Is the Fed prepared to bring down inflation if that requires throwing people out of work?
That was the question posed to three current or former Fed officials Friday night at Stanford.
What followed was a story about a panic button, a security guard, and a piece of art:
That was the question posed to three current or former Fed officials Friday night at Stanford.
What followed was a story about a panic button, a security guard, and a piece of art:
Randy Quarles, who until last year was the Fed’s vice chair of supervision, said the answer was “Yes.”
Working late at night, he would sometimes set off a security alarm in the Eccles building. One night, he was showing the art in his office to the guard who had come running.
Working late at night, he would sometimes set off a security alarm in the Eccles building. One night, he was showing the art in his office to the guard who had come running.
One of the paintings on the walls of his office was by Arthur Burns. Quarles proceeded to explain who Burns was.
The guard stopped him. “Oh my God, that's the guy who let inflation get outta control.”
The guard stopped him. “Oh my God, that's the guy who let inflation get outta control.”
The point of the story: “This is an institution from top to bottom that knows that the one great sin that will be remembered by everyone 50 years later is if you let inflation get out of control.”
I wish I had gotten this story into my recently released book. If you’re into this sort of history, check it out.
There’s the time Volcker told Nixon to take a recession early in his term.
And Trump’s reaction when he met Quarles for his Fed interview: nicktimiraos.com
There’s the time Volcker told Nixon to take a recession early in his term.
And Trump’s reaction when he met Quarles for his Fed interview: nicktimiraos.com
Loading suggestions...