Core Viewpoint - The independence of the Federal Reserve is derived from public trust, and it must recommit to maintaining the confidence of the American people. The focus should be on three statutory responsibilities: maximum employment, price stability, and moderate long-term interest rates [1][2][14]. Group 1: Critique of Current Policies - The use of unconventional monetary policies since the 2008 financial crisis is described as a dangerous "functional gain" experiment, threatening the independence of the Federal Reserve [2][10]. - The overuse of unconventional policies and the expansion of functions have led to a concentration of wealth among asset owners, exacerbating inequality [4][12]. - The Federal Reserve's actions have created a perception that monetary policy is being used to accommodate fiscal needs, undermining its independence [7][13]. Group 2: Recommendations for the Federal Reserve - The Federal Reserve should return to its narrow statutory mission and reduce economic distortions, focusing on maximum employment, price stability, and moderate long-term interest rates [8][14]. - Unconventional policies like quantitative easing (QE) should only be used in "true emergencies" and in coordination with other government departments [2][8][14]. - A comprehensive, independent, and nonpartisan review of the Federal Reserve's monetary policy, regulation, communication, personnel, and research is necessary [8][13]. Group 3: Market Implications - The statements made by the Treasury Secretary are seen as a precursor to a significant shift in U.S. monetary policy, potentially paving the way for financial repression policies such as QE or yield curve control (YCC) [3][9]. - If such policies are implemented, they could lead to a weaker dollar and benefit commodities like gold, silver, and copper, as well as markets like A-shares and Hong Kong stocks [3][9].

Core Viewpoint - U.S. Treasury Secretary Bessen criticizes the Federal Reserve for straying from its statutory duties and emphasizes the need for the Fed to regain public trust and focus on its core mission of maximizing employment, stabilizing prices, and maintaining moderate long-term interest rates [1][12]. Group 1: Critique of Federal Reserve Policies - Bessen describes the Fed's post-financial crisis policies as a dangerous "functional gain" experiment, warning that excessive use of unconventional policies threatens the central bank's independence [1][3]. - He argues that these policies have exacerbated wealth inequality, benefiting asset owners while disadvantaging small businesses and lower-income families [3][10]. - The Treasury Secretary highlights that the Fed's failure to achieve its inflation mandate has widened class and generational disparities, counteracting its intended growth stimulation through the "wealth effect" [3][10]. Group 2: Call for Policy Reformation - Bessen calls for the Fed to return to its three statutory responsibilities and to reduce economic distortions caused by its policies [6][12]. - He insists that unconventional policies like quantitative easing (QE) should only be employed in genuine emergencies and in coordination with other government departments [6][12]. - The need for an independent, bipartisan review of the Fed's monetary policy, regulation, communication, staffing, and research is emphasized to restore credibility and independence [6][11]. Group 3: Implications for Future Monetary Policy - Analysts interpret Bessen's statements as a potential precursor to significant shifts in U.S. monetary policy, possibly paving the way for renewed QE or yield curve control (YCC) [2][7]. - The introduction of "moderate long-term interest rates" as a focus area is seen as a notable signal, suggesting a priority on lowering long-term financing costs, particularly for mortgage rates [1][7]. - If such policies are implemented, they could lead to a weaker dollar and benefit commodities like gold, silver, and copper, as well as markets such as A-shares and Hong Kong stocks [2][7].