Thomas Sowell: Federal Reserve a 'Cancer'

Complete video at: fora.tv/2010/12/14/Uncommon_Knowledge_Basic_Economics_with_Thomas_Sowell
Economist Thomas Sowell explains why he supports Ron Paul's stance on abolishing the Federal Reserve. When asked by Peter Robinson what should replace the Fed, Sowell replies: "When someone removes a cancer, what do you replace it with?"
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Thomas Sowell has studied and taught economics, intellectual history, and social policy at institutions that include Cornell University, UCLA, and Amherst College. Now a senior fellow at the Hoover Institution, Sowell has published more than a dozen books, the latest of which is a revised and updated edition of his classic volume, Basic Economics.
"Through its various editions," Sowell writes, "the fundamental idea behind Basic Economics remains the same: Learning economics should be as uncomplicated as it is informative."
Here, Sowell seeks to uncomplicate some of the economic issues confronting the country today, from the financial crisis and the role of the Fed to the economics of health care and trade imbalances. - Hoover Institution
Thomas Sowell is an American economist, political writer, and commentator. He is currently a senior fellow of the Hoover Institution at Stanford University. In 1990, he won the Francis Boyer Award, presented by the American Enterprise Institute. In 2002 he was awarded the National Humanities Medal for prolific scholarship melding history, economics, and political science.
Peter M. Robinson is a research fellow at the Hoover Institution, where he writes about business and politics, edits Hoover's quarterly journal, the Hoover Digest, and hosts Hoover's television program, Uncommon Knowledge.

[@praisekek4487]

the problem with government is government

[@plushtown29]

The problem with government is bribery.

[@stratocaster1986able]

Sowell gets it.

[@catherinebourdon8258]

"When someone removes a cancer, what do you replace it with?" *Not another form of cancer* This is why I love Sowell

[@joeb6544]

Mr. Sowell is a brilliant, informed, educated, intelligent, articulate individual!!!

[@CP9Des]

A modern day philosopher I’d add too!

[@Patricia-sn9ln]

A Gentleman And A Schollar.

[@pearleycunningham]

“When someone removes a cancer, what do you replace it with?” Brilliant answer to anyone who asks, “Well what will we do if we get rid of (insert gov’t department of choice)?”

[@adiintel1]

Smaller banks that must use full fractional banking. Instead of reserves?

[@jackbrady9738]

@@adiintel1 good point. Maybe smaller banks should have like 30% reserve rate instead of 10%

[@dcirish1213]

The federal reserve is private corporation. Just goes to show how ill informed people are lol

[@pearleycunningham]

@@dcirish1213 lol yes we all know it’s technically private but it’s an instrument of the government literally created by federal legislation…

[@jackbrady9738]

@@dcirish1213 it's technically a private corporation but in all aspects under the Act that ggives it power it's public

[@MeteorMega]

Ron Paul spent a lot of time on Congress trying to end the FED and got nowhere. When is someone going to get it?

[@nasisimi1]

The Fed will eventually collapse on its own when there is no more road to kick the can down.

[@kimobrien.]

@@nasisimi1 In other words a collapse of world capitalism. Workers control of industry. NOW!!

[@pokerkramer1240]

@@nasisimi1 How do you say that after 2008? the guys ended the world economy and no one from the elite responsible for that was arrested! They are above the law.

[@pokerkramer1240]

@@kimobrien. get the fuck out of here you duty commie

[@cheesemccheese5780]

@@pokerkramer1240 lmao. What did he say?

[@olanordmann7836]

I can't see how people can make this so complicated; End the Fed (end every other central bank in the world), and let's move back to gold and silver.

