Central Banking for the 21st Century: An American Perspective

21 Pages Posted: 11 May 2011

See all articles by Paul Wachtel

Paul Wachtel

New York University - Stern School of Business

Date Written: December 28, 2010

Abstract

Central banks are peculiar institutions with one foot in the private sector and one foot in the government. In the United States, in particular, the central bank stands out as the extra-constitutional fourth branch of the federal government. It has considerable power which it can exercise without any significant formal review or interference from Congress, the President or any elected officials. It stands outside the American constitutional framework with its checks and balances on the exercise of power by Congress, the President and the judiciary. The Fed’s unique position has withstood repeated challenges to its legality and extra constitutional status and, like central banks around the world, it is viewed as an essential part of the policy framework.

Suggested Citation

Wachtel, Paul, Central Banking for the 21st Century: An American Perspective (December 28, 2010). Available at SSRN: https://ssrn.com/abstract=1836714 or http://dx.doi.org/10.2139/ssrn.1836714

Paul Wachtel (Contact Author)

New York University - Stern School of Business ( email )

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HOME PAGE: http://www.stern.nyu.edu/~pwachtel

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