1 00:00:13,800 --> 00:00:17,600 Speaker 1: Hello, and welcome to What Goes Up, a weekly markets podcast. 2 00:00:17,640 --> 00:00:19,880 Speaker 1: My name is Mike Reagan. I'm a senior editor at 3 00:00:19,880 --> 00:00:24,400 Speaker 1: Bloomberg and Umbaldonna Higher Across as reported with Bloomberg and 4 00:00:24,600 --> 00:00:27,480 Speaker 1: this week on the show, Well, since vill Donna won't 5 00:00:27,480 --> 00:00:30,440 Speaker 1: invite me to join any of her many, many book clubs, 6 00:00:30,680 --> 00:00:33,320 Speaker 1: we're gonna have one right here on the podcast. So 7 00:00:33,479 --> 00:00:36,839 Speaker 1: break out the Pinot Grigio and your coffy pants because 8 00:00:37,040 --> 00:00:39,080 Speaker 1: we have a great guest this week to talk about 9 00:00:39,120 --> 00:00:42,600 Speaker 1: a very important and timely book. Not only is she 10 00:00:42,640 --> 00:00:45,200 Speaker 1: one of my favorite colleagues, but she also helped former 11 00:00:45,240 --> 00:00:49,879 Speaker 1: Federal Reserve Chair Paul Volker write his memoirs and Taboot. 12 00:00:49,960 --> 00:00:52,400 Speaker 1: She has a fascinating piece out in the latest issue 13 00:00:52,440 --> 00:00:56,040 Speaker 1: of Business Week about Boker's reputation as an inflation fighting 14 00:00:56,040 --> 00:00:59,960 Speaker 1: superhero and what lessons his experience holds for the current 15 00:01:00,080 --> 00:01:03,960 Speaker 1: FED as it tries to play that same role. But first, 16 00:01:03,960 --> 00:01:09,520 Speaker 1: Pill Donna, confess, have you read the whole book of 17 00:01:09,520 --> 00:01:12,880 Speaker 1: the book? Yes, and I have proof. Well, you don't 18 00:01:12,920 --> 00:01:15,880 Speaker 1: spoil the ending for me. This won't spoiled the the 19 00:01:16,000 --> 00:01:20,080 Speaker 1: ending for you, but I know you'll know that I 20 00:01:20,120 --> 00:01:22,880 Speaker 1: read all the way through because the acknowledgement section. I 21 00:01:22,959 --> 00:01:28,360 Speaker 1: even read that, and Wolker in it talks about our 22 00:01:28,400 --> 00:01:31,120 Speaker 1: guests so so nicely. And this is all at the 23 00:01:31,200 --> 00:01:34,080 Speaker 1: end of the book. So this is my proof. All right, Well, 24 00:01:34,080 --> 00:01:38,280 Speaker 1: you just spoiler. That was a spoiler of the acknowledgment. 25 00:01:39,280 --> 00:01:41,440 Speaker 1: I'd never make it to the You didn't read the footnotes, 26 00:01:41,480 --> 00:01:44,440 Speaker 1: did you? Of course I did? Are you kidding? My goodness? 27 00:01:44,440 --> 00:01:46,520 Speaker 1: I was hoping to learn from them and learn I 28 00:01:46,560 --> 00:01:49,920 Speaker 1: did well. I confess I've read most of the book. 29 00:01:50,040 --> 00:01:52,400 Speaker 1: I had a very busy weekend. You know. It was 30 00:01:52,480 --> 00:01:56,040 Speaker 1: parents weekend at my my daughter's college, so there was 31 00:01:56,320 --> 00:02:00,280 Speaker 1: a football game and a tailgate, and that's lot of 32 00:02:00,280 --> 00:02:04,279 Speaker 1: activity for a guy my name, guy my age. I 33 00:02:04,280 --> 00:02:06,240 Speaker 1: I hardly even got a single map in all weekend. 34 00:02:06,280 --> 00:02:08,080 Speaker 1: But I think I read most of it. If you 35 00:02:08,120 --> 00:02:10,880 Speaker 1: count the pages in the middle with the pictures, then 36 00:02:10,960 --> 00:02:12,880 Speaker 1: I read most of it. You read most of it, okay? 37 00:02:12,919 --> 00:02:15,280 Speaker 1: Just to make it to make you feel even worse, 38 00:02:15,440 --> 00:02:18,640 Speaker 1: the Bills were playing on Sunday, and I didn't watch 39 00:02:18,680 --> 00:02:21,239 Speaker 1: the game because I sat around reading the book. Oh 40 00:02:21,240 --> 00:02:23,919 Speaker 1: my goodness. Yeah, So I hope you feel really bad. 41 00:02:24,040 --> 00:02:26,880 Speaker 1: That's that's commitment. I do feel bad, but it's what 42 00:02:26,960 --> 00:02:30,320 Speaker 1: I read is excellent. So when you bring our guests 43 00:02:30,360 --> 00:02:32,760 Speaker 1: in here we're speaking soon. Let's hear what she has 44 00:02:32,840 --> 00:02:35,800 Speaker 1: to say about you not reading. It's Christine Harper. She's 45 00:02:35,919 --> 00:02:38,840 Speaker 1: editor of Bloomberg Markets magazine. Christine, thanks so much for 46 00:02:38,880 --> 00:02:41,000 Speaker 1: coming on the show. Thank you so much for having me. 47 00:02:41,720 --> 00:02:43,440 Speaker 1: And to be fair, I don't even read all the 48 00:02:43,480 --> 00:02:48,799 Speaker 1: stories I edit. Sometimes you know it's uh. But Christie, 49 00:02:48,800 --> 00:02:52,120 Speaker 1: why don't you start and just tell us how um 50 00:02:52,160 --> 00:02:54,720 Speaker 1: you got involved in this project and sort of what 51 00:02:54,840 --> 00:02:56,840 Speaker 1: the division of labor is when you write