Joe Biden bets on Jerome Powell at the head of the Fed (again). The Republican, nominated by Trump, will most likely continue as head of the United States Federal Reserve with a congress now dominated by Democrats. Despite record-breaking inflation, both parties are satisfied with Powell’s work. How can we interpret this? Why the bipartisan support?

In the United States, we have a conservative party and a progressive party. You could say that we have a right and a left. There are other parties. But they are small parties without much relevance. Generally speaking, the system is bipartisan. I am obviously referring to the Republican Party and the Democratic Party. Trump (Republican) was replaced by Biden (Democrat). Congress also changed from being a Republican to now a Democrat. Nevertheless, When it comes to the Federal Reserve, apparently, there is consensus. They all love Powell. Which, in turn, is bipartisan support for monetary policy. That is, both conservatives and progressives are happy with current monetary policy.

Of course we must also talk about the Libertarian Party. You could say that the Libertarian Party is ultraconservative economically and liberal socially. So economically he looks a bit like the Republicans and socially the Democrats. I use the adjective “ultraconservative” in this case because the position of the Libertarian Party on economic matters is really extreme. In fact, it is too extreme for most Republicans, already quite conservative. Libertarians who don’t vote for the Libertarian Party typically vote for the Republican Party. But by way of voting for the lesser of the two evils. In the case of voting for the Democratic Party, it may be because for that particular libertarian social freedoms are more important than economic conservatism.

Libertarianism in a sense is a reactionary movement (back to the past). So to speak, it is a kind of Tomas Jefferson-style anarcho-capitalism. I mean, the enemy is the state. Although it is true that the total elimination of the State is not advocated, it is advocated to keep it in its most minimal expression. Where are the libertarians? Everywhere. But mainly in California (Silicon Valley), New York (Wall Street), in the gold market, and in the crypto space.

In the crypto space, we have an over-representation of libertarians. Why? By the cypherpunks. Many libertarians among the first bitcoiners. Therefore, the community grew up with that libertarian spirit. Libertarians follow the libertarian dogma. What the defense of state non-interventionism in economic matters implies. In other words, monetary policy, the Fed, and almost all recovery measures are wrong. The fixation on inflation is a consequence of the belief in a hard currency system in the context of an ultra-conservative economic policy. Within the crypto space, that vision is practically ubiquitous. However, in reality, it is a rather “eccentric” view. In American politics, its most visible representatives would be the politician Ron Paul and supporters of the Tea Party movement.

Now speaking of Jerome Powell. How would you rate your handling of the crisis? B-. However, many give it a B + or an A-. We are not talking about libertarians. For a libertarian, Powell deserves a C- or an F. But that’s the case with Powell or anyone. Because here we are entering a matter of dogma. That is, according to most libertarians, the FED is a harmful entity by nature and fiat money is a fraud. However, Powell will continue to lead the Reserve with bipartisan support.

Read:  IBM Executive Says Continuous Digital Transformation Mindset That Includes Blockchain Is Needed

The far left is not very happy with Powell because of his liberal attitude towards regulation. Elizabeth Warren has said that Powell is a “dangerous man”. Personally, he weaned Warren. But I must admit that Powell, during the crisis, has distributed money left and right without many controls. I am referring to the purchase of corporate bonds. That mostly benefited people like Elon Musk, Warren Buffett, etc. The K-shaped recovery is due in part to that and in part to low government spending. Of course, Warren also talks about the regulation of banks. What is a more complex issue.

How do you understand that, with inflation at historic levels, Powell’s work is still being applauded? What is the logic in the minds of members of Congress? First, the worst crisis since the Great Depression was overcome in record time. That is efficiency. It is not perfection. But demanding perfection in such a core would be too much. Second, the current inflation is seen as a necessary evil, tolerated to reactivate the production and distribution chains that were interrupted during the worst of the lockdown. Third, it is better known rooster than rooster to know in such a delicate moment. Putting in a Democrat now could cause unnecessary tension. We must remember that Biden’s popularity is not at its best. Trading Powell would be a huge political risk. Not worth it. The best thing is to support it and that’s it.

Liquidity stimulates growth. Deflation causes a crisis. The coin can be neither too hard nor too soft. It should be a reflection of the production. AND intervention is given to balance imbalances. Ultra-conservatives idolize hard currencies and nonintervention. In other words, prolonged deflationary cadres and government inaction. According to them, these “pains” are necessary to eliminate bad actors in a kind of spartan justice. In the past, such a crisis lasted for several years. Which implied poverty, hunger, political tension, and social insurrection for a long time. Example. The Great Depression and the many crises of the 19th century.

It is easy to be a radical when you are always in opposition. We can write a thousand things on Twitter and always be right. Because life from the bank is simple. Criticizing and selling utopias on the Internet is cheap. It is very different to be responsible for something. Have the power to change things. I mean being the man in the arena fighting the lions. Personally, I don’t want to be in Powell’s shoes. Anyway, Powell is Biden’s candidate for head of the Fed. I am sure I will get his second term due to bipartisan support. Luck!