On the other hand, do you think that congress would have made the fed prick the housing bubble back in 2003? I suspect that congress would, on average, want looser monetary policy than the fed.

Given that I have savings, and no debt, I personally am in no hurry for Congress to oversee the Fed. Eventually the voters, business, and then Congress, are going to realize that a few years of 20% inflation would solve a lot of problems for a lot of people.

AndyfromTucson wrote, Eventually the voters, business, and then Congress, are going to realize that a few years of 20% inflation would solve a lot of problems for a lot of people.

It's possible we might not have any choice. I've heard talk that there's some evidence from history that when there's too many people saddled with too much debt, "debt forgiveness" via inflation is the only way out.

Not that I'm happy about it, either.

Congress would be no better at discretionary regulation than the Fed. What Congress has to do is set up a tax and legal framework for banking and finance in which crazy speculation is not rewarded. This is not impossible - a lot of it was done during the Depression, but has since been repealed. Instead of taking constructive action when those industries appeared threatened, Congress and both the Bush and Obama administrations have just given them more power.

The specific issue under consideration at present is how much of the Fed's operations are secret, not whether Congress will be micromanaging monetary policy. The Fed and finance industries are probably not so much afraid of Congress as of public reaction to how much the Fed's policy is actually set by Wall Street.

This whole argument about Congress controlling monetary policy is an incredible strawman. This isn't even on the table! The only real legislation under consideration right now is for a mere audit. Let's keep the debate honest.

I suspect that congress would, on average, want looser monetary policy than the fed.

Negative rates? It doesn't get much looser than what we have now.

Regulatory capture dominates.

They fight over the regulations
not out of a desire to exercise them, but out of a desire to enjoy the fruits of being captured.

You ask: "Could things be much worse?"

Can you say "free coinage of silver?"

A while back, I challenged Obama's budget projections as "phoney baloney" and you said they weren't.

Now, you are constantly saying that the economy will be much worse than most predictions. This is especially true of the White House's earlier projections, especially the ones that said the stimulus would keep unemployment from going anywhere near 10 percent.

What gives?

Those supporting the Fed's continued policies of secrecy are really saying:
"It's better if unelected private bank controls US monetary policy, rather than the elected representatives of the People—those very people who foot the bill for US monetary policy.

It seems like the spirit of the Constitution was that Congress, the representatives of the People, would determine how the People's money was spent, and what financial obligations the Government imposed on the People.

The Fed has not only usurped that right, it's trying to assert a "right" to not even inform the People—whose money it uses —how that money is even being spent.

Never mind "auditing" the Fed.

It's time to just end it.