[@shakkamannaka6618]

+Ola Nordmann there are several problems with having the gold standard, that you don't have with a fiat currency: 1) It takes a lot of resources to extract and transport the gold, resources that might have been allocated more efficiently elsewhere in the economy. This was a point that was famously argued by Milton Friedman against the gold standard. 2) While it is true that inflation over very long periods of time have been lower and more stable on the gold standard, inflation/deflation on a year to year basis was much higher and volatile, which caused many unnecessary banking failures (due to deflation), and reduced efficiency in the economy (due to rampant inflation). 3) Interest rates on the gold standard tend to run contrary to the rates that are most beneficial to the economy during economic cyclicals (interest rates were higher during downturns, and lower during booms effectively exacerbating the cyclicals) 4) The currency would be subject to speculative attacks against its value (Which was why Britain among others had to leave the gold standard in the early 30s)

[@shakkamannaka6618]

+Ola Nordmann btw jeg er norsk jeg å

[@olanordmann7836]

shakka mannaka God dag! Et år sinden jeg skrev den komentaren, så har endret meningene mine litt. I stedet for å avskaffe sentralbanken, bør vi avskaffe Staten.

[@shakkamannaka6618]

Hei. Det var en et enda større hopp. Hvis du ikke skjønte det så skrev jeg kommentaren i forsvar til sentralbanken, fordi jeg mener den er en netto-positiv bidragsyter til næringslivet. Jeg synes også det er en dårlig idè å avskaffe staten, grunnet at studier antyder at det vil resultere i underinvesteringer av grunnleggende goder som god infrastruktur, forsvar og beskyttelse mot markedsrelaterte eksternaliteter. Hvis du har lest "Basic Economics" av Sowell, så anerkjenner til og med han nytteverdien av å ha en sterk stat. Man kan i midlertidig ha en diskusjon om størrelsen og rekkevidde til staten

[@olanordmann7836]

shakka mannaka Staten har ingen penger. De 4 ordene summerer argumentet for kapitalisme; Staten kan ikke bruke mer penger enn det Staten stjeler fra den private sektoren. Staten kan trykke, låne eller rane, men den kan ikke produsere noe som helst. Markedet har ingen problemer med å produsere biler, tog og fly, så hva får deg til å tro at markedet ikke kan produsere vei? Hva burde min straff være vis jeg nekter å bruke kroner? Jeg mener ikke vi bør innføre gull-standard, jeg mener vi bør oppheve "tvungen betalingsmiddel"-loven, og la markedet bestemme fritt, hva som skal være penger. Jeg personlig stemmer gull og sølv.

[@StreetFighter2010]

I have just discovered this man, and now I can't get enough of listening to him.

[@EKwisnek]

It's these statements that confirm Sowell as one of our great minds in modern times.

[@John-zh6ld]

Thomas delivers again. No value in the Fed doing the Treasury job.

[@aveyowyns]

Guns is a trivial issue? The right to arms is written into the U.S. constitution. The Federal Reserve and how we use/protect/issue out our currency is not.

[@turtlelovingzombie]

The Fed should be ended a long time ago. Thomas Sowell states it well as he does. He is more than a perfect rolemodel for the black community. He inspires me and i would vote him president over any of the latest presidents in the us. I am not a American nor am i black.. just a humanitarian thats all

[@charlieivey6506]

Brilliant man...so sad our so called black leaders belittle him.

[@thinbev]

It should be noted that our economy has grown IN SPITE of the Fed and not "because" of the Fed.

[@Jalilvideogeek93]

"When someone removes a cancer, what do you replace it with" EPIC QUOTE

[@davidkidd2644]

Guys like Sowell and Paul give me hope in America.

[@mercen144]

"when someone removes a cancer what do you replace it with" - Priceless

[@bigtay522]

It's almost as if having a streamlined machine for manufacturing debt would create slavery.

[@life_of_riley88]

H-ha! Perfectly stated. That is what American workers are staring down the barrel of currently. Their energy or the value of their lives, their work is being devalued to support endless debt. It's cycle that cannot be outrun without high risk speculation. We all know how that ends. . .when Americans are pushed further and further out the risk curve, collapse is inevitable.

[@billdoell1868]

Yes, End the Fed.

[@TheManiacalSatanist6]

My respect for Thomas Sowell just increased by a factor of 10.

[@jbgant8513]

Thomas sowell is a National Treasure.

[@shiftymg3590]

Man I love this guy!!

[@juancarlosfigueroasolis2464]

The federal reserve is about as federal as federal express (fedex) It’s not It’s a private corporation

[@user-ri4jx2lp7x]

What private corporation has that kind of power?

