Paul A Volcker

Who do you think the best chairman of The Federal Reserve in 20th century?

I believe most of you will say "Alan Greenspan". But I have different choice, and my choice goes to Paul A Volcker. I still prefer Volcker for some reasons even though Greenspan has become chairman of the Fed for several periods.



Who do you think the best chairman of The Federal Reserve in 20th century?

I believe most of you will say "Alan Greenspan". But I have different choice, and my choice goes to Paul A Volcker. I still prefer Volcker for some reasons even though Greenspan has become chairman of the Fed for several periods.

My reason to choose Volcker is based on hos achievement in solving severe economic problems in the United States. Beneath his supervision, The Federal Reserves has successfully ended the stagflation crisis in the United States during 1970s by limiting the growth of money supply. This decision was very controversial due to government's goal to always stimulate economics growth and to reduce unemployment. Limiting money supply would stem economic growth and it would contradict with governments policy. But Volcker thought that this is the role The Fed should play in the United States' economy.

by that time, he was succeeded in altering the of thinking of all Fed's chairman committee that the Fed's target is no longer interest rate but inflation. Volcker saw that if inflation should be managed properly in order to stabilize the economy and boosting the economic growth.

The harsh stagflation in 1970s was caused by the raise of oil price and give rise to inflation to reached its highest level in history at 13.5% in 1981. The strategy choose by Volcker was succeeded in lowering the inflation to 3.2% in 1983. But unfortunately, after his tremendous achievement he should loosen his "throne" and should abdicate to Greenspan. Some rumors said that he put down his authority because of some contradict thought against the President of United States, Ronald Reagan.

Now a days, he become one of economics adviser to Barrack Obama, who just won the presidential election in United States, along with Warren Buffet.