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|Rep. Ron Paul (R-Texas)|
Therefore, we experience constant inflation, prolonged booms and busts, and illusions of prosperity, resulting in bad investments, minimal savings, and the transfer of wealth from the poor and middle classes to the wealthy. Ron Paul’s excellent book End the Fed  describes and documents these phenomena plainly and convincingly. As Paul points out, there is a growing movement to transition away from the Federal Reserve and their power to create money and control interest rates.
A degree of secrecy far more than found in any government agency prevails at the Fed, and no one breaks their barrier or forces any transparency. Congress has the authority to control the Fed, but up to now, little will to do so. There are several aspects which Ron Paul and others have noted about the disadvantages and dangers of the Fed, showing that their (the Fed's) work creates tremendous danger to the country. The Fed was the main factor in causing the Great Depression, which the Federal Government wasted no time in prolonging and deepening through bad, and often ridiculous, economic policies. The Fed is also the main culprit behind today’s economic crisis, which is being made far worse by the economic policies of the Obama Administration.
Austrian School economists predicted the housing bust and described the dangers of the Fed’s actions:
As adherents to Austrian economics know, the Federal Reserve-induced economic boom must turn to bust. People who have lived high, yet have truly earned nothing, will not fare well in the coming bust. Such cash-strapped and indebted families will head toward financial collapse and thus will turn to the state for welfare and credit relief. As to welfare, parent and child become virtual wards of the state….
The loan markets are profoundly distorted due to the nature of fiat money machinations. Because of this intervention, lending is now dramatically different. It is no longer necessary to know your borrowers. The bank – sustained by its cat-and-mouse scheme of fractional-reserve banking — has a huge incentive to fund the loan, and then sell the loan off to intermediaries who package the loans into mortgage-backed securities. In turn, this toxic junk is sold to mutual funds, insurance companies and other institutions starved for yield. The debt-o-rama grabs hold, and as for the borrowers, there is no longer a fear of debt….
Is it possible that the two-thousandaire is merely a precursor to the "new man" (a pliant, unthinking being) Mao and Lenin attempted to socially engineer via central planning? It would seem that the communists had it backwards thinking that banning money was integral to transforming mankind. For it certainly appears that easy money and credit do the trick in eroding the human spirit, morality, and basic decency, along with intellectual and financial independence. 
The monetarists argue that a top-down central bank guarantees monetary stability. Well, sure if your definition of stability is a grinding erosion of value through incessant inflation: today's dollar is worth $0.19 in 1971 dollars (the year the United States officially dropped any pretense of abiding by a gold standard) and worth only a nickel in 1913 dollars (the year the Federal Reserve was voted into existence). 
As has frequently been pointed out, numerous large bailouts have brought attention to moral hazard, that is, knowing that if a bank or company is considered “too big to fail,” it will be bailed out if it gets into trouble; therefore their management will likely be less cautious and willing to take more risks than would otherwise be the case. The other moral hazard, or more properly, moral failure, is that a monopoly on money, along with the unlimited power to create it at will, must lead to abuse and serious economic trouble and finally, collapse.
While the Fed is often thought of as non-political, it has usually tried to help the incumbent president politically. Ben Bernanke risked criticism by supporting (concocting?) President Barack Obama’s (and Treasury Secretary Timothy Geithner’s) politically unpopular auto bailouts and the Bush TARP bailouts which Obama also supported.
Tom Dilorenzo gives another example in this paragraph from a 2000 article:
As long as [President Bill] Clinton was fearful of impeachment, [Fed Chairman Alan] Greenspan kept the monetary spigots wide open, even while voicing "concern" about an "irrationally exuberant" economy. With Clinton out of the woods and the presidential race in full swing, Greenspan is attempting to reverse the irreversible economic forces that he set in motion over the past two and a half years. There is no easy answer to the current crisis. Even after something passes and everyone breathes a sigh of relief, we will still have this enormous debt and the longer-term problem unsolved. The conservative consensus, which I have supported, is that the Republicans must avoid caving to the Democrats in this situation, which, I think, could be politically damaging to the GOP. But if politics would allow it, Ron Paul offers, perhaps, the best approach, and that involves not paying the debt of the U.S. to the Fed (via Tulsa Change):
Over the years, the Fed has forestalled quick recoveries by preventing the corrections from taking place at times when the least amount of damage could have been sustained. Eliminating the Fed would put a lot of currency and economic troubles behind us, and ultimately lead to increased personal liberty and national prosperity.
 Ron Paul, End the Fed, New York: Grand Central Publishing, 2009. This is important reading for anyone interested in the U.S. economy and the Federal Reserve. I highly recommend it.
 Karen De Coster and Eric Englund, “Will the Federal Reserve Create the New Socialist Man?” 06/26/2006, Mises.org.
 Stephen Mauzy, “Don’t Blame the Federal Reserve,” 12/15/2009, Mises.org.
 Tom Dilorenzo, “The Federal Reserve and Political Corruption,” May 2000, Mises.org.