[@DocOrtmeyer]

@@user-ri4jx2lp7x the Illuminati ;)

[@austinbyrd4164]

No, the dollar is a government monopoly, the fed was established through government, answers to congress, has all of its officials appointed by government, & always gives them the money they want no matter the detriment. It's not private. If you sincerely think so, then you're a dumb@ss.

[@life_of_riley88]

@@austinbyrd4164 No no no. The Federal Reserve Note is what you mean. The dollar can ONLY be minted and issued by Congress. You've been duped and you won't admit it. You need to do some studying and learning on who really controls the FED, it's not our government. They are a private corporation and they issue their own currency, and it's not American dollars, it's says right on it "Federal Reserve Note".

[@austinbyrd4164]

@Life_of_Riley The federal reserve literally has its people chosen by the government, answers to the government, was created by government, & its currency is monopolized by the government. It's a semi independent government organization.

[@anticommunistOAC]

That last remark is why Sowell is one of the greatest

[@layahma]

"When someone removes a cancer, what do you replace it with?" Massive amount of debt from treatment and medication.

[@find_pain]

so what let it fucking kill us?

[@JavedAnsari-sc3pd]

Decentralised crypto currency.

[@mtstatehk14090914]

Nice to see the Chicago School coming around against the fed

[@gabbar51ngh]

Milton Friedman wanted to abolish the fed in his last years

[@JaredJosephHoag]

People, this video only has 18,496 views as of the time of this writing. I implore you to spread this around as much as possible. Every thinking/voting person in the United States of America needs to hear this man speak, and speak clearly.

[@jameseldridge3445]

Helping those who can't help themselves always hurts the country as a whole. But people value sympathy/emotion over logic, that is why politicians use this to help boost the idea of a centralized system. Ludwig von Mises and Thomas Sowell have many writings on this phenomenon

[@Nekrumorfiini1]

Most people are just like animals, they just need to fulfill their basic desires and feel good about themselves and they're happy, they don't want to know the truth nor do they care about reality. The government is happy to give them what they want.

[@jameseldridge3445]

@@Nekrumorfiini1 couldn’t have been said better

[@koolkamel322]

"If the gov't had taken the bailout money, and given it every person in America, each person would have obtained an estimated $3,000. Instead, we gave it to the banks to prevent a recession that came shortly after anyway." - Dr. Ron Paul How can you read that and still say libertarians are crazy?

[@eddarby469]

I think libertarians are short sighted for other reasons. If I understand their policies, they want us to be isolationist. That would lead to another World War in short order. I don't think that would be good for the average US citizen.

[@nasisimi1]

The Founding Fathers knew about the problems fiat money. That is why Gold and Silver are only allowed to be used as money under The Constitution. The Gold Standard is the best thing for regular working class people.

[@lcotee]

I'm watching this in 2022 and its even more relevant!!! Steven Zarlenga has passed sadly but his book Lost Science of Money " is available for free online. Approximately 750 pages of well documented history and facts. He was part of the American Monetary Institute.

[@KAZVorpal]

I love what he says on this, except his evasion of the question of what to replace it with. If we disbanded the Fed without actively replacing it, that would leave Congress controlling the printing of our fiat currency. This would be a disaster, leading to actual hyperinflation, as it printed however much money it wanted.

[@YumegakaMurakumo]

I love him so much! 💜 Thomas Sowell is such a classy elegant man.

[@thaegypti]

Any one watching this in 2022 to understand the main issue with the USA financial system 🇺🇸 ? This man knows toooooo much real info's 😳

[@sowitsky]

Absolutely

[@lauradahlus]

God bless this intelligent man! 🙏

[@givetheymeantake]

I really like both of these men. Mentors for thought and conversation.

[@Firehorse40]

The FED is privately owned. It is unconstitutional, and it is not likely to be dissolved without a great deal of effort.

[@dreamingWisdom]

Volker was the best Federal Reserve chairman in the last 60 years. He didn't make the mistake of putting too much money in the system as Greenspan did.

[@absolutroot]

OMG greatest quote ever at the end. Someone write that down... nevermind, i will do it, to make sure it gets done :D

[@gaozhi2007]

But when I remove this shackle from my leg, what do I replace it with? FREEDOM.

[@ask_why000]

They had so many warnings.

