by Karl Denninger, Market Ticker:

It’s time to seriously reconsider the “premise” that The Fed is “independent.”

It certainly is not, and never was — but occasionally someone does something so stupid as to personally identify and put a face on their political machinations.

I understand and support Fed officials’ desire to remain apolitical. But Trump’s ongoing attacks on Powell and on the institution have made that untenable. Central bank officials face a choice: enable the Trump administration to continue down a disastrous path of trade war escalation, or send a clear signal that if the administration does so, the president, not the Fed, will bear the risks — including the risk of losing the next election.

There’s even an argument that the election itself falls within the Fed’s purview. After all, Trump’s reelection arguably presents a threat to the U.S. and global economy, to the Fed’s independence and its ability to achieve its employment and inflation objectives. If the goal of monetary policy is to achieve the best long-term economic outcome, then Fed officials should consider how their decisions will affect the political outcome in 2020.

Excuse me?

We’ve always known The Fed is not independent of politics and in fact kowtows to politicians.  Indeed, absent The Fed Barack Obama’s ridiculous deficit spending could not have happened.

Contemplate what happens if there is no Fed buying up Treasuries and mortgages while the Federal Government is running a $1.5 trillion deficit.  Interest rates spike higher and that’s the end of that game.

Instead, The Fed literally sucked Obama off and enabled his and Tim Geithner’s economic policies.

Tim Geithner, if you remember, was the former head of the NY Fed before Obama appointed him to run Treasury.

Buttsex incest much, you ask?

But to come right out and state that The Fed has a “mandate” to determine election outcomes and has not only the right but the obligation to change them ought to result in the instant declaration of secession by the entire Red Land Mass of this nation.

This is not some random commentator spouting off their own personal insanity.  This OpEd comes from the former vice-chair of the FOMC who has now managed to slide into a nice cushy job at a hard-left educational institution.  By writing this piece he has declared that The Fed is not only “not independent” but that it has both the authority and right to determine the political path of the nation and should do so.

This of course raises the question as to whether it has previously done so — like when Dudley was previously Vice-Chair.  Did it?  Do you think it did not?  Gee, how about that curious withdrawal of liquidity I documented right into the maw of Lehman’s collapse just about a month before the 2008 election?

Now Dudley wasn’t in the FOMC then, but Bernanke was.  Dudley was at Goldman at the time — you know, one of the banks that packaged up all those trashy mortgages and sold them — and then was rescued by Bernanke after it all blew up in their face?  He ascended to the NY Fed right when Geithner ascended to Treasury.

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