The Lender of Last Resort | The Federal Reserve’s Big Mistake

What does it mean in 2022 for the United States Federal Reserve to be the lender of last resort? I talked with New York Times Best Selling author Christopher Leonard about why the Federal Reserve was originally created in the United States and how the organization that controls our American monetary system has strayed from it’s original purpose to be a lender of last resort to banks. Leonard discusses how the FED has gone from a backstop for banks to potentially putting itself in position to bail out the entire American economy.

I spoke with Chris about his interview with former chair of the Federal Reserve and current United States secretary of the treasury Janet Yellen. In this interview, Yellen mentioned that she see’s the FED as shifting from a lender of last resort for banks to being a lender of last resort for everyone. This statement represents a sea change in what the Federal Reserve’s purpose is and the reach of the organization. Chris also comments on who this change has benefited most and why he finds the new policy troubling.

Watch our full interview with Chris Leonard here: youtu.be/w5XUvjnd3EY

See more 👀 of our interviews with founders, economists, scholars, and business mavens on this playlist: www.youtube.com/playlist?list=PL_K104J9GHJaQENCpllXso5Rf-t-Uc_x5

00:00 – The original thesis behind the Federal Reserve
00:21 – The FED as a lender of last resort to banks or everyone
01:31 – This is changing what the FED can control
02:05 – What changed about the FED in 2020
02:26 – Bailing out the whole economy?!

#FederalReserve #Monetary #FED

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