In today’s real world, the remains of the old media appeal to the remains of the older generations. Unlike its earlier behavior, it acts largely as a government propagandist; it is too diminished to risk troubling real power. Too intertwined financially as well. If you want old style journalism, hunt it up on the Internet, while it lasts.
In international finance, there is one big gorilla: the Federal Reserve. By comparison, the European Central Bank is maybe a chimpanzee. It’s downhill from there. And the world financial system is roped to the train tracks in front of an approaching train, waiting for the Fed to dash to the rescue.
But the Fed is back at the ranch, dithering. If it shovels out still more cheap money, the pile of the stuff is already so high that the whole supply seems likely to turn into dreck, worthless. If on the contrary, it starts as advertised recently, to allow interest rates to rise, governments that owe a ton of interest they can’t currently pay, will be even more unable to pay and the entire credit system will likely collapse, rendering money essentially unavailable for a while. That rock and a hard place for the Fed, right? What to do? No wins visible.
So the Fed dithers. Its Open Market Committee just met and sat on its respective thumbs. The Fed’s target interest remains between 0.0% and 0.25% and banks continue to charge fees for holding people’s money while sales calls tout irresistible real estate deals relying on the free money and reduced credit qualifications. The sound you hear is the same one heard by skiers who look up above them and see a wall of onrushing snow. The political dither solves nothing; it allows conditions to continue to worsen until they disintegrate on their own.
It has not always been so. Starting with the Truman Administration and proceeding for 19 years through 5 administrations, Fed Chairman William McChesney Martin held a different view of his job. He famously said that his job was to “take away the punch bowl just as the party was getting under way.” More recently, Arthur Greenspan, Ben Bernanke and now, Janet Yellin have been spiking the punch with cheap/free money and credit, exactly what Chairman Marin wanted to avoid.
The Fed is the third U.S. central bank; the first two were both terminated when enough people realized the inherent costs, corruption and economic destruction they brought. Today, we only have “End the Fed!” Congressman Ron Paul taking that position and he’s now out of office. Nor do we hear much of anyone pointing to the damage that the Fed is making. Better to keep our minds on ISIS, racism, guns and gays.
Donald Trump is annoying the Washington leadership on both sides … but even he isn’t talking about the financial suicide in which the world is engaged with its overspending and resulting debt. Compared to that, though, the world’s other problems seem almost comforting.