a book 52 00:02:56,880 --> 00:03:00,080 Speaker 1: with with such a legendary figure like that. Well, I 53 00:03:00,120 --> 00:03:03,519 Speaker 1: can't speak for how this normally works, because I think 54 00:03:03,800 --> 00:03:06,920 Speaker 1: this was a really exceptional sort of lightning bolt experience 55 00:03:06,960 --> 00:03:10,400 Speaker 1: for me. I'd never written a book, and I just 56 00:03:10,480 --> 00:03:13,680 Speaker 1: happened to know somebody who is in the publishing business 57 00:03:14,720 --> 00:03:17,400 Speaker 1: and a friend, a mutual friend, came to me and 58 00:03:17,440 --> 00:03:21,320 Speaker 1: said he suggested my my name to this friend and 59 00:03:21,360 --> 00:03:24,040 Speaker 1: the publishing business as somebody who might be able to 60 00:03:24,080 --> 00:03:28,160 Speaker 1: help Paul Vulcan write his memoir. So the guy in 61 00:03:28,200 --> 00:03:30,880 Speaker 1: the publishing business, who name is Peter Ostos, calls me 62 00:03:31,000 --> 00:03:32,919 Speaker 1: up and he says, would you'd be interested in doing this? 63 00:03:33,080 --> 00:03:36,000 Speaker 1: Paul Wolker, he's getting quite old, he wants to write 64 00:03:36,000 --> 00:03:38,560 Speaker 1: his memoir and uh, he just needs a little help. 65 00:03:38,760 --> 00:03:40,360 Speaker 1: And I said, well, you know, I know nothing about 66 00:03:40,360 --> 00:03:43,200 Speaker 1: writing books, so and I'm not really an expert economics, 67 00:03:43,280 --> 00:03:45,600 Speaker 1: so I don't know why. And he was like, listen, 68 00:03:45,640 --> 00:03:47,960 Speaker 1: just you know, go talk to him. It should be 69 00:03:47,960 --> 00:03:50,800 Speaker 1: somebody in New York and and we want to make 70 00:03:50,800 --> 00:03:53,160 Speaker 1: it his book and not bringing somebody who's going to 71 00:03:53,200 --> 00:03:55,120 Speaker 1: make it their book. And I said, well, that's fine, 72 00:03:55,120 --> 00:03:57,880 Speaker 1: I'll do that. So and I thought to myself, no 73 00:03:57,880 --> 00:04:00,920 Speaker 1: matter what goes wrong, here, the worst case scenario as 74 00:04:00,960 --> 00:04:02,840 Speaker 1: I get to spend a bunch of time with Paul Volker. 75 00:04:02,920 --> 00:04:06,520 Speaker 1: How great is that? So so I had an introductory 76 00:04:06,560 --> 00:04:09,640 Speaker 1: meeting with him in his Rockefeller Center office in a 77 00:04:09,920 --> 00:04:15,119 Speaker 1: sort of late summer, and he was absolutely charming and 78 00:04:15,240 --> 00:04:19,440 Speaker 1: absolutely you know, great, and clearly had no qualms about 79 00:04:19,480 --> 00:04:23,800 Speaker 1: working with an untested person like me. And so we 80 00:04:23,880 --> 00:04:26,000 Speaker 1: just started meeting on a very regular basis at his 81 00:04:26,120 --> 00:04:28,320 Speaker 1: office at his home. He would tell me stories, I 82 00:04:28,320 --> 00:04:30,880 Speaker 1: would record them, I would get them transcribed. We would talk. 83 00:04:30,960 --> 00:04:34,320 Speaker 1: We would talking and then eventually he started writing and 84 00:04:34,480 --> 00:04:37,760 Speaker 1: handing me pages and and handing his secretary pages his 85 00:04:37,880 --> 00:04:41,080 Speaker 1: hype up and and I would give him feedback and 86 00:04:41,120 --> 00:04:44,200 Speaker 1: we would talk about it, and so yeah, it was 87 00:04:44,240 --> 00:04:47,080 Speaker 1: just it was great collaboration. He wrote a lot of 88 00:04:47,120 --> 00:04:51,320 Speaker 1: it himself a longhand on a yellow legal pads. I 89 00:04:51,360 --> 00:04:54,560 Speaker 1: had it typed up by his amazing secretariat, who uh, 90 00:04:55,120 --> 00:04:58,400 Speaker 1: who could read his handwriting, which is not an easy 91 00:04:58,760 --> 00:05:02,000 Speaker 1: not an easy thing, and then uh and then I 92 00:05:02,000 --> 00:05:05,240 Speaker 1: would sort of edit it and and make notes and changes, 93 00:05:05,279 --> 00:05:07,039 Speaker 1: and he would read it and then he in his 94 00:05:07,480 --> 00:05:10,560 Speaker 1: allegible handwriting right all these notes on it. He was very, 95 00:05:10,680 --> 00:05:14,800 Speaker 1: very involved. He would he had a great uh attention 96 00:05:14,839 --> 00:05:18,159 Speaker 1: to detail, a great interest in making sure we always 97 00:05:18,440 --> 00:05:21,920 Speaker 1: chose the exact right word. And I wasn't expecting that. 98 00:05:21,960 --> 00:05:24,920 Speaker 1: But as I worked with him, and as I learned 99 00:05:24,960 --> 00:05:27,640 Speaker 1: more about his career, it became clear to me that 100 00:05:27,800 --> 00:05:31,040 Speaker 1: so much of being in the roles he had was 101 00:05:31,080 --> 00:05:34,159 Speaker 1: about really perfect communication. If you read some of the 102 00:05:34,160 --> 00:05:37,240 Speaker 1: FED minutes from his time as chairman, the discussions are 103 00:05:37,279 --> 00:05:40,920 Speaker 1: all about how to convey exactly the right way in 104 00:05:40,960 --> 00:05:44,360 Speaker 1: their you know, in their statements and in their communications. 