Paul Volcker at Bloomberg HQ

Thursday, September 28, 2006 | 07:05 AM

The King Report, an institutional commentary, recounted a fascinating discussion that took place at Bloomberg's HQ in NY on Monday night. A panel of ex-NY Fed Presidents (Paul Volcker, Gerald Corrigan, William McDonough and Anthony Solomon) held a panel discussion on the risks to the US economy. The panel chair was current NY Fed President Tim Geithner.

Here are a few comments that Bill King was kind enough to pass along:

"Volcker and Corrigan warned about inflation.

Gerald Corrigan on our current structutral issues: “Once the genie [inflation] is out of the bottle, it is very, very difficult and expensive to put it back in the bottle...The U.S. savings rate is virtually zero. It brings with it some potential of very serious problems down the road, as far as the well-being of our citizens.”

While Greenspan gets most of the credit, the reality is we have been living in the house that Volcker built. Easy Al has frittered away much of the solidity of that Anti-Inflation structure. 

Here are Volcker's comments:

Paul Volcker: “I am a little bit more worried about inflation…it is kind of creeping up, and I am impressed by the degree of pressure, if that is the right word, psychological pressure, political pressure, there is not to do anything about it.”

Volcker added, “A lot of people out there on Wall Street, and on Main Street, are operating on the assumption that nothing very startling will happen in terms of restraint…But once people are convinced that that’s the case, it can creep up and the more it creeps on you the more difficult it becomes to do something about it.”

Volcker also criticized the LTCM bailout. “I expressed certain reservations about that particular operation at the time and I hold steadfast to my reservations.”

Paul also takes a swipe at the contemporary Fed for its penchant to warble. “I do think actions speak louder than words and the words should as little as possible confuse things. The market ought to make up its own mind once in a while and eventually it will. I don’t know how much they need to be spoon-fed, so to speak.”

Mr. Volcker, God bless him, ridicules contemporary central bank & Street sophistry:
“We live in this peculiar world where 3 percent inflation is stability but a half percent decline in the price index is deflation. I am not quite up with modern nomenclature.”

Great stuff. Thanks, Bill.


The King Report
Bill King
M. Ramsey King Securities, Inc.
Tuesday September 26, 2006 – Issue 3482 “Independent View of the News”

Thursday, September 28, 2006 | 07:05 AM | Permalink | Comments (10) | TrackBack (0) add to | digg digg this! | technorati add to technorati | email email this post



TrackBack URL for this entry:

Listed below are links to weblogs that reference Paul Volcker at Bloomberg HQ:


I don't know why you're giving credit to The King Report. The full story is available on The event was, incidentally, sponsored by the Woman's Economic Forum.

Posted by: DKH | Sep 28, 2006 9:15:07 AM

The comments to this entry are closed.

Recent Posts

December 2008
Sun Mon Tue Wed Thu Fri Sat
  1 2 3 4 5 6
7 8 9 10 11 12 13
14 15 16 17 18 19 20
21 22 23 24 25 26 27
28 29 30 31      


Complete Archives List



Category Cloud

On the Nightstand

On the Nightstand

 Subscribe in a reader

Get The Big Picture!
Enter your email address:

Read our privacy policy

Essays & Effluvia

The Apprenticed Investor

Apprenticed Investor

About Me

About Me
email me

Favorite Posts

Tools and Feeds

AddThis Social Bookmark Button

Add to Google Reader or Homepage

Subscribe to The Big Picture

Powered by FeedBurner

Add to Technorati Favorites


My Wishlist

Worth Perusing

Worth Perusing

mp3s Spinning

MP3s Spinning

My Photo



Odds & Ends

Site by Moxie Design Studios™