James Grant: Fed Should Heed Lessons of 1920's Policy
February 14 — The U.S. has been “overmedicated” by public policy and should consider the government’s 1920's response to recession, said James Grant, editor of Grant’s Interest Rate Observer.
Responding to a severe economic downturn from 1920 to 1921, the Federal Reserve increased interest rates and the national budget was balanced, moves that kept the painful recession short, New York-based Grant said. In contrast, he said U.S. policy makers are prolonging the pain of the so-called Great Recession by intervening in markets and running unprecedented federal budget deficits. Read more.