105 00:05:44,400 --> 00:05:47,080 Speaker 1: What they were trying to achieve because of course back 106 00:05:47,080 --> 00:05:49,840 Speaker 1: then they didn't they didn't announce what the FED funds 107 00:05:49,960 --> 00:05:52,520 Speaker 1: target was. You know, they just it's sort of they 108 00:05:52,520 --> 00:05:55,360 Speaker 1: would do it the open markets of desk would uh 109 00:05:56,279 --> 00:05:59,680 Speaker 1: would make it happen. They did announce the discount rate, 110 00:06:00,279 --> 00:06:01,760 Speaker 1: but it was it was a lot of it was 111 00:06:01,800 --> 00:06:05,000 Speaker 1: just communication. So, um, he's a he was a great 112 00:06:05,040 --> 00:06:07,919 Speaker 1: word smith, a great communicator, really cared about how to 113 00:06:07,960 --> 00:06:10,279 Speaker 1: tell the story, had a lot of stories to tell, 114 00:06:10,480 --> 00:06:14,120 Speaker 1: didn't really want to focus mostly on the inflation episode. 115 00:06:14,120 --> 00:06:17,920 Speaker 1: That was one chapter for him of a career that's 116 00:06:17,960 --> 00:06:22,359 Speaker 1: full of amazing chapters. And uh, it was just delightful 117 00:06:22,520 --> 00:06:25,560 Speaker 1: and uh he he and I worked on it really quickly, 118 00:06:25,640 --> 00:06:28,200 Speaker 1: got it done in I guess less than a year, 119 00:06:28,600 --> 00:06:31,240 Speaker 1: which is really impressive. Yeah, and um, but you know, 120 00:06:31,320 --> 00:06:34,120 Speaker 1: he was a motivated guy who's very disciplined, so you know, 121 00:06:34,160 --> 00:06:36,360 Speaker 1: and then unfortunately he got sick right towards the end 122 00:06:37,160 --> 00:06:40,599 Speaker 1: um and and was died a year after he came out. 123 00:06:40,720 --> 00:06:43,720 Speaker 1: So it's really sad because you know, he would he 124 00:06:43,760 --> 00:06:45,560 Speaker 1: would have a lot to say today. But I think 125 00:06:46,080 --> 00:06:49,320 Speaker 1: in a way he knew that his lessons would be 126 00:06:49,520 --> 00:06:52,559 Speaker 1: a value to people in many ways going forward, and 127 00:06:53,480 --> 00:06:55,880 Speaker 1: so he tries to he tries to impart them as 128 00:06:55,920 --> 00:07:02,839 Speaker 1: as clearly and uh and impact as he can. And 129 00:07:03,120 --> 00:07:04,720 Speaker 1: I want to get to all those things, but I 130 00:07:04,760 --> 00:07:07,320 Speaker 1: want to ask you one more question about the actual process, 131 00:07:07,320 --> 00:07:10,960 Speaker 1: because I really like the stories about his childhood right 132 00:07:11,000 --> 00:07:12,920 Speaker 1: at the start of the book and how I think 133 00:07:12,920 --> 00:07:15,560 Speaker 1: there was one story about how he had this allowance, 134 00:07:15,600 --> 00:07:18,360 Speaker 1: that it was the same amount he was getting weekly 135 00:07:18,480 --> 00:07:21,679 Speaker 1: or monthly that his sister's years beforehand had been getting, 136 00:07:21,720 --> 00:07:24,560 Speaker 1: and what that taught him about inflation. Um. And then 137 00:07:24,600 --> 00:07:27,080 Speaker 1: I think later on in the book he mentioned something 138 00:07:27,160 --> 00:07:30,400 Speaker 1: like he had been pulling out files specifically for the book, 139 00:07:30,440 --> 00:07:33,200 Speaker 1: and he was surprised by the things and that he 140 00:07:33,280 --> 00:07:36,080 Speaker 1: found in the notes that he had scribbled in the margins. 141 00:07:36,120 --> 00:07:37,600 Speaker 1: So maybe you can just talk a little bit more 142 00:07:37,600 --> 00:07:39,920 Speaker 1: about the process and what it was like where he 143 00:07:40,160 --> 00:07:42,320 Speaker 1: you know, for him to be digging out this these 144 00:07:42,360 --> 00:07:45,800 Speaker 1: historical documents. Yeah, I mean it was great fun because 145 00:07:45,840 --> 00:07:48,560 Speaker 1: not only did he have documents that either had been 146 00:07:48,600 --> 00:07:50,560 Speaker 1: sent to him by people he had grown up with, 147 00:07:50,880 --> 00:07:54,920 Speaker 1: or you know, he'd sort of come across at some point, um. 148 00:07:54,960 --> 00:07:58,280 Speaker 1: But occasionally I would come up with something, uh that 149 00:07:58,440 --> 00:08:02,280 Speaker 1: you know, he may have over booked and uh, and 150 00:08:02,360 --> 00:08:06,040 Speaker 1: so he was always delighted when something came. And and 151 00:08:06,040 --> 00:08:07,840 Speaker 1: there were also some stories he told me in our 152 00:08:07,880 --> 00:08:11,400 Speaker 1: discussions that I recorded that when I said, oh, should 153 00:08:11,400 --> 00:08:13,160 Speaker 1: we tell this story, he'd