The Problem With Interest Rates

Paul Volcker had a long and successful career in monetary affairs but is best known as the chairman of the Federal Reserve from 1979 to 1987. Dr. Volcker is lauded for battling inflation during a time of major economic imbalances in the United States. However, to do so, he had to raise interest rates to an all-time high: 19 percent. What he said when we talked was instrumental in my opinion. He didn’t raise rates because he thought it was “right” at the time. He raised rates because that was the only way to get the capital the government needed to keep the ship afloat at the time. These interviews are short, but instructive…