scotty gives us another old wives tale
The fed simply was all about real ouptut prior to the full volckerdammerung figure for camel clutch in 1981 or so sez our S-s-s-summy boy
"Indeed ...from 1967 to 1981. "
so here goes.... hold on tight :
" In late 1966 the Fed tightened slightly to slow inflation, which was gradually rising. "
" The yield curve inverted."
" Normally we should have had a recession, but instead the Fed quickly switched to a policy of easing in 1967, and we merely had a slight slowdown."
"Then we entered the 15 year period of very high inflation."
just that little first step and ...down the slope we went
"If the Fed was trying to control inflation, they would have never once cut interest rates during that 15 year period...inflation was always too high—usually much too high (although ---nixon's --- prices controls temporarily held it down in 1972)."
" The Fed raised and lowered rates again and again during this period, because they weren’t trying to bring inflation down, they were targeting real GDP. "
" Even worse, to the extent they cared about inflation at all,
they were doing price growth rate targeting, not level targeting."
