While the Fed was sold to the American public as an institution necessary to provide an "elastic currency" that would wax and wane with commercial demand for money, the Fed saw to it that the money supply did a lot more waxing and not much waning. The data tell a remarkable story.
In 1913, the M2 money supply was approximately $16 billion. Last month M2 came in at $8,804.2 billion. $8.8 trillion! Who knew elastic stretched in only one direction? What did all of this monetary inflation get us?
In the name of economic stability, the Fed has presided over seventeen recessions, several of them very serious, including the Great Depression, and a century of higher prices. After more than a century of generally decreasing prices, the Fed ushered in almost one hundred years of price inflation that really took off after the final severing of gold from the dollar in 1971. That move itself was the necessary consequence of Federal Reserve inflation.