Business: Volckerism: a Rough First Year

The Fed is still groping for a handle on the money supply

When President Carter last week admonished Federal Reserve Board Chairman Paul Volcker for pushing up the cost of borrowed money, he was not alone in the attack. Both at home and abroad, critics are taking a hard and skeptical look at the U.S. monetary policy that Volcker introduced Oct. 6, 1979. As part of a program to defend the dollar and fight inflation, he signaled a significant shift in strategy. Previously the Fed had attempted to keep interest rates steady and certain,...

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