Chart of the Week: 10 year Treasury 1974-2006

Monday, January 30, 2006 | 02:10 PM

Greenspan garners all the credit for the low interest rates of the past 20 years. We believe the chart below proves otherwise. The Oil shock in the 1st half of the 1970s gave way to inflation shock of the 2nd half.

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10 year Treasury 1974-2006, Constant Maturity
Volcker_versus_greenspan

Source: RCP, Economagic

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When Volcker was appointed Fed Chair, inflation was in the double digits and growth was stagnant. He forced unpleasant medicine down the gullet of the American economy, limiting the growth of the money supply and abandoning interest rate targeting. Inflation, which had peaked at 13.5% in 1981, was down to 3.2 percent by 1983.

 

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Quote of the Day: 

“A wise observer of the economic scene once commented that ‘what can be left to later, usually is – and then, alas, it's too late.’”

-Paul Volcker, Federal Reserve Chairman, 1979-87

Monday, January 30, 2006 | 02:10 PM | Permalink | Comments (7) | TrackBack (0)
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Comments

Volcker is the last of the true He-men Woman Hater's Club. Ain't no sissified Fed quasi-politicians capable of such actions today. That's why we'll likely do a Mama Cass and choke on our gluttony.

Anyone follow the derivatives markets? Today was an odd day. Extremely odd day. Makes me wonder if we are getting ready to give Bernanke a welcome-to-the-party present. Last time I saw this type of behavior was late December back in 63. Oh what a night. Actually late September of 2005 days before our mini sell off.

Ok, three references to music in there. One is obvious. Care to crack the codes?

Posted by: B | Jan 30, 2006 4:11:58 PM

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