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The Fed Is Down

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Re: The Fed Is Down

#51

Post by aksss »

efficax wrote: post #34
dragontamer wrote: post #2

https://engineering.gusto.com/how-ach-works-a-developer-pers... A good time to remind people that the USA's money-transfer system (aka: ACH) is a giant Rube-Goldberg machine involving FTP transfers of specially formatted files. So it sounds like the Fed's FTP server is down?? Or something like that?

Some of the first software I ever wrote for pay was a daily shell script that pgp encrypted an ACH batch and sent it from one financial institution to another over a dedicated frame-link, via FTP. This was over 20 years ago! Can't believe it's still the same.

We had to write jobs to encrypt the NACHA files and send over FTP years ago, but I was at the same company long enough (prior to 2010) to see the banks at least adopt SFTP. Slightly better, but still encrypted the files. Hey, it works and is reliable. I learned banks are really cheap, though, definitely not in the mood to spend money on new systems/processes even if they'd improve productivity.

Re: The Fed Is Down

#53

Post by natchy »

Meekro wrote: post #30
dragontamer wrote: post #26

Earlier quoted context omitted.

The Fed is a private entity actually. The Treasury is US Government. But the Fed is owned by the member banks. The US kinda coopted a seat at their table and Congress + President appoints the Fed head. But otherwise, the rest of the board is made up by private companies.

Calling the Fed a private entity is really misleading. It was created by an act of Congress and its highest ranking officials, the Board of Governors, are all appointed by the President. Yes, it shares some power with the banks it regulates (who can elect representatives), but the US government didn't "coopt a seat at the table." It built the table and had most of the seats from the start. And it's true that member b…

Yes created by an act of Congress but is not under the jurisdiction of congress or the president, apart from appointments.

Re: The Fed Is Down

#54

Post by Meekro »

jerry1979 wrote: post #40
Meekro wrote: post #30

Earlier quoted context omitted.

Calling the Fed a private entity is really misleading. It was created by an act of Congress and its highest ranking officials, the Board of Governors, are all appointed by the President. Yes, it shares some power with the banks it regulates (who can elect representatives), but the US government didn't "coopt a seat at the table." It built the table and had most of the seats from the start. And it's true that member b…

Correct me if I'm wrong, but people constructed a cleavage between the Fed and the US Govt because they thought we shouldn't trust democracy with money creation.

You're right-- the Fed Board of Governors members are appointed by the President for 14-year terms, which is supposed to make them more independent.

I'd say that what you're describing isn't limited to just fears about money creation, though. It's part of the broader notion in most Western democracies that permanent (or semi-permanent) bureaucrats are more trustworthy than elected officials. It's not just the Fed: Presidents who tamper with the Department of Justice too much, for example, are often criticized for intruding on its "independence."

This notion has both practical problems-- who can fire an "independent" bureaucrat run amok?-- and constitutional problems-- the Constitution says "the Executive power is vested in the President" and makes no allowances for any Executive power to be wielded outside the President's control. The Supreme Court has been known to remind everyone of this fact when it's forgotten. For example, the Consumer Financial Protection Bureau has a director who is appointed by the President for a 5 year term, and can only be fired for a narrow list of reasons. The Supreme Court struck down that restriction and said, roughly, that any inquiry into why the President is firing a particular bureaucrat would infringe on the Executive power that is vested in the President alone.

Nonetheless, this idea that some power is "too dangerous to be wielded by elected officials" is alive and well, like with the Federal Reserve. It just can't be wielded too far from the President-- and yes, the President can remove members of the Fed Board of Governors, though it isn't commonly done.

Re: The Fed Is Down

#56

Post by smitty1e »

dragontamer wrote: post #26
sodality2 wrote: post #7

Earlier quoted context omitted.

Meet the US government... Triple DES is still used for backwards compatibility in banking

The Fed is a private entity actually. The Treasury is US Government. But the Fed is owned by the member banks. The US kinda coopted a seat at their table and Congress + President appoints the Fed head. But otherwise, the rest of the board is made up by private companies.

>The Fed is a private entity actually.

The idea of the Federal Reserve urinates all over the Constitutional principle that people weilding power stand for election.

Doom on us for permitting such.

Re: The Fed Is Down

#57

Post by Meekro »

natchy wrote: post #53
Meekro wrote: post #30

Earlier quoted context omitted.

Calling the Fed a private entity is really misleading. It was created by an act of Congress and its highest ranking officials, the Board of Governors, are all appointed by the President. Yes, it shares some power with the banks it regulates (who can elect representatives), but the US government didn't "coopt a seat at the table." It built the table and had most of the seats from the start. And it's true that member b…

Yes created by an act of Congress but is not under the jurisdiction of congress or the president, apart from appointments.

The Fed is completely under the US government's control. Congress created it by passing a law, and could pass another law to restructure it if they ever wanted to. The President fills the Board of Governors who run it with his chosen nominees, and can remove and replace them at will. How much more "jurisdiction" do you want?

Re: The Fed Is Down

#58

Post by unishark »

goodluckchuck wrote: post #50
umeshunni wrote: post #37

Earlier quoted context omitted.

That's an adorable meme that crypto-bros like to tweet, but really they are actually an agency of the federal government and answerable to Congress. From https://www.federalreserve.gov/faqs/about_14986.htm Who owns the Federal Reserve? The Federal Reserve System is not "owned" by anyone. The Federal Reserve was created in 1913 by the Federal Reserve Act to serve as the nation's central bank. The Board of Governors in…

I think it's fair to question the wisdom (and legality) of agencies ( https://en.wikipedia.org/wiki/Independent_agencies_of_the_Un... ) that are "independent" of the constitution's separation of powers. The constitution vests Judicial power in an independent judiciary, but provides that the POTUS shall be elected and that executive power shall be vested in him/her... and that legislative power shall be vested in Cong…

There are plenty of agencies under the president who need to be as independent as possible of day-to-day control by politicians. Especially in law enforcement.

Not great if you consider democracy to the be a universally good thing of which more is always better. But it really isn't true. The majority can do good or bad things.

Re: The Fed Is Down

#59

Post by billiam »

ryanmarsh wrote: post #25
droffel wrote: post #14

Earlier quoted context omitted.

The Federal Reserve is a private company.

It's not surprising how many people aren't aware of that. When you look at the ceremony around the chair and reports to congress, when you read Wikipedia articles, it sounds as if we have a government owned central bank when in fact we have a private entity with distributed and opaque governance which is ostensibly accountable to the congress although I've not seen congress ever act like it has any accountability for…

Not true. Congress passed the Federal Reserve Act and assigns to the Board the implementation of it and regulations that are written down in the Code of Federal Regulations. And the Chair is confirmed in the Senate of course.

Re: The Fed Is Down

#60

Post by zhoujianfu »

krupan wrote: post #48
anandsuresh wrote: post #31

Obligatory "Bitcoin would solve this!" post. :)

https://www.buybitcoinworldwide.com/bitcoin-uptime/

"The Bitcoin network has been functional for 99.9861136495 % of the time since its inception on Jan 3 2009 02:54:25 GMT"

...for certain definitions of "functional".

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