rant · moment 6 of 15
The Federal Reserve, Andrew Jackson, and the House of Cards Economy
from A Nuanced Man · #40
Audio-only archive episode — no video to seek.
5 minA history-nerd digression into the Federal Reserve as a private banking cartel, Andrew Jackson's war with Nicholas Biddle and the Second Bank of the United States, and whether the modern financial system could ever be safely unwound.
- 22:21Tim argues that to be rational now, you essentially have to be a radical, because the financial system itself is fundamentally broken.
- 22:50The U.S. has operated as a house of cards financially for nearly 100 years.
- 23:13In theory the system could be unwound gradually through currency revaluation and inflation reduction, but the political cycle prevents it.
- 23:33Banks now effectively hold the government hostage and can destabilize the economy with their actions.
- 24:02Andrew Jackson's war against the Second Bank of America and Nicholas Biddle was a monumental political and bureaucratic battle in the 1820s-30s.
- 24:48Jackson famously said he would break the bank on his knee and fought a PR war with bank president Nicholas Biddle.
- 25:19The Federal Reserve itself faced massive opposition when being passed because average people understood the dangers of banking systems.
- 25:42The Federal Reserve is a private bank, essentially a cartel that the government borrows money from on behalf of citizens.
- 26:05What the Fed effectively does is cartelize U.S. currency into a massive bubble, whereas before you had different banks that could fail if they made bad decisions.
- 26:28Before centralized currency, if a bank ran a scam, it had to be a good one because the bank would collapse and people would just use a different one.
Federal ReserveAndrew JacksonSecond Bank of the United StatesNicholas BiddleBernie SandersSteve Bannonbanking systemAlexander HamiltonThomas Jefferson