say, no, let let's leave 154 00:08:13,160 --> 00:08:18,520 Speaker 1: that one. So uh yeah. And actually one of the 155 00:08:18,520 --> 00:08:22,360 Speaker 1: funniest moments, um, right towards the very end of writing 156 00:08:22,400 --> 00:08:25,520 Speaker 1: the book, Um, I think actually we'd already it was 157 00:08:25,560 --> 00:08:29,360 Speaker 1: already in galleys, it was pretty far along. And uh. 158 00:08:29,440 --> 00:08:32,480 Speaker 1: He I was in his study in his apartment and 159 00:08:32,520 --> 00:08:35,000 Speaker 1: he said he had like a first edition of like 160 00:08:35,120 --> 00:08:38,000 Speaker 1: Canes or something in his in his library there. And 161 00:08:38,000 --> 00:08:39,800 Speaker 1: so I was looking around on the bookshelf trying to 162 00:08:39,840 --> 00:08:42,440 Speaker 1: find it, and I couldn't find it. But I found 163 00:08:42,480 --> 00:08:46,560 Speaker 1: this other slim volume which was an economics textbook from 164 00:08:46,720 --> 00:08:50,160 Speaker 1: the nineteen twenties or maybe even before, I think maybe 165 00:08:50,200 --> 00:08:53,679 Speaker 1: the nineteen tents that had been his his mother's textbook 166 00:08:53,720 --> 00:08:58,240 Speaker 1: in college. And and it was filled with MARGINALI if 167 00:08:58,280 --> 00:09:01,559 Speaker 1: they note she had written and he if you'd ever 168 00:09:01,640 --> 00:09:03,760 Speaker 1: realized he had it, he had totally forgotten about it. 169 00:09:03,800 --> 00:09:06,319 Speaker 1: So he was sort of you know, discovering this I 170 00:09:06,360 --> 00:09:07,960 Speaker 1: had handed it to him. We were looking at it. It 171 00:09:07,880 --> 00:09:12,840 Speaker 1: It was amazing and uh, from her time advassaor advassor exactly, 172 00:09:13,120 --> 00:09:16,000 Speaker 1: and it was I think the FED had not been created. 173 00:09:16,280 --> 00:09:21,800 Speaker 1: It was like really amazing and so um. So one 174 00:09:21,800 --> 00:09:24,440 Speaker 1: of the notes she'd written to herself was about how 175 00:09:25,080 --> 00:09:29,720 Speaker 1: psychology was the real key to so much of what 176 00:09:29,800 --> 00:09:33,560 Speaker 1: was happening in what happened in economics and finance, and uh, 177 00:09:33,600 --> 00:09:37,480 Speaker 1: and I think that really was kind of a eye 178 00:09:37,480 --> 00:09:40,360 Speaker 1: opener because he credits his father a lot with his 179 00:09:40,440 --> 00:09:43,480 Speaker 1: interests in public service, but he also credits his mother 180 00:09:43,559 --> 00:09:46,120 Speaker 1: as having been quite interested in markets and quite smart 181 00:09:46,160 --> 00:09:48,080 Speaker 1: about them, and he quotes her a few times in 182 00:09:48,080 --> 00:09:51,120 Speaker 1: the book. But we ended up adding this little bit 183 00:09:51,240 --> 00:09:54,800 Speaker 1: about his mother's economics textbook and her note to herself 184 00:09:54,840 --> 00:09:58,560 Speaker 1: about how psychology was really important, because, of course, if 185 00:09:58,600 --> 00:10:00,960 Speaker 1: you look at what Volker did during his career, he 186 00:10:01,040 --> 00:10:05,439 Speaker 1: really understood the psychology of investors, the psychology of consumers 187 00:10:05,440 --> 00:10:07,400 Speaker 1: and business people, and so much of what he did 188 00:10:07,400 --> 00:10:12,520 Speaker 1: in the inflation fight was basically around changing the psychology. 189 00:10:12,600 --> 00:10:15,640 Speaker 1: So it was cool to realize that his mother kind 190 00:10:15,640 --> 00:10:20,400 Speaker 1: of knew that too. That's that's pretty amazing. Yeah, setting 191 00:10:20,440 --> 00:10:23,760 Speaker 1: the expectations, I guess is so important for a central pak. 192 00:10:23,840 --> 00:10:26,840 Speaker 1: But I became fascinated with his father a little bit too, 193 00:10:26,880 --> 00:10:29,040 Speaker 1: because Christine, I think you and I both sort of 194 00:10:29,080 --> 00:10:32,560 Speaker 1: cut our teeth in journalism covering you know, small towns, 195 00:10:32,840 --> 00:10:37,000 Speaker 1: small municipalities in uh Pennsylvania and I was in Pennsylvania 196 00:10:37,000 --> 00:10:39,079 Speaker 1: for a while. In New Jersey, I know, I think 197 00:10:39,080 --> 00:10:42,440 Speaker 1: you were in good old Delco outside of Philly for 198 00:10:42,559 --> 00:10:45,840 Speaker 1: a while. Yeah. And and so Paul's father was a 199 00:10:46,440 --> 00:10:49,040 Speaker 1: like a town manager. And I'm not sure if if 200 00:10:49,120 --> 00:10:51,760 Speaker 1: everyone appreciates in these small towns how that works. You 201 00:10:51,800 --> 00:10:55,479 Speaker 1: have a sort of a part time, you know, unpaid 202 00:10:55,559 --> 00:10:58,800 Speaker 1: or lowly paid counsel and a lowly paid mayor, and 203 00:10:58,800 --> 00:11:02,480 Speaker 1: then you bring in a manager who was supposed to 204 00:11:02,520 --> 00:11:06,040 Speaker 1: be non political at all, and that was that was 205 00:11:06,080 --> 00:11:08,920 Speaker 1: fulkers father, I guess in what in Cape may and 206 00:11:09,040 --> 00:11:11,679 Speaker 1: in te Neock, New Jersey, a few other towns. Actually. 