The Fed: Reality Trumps Rhetoric

Shawn Ritenour

“Everyone ‘knows’ the gold standard fostered those nineteenth-century panics, which high-minded bankers finally addressed by creating the federal reserve system in 1913. Under the federal reserve, the government was able to create enough debt to send our boys into the bloodbath known as World War I to die (116,708) and suffer in horrendous numbers. With the federal reserve engaged in money printing, including Fed chief Benjamin Strong’s famous coup de whiskey” in 1927, stocks soared stupendously from 1922–1929, until they didn’t. Following the crash, the very thing the Fed was supposed to prevent, it attempted to inflate us out of the Depression that followed but, as the story goes, was hamstrung in part by the barbarous relic, gold. For this reason President Roosevelt, almost immediately after being elected in 1933, ordered Americans to turn in their gold under threat of fine and imprisonment.