I am pleased with the work that my new Senator, Bernie Moreno, is doing in Washington, D.C. It’s almost a shame that Trump is doing such a good job that great people like Bernie Moreno are being overlooked amidst all the goodness.  But that’s a good problem to have.  Bernie, in particular, has been great at keeping up the pressure on the Fed, and specifically, Jerome Powell.  So, let’s answer a common question first: No, our Federal Reserve doesn’t need to be independent of politics.  That is the dumbest thing perhaps ever said.  That our political system needs to be separate from our fiscal policy is an entirely dumb idea that needs to be destroyed in our era.  The Fed’s independence is only suitable for one entity, and that is the banks.  It’s there for their protection and nothing else. And because of that assumption, banks and all financial institutions have gained way too much power in the world, and they need their teeth knocked out in substantial ways.  Old man Jerome Powell and all the rest who came before him at the Federal Reserve need a reality check, and I’m more than happy to see that Bernie Moreno has been leading the charge to reform.  Warren Davidson, my congressman, has also been excellent on this issue.  Criticism of the Fed is a very good thing, and here’s why.  I have recently received more education than I ever wanted regarding banking practices, and the more you learn, the more obvious it becomes that many of these banking types have been influenced by comfortable terms that have inspired very anti-American activity.  The way the Fed was created was outside our Constitution, and the belief over the years that it should be separate from other social concerns has only benefited banks by providing a stable environment for them, even if harm is being inflicted on the people who are voting. 

This idea that our elected government would not have direct control over fiscal policy is an absolute joke, but that has been the assumption.  When people say that Bernie Moreno, Warren Davidson, or President Trump should respect an independent Fed, they are smoking crack.  Currently, the economy is humming along nicely, with excellent job reports, energy costs coming down, and a significant amount of money being generated from tariffs. However, this activity has not had the intended effect of raising fears of inflation, as the Fed had anticipated.  Inflation, generally speaking, is when you have too much money chasing too few goods.  The Fed has been accused of printing too much money, which causes inflation to saturate the market.  The Biden administration had too many rules, which constricted market saturation for desired goods and services, leading to inflation.  Inflation is usually caused by standing in the way of human enthusiasm.  Price breaks occur due to market saturation, revealing the actual price that a person is willing to pay for a product or service.  You can usually figure that out if you have four fast food restaurants selling their version of a hamburger.  If you have only one, they can charge whatever they want for a hamburger.  However, if you have four places to choose from, then they must compete for your attention.  Therefore, when a government effectively removes barriers to market entry, a tangible value can be expressed.  However, when a government creates obstacles, we can say that we witness inflated values due to the restriction of that enthusiasm.  And that is precisely what the Fed is currently guilty of doing. 

Currently, the rates set by the Federal Open Market Committee, FOMC, are in the range of 4.25% to 4.5% which equates to about $600 billion of money generated for lenders.  Nobody is saying that banks and other financial institutions shouldn’t pay a fair wage.  Credit card companies make it extremely easy to spend money with the swiping machines and chips that we have today, where nearly every transaction for a mature adult is monitored by their computer systems, making it easy for all of us to spend money.  That is a valuable service, but it is currently being done at an artificially high rate because the Fed policy protects lenders at the expense of the public, the voters.  As Trump and Bernie Moreno have been saying, we are probably sitting on at least two interest rate points too high for what this Red-Hot American economy should be, holding back over a trillion dollars from money flowing into our financial system.  The excuse from Jerome Powell for keeping interest rates as high as they are is to keep inflation in check.  However, as it stands, the Fed has been contributing to inflation, rather than preventing it.  And that has been grotesquely obvious with their sinful relationship with BlackRock.  The Fed printed too much money, which was then distributed through Wall Street, as seen through people like Larry Fink, and this money was used to acquire companies, effectively taking away private ownership and control, which is why I have been discussing this issue so intensely.  The foundation of communism is to abolish the concept of private property, and the Fed has been facilitating the subversion of this foundation at the bank level in very detrimental ways.  And when we have tried to address it, we keep hearing that the Fed needs to be independent of political theater.  No, that’s only good for one party, the banks.

Trump’s approach to the economy has been brilliant.  Usually, we rarely find political figures who understand fiscal policy as well as banks do, so there is always an unfair advantage.  But in Bernie’s case, and Trump’s, they have had to slug it out with banks in the past and understand the games as opposed to the typical loser politician who has done nothing else in their life but get elected to a public position.  And once you know that the name of the game is to take away as much risk as possible from banks and to give them enormous power in the process, then the errors become very obvious.  If we got rid of Jerome Powell at the Fed and put in someone who truly represented the Trump administration, and would bring down interest rates into the 2% range, we would see wealth creation beyond the scope of what anybody thought previously to be possible.  And everyone would make a lot of money in the process, including the banks.  However, this 4.5% approach is excessively restrictive and primarily focuses on exerting power over the political process and securing international financing.  And no, the Fed doesn’t have to be independent of our elected representatives.  We need a monetary policy in America that is representative of the people, who seek representatives to run their government on their behalf.  And the Fed is only suitable for shielding international banks from the whims of political sentiment.  The only people profiting from these high interest rates are the banks.  However, in the process, they restrict economic output, such as having only one place to buy a hamburger, as opposed to four.  And if Powell wants to fight it out to hold his term to its close, he should feel the pressure that people hate him for artificially restricting their options.  Interest rates should be at 2%, not 4%.  And when that happens, the grip that socialism and communism around the world have on all this centralized banking will lose control over mass populations, and a real era of prosperity can begin.  And Bernie Moreno gets it, and I’m proud that he does.  The Fed stronghold is breaking, as it should.  And we are seeing the light on the other side, perhaps for the first time in all human history.

Rich Hoffman

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