The Fed, Bankers, & Thomas Jefferson

The Federal Reserve cut rates yesterday to practically zero, and committed to 'quantitative easing'. The markets applauded by rising, and the cycle of debt-and-credit goes on. Will that help us now by making us pay later? I suspect so. The previous central banker, Greenspan, created one mess, and the current one, Bernanke, is 'solving' this mess but doing the very thing that Greenspan did in 2002-2003 to fix the previous bubble that burst (internet bubble). This will get us back 'on track' - maybe - or it may end up giving us another 'lost decade' like Japan had in the 1990s. The previous post mentions the price tag on the bailouts - about $7 trillion. 2% return on 10-year treasuries is absurdly low and it makes for cheaper housing refinancing, but at the same time it inflates our currency and sows the seeds for a weak dollar and inflation down the road.

So it seems apropos to have a quote about the bankers. A tart suspicion of bankers has been an American tradition since ... Thomas Jefferson:

"I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs. " - Thomas Jefferson in a Letter to the Secretary of the Treasury Albert Gallatin