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The Coming Recession: Blame the Federal Reserve, Not the President

Written by Gary North on October 1, 2016

No matter who is elected this November, there will be a recession before the next President is elected.

This is why we should not lose sight of cause and effect: central banking. This is true in every major nation and the Eurozone.

Central banks operate domestic banking cartels. These cartels operate for the advantage of large multinational banks.

The central banks establish the rules of money creation domestically. This places limits on the banking system as a whole.

When there is a recession, blame the central bank. It establishes the rules governing the creation of the central economic institution: money.

The public wants a representative who can be held accountable when bad things happen in the economy. But most of what happens in the economy happens because of what the banking system does. The banking system governs the money supply, which in turn influences interest rates. Interest rates influence the supply and demand for capital. They tell investors where the highest rate of return is on borrowed funds.

The voters do not understand this. So, they look to the one American politician who represents all of the voters. That means the President.

This is how the system was designed in 1910-13. The central bank was deliberately structured to present a facade of decentralization: 12 regional, privately owned banks. But policy is set by the Federal Open Market Committee, which is a representative agency of all the regional branches plus the President-appointed Board of Governors. It therefore conceals responsibility. It is a bureaucracy. It is an operationally independent bureaucracy.

This means that the President takes the hit when the economy heads south. The Federal Reserve is not blamed. The public cannot throw the rascals out. It was designed to achieve this goal.

If Hillary is elected, I will blame Janet for the recession. The same is true if Trump is elected.

(For the rest of my article, click the link.)

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