Central bankers, like the Fed, manage “the big risk.” When the debt cannot be paid on demand, coincidental to falling median income, the reserve bank has a lot of discretion to manage the probable risk, and its authority fits the relative size and strength of the risk proportion.
The relative risk proportion is where the “arcane discussion” about Glass-Steagall, for example, comes in. Big bankers say repeal of Glass-Steagall did not cause the ’08 financial crisis. It’s just a myth perpetrated to blame something on somebody without really understanding the causal attributions.
So-called “repeal” occurred with the 1999 Gramm-Leach-Bliley Act (GLBA). Texas Senator, Phil Gramm was a leading proponent of this Act to make sure the takers do not despoil the capital with greedy notions of “our money” belonging to them.
(Gramm was famous for arguing the Objectivist reality of capital’s natural identity. He argued that the capital naturally conserves in the hands of rich people because they know how best to manage it for everybody, which argues the utility of its use-value–the weak force of its relative strength–on demand.)
The GLBA and the CFTMA (the Commodities and Futures Trade Modernization Act) effectively combined to allow for what Glass-Steagall prohibited–a financial system so hugely complicated and interconnected it cannot be allowed to fail. Thus the term, Too Big To Fail (and a complexity that allows the term “too big to jail” to be an objective reality).
Again, keep in mind how the accidentals can actually work to discover the proper form. Many of the rich people Gramm said are the best and the brightest, compared to the real upper class, are relatively not that rich. Many of them occupy congressional committees that oversee financial operations and many of them resent the Fed having used its authority to bail out the richest of the rich to conserve the “natural identity” of the capital. (Ooops!)
Now we’re looking at the Fed Oversight Reform and Modernization Act of 2015 (the FORM Act).
Apparently the Fed’s discretionary authority does not fit the proper, republican form.
Apparently, rule by fiat is not the republican form of governance.
(Huh… support becomes resistance… sort of accidental like, doesn’t it?)