Comedian John Oliver mocked Jill Stein’s idea that the US Federal Reserve Bank could free student’s from student loan debt by buying up all the student loans and forgiving the debts.
In fact, the Federal Reserve could do exactly that. The Federal Reserve engaged in quantitative easing a few years ago. Quantitative easing was a Fed determined policy in which the Fed purchased trillions of dollars of completely valueless mortgage backed bonds (along with treasury bills) from rich folks at face value.
In other words, if the rich folks bought bonds valued at $100 which had since become valueless, then the Fed bought the bonds at $100. Nice scam huh? But only if you’re rich, and student borrowers are not, so don’t expect the Fed to do anything about their plight.
It’s true as Oliver pointed out, not even the US president can tell the Fed chief what to do. but the US president recommends and appoints the Federal Reserve chief, and negotiations between the two could convince the Fed to purchase all student loan debt, including the student loan backed bonds the rich folks enslave the borrowers with.
Let’s face it, the folks running the Federal Reserve can do anything they like because nobody is in position to hold them responsible for their actions (See video above). In that respect, the Fed is just like any Wall Street bank. So, during the economic meltdown of 2007-12, the Fed mysteriously lost $9 trillion (See The Fed Lost $9 Trillion! Not Likely! JohnHively.Wordpress.com), gave away $26 trillion to the rich folks (Breakdown of the $26 trillion Bailout-JohnHively.wordpress.com), and they created trillions of dollars out of air in order to buy worthless bonds from rich people; but the Fed cannot do the same with student loan borrowers? Nonsense!
We need a central bank of all the people, not just the rich ones, and this can be accomplished through legislation.