I understand the reasoning that the fed & equivalents in other countries are supposed to manage the money supply as a smoothing function in booms and busts. I have never managed to accept though that the decision making of a committee can outperform the decision making of the market itself.
The problem is that market performance is never pure, and even when it is, the performance can be so volatile that side-effects permanently harm communities and subsequently offset the market performance.
And of course performance isn't everything. The 1-person committee in charge of driving a tractor trailer, for example, will deliberately choose sub-optimal performance when driving down a steep grade, because optimal short-term performance would result in a crash and complete long-term failure.
