Brendan Greeley

It's gotten out of that business.

So my frustration as a Fed reporter is, God, it's such an important institution.

And it's very easy to get captured by the Fed because they're lovely.

They all have PhDs.

They clearly care for what's best for America.

And if you've ever reported from Washington, you know that those three qualities, particularly altogether, are incredibly rare in that town.

So you sort of begin to identify with the Fed as a Fed reporter and want to protect it as an institution.

The challenge is we have to believe that the Fed is an important institution and that we want them to thrive.

We also have to stop letting them assign their own homework and then grade themselves on their own homework.

We have to understand the Fed is a bank and it can do what we ask it to do.

And that doesn't compromise monetary independence.

We have to be careful about that.

But, you know, we have decided every 50 years or so that a big bank that answers to us has its own new job.

We should feel the power to give the Fed a job if we wanted to take on that job that we think would make the economy more productive.

I also think that one of the things that's gotten lost

when we forget that the Fed is a bank and we forget that banks create money, is this distinction between backing and redemption.

So in the 19th century, early 19th century, banks in America carried a reserve of dollar silver coins, the same what Alexander Hamilton called the ancient dollars, the same dollar that comes from Bohemia and then the Spanish Empire.

Okay.

So on demand, they kept a reserve of these coins so that they could redeem your banknotes for coins, right?

That's the understanding that we have of what gave those banknotes value.