Congressman Ron Paul Analyzes the Work of our "FED".

For the past three decades, the Federal Reserve has been given a dual mandate: Keeping prices stable and maximizing employment. This policy relies not only on the fatal conceit of believing in the wisdom of "supposed experts", but also on numerical chicanery. Rather than understanding inflation in the classical sense as a monetary phenomenon - an increase in the money supply - it has been redefined as an increase in the Consumer Price Index. The CPI is calculated based on a weighted basket of goods which is constantly fluctuating, allowing for manipulation of the index to keep inflation expectations low. Employment figures are much the same, relying on survey data, seasonal adjustments, and birth/death models, while the major focus remains on the unemployment rate. Of course, the unemployment rate can fall as discouraged workers drop out of the labor market altogether, leading to the phenomenon of a falling unemployment rate with no job growth. In terms of keeping stable prices, the Fed has failed miserably. According to the government's own CPI calculations, it takes $2.65 today to purchase what cost one dollar in 1980. Since its creation in 1913, the Federal Reserve has presided over a 98% decline in the dollar's purchasing power. The average American family sees the price of milk, eggs, and meat increasing, while packaged household goods decrease in size rather than price.