207 00:11:12,280 --> 00:11:15,520 Speaker 1: Vildanna might know this from having read the acknowledgements, because 208 00:11:15,559 --> 00:11:17,840 Speaker 1: he he does say in that his very very kind 209 00:11:17,840 --> 00:11:19,679 Speaker 1: of words about me at the end of the book 210 00:11:20,040 --> 00:11:23,400 Speaker 1: that I actually thought his father was the real hero, 211 00:11:23,880 --> 00:11:27,920 Speaker 1: because I did become fairly obsessed with his father. The 212 00:11:27,920 --> 00:11:29,760 Speaker 1: more I learned about his father, his father was a 213 00:11:29,840 --> 00:11:35,360 Speaker 1: huge deal in New Jersey. And it was because so 214 00:11:35,440 --> 00:11:40,040 Speaker 1: his father was the son of German immigrants, grew up 215 00:11:40,040 --> 00:11:43,400 Speaker 1: in Brooklyn studying engineering, became an engineer, worked on the 216 00:11:43,440 --> 00:11:47,160 Speaker 1: Erie Canal, met Fulker's mother up in the town on 217 00:11:47,200 --> 00:11:51,360 Speaker 1: the Erie Canal, but then ended up discovering that there 218 00:11:51,440 --> 00:11:54,640 Speaker 1: was this interest in kind of city managers, right, like 219 00:11:54,679 --> 00:11:57,520 Speaker 1: these professionalized city managers, because you know, that was the 220 00:11:57,600 --> 00:12:01,840 Speaker 1: era of like total corrupt in I mean, American politics 221 00:12:01,840 --> 00:12:04,679 Speaker 1: had gotten into the cess pool. I mean, you know, 222 00:12:05,000 --> 00:12:09,959 Speaker 1: you can argue, but I mean it was all crony 223 00:12:10,080 --> 00:12:14,360 Speaker 1: ism all and so somehow, like New Jersey had passed 224 00:12:14,360 --> 00:12:17,240 Speaker 1: this law allowing these like city managers to be appointed 225 00:12:17,280 --> 00:12:19,720 Speaker 1: to be kind of professionalized the way cities were run. 226 00:12:20,080 --> 00:12:23,440 Speaker 1: And Paul Volker Sr. Was the first ever in New Jersey, 227 00:12:23,520 --> 00:12:27,040 Speaker 1: first in Cape May and then eventually in Neck, and 228 00:12:27,320 --> 00:12:30,480 Speaker 1: he had a remarkable effect on these communities. It was 229 00:12:30,600 --> 00:12:35,000 Speaker 1: really an incredible turnaround stories. And so I was very 230 00:12:35,080 --> 00:12:38,240 Speaker 1: keen on sort of opening the book because actually when 231 00:12:39,000 --> 00:12:41,200 Speaker 1: Paul would talk to me about the book, one of 232 00:12:41,360 --> 00:12:43,800 Speaker 1: the key points he wanted to make was about public service. 233 00:12:43,800 --> 00:12:45,600 Speaker 1: This was his real mission at the end of his life, 234 00:12:45,640 --> 00:12:50,640 Speaker 1: is trying to professionalize and better educate people for public administration. 235 00:12:50,720 --> 00:12:52,240 Speaker 1: He cared a lot about it, and that's what the 236 00:12:52,280 --> 00:12:55,719 Speaker 1: Vulgar Alliance he founded is dedicated to. And it was 237 00:12:55,760 --> 00:12:59,000 Speaker 1: all really what his father had taught him. Yeah, well 238 00:12:59,080 --> 00:13:00,880 Speaker 1: I was gonna, I was gonna. Does that? Do you 239 00:13:00,920 --> 00:13:03,600 Speaker 1: think that influence of his father sort of having to 240 00:13:03,600 --> 00:13:07,640 Speaker 1: be above the politics and you know, non non political 241 00:13:08,160 --> 00:13:11,280 Speaker 1: played an influence on how he approached the FED being 242 00:13:11,400 --> 00:13:14,760 Speaker 1: you know, the same thing basically outside of politics. Yes, 243 00:13:14,880 --> 00:13:17,000 Speaker 1: I mean, I think in all ways, but you know, 244 00:13:17,160 --> 00:13:19,280 Speaker 1: like I think when people think about Paul Volker, they 245 00:13:19,280 --> 00:13:21,480 Speaker 1: think of him as somebody who could kind of, you know, 246 00:13:21,600 --> 00:13:24,719 Speaker 1: see every side of the political argument and stay kind 247 00:13:24,760 --> 00:13:28,440 Speaker 1: of above it um. But also in the way that 248 00:13:28,480 --> 00:13:31,840 Speaker 1: he sort of believed in a certain humility and sort 249 00:13:31,840 --> 00:13:35,720 Speaker 1: of not not seeing himself as above the people. Right Like, 250 00:13:35,760 --> 00:13:37,920 Speaker 1: So his father, you know, gave himself a pay cut 251 00:13:38,000 --> 00:13:40,920 Speaker 1: during the depression, you know, spent weekends going out and 252 00:13:40,960 --> 00:13:43,600 Speaker 1: meeting with the families of all the city workers, whether 253 00:13:43,679 --> 00:13:47,640 Speaker 1: they were the you know, uh, sanitation workers or whatever. 