Dominant Social Theme: The Fed needs to be reined in. Its actions need to be calibrated. Its results need to be further focused.
Free-Market Analysis: Here's an analysis by The Hill that is half right. The part that is wrong we'll mention later in this analysis. The part that is right we'll discuss now.
The Hill is not exactly a muckraking publication but in this exposé it provides us with a good history lesson.
In fact, we learn the Fed's dual mandate is actually a triple mandate and that the third part of the mandate is simply ignored by the Fed.
The Humphrey-Hawkins Act ... decreed that the inflation rate should be brought down to zero by 1988; that the federal government should achieve and maintain a balanced federal budget; and that the United States should promote a "sound and stable international monetary system."
The legislative language amending the Federal Reserve Act explicitly directs the Fed to aim its efforts at achieving not two, but rather three objectives, i.e., "to promote the goals of maximum employment, stable prices, and moderate long-term interest rates."
Read the entire article