Quote from: Elwar on September 14, 2011, 04:46:30 PM

Quote from: hugolp on September 14, 2011, 04:41:53 PM

Quote from: mizerydearia on September 14, 2011, 04:33:42 PM

Isn't federal reserve a company/bank?

The Federal Reserve system is a mixed private/government system. But its mainly a government system, and the monopolly on money is imposed by the government, who delegates its management on the Federal Reserve.

The only tie the US government has to the private Federal Reserve Bank is that it gets to choose the anointed head of the Federal Reserve whom is chosen from a list of the presidents of those private Federal Reserve Banks.

It would be like saying that McDonalds is a government restaurant if the US president was allowed to choose the CEO from a list of 12 vice-presidents. (and that CEO did not have any special privileges as a majority vote of those 12 VPs would be required to do anything).

You have been misinformed.

First of all, the government gets the benefits the Fed generates. If you want to know who controls a system check who gets the money.

But then what you said is not true. The government chooses the whole Board of Governors of the Federal Reserve. Its important to note that the Board of Governors of the Federal Reserve System is a federal government agency and takes all the decisions on monetary policy in the USA (except open market operations).

The open market operations are decided by the FOMC, that is a board formed by 12 members. 7 are the 7 members of the federal government agency Board of Governors. The other 5 are presidents of the local Feds (the president of the New York Fed permanent, the other 4 rotatory).

The last part of the Federal Reserve system are the local feds. The local feds are a mix of government of private and government agencies but they are mainly government. The boards of the local feds are choosen 1/3 by the federal government, 1/3 by the local governments and 1/3 by the member private banks. So even the local feds, the ones accused usually of being private, are 2/3 government.

Being honest, how can anyone say that the Fed is a private entity? Its mainly a government entity, with a private touch.