[@fecklessman]

'i have to say, i wasn't expecting your answer to run in this direction, so i don't have questions - follow up questions - prepared, and i may have to actually think here in real time!' lol. at least he's honest about it.

[@zionisimkills1098]

Thomas Sowell,, you sir are truly a patriot, as opposed to the LIAR and current occupant of the white house.

[@dukef4]

I bet you can't define Zionism.

[@hellohithereyep8530]

+dukef4 He's right on President Obama. Bush and him have been the worst thing for the middle class. The Federal Reserve the main culprit, that has kept artificially low interest rates, which hurst who? The middle class. Why? Because middle class keep their money mostly in checkings/savings account. Who has most of their money in the stock market? The rich. Lower rates allow for banks to lend to large companies and small companies at low rates, which allow for them to grow.

[@DkleinD]

You can do nothing and there are still more than enough people, like myself, to fill in the gap that technology cannot. If you open your eyes you will not be disappointed! Love you!

[@bigglilwayne7050]

The biggest heist in the history of mankind resulted in the Federal Reserve

[@joepeeler34]

@CaptainCocaine This is big news. Many consrvative don't read Austiran economists, but hey do read Sowell. Sowell is the major intellectual to most conservatives. This can only help the cause immensely. Sowell is one of the few non-Austrians that I read regularly.

[@JensHove]

Cancer, spot on!

[@eelvevets]

Love this man's intelligence and candor.

[@laborwage]

@MatsKaarbo I just looked into the Venus Project. I would like to ask you a question; if not for the price system, which system will allocate scarce resources that have alternative uses?

[@ghxstleader485]

beautiful line I'm stealing it When someone removes a cancer what do you replace it with?

[@Daniel44125]

End the Fed!

[@Theimpromptulife]

Brilliant man love hearing him.

[@chaseorosco9017]

That last line was a zinger. Yes!

[@johnmackey2240]

I am kind of shocked that this man completely discredited himself and his understanding of our economy and the Federal reserve by thinking that Thomas Sowell would not end that corrupt, manipulative, destructive, thieving Federal Reserve.

[@xBlake4]

The solution isn't gold and silver - both markets are subject to heavy manipulation. The solution is to let the Treasury issue debt-free notes. Simply restore the money making power to the government. There's no rational justification for having this power vested in private hands, especially the hands of bankers.

[@ryanmurphy2588]

Mr. Sowell is brilliant and knows that whatever that you replace one system with you gotta work hard to replace it with another. That will take some time. The Federal reserve is a cancer tho, and needs to be replaced as quickly as possible. It all takes time tho.

[@karlwolff3292]

A very good comeback. What do you replace cancer with?

[@laborwage]

@MatsKaarbo Your English is just fine. My confusion is with HOW the resource based economy can allocate scarce resources which have alternative uses. How does such an economy deal with knowledge? That is, how is it that resources go to one time and place in a certain quantity or quality? How are resource demands communicated, and how are these demands weighed against alternative demands for the same resources elsewhere in the economy?

[@oiuoiu988]

@Livefreerevolution the tally stick was backed by the implicit use of force, it was not just an idea.

[@md12318]

"Creature From Jekyll Island" --A MUST READ regarding the Federal Reserve.

[@dcirish1213]

I don’t understand why everyone thinks this is a brilliant response?? He literally dodged the question when asked what system should be in place which shows the ignorance of most people on how our monetary system works. The reasons he stated for the abolishment of the fed are Not the reason it should be ended. The reason the fed SHOULD be disbanded and outlawed is for the very reason of PRIVATE issuance of our money!! He states that the Fed buys up dollars bonds but doesn’t state why?? Because that’s the conspiracy that leads down the rabbit hole. Like Thomas Edison said “If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good, makes the bill good, also. The difference between the bond and the bill is the bond lets money brokers collect twice the amount of the bond and an additional 20%, whereas the currency pays nobody but those who contribute directly in some useful way. … It is absurd to say our country can issue $30 million in bonds and not $30 million in currency. Both are promises to pay, but one promise fattens the usurers and the other helps the people.”

