Paul Volcker, the venerable former chairman of the Federal Reserve, is credited with slaying the dragon of 70s stagflation during his tenure as U.S. central bank chief. Long afterwards, he was still pushing for sound monetary policy and financial regulations through his think-tank, the Volcker Alliance. He died Sunday at 92.
Mr Volcker was a key figure at many critical financial events in the last half century. He was instrumental in ushering in the post-Bretton Woods system of flexible exchange rates. He undid the damage caused by wage and price controls in the 1970s by pushing the Fed funds rate to 20% in 1981, and persisted in spite of strong opposition — vanquishing inflation and laying the foundation for decades of growth. He was a fighter against corruption in finance, lending his name to the rule that would curtail banks’ proprietary trading and speculative excess.
May Mr Volcker’s lessons and convictions long resound in the halls of Washington.
