The public considered monetary history of a hero
Mentioned by Mr
Mentioned by Mr. Paul Volcker (Paul Volcker), 1979-1987 by Fed Chairman. The public considered monetary history of a hero, a strong torsion phagocytosis by inflation in the United States. We haven't discussed the RMB to dollar-anchor, to a large extent, also because out of gold, the dollar was caught after such a figure. I like his story, syncopation is heroic legend, let me know the currency selected anchor problems. August 15, 1971, President Nixon announced to close the "Golden window", the Bretton Woods system. All of a sudden, central banks hold billions euro-dollar, no u.s. Government had promised par gold. Previous years, the United States Congress also seems unconcerned with the US Federal Reserve USD to a certain proportion of gold reserves. This means that, regardless of the
Fake Watches external or internal, dollar gain "liberation" it does not consider itself bound by the chains of gold reserves, but also not subject to the fulfilment of commitments against the gold price. However, the United States so really nothing accounted for cheap. At least not so Volcker. It is not a coincidence that the status of the dollar, was worrying or "Nixon shock" was one of the most important planning. As was the U.S. Treasury Department is in charge of monetary Affairs, Deputy Minister, he finds the Eurodollar crisis is the United States out of gold reserve currency result. Therefore, he did not agree with the other think tanks and the President of the European countries that coercion when the currency against the dollar, you can unlock the dollar crisis once and for all. He advocated the open end of the showdown, simply is not possible to keep them the Bretton Woods system.
Volcker that also great resolve governance US domestic inflation. The scourge of excess supply in the source or the dollar, but the treatment of domestic inflation than against those who hit the foreign government representatives more difficult. After all, the treatment of domestic inflation by compatriot and industrial businesses and politicians to bear. Not some consensus that lack the necessary political tolerance, licensing and support, governance is a fundamental deterioration of inflation. In fact, in 1979, President Carter Volcker was nominated by the Rolex Watches Federal Reserve Chairman, u.s. CPI has been as high as 13% of the accumulated while accelerating inflation is the number one domestic economic issues in the United States. The height of two meters above the sea level at the beginning of a new President took office in respect of the following pain in the hand. Then the Fed's policy tool and the subsequent Greenspan era, mainly to improve the federal funds rate. He assumed office on the eighth day they announced the Fed funds rate by 50 basis points to increased 11% in two days and announced a discount rate increase of 5 basis points to 10.5%. However, when the new head of the Fed once again raise the discount rate required, he got into trouble: the Fed has the right to vote 7 members, 3 bits. Though Volcker also owns a majority, but public opinion and market are further interest rate is judged.
Vote in the Federal Reserve decided to base rate system, the Walker has a dilemma. If he insists on "interest is at least as" stance and calls for further increases in interest rates, then he is likely to be fairly becomes minority by Fed Chairman and became the minority and cannot implement its own policies. If he's like his predecessor sleek and compromise, the anti-inflation mission go by the wayside. The key here is that inflation is not only a monetary phenomenon, but also the public Tiffany Jewelry mental phenomena. It is expected that future inflation will continue to purchase behavior to defend their own wealth. More non-stop to buy, buy, buy, monetary growth than the goods and services for faster more Super release nature exposed, and the prices rising to stimulate more buying behavior and higher prices. To break the self-reinforcing high inflation, effective means of logic is higher because the interest of improving equals increased the opportunity cost of consumer behavior. Economics, as long as the price is high enough, you can constrain it.
The problem is that there is no allow rule for the role of the economic and political conditions? fed internal objections actually have broader representation because substantial interest inherent in "treatment". From the perspective of producers and consumers together reduce shopping will also be a disaster because inventory increases, slowing down, bankruptcy to rise, unemployment will be serious. In fact, not only economic but also fear of pain, the pain will be screaming. Like normal circumstances that flashes "fine-tune" the interest, things Swiss Watches haven't accomplished, the pain of political forces would rally. Volcker's own understanding, but never abandon the dollar from gold to build an anchor. He insists on the principle of economic logic, with years "deal" in the United States Government and politics in the maze master skills, finally found the actual path to solve the dilemma the Fed no longer vote benchmark interest rate, go directly to develop u.s. money supply targets, and then through the marketing process, from the money supply changes interest rates change. This is of course pan: money supply, interest rates, the Fed is no longer needed for the upgrading of the interest rates at the face of political tension. There was a bit critics commented, "this is a political rather than Replica Watches economic action" because with interest rates rising, the Fed can say, this is not the same as we do, we have no interest, we are just in the money supply target.
The public considered monetary history of a hero
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