As I've demonstrated on several posts here, the frequency and duration of recessions in the U.S. was significantly higher in the century before the establishment of the Fed than in the century after. Vastly oversimplified, but basically your reason why, laissez faire leads to unnecessarily longer and more frequent system shocks no matter if you're talking about an economy, an ecosystem, or a control system. I am curious as to any counterexamples of counties with their own currency and a significant economy who have had better economic success without a central bank? And why in the world should the opinions of a bunch of farmers and small merchants in a pre industrial revolution, tiny agrarian economy at least partially based on slave labor have any relevance whatsoever on what's optimal for our economy today?
Bullshit Regardless - as you yourself also said it was "a bunch of farmers and small merchants in a pre industrial revolution" - Recessions (which are corrections to excesses) cannot be outlawed. No matter how hard "well-intentioned" PHD's at The Fed try.
First off, the industrial revolution in the U.S. was 100 years before the Fed was established. Second, who said anything about outlawing recessions? I believe in the exact opposite, a Fed makes inevitable recessions less frequent and shorter, as history has proven. And most importantly, which modern large economy countries without a central bank would you point to as examples of what you advocate for?
The US dollar is the world's reserve currency. How the U.S. Dollar Became the World's Reserve Currency (investopedia.com) There isn't any currency that is capable of replacing it. Most countries "managed" their exchange rate against the US$ in order to remain competitive in global trade. Economists often coin it as racing to the bottom. For non-reserved currency, once there is a capital flight, exchange rate will spike and value of currency diminish fast. Hyper inflation ensue.
First - Your words. Why then did you refer to it when referencing The Fed? Second - My words outlawing recessions because that is what they have been trying to do since QEternity began.
Money supply increases and price inflates. When growth does not utilize full capacity inflation stimulates growth. Kinda like a closed loop control. When it works as expected to work it works. But in modern times people tend to live longer and as they get older they don't spend instead save and this derails the theory depending on population of those that don't spend.
Perhaps reread what I wrote? I was responding to @Tradex who said we shouldn't have a Fed because the founding fathers were against it. I pointed out that 1776 United States was a small agrarian slave based economy while the 1913 United States was very different large industrial based one, so their opinion on the matter is irrelevant. I'm really at a loss for what your point is, do you disagree and think the founding father's opinion is relevant? And still waiting for an example of a successful first world economy without a central bank?