as they are mostly used in production and alternatives are found if too expensive. We also become more efficient at using them. Between 1860 and 1971 (when we moved from a gold-based sys

Cooper vs. Forest: The Sleeper Race That May Surprise

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Cardinal Point Analytics, a Raleigh-N.C. based firm that had an excellent track record in 2016, released a new poll of the Old North State on Monday. They find President Donald Trump ahead by 0.9 point, which is consistent with other data that show N.C. as the 2020 swing state most favorable to the GOP. Conversely, incumbent U.S. Senator Thom Tillis -- a Republican -- trails his Democratic challenger by 3.1 points. The poll's biggest surprise was its assessment of the gubernatorial race. Incumbent Democratic Governor Roy Cooper leads Republican challenger Dan Forest, the lieutenant governor, by only 2.6 points. This is in stark contrast to the latest poll from East Carolina University, which had Cooper at 49% and Forest at 38%. However, it is consistent with Cooper's declining advantage in Public Policy Polling surveys (he is down to a nine-point lead from 13 in April) and the tied race indicated by Gravis Marketing. Roy Cooper (left) & Dan Forest (right) Gran