The Federal Reserve and The Economy (L160)

It may come as a surprise to most that the housing bubble of the early 2000s was not only predictable, but preventable. (With every boom comes a bust; especially when it is an artificially stimulated boom.) Austrian economics has shown us time and time again that a boom created by monetary inflation, while being unsustainable, is also reckless and superfluous. As the government floods the market with false pointers (as to where the market is headed), investors are finding their money misplaced. Without real market statistics, investors cannot accurately make decisions with their money; rather it is placed where the government points, not the buyers. This in turn, makes the bust following each improper investment inevitable. The Federal Reserve continues to stick its nose where it doesn’t belong, and it is causing issues on a massive country-wide scale.
In a free market, the buyers control the investment pointers; accurately directing the money where the producers want, and need it. This would also mean that in a free market, the booms and busts of the economy would be lesser. There would be more of a smooth, natural and intervention-free flow of money and products between producers and buyers; therefore creating a healthy economy with less risk.


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