[@barttfisher]

It’s amazing really. We have a financial crisis, caused by greedy, reckless financial institutions. Congress passes legislation requiring those institutions to be less greedy and reckless. The institutions then lobby to have those restrictions removed, usually in the name of “remaining competitive”. This leads to another financial crisis. It’s completely predictable, and we have been doing this dance since the Great Depression almost 100 years ago.

[@PennyBergeron-os4ch]

Agree; the rules should be applicable to all banks - big or small. First; very few meaningful laws are passed and then this cycle of doing-undoing seems to support deregulation risking the economy and the faith in banks.

[@FinnBraylon]

A lot of folks downplay the role of advlsors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.

[@HildaBennet]

Well, I've been researching advisors lately because the market news I've been seeing hasn't been that positive. Who is the individual who helped you, and is he or she still around?

[@FinnBraylon]

I work with Sonya Lee Mitchell as my fiduciary advisor. Simply look up the name. You would discover the information you needed to schedule an appointment.

[@HildaBennet]

I just looked her up on the web and I would say she really has an impressive background in investing. I will write her an email shortly.

[@oiuoiu988]

all that needs to be done is to repeal legal tender laws to allow for competing exchange media, let the fed AND treasury compete too if they wish. federal reserve notes, treasury notes, private bank notes, foriegn currencies and whatever else people wish to use as exchange media can compete. who knows, maybe some people will even choose to accept/use actual specie as exchange media again.

[@brianbailey7128]

Boy does this ring true in Oct 2021.

[@44hawk28]

1907 JP Morgan was the one who called a bunch of the newspapers and told them that a bunch of the smaller Banks were out of money, and created the situation, and then he fixed it.

[@leftofcollegestation]

What do you replace it will is a legitimate questions. What do would you use to regulate the money supply?

[@EriPages]

LOL@the last line...the journalist felt silly by the end of this video. Thomas Sowell, you are a respectable individual.

[@alahjandrodagrate1611]

You replace it with whatever commodity the market demands. It’s been gold for thousands of years and will likely to continue being gold and silver, but if another commodity serves as a better money, then the market will inevitably shift to that money. Hopefully bitcoin will be in the mix.

[@vibratehigher2441]

Thanks

[@DkleinD]

@oiuoiu988 I meant if you really think you have a good answer to the problem keep educating people about it. Thats what I meant by keep doing what you are doing. This is my last response. THank you for your comments. Peace and love.

[@cankorgbr]

excellent

[@21Million]

Instead of the FED, simply implement a "100% reserve requirement banking system" !!!! "The Need Act" tried to fix this (in 2011) but did not pass. (see Wikipedia for info)

[@oiuoiu988]

@MrResilire he wasnt the first to say that about the fed, i cant remember where right now but ive heard it about the fed many times before.

[@ByronicLuke]

I'm honestly looking to understand; not criticize the good, Dr. Sowell. What does he mean? To not have currency at all? Barter? Or does me mean a finite currency of dollars?

[@4191good1]

The Treasury can do it again and if the current Presidents Treasurer is doing a poor job put pressure on the President to replace them or replace the Administration the next time the term comes up. Central Banks historically were on 5, 10, 20 or 25 year contracts, not this perpetual BS like the Fed.

[@Southparkateer2]

Great metaphor.

[@sp1ke0kill3r]

@ ByronicLuke I didn't hear Sowell say anything about no currency. He did say something about no gold standard, but he also described that as a different set of arguments. Finally, perhaps the question is less about what would you replace the fed with and more about what is likely to replace the Fed. Are we likely to see the statusQuo ante or more likely to see congress take a stab @ it? The governments solution invariably seems to amount to adding another layer of bureaucracy. Will we see a department of Economy wide security?

[@cmbradford]

It's interesting that the interviewer did not expect Sowell's answer.

[@laborwage]

@MatsKaarbo Hmmmm.... when you say "we have and what we can use," who do you mean?

[@fastted9390]

Every American needs to read and study the book - "The Creature From Jekyll Island."

[@davidchase9424]

We don't need the government but the government sure needs us.

[@smeekle2000]

When a black man says a system is dysfunctional, it's time to switch on and dismantle the machine.

[@alliebamski7620]

the bolsheviks love this intentional divide.

[@sniped101]

what do you place it with?

