Chinese woman sues US Federal Reserve over shrinking cashTuesday 23 April 2013 07.38
A woman in China is trying to sue the US Federal Reserve after discovering that the real value of the $250 she put in an account in 2006 had shrunk by 30%.
She claims it was a result of the Federal Reserve issuing too much money.
Her lawyer, her son Li Zhen, called the lawsuit "litigation for the public good" which aimed to stop the Fed from continuing its quantitive easing policy and promote people's awareness of their rights.
He filed the lawsuit alleging "the abuse of monopoly in issuing currency" last month on behalf of his mother, Liu Hua, but the court has yet to decide whether to officially place the case on file.
Since the global financial crisis, the Fed has been pumping more money into the economy via several rounds of quantitative easing to try to boost consumer spending and revive economic growth.
Li said he referred to Black's Law Dictionary, the most cited legal dictionary in the US, and concluded that the Fed is a private institution instead of a government department.
According to the dictionary, US financial institutions are required to invest in the Federal Reserve System if they want to join it, which he construed as meaning the Fed is privately owned.
"Since the Fed is a private institution which enjoys a monopoly over the issuing of currency, US dollar holders can sue it for printing too much money," he said.