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The reason most libertarians I speak to are against the Fed is because it's regulation of the market, not because it's private. No matter if privately or publicly owned, the Fed is interfering with a free market and therefore "illegal".
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Furthermore, through the close cooperation between the treasury dept. and the federal reserve corporate losses are
socialized, while profits remain privatized. Nobody likes a multi-billion dollar welfare queen.
Most libertarians are really just Republicans who like to smoke weed. They take the free-market capitalism ideology a bit further socially and politically.
This thing is sticky, and I don't like it. I don't appreciate it.