The Economist - "Inequality or middle incomes: which matters more?"

actually Milton Friedman was considered pro free market perhaps more than an economist in history and he supported the Fed. Hate to rock your world.

 

"Rock my world"? God, such a stupid phrase...

LOL if you think I don't know Uncle Milty. As I took accounting, he was required reading. I have a copy of "Capitalism and Freedom" on my desk here at work that I loan out to my peers. I am intimate with his works, as well as his views on the Fed.

Some of his views are to this day are valid and some I disagreed with from the first time I read it, just like any other economist.

For what the Fed is today, you can not in any way be pro-Fed and be considered pro-capitalism. The Fed manipulates the free market as heavy handed as any set of regulations. It centralizes power via government fiat. It is the antithesis of Capitalism.

 

How is the Federal Reserve compatible with a free market?

 

Good Uncle Milton Quote:

“The Fed was largely responsible for converting what might have been a garden-variety recession, although perhaps a fairly severe one, into a major catastrophe. Instead of using its powers to offset the depression, it presided over a decline in the quantity of money by one-third from 1929 to 1933 … Far from the depression being a failure of the free-enterprise system, it was a tragic failure of government.”.—Milton Friedman , Two Lucky People, 233

Here's another.

'Any system which gives so much power and so much discretion to a few men, [so] that mistakes ‑‑ excusable or not ‑‑ can have such far reaching effects, is a bad system. It is a bad system to believers in freedom just because it gives a few men such power without any effective check by the body politic ‑‑ this is the key political argument against an independent central bank. . .To paraphrase Clemenceau: money is much too serious a matter to be left to the Central Bankers.

 

When asked "But it would be preferable to abolish the Fed entirely and just have government stick to a monetary growth rule?" Friedman responded "Yes, it's preferable. And there's no chance at all of it happening."
I've no recall of Friedman ever actually having claimed support for the Fed. Feel free to provide a link to where he did, if you know of one.

 

nice try to change subject but issue was whether Milton was pro fed and most pro free market economist in history. He was so you were mistaken. Being free market does not mean you set up free market for all human activity.

 

friedman supported the Fed and was consultant to it because it existed and was not going away. He and Bernanke wanted it managed much the way currency would be managed if on a gold standard.

 

Only If you consider his view of making the Fed irrelevant as supporting it. He thought the Fed should not fiddle with interest rates but simply assure a constant increase in the supply of money at a set rate of inflation. Consistency in the rate at which the money supply is changing allows both business and consumers to make more rational decisions on how to manage their money.

In your response to TedintheShed, you stated that the issue was "whether Milton was pro fed", noting that it is indisputable that he was "pro free market".
The fact that he stated that he would abolish the Fed would seem to indicate he was NOT pro Fed, or in other words a proponent of a NEED for a Fed to control the fiat money supply, and even more so interest rates.

 

Precisely. Friedman never supported the Fed, but understood that since it existed it more than likely was not going away (like Social Security and Obama Care) the best approach to him was to limit it as much as possible.

Also, like many of his views his apprach to the Fed changed over time.

 

You really need to read more of his works