254 00:13:47,720 --> 00:13:49,520 Speaker 1: It just like didn't matter. He was very you know, 255 00:13:49,559 --> 00:13:52,360 Speaker 1: sort of engaged in in this sort of very you know, 256 00:13:53,280 --> 00:13:57,640 Speaker 1: uh democratic with a with a small d way with 257 00:13:57,760 --> 00:14:00,240 Speaker 1: the people. And I think that was also something that 258 00:14:00,440 --> 00:14:04,320 Speaker 1: Paul Walker brought to, you know, the his belief in, 259 00:14:04,360 --> 00:14:06,440 Speaker 1: like you know, being a certain basically kind of a 260 00:14:06,520 --> 00:14:09,920 Speaker 1: servant to the to the people more than like a ruler, 261 00:14:10,080 --> 00:14:12,640 Speaker 1: you know. I mean, so he was above politics, but 262 00:14:12,720 --> 00:14:16,480 Speaker 1: he always you know, saw himself as sort of there 263 00:14:16,520 --> 00:14:26,200 Speaker 1: to serve. And Mike mentioned that you have this piece 264 00:14:26,240 --> 00:14:28,760 Speaker 1: out in Business Week that recaps a lot of what 265 00:14:28,760 --> 00:14:30,560 Speaker 1: what we were just talking about and what's in the book, 266 00:14:30,880 --> 00:14:32,720 Speaker 1: But maybe you can just lay out for us what 267 00:14:32,840 --> 00:14:36,080 Speaker 1: the environment was like back then when he became FED 268 00:14:36,160 --> 00:14:39,280 Speaker 1: chair and and what some of the comparisons are to 269 00:14:39,400 --> 00:14:41,920 Speaker 1: what we're seeing today because we had high oil prices. 270 00:14:41,960 --> 00:14:43,360 Speaker 1: I think it's one of the main things he had 271 00:14:43,360 --> 00:14:47,840 Speaker 1: been talking about. So maybe just lay out the the environment. Yeah. Yeah, 272 00:14:47,880 --> 00:14:50,320 Speaker 1: So he came he was appointed by Jimmy Carter to 273 00:14:50,360 --> 00:14:54,200 Speaker 1: be FED chair at this period of horrible inflation in 274 00:14:54,280 --> 00:14:57,080 Speaker 1: nineteen seventy nine. Really things have gotten out of control. 275 00:14:57,160 --> 00:15:01,920 Speaker 1: You've had a huge energy um crisis with you know, 276 00:15:01,960 --> 00:15:05,160 Speaker 1: there was a big issue with the Saudis and the 277 00:15:05,360 --> 00:15:11,200 Speaker 1: other Arab states and uh, and so nobody had been 278 00:15:11,200 --> 00:15:13,000 Speaker 1: able to deal with the inflation problem. There was also 279 00:15:13,280 --> 00:15:16,040 Speaker 1: quite a lot of power in the labor unions back then, 280 00:15:16,560 --> 00:15:20,200 Speaker 1: so um, uh, the negotiations for you know, wages were 281 00:15:20,400 --> 00:15:23,440 Speaker 1: much different from I think they are today, So that 282 00:15:23,480 --> 00:15:27,000 Speaker 1: I think is a difference. But um, but yeah, it was. 283 00:15:27,160 --> 00:15:29,760 Speaker 1: I mean the inflation problem was much more entrenched back then. 284 00:15:30,240 --> 00:15:33,360 Speaker 1: It had been going on through most of the seventies. Uh. 285 00:15:33,440 --> 00:15:36,000 Speaker 1: It had people that sort of failed to recognize during 286 00:15:36,000 --> 00:15:38,880 Speaker 1: the late sixties and early seventies how much the war 287 00:15:39,080 --> 00:15:43,760 Speaker 1: spending had was contributing to inflation, the war, Big Vietnam, um. 288 00:15:44,000 --> 00:15:47,080 Speaker 1: And there were just a lot of factors, you know, 289 00:15:47,200 --> 00:15:51,040 Speaker 1: even the role that M. Vulker was involved in taking 290 00:15:51,080 --> 00:15:53,520 Speaker 1: the dollar off the gold standard at the beginning of 291 00:15:53,560 --> 00:15:56,880 Speaker 1: the seventies under Nixon, and that played a role. I mean, 292 00:15:56,920 --> 00:15:59,720 Speaker 1: basically the dollar was no longer anchored to you know 293 00:16:00,040 --> 00:16:04,240 Speaker 1: old Um. So there was this you know, decade long 294 00:16:04,360 --> 00:16:08,040 Speaker 1: kind of you know creep in in prices, and it 295 00:16:08,120 --> 00:16:10,880 Speaker 1: had gotten so that people just assumed prices were going 296 00:16:10,960 --> 00:16:14,560 Speaker 1: to go up double digits every year, and his predecessors 297 00:16:14,560 --> 00:16:16,920 Speaker 1: that FED chairman had basically kind of thrown up their hands. 