It’s like all of we old and sort of old guys are coming out of the woodwork this week about the passing of the last great Fed chief.
Yesterday we took note of Doctor Ed’s views, and I added some of my own. The day before that we took note of a Tweeter who’s on financial TeeVee and his views, and I added some of my own.
…while I liked Volcker relative to the rest of them, let's not aggrandize any of them. Volcker did what inflation signals at the time demanded he do. Nothing more, nothing less. Just as Powell threatened last year. If long rates rise and the Fed sits, they are exposed.
— Gary Tanashian (@NFTRHgt) December 9, 2019
Today Bob Hoye presents his views, and in his view that Volcker was the Fed chief who just happened to be in the right (or wrong) place at the right time, Bob and I agree. Here’s Bob’s piece, with a key point made in Bob’s unique writing style…
“Paul Volcker just happened to be on duty during the natural transition from the stress of inflation to the wonders of financial speculation.”
“Indeed, during Volcker’s watch inflation soared and as usual interest rates soared until the mania exhausted itself. But it was global and central banking has been a national enterprise. If one looks at the popular proxy for credit/money (M2) there was no decline in its growth rate during the 1980 transition. However, there was a harsh global recession that included America, followed by the fascinating shift to speculation in financial assets which continues to this very day.”
Click for the full PDF file. It’s not a long read.
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