[@TruthisWITHIN]

I feel if you end the federal reserves right now, those who own majority of the land and gold will control EVERYTHING. The complete financial system will need to be replaced, I agree with Mr Sowell on nearly everything. But on this topic, I’m not sure if he’s completely correct.

[@JanRiffler]

Brilliant.

[@quidnick]

My holms, Sowell tells it straight yet again.

[@TS175]

Sweet...very sweet!

[@BrianValddreifing]

He was great! Go Austrian School of Economics!

[@ananiasacts]

@AquaticApe1, so we carry around bags of flour? They never actually explain how "wealth" works in that video. I couldn't figure out how the accounting works.

[@alitlweird]

Thomas Sowell™️ is against the Federal Reserve? That’s good enough for me. 🇺🇸

[@fastted9390]

The 2 basic but important things about the "Fed" - It is NOT 'federal' / rather a banking cabal And, there is NO RESERVE.

[@herviews]

Replace it with discarded plastic bags; that would clear out the landfills.

[@Whoo711]

late after the stock market crash and bank runs. They held to a VERY STRICT "sound money" approach, and because of that, THEY HAD NO WIGGLE ROOM in terms of fixing the money supply to DEAL W/ THE PROBLEMS, nor did they do much about ENSURING THAT BANKS AND DESPOSITORS WERE SAFE. Because there was HARDLY any fractional-reserve banking, loads of banks HAD ONLY ENOUGH FOR SOME DEPOSITORS (whatever was in the vault), and they ran out. Now, with fractional-reserve banking AND deposit insurance

[@ninjanickb]

@VanceJoudrey Sowell use to be a liberal early on in his life until he actually worked for the government and noticed first hand how there intervention often made things worse. Sowell doesn't write or say things in hopes of whites approving his message. Anytime he goes on Beck or Rush talks about him they give him major respect because they know his work is thorough. In a Sowell book you're guaranteed at least 3-4 facts per page that you didn't know about before.

[@freesk8]

Yay, Thomas Sowell!!!

[@jppj5977]

When a guest goes off-script, mainstream academia falls apart. OMG I have to think in real time, There is no script for me to read!

[@theolympiaacademy1868]

Replace the federal reserve with BItcoin, instead of the gold standard? I need to do more research, but at this time it seems like the most rational option to me.

[@derpmeowslurp1593]

+Alexander Adams sorry this was for the guy below you but i can't reply to him, so i'll just leave this here. well true Fiat currency is currency in which Government sets the standard of value. That's actually Congress' job...that they gave away to a PRIVATE consortium of bankers. Whether or not all of the roses were blooming under the gold standard is virtually irrelevant here. We the People, have no control over our currency. We cannot control when the increase the availability of loans, print more money, or reduce those things. Subsequentially we have no control over inflation. By paying the Fed, essentially interest, to print the money, that interest takes on the form of real wealth. All the real wealth has been sucked out, we couldn't go on the gold standard if we wanted to. The current debt based system isn't even a bad system, if A) humans weren't the collateral (social security act) and B) the debt pool had oversight. We can only guess how much debt is being created, and I think it's fair to say that it is way too much to be sustainable. The first order of business is to find out what algorithms the Fed is using, where the money is going, who's on the board of the Federal Reserve, and what their internal policies are. I will grant it is possible, however unlikely, that the Federal Reserve is doing a better job than congress ever could. That still doesn't make it ok for our money to be controlled secretly.

[@JensHove]

Fiat currency works fine as long as someone with a brain controls the printing press.

[@b.chuchlucious5471]

Bitcoin?! And what is that backed by? The US needs its own currency as stated by the Constitution. End the Fed!

[@ghxstleader485]

Bitcoin is just math and I trust math more than any human being

[@therealghosty6629]

Bitcoin is highly volatile, as it has no tether to reality

[@oiuoiu988]

@zayadnay thats a non-sequitur, i never said we should switch to gold. its also idiotic because the amount of money in circulation has no correlation with actual economic growth, just gdp.

[@sniped101]

wow.. thats amazing

[@doglegjake6788]

It's time for a change NOW

[@tommybo4699]

Thomas Sowell for the win.

[@CharlesWilson-zs3vd]

The founding fathers, said gold and silver was to be our currency, no other.