298 00:16:16,920 --> 00:16:19,280 Speaker 1: They didn't know how to do anything about it because 299 00:16:19,280 --> 00:16:21,840 Speaker 1: every time they would try to start raising prices, you know, 300 00:16:21,880 --> 00:16:25,800 Speaker 1: they'd get all this pushback, or try raising interest rates, 301 00:16:25,800 --> 00:16:28,720 Speaker 1: they'd get a lot of pushback, so much political opposition 302 00:16:28,760 --> 00:16:33,360 Speaker 1: for obvious reasons. There was you know, um law passed 303 00:16:33,360 --> 00:16:37,480 Speaker 1: in Congress which known as uh, you know now the 304 00:16:37,520 --> 00:16:39,760 Speaker 1: dual mandate. They talked about it, which was sort of 305 00:16:39,760 --> 00:16:43,640 Speaker 1: required the Fed to make employment one of its goals 306 00:16:43,680 --> 00:16:49,000 Speaker 1: as well as price stability. So um, you know, when 307 00:16:49,080 --> 00:16:52,480 Speaker 1: Volker became FED chairman, he knew he'd been New York 308 00:16:52,520 --> 00:16:56,280 Speaker 1: Fed President that the problem he needed to address was inflation. 309 00:16:56,320 --> 00:16:58,360 Speaker 1: He told Jimmy Carter that when he went to meet 310 00:16:58,360 --> 00:17:00,960 Speaker 1: with him, he thought maybe that prevent him from getting 311 00:17:00,960 --> 00:17:02,560 Speaker 1: the job, because he said, I'm going to raise rates 312 00:17:02,560 --> 00:17:05,879 Speaker 1: a lot, and Jimmy Carter appointed him anyway, and he 313 00:17:05,920 --> 00:17:08,960 Speaker 1: really admired that Carter did that because it you know, 314 00:17:09,000 --> 00:17:11,280 Speaker 1: he thinks it contributed to him only being a one 315 00:17:11,400 --> 00:17:15,280 Speaker 1: term president. But um, but he he went, he came 316 00:17:15,280 --> 00:17:18,040 Speaker 1: into the role saying, inflation is the job I have 317 00:17:18,160 --> 00:17:21,639 Speaker 1: to focus on I'm going to ignore all the other factors. 318 00:17:21,760 --> 00:17:23,960 Speaker 1: You know, he said, the Fed economists at the time, 319 00:17:23,960 --> 00:17:27,320 Speaker 1: we're telling him they were the economy was about to 320 00:17:27,320 --> 00:17:31,520 Speaker 1: go into recession, but he kind of just disregarded them, 321 00:17:31,560 --> 00:17:35,879 Speaker 1: and uh, and he had to, you know, raise rates 322 00:17:36,119 --> 00:17:41,080 Speaker 1: as as strongly as he could. One thing I think 323 00:17:41,200 --> 00:17:44,160 Speaker 1: is underappreciated, Christine that I've I've really come to realize 324 00:17:44,200 --> 00:17:47,480 Speaker 1: by by reading the book is that, um, so much 325 00:17:47,520 --> 00:17:52,080 Speaker 1: focus was on that aggressive campaign to to raise rates. 326 00:17:52,080 --> 00:17:54,880 Speaker 1: I mean sometimes would be a few rate hikes within 327 00:17:54,920 --> 00:17:57,240 Speaker 1: a few weeks, right, I mean they were. They were 328 00:17:57,400 --> 00:18:01,479 Speaker 1: very fast and aggressive about it. But there's also the 329 00:18:01,520 --> 00:18:04,919 Speaker 1: notion of he sort of embraced to some extent the 330 00:18:04,960 --> 00:18:09,520 Speaker 1: ideas of Milton Friedman and the so called monitorists, you know, uh, 331 00:18:09,800 --> 00:18:12,359 Speaker 1: the idea that's to control inflation, you also had to 332 00:18:12,960 --> 00:18:16,880 Speaker 1: sort of control growth of the of the monitor money supply. 333 00:18:17,720 --> 00:18:21,720 Speaker 1: UM and he he referred to it as practical monitorism. 334 00:18:22,200 --> 00:18:23,760 Speaker 1: So I wonder if you could talk a little bit 335 00:18:23,800 --> 00:18:27,119 Speaker 1: about what that means. But also, you know, I I 336 00:18:27,200 --> 00:18:31,919 Speaker 1: get there the impression that he maybe wasn't sure what 337 00:18:32,040 --> 00:18:36,639 Speaker 1: exactly the role that played in taming in inflation. Compared 338 00:18:36,680 --> 00:18:39,679 Speaker 1: to the interest rate increases. You know that from one thing, 339 00:18:39,760 --> 00:18:42,200 Speaker 1: it's just so hard to measure the supply of money. 340 00:18:42,680 --> 00:18:45,120 Speaker 1: He ran in some difficulties with that. But but talk 341 00:18:45,240 --> 00:18:47,719 Speaker 1: us through what you think, you know, the legacy of 342 00:18:47,760 --> 00:18:51,359 Speaker 1: that sort of part of his inflation fighting campaign is 343 00:18:51,400 --> 00:18:53,439 Speaker 1: you know, was that was that an important part of it? 344 00:18:53,440 --> 00:18:56,000 Speaker 1: Do you think? Yeah? Absolutely? But I think that goes 345 00:18:56,040 --> 00:18:58,359 Speaker 1: back to the stuff we were talking about with his 346 00:18:58,359 --> 00:19:01,639 Speaker 1: his mom and the whole psychology thing. Because when he 347 00:19:01,720 --> 00:19:04,240 Speaker 1: was earlier in his career, when the idea of monetorism 348 00:19:04,359 --> 00:19:09,640 Speaker 1: was first being introduced by Milton Friedman and other people, Um, 349 00:19:09,920 --> 00:19:12,560 Speaker 1: the idea was much more mechanistic. It was sort of 350 00:19:13,119 --> 00:19:15,879 Speaker 1: that the to the degree that there should be a 351 00:19:15,920 --> 00:19:18,320 Speaker 1: fed at all, you know, and some people didn't even 352 00:19:18,320 --> 00:19:21,399 Speaker 1: believe you needed a group of human beings. It should 353 00:19:21,440 --> 00:19:24,760 Speaker 1: just be about figuring out what the optimal supply of 354 00:19:24,800 --> 00:19:28,400 Speaker 1: money in the economy was to prevent inflation, but also 355 00:19:28,440 --> 00:19:33,159 Speaker 1: to allow the economy to grow and just keep that supply, 356 00:19:33,560 --> 00:19:35,840 Speaker 1: you know, steady, and make sure it didn't get you know, 357 00:19:35,920 --> 00:19:38,680 Speaker 1: beyond that and and and nothing else. No other human 358 00:19:38,720 --> 00:19:41,520 Speaker 1: judgment should be involved. It should be like automated basically. 