The Fed was established by an act of Congress and can be changed or abolished by an act of Congress. Congress is democratically elected. That's the connection to the people.

The reason Congress has not abolished the Fed is that most people think that the Fed is pretty good at what it is supposed to do.

Most people have no idea what the Fed does (let alone that it even exists) nor do they have any framework with which to evaluate its work.

I assure you, if inflation reached 10+%, most every voter in the US would know what the Fed does and what they wanted it to do instead.

The non-conspiracy fact is the Fed has stayed quiet during the past 7 years because it has done a remarkably good job compared to their conservative-to-the-point-of-incompetency European counterparts. Europeans are quite familiar with ECB policy, because it has handled the crisis so astoundingly badly.

Since the federal reserve stopped reporting M3 data, we don't know the actual inflation levels, and haven't known them since 2005 [1].

On another note, we need a Godwin's law for "Conspiracy Theory". As soon as someone mentions the word, it's likely to set up a appeal to ridicule fallacy, such as used in the parent.

1. http://mises.org/library/death-m3-fifth-anniversary

Thanks for your assurances, but catastrophic failure does not an understanding make. Also, "not break the economy" is not an actionable (or, I'd argue, even comprehensible) framework.

Inflation, by the government's own numbers which tend to under report it, reached over %10 during the bush administration (and has been probably over %20 for most of the Obama administration.) "Inflation" as reported by CNN et. al. every quarter is a propaganda number that has all of the key inflation indicators taken out of it and is effectively watered down. (making it so that you can't even compare it from one administration to another.)

Even the most cursory analysis makes it obvious your numbers are ridiculous. 20% inflation during 6 years of Obama would make items, on average, 3x as expensive as they were in 2008-- is your food 3x as expensive? housing? gas?

Mine is. I don't know about the rest of the country, though.

I'm curious where in the country gas costs $9/gal now. In 2008, it was around $3 across the country.

I'm also curious where in the county a loaf of bread is now $3-4, and I mean the cheap white/wheat bread that used to cost a buck and change (and still does here).

Housing, I know it's gone up a lot, but even so, 3x?

Can you provide any hard numbers on the 3x increase in gas, housing, and food?

I moved to Canada. Due to NAFTA/CAFTA/SPP, Mexico, Canada and the US are the same country now.

The prices mentioned are exactly in-line with what I'm paying overall, though gas has gotten to around $3.10USD/Gal recently. Food prices are astronomical, and labor wages are flat/stagnating.

We were talking about the cost of goods in the US.

I guess if you want to compare the situation in the US in 2009 with the situation in Canada in 2015, then, ok, but it's hard to see what point you're actually trying to make then.

Canada is the US, post SPP. so yes, we're talking about the costs of goods in the US.

I think you're probably using an idiosyncratic meaning for "in," so we may be at an impasse for going further with this discussion.

it all depends on what the definition of "we" is, I suppose.

I'm not sure he was talking about an annualized rate.

On a sidenote, why is economics so wrapped up in astrology?

You assume there is any real democratic control of Congress, and that the whole game hasn't been rigged by a duopolist oligarchy.

America doesn't even have democratically elected presidents (just ask Al Gore). Hoping that Congress will even halfway represent the wishes of the people is bold.