It's 2022, not 1972 - Addendum
A brief addendum to yesterday’s post: The post is an example of me trying to make economics more accessible while sharing my expertise. I truly love economics, and my goal is to share that love with others.
Above all, I want to create space for others to join these discussions, especially those who do not look like a typical economist on the news or in top policy roles, or who do not have the elite credentials. So yeah, some might see me as “not serious,” but the worst thing I could do is take myself too seriously. It’s not about me.
Finally, here’s a snippet from below the paywall, which is a dive into FOMC meeting transcripts from the 1970s. It shows how different the Fed is now.
I am floored at the vagaries that passed communication policy. Here’s January 1973:
Mr. Mitchell asked, with respect to the upper limit of 6-3/8 per cent for the funds rate, whether the Chairman was suggesting that the Desk probe toward that level immediately.
In reply, Chairman Burns said he would not want to see the Desk take steps that would firm money market conditions on the first day after the Committee's meeting, thereby giving clear signals that might benefit market participants; he preferred to maintain a degree of uncertainty about the course of policy.
Compare that to Jay Powell and numerous Fed officials clearly telegraphing a 50 basis point move at the next meeting in May and “expeditious” increases after that. The last thing the Fed wants to do is inject uncertainty into the world now. Smart.
Much more from the transcripts below the paywall.
I appreciate your support of my Substack and your patience with my limited paid-only content. Going forward, I aim to write one private post per week and one public one. Please send me suggestions or questions about the Fed to address. stayathomemacro@gmail.com.
My views here are my own and do not represent anyone else.