Sunday, March 6, 2011

Senior Fed Economist Calls Ron Paul A Pinhead, and Ridicules Critics on His Blog

Robert Wenzel of Economic Policy Journal writes (3/4/2011):

David Andolfatto, Vice President in the Research Division of the Federal Reserve Bank of St. Louis, makes one of the most ludicrous arguments against Ron Paul’s attack on the Fed that one could make. I mean even for a Fed apologist, it is off the wall.

He attacks this paragraph in Ron Paul’s book End the Fed:

One only needs to reflect on the dramatic decline in the value of the dollar that has taken place since the Fed was established in 1913. The goods and services you could buy for $1.00 in 1913 now cost nearly $21.00. Another way to look at this is from the perspective of the purchasing power of the dollar itself. It has fallen to less than $0.05 of its 1913 value. We might say that the government and its banking cartel have together stolen $0.95 of every dollar as they have pursued a relentlessly inflationary policy.

What are the details of the attack?

He starts out this way:

The guy can be a real pinhead at times. And this is never so evident as in his persistent “attacks” against the Fed…Now, of course, I work at the Fed, so maybe you think I’m just complaining for the sake of defending my employer. If you think that, I can understand why you do. It is because you do not know me.

There are legitimate arguments one could make against the Fed as an institution and/or about the conduct of Fed policy. And then there are the stupid arguments, for example, the one contained on pg. 25 of his book End the Fed

So who is this guy, David Andolfatto? Economists at the Federal Reserve banks tend to think very highly of themselves and themselves only. Remember the guy from Richmond Fed, an Indian who trashed bloggers writing about economy and declared that the only people who can comment on economy are the people with PhD in economics?

Andolfatto is Vice President and Economist at the St. Louis Fed which he joined in July 2009. He got his PhD in economics from University of Western Ontario in 1994, MA and BBA from Simon Fraser University (I'm sure both universities are the citadel, fortress of the highest education and research in economics). He's probably a Canadian, as he says himself that he's not permitted to vote in the US.

His boss at the St. Louis Fed is James Bullard, who's recently seen gloating over the successful creation and acceleration of inflation due to QE2, just like he specified in his paper he wrote in 2010, and warming up for QE3.

Andolfatto has a blog. Here it is:

He says he's taken down his post about Ron Paul after it has "provoked mindless rage". Well, calling someone a pinhead is not really a good start for thoughtful debate, is it, Dr. Fatto?

And just like that Richmond Fed Indian, he taunts people without economic credentials and a long list of research papers on monetary policy. This is his answer to one of the comments:

I just performed a Google search of your name and contributions to monetary theory. I came up empty. Perhaps you'd be kind enough to send me a sample of your work?

Another, just incredibly arrogant, crackpot.

And the likes of him are in charge of not just the monetary policy but the fiscal policy of the country. Fiscal? You ask? Well what else can you call their mandate for employment, and QE2 being done to help out the federal government?

Bright future ahead of us. Nothing to worry about. All you need is a PhD in economics.


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