What exactly is the Federal Open Market Committee?

The Federal Reserve Web Site defines the committee as follows.

“The term “monetary policy” refers to the actions undertaken by a central bank, such as the Federal Reserve, to influence the availability and cost of money and credit to help promote national economic goals. The Federal Reserve Act of 1913 gave the Federal Reserve responsibility for setting monetary policy.”

Fantasy Free Economics defines institutions according to how they function in real life.
In real life the Open Market Committee consists of twelve sociopaths, currently only ten, all attempting to accomplish personal agendas. Anything done in the public interest is incidental. Only sociopaths have the manipulative skills necessary to gain an appointment to such a high committee.
Who does the Open Market Committee serve? It serves those who help the members accomplish their personal agendas.
In short, the Federal Open Market Committee operates the world’s largest wealth and income redistribution engine.
Who benefits? Most benefit goes to friends of the Fed and a friend is one who supports the power hungry members in their pursuit of personal ambitions.
If the official definition provided on the Federal Reserve web Site was accurate, there would be no asset bubbles. Use the description provided by Fantasy Free Economics and everything they do makes perfect sense.

Music For The Hard Times Coming

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About Fantasy Free Economics

James Quillian is an independent scholar,free market economist, teacher of natural law, teacher and originator of the Fantasy Free approach to economics. James Quillian does not believe lies. Contact: news@quillian.net
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JR
JR
5 years ago

Sorry, the idea that something is valuable because it is scarce is a fallacy. Would you value a Porsche less than some Korean hatchback, if you knew there were more Porsches than Korean hatchbacks? What about a banjo? You value a banjo based on its sound & its build, that is to say, its QUALITY. You have no idea how many of that particular kind of banjo exist, nor do you care. What the Open Market Commitee is doing is monetising junk debt, making unpayable debt more in the ‘money’. Of course this has really turned the credit of the… Read more »

Common Sense Econimics
Common Sense Econimics
5 years ago

We have to remember that one of the necessary attributes of money is that it is scarce. Remove scarcity and it stops functioning as money. If money is loaned to risk free investors for less than the rate of inflation, scarcity is removed completely. Of course you astutely mention marginal utility of money and that would be zero or less when the elite are paid to borrow.

JR
JR
5 years ago

I should add that when something is precious, the demand for it verges on insatiable. Money is the most precious, the only thing you can’t have too much of, because you have the one thing everyone else wants. The term is constant marginal utility.

Hence the irrational behaviour. And think of the power & influence if you could turn whatever junk you like into money, through the open market commitee. Not a position you would willingly give up I would think.

JR
JR
5 years ago

What the Open Market Commitee does, is what every bank does – monetise debt. Using the supposed good credit of the Federal Reserve Bank i.e the $, it makes debt denominated in $ – Treasury bonds, mortgage debt & so on – trade more ‘moneylike’. The higher in ($) price say, an ‘asset backed security’ trades, the more like money ($), it is. ‘Money good’, is the financial term. Of course the credit of a bank, in this case $, is only as good as its assets. Credit can, & does, trade anywhere from ‘good as gold’ to worthless. The… Read more »