money creation should be abolished

For this debate I shall be debating on the aspect of fiat which is the topic outlined by my opponent in R1 by him. My opponent then moved on to talking about the Fed, so I'm going to attempt to argue along the resolution he has established. Contention 1: Monetary Policy Monetary policy is quite key in many things as in 2008 during the subprime crisis, Federal Reserve Chairman Ben Bernanke created a stimulus that far surpassed that of the Federal Government's TARP, which I'll get into TARP later on. Bernanke saw the issue in the economy needed a huge fix and it was obvious that he needed to supply credit, not liquidity [1]. The Monetary policy had many types of stimulus, but none more effective, by far, than the Quantitative Easing (QE from this point forward). During QE1, the Federal Reserve purchased US treasury bonds that were mortgaged based bringing totals up to nearly $2 trillion [2]. This was important as the Federal Reserve had no choice, but to buy these toxic assets as many banks began to go under. Much of these toxic assets were grouped together in CDS, which these toxic assets and bad mortgages were packaged and sold off to other banks as well as other companies. When Lehman Brothers went under, the Fed jumped in and began to start buying these toxic assets. Many of these came from Freddie and Fannie Mae's Mortgage Backed Securities (MBS). In QE3, the Federal Reserve has increased purchasing MBS and GSE (Government Sponsored Enterprises) debt increased to $85 billion per month and this would continue until the markets recovered. To this point, the Federal Reserve's total holding are at $4.4 trillion by the end of 2014 [3]. US unemployment has fallen from 10% to now around 5% by the end of 2014 [4]. Unlike many critics speculation, QE did not lead to the hyperinflation that many had feared as the US economy began to recover. In the purchasing of the toxic assets and public debt, it infused credit into the markets leading to an increase in AD which is the number 1 driver of the economy as nearly everything and all paths to recovery revolves around the AD and as the public spending increases, it sends signals to the consumers that the economy is beginning to recover and they can feel safe to begin continuation of consumer spending and making investments. This has helped pave the pathway to recovery that Free Market policy wouldn't be able to even come close to such a safe recovery as we would have likely have been plunged into another Great Depression as world markets were all beginning to fail. Contention 2: Controlling Inflation One of the key issues behind inflation is the amount of harm it can do when we look at the effects it has on the average American. It tends to harm the middle class the most as inflation requires debtors and banks to raise their interest rates and you see prices increase substantially. This impact increases more of a harm as we tend to see sticky wages where even if prices go up, wages stay the same. This means the consumer is able to afford less and less [5]. We see less and less investment in the stock market and businesses which means less and less jobs. If we do not combat inflation we will see high unemployment rates and slowed economic growth. What does this has to do with the Federal Reserve you may ask. The Federal Reserve is the government’s only and best tool to control inflation by the raising of interest rates. By increasing interest rates, they purchase currency on the market meaning that there is less and less money on the market causing more and more people to save. This causes deflation and prevents inflation from becoming out of control as this was the task since post-Johnson and Nixon era where they were tasked with this in order to defeat the mounting 16% inflation rate at the time [6]. Many "End the Feders" seems to think that there was no inflation before the fed, but this is hilariously wrong. We can see that the highest points of inflation were in the mid 1780’s at 30%, early 1802’s at 20%, and 1863-1864 at 25% [7] . With the Fed not tasked with controlling inflation until the Nixon era, we can see this has caused a massive decrease in inflation ever since compared to post inflation. The "End the Feders" also ridiculous to think that today’s inflation is 15% and unemployment at 9%. The actual numbers are inflation is at 1% and unemployment is 4.9% [6].Sources http://tinyurl.com... http://tinyurl.com... http://tinyurl.com... http://tinyurl.com... http://tinyurl.com... http://tinyurl.com...