This guest commentary was written by Jesse Felder of The Felder Report. It was originally published on September 14. Click here to get Hedgeye's Market Brief, a free weekly newsletter featuring the top 5 trending insights on

All You Need To Know About The Fed In Just 2 Charts - Fed La La Land cartoon 09.15.2016

The Fed was created in 1913 in response to the Panic of 1907. Its original mandate was to promote the sort of financial stability that would prevent or at least ameliorate this kind of banking crisis. 100 years later they’ve clearly made very little if any progress on this front.

In fact, this original mandate has seemingly been entirely forgotten in the pursuit of Fed’s single greatest achievement since it’s creation: inflation. The purchasing power of the dollar has fallen fully 96% since the institution was first established.

All of this begs the (rhetorical) question: ‘What is the purpose of giving an institution the greatest power there is to give (control of the nation’s money supply) when it completely falls down in its single most important function and could hardly be more successful at destroying the value of your hard-earned savings?’


This is a Hedgeye Guest Contributor piece written by Jesse Felder and reposted from The Felder Report blog. Felder has been managing money for over 20 years. He began his professional career at Bear, Stearns & Co. and later co-founded a multi-billion-dollar hedge fund firm headquartered in Santa Monica, California. Today he lives in Bend, Oregon and publishes The Felder Report. This piece does not necessarily reflect the opinion of Hedgeye.

All You Need To Know About The Fed In Just 2 Charts - market brief