359 00:19:42,119 --> 00:19:44,720 Speaker 1: And obviously, you know, when he was early in his 360 00:19:44,760 --> 00:19:46,639 Speaker 1: career at the New York Fed, nobody he worked with 361 00:19:46,680 --> 00:19:48,680 Speaker 1: agreed with that, right, and there are a bunch of 362 00:19:48,920 --> 00:19:51,560 Speaker 1: people were against central banks. So he was kind of 363 00:19:51,600 --> 00:19:54,600 Speaker 1: raised with this, this is a foolish idea. Monitorism is 364 00:19:55,200 --> 00:19:58,800 Speaker 1: kind of you know, crazy, and it won't work. When 365 00:19:58,880 --> 00:20:01,440 Speaker 1: he got to be FED chair it's actually interesting looking 366 00:20:01,480 --> 00:20:03,560 Speaker 1: at some of the correspondence. I have some of it 367 00:20:03,800 --> 00:20:08,480 Speaker 1: where ah, he's writing to Milton Friedman actually after he 368 00:20:08,680 --> 00:20:12,679 Speaker 1: was appointed FED chairman and sort of hinting that you know, 369 00:20:13,160 --> 00:20:17,080 Speaker 1: he may, you know, he may do some things that 370 00:20:17,080 --> 00:20:19,399 Speaker 1: that Freeman would agree with, but he was sure Freedman 371 00:20:19,480 --> 00:20:23,520 Speaker 1: was still criticize him. I think what he knew going 372 00:20:23,560 --> 00:20:26,320 Speaker 1: into the job was that what they were doing wasn't 373 00:20:26,320 --> 00:20:29,560 Speaker 1: really working right. So just like setting interest rates higher 374 00:20:29,560 --> 00:20:32,040 Speaker 1: and higher, because as long as you were able to, 375 00:20:32,280 --> 00:20:35,520 Speaker 1: as long as politicians and everybody could see human beings 376 00:20:35,520 --> 00:20:37,600 Speaker 1: were setting these interest rates, there was always going to 377 00:20:37,640 --> 00:20:39,399 Speaker 1: be pushed back. They're always gonna be human beings who 378 00:20:39,440 --> 00:20:42,679 Speaker 1: couldn't stomach it, right. So in the second time they 379 00:20:42,760 --> 00:20:44,720 Speaker 1: raised rates when he was FED chairman, there was a 380 00:20:44,800 --> 00:20:47,480 Speaker 1: split on the on the committee, and he he was 381 00:20:47,560 --> 00:20:50,359 Speaker 1: confident that the four people who were voting for higher 382 00:20:50,400 --> 00:20:53,119 Speaker 1: rates would keep doing it. But he realized the market 383 00:20:53,160 --> 00:20:56,160 Speaker 1: wasn't convinced, so he had to do something different. So 384 00:20:56,880 --> 00:21:00,359 Speaker 1: he basically used monitorism as kind of a tool. So 385 00:21:00,400 --> 00:21:02,600 Speaker 1: he didn't employ it in the pure way that the 386 00:21:02,680 --> 00:21:06,480 Speaker 1: real monitorism monitors would have wanted. He just basically used 387 00:21:06,480 --> 00:21:10,719 Speaker 1: it as a psychological crutch. So he the Saturday Night 388 00:21:10,760 --> 00:21:16,160 Speaker 1: Special October six ninety nine, called This Saturday Press Conference, 389 00:21:16,160 --> 00:21:18,840 Speaker 1: announced a series of changes, including a rate increase and 390 00:21:19,560 --> 00:21:22,399 Speaker 1: a whole bunch of, you know, different factors, but the 391 00:21:22,440 --> 00:21:24,600 Speaker 1: main thing was from now on, we're gonna we're gonna 392 00:21:24,600 --> 00:21:27,840 Speaker 1: target the money supply. And what that essentially did is 393 00:21:27,840 --> 00:21:29,600 Speaker 1: it sort of tied their hands. It said to it 394 00:21:29,680 --> 00:21:32,119 Speaker 1: said to the market. You know, it's not us human 395 00:21:32,160 --> 00:21:35,240 Speaker 1: beings who are gonna be setting interest rates anymore. We're 396 00:21:35,280 --> 00:21:37,439 Speaker 1: just gonna focus on the money supply, and the interest 397 00:21:37,520 --> 00:21:39,760 Speaker 1: rates will do what they do. You know, we're gonna 398 00:21:39,840 --> 00:21:42,040 Speaker 1: work up, but we're gonna focus on the quantity of money, 399 00:21:42,240 --> 00:21:44,720 Speaker 1: not the price of money. The price of money, you 400 00:21:44,760 --> 00:21:46,880 Speaker 1: know what it'll do, what it does, you know, interest 401 00:21:47,000 --> 00:21:49,960 Speaker 1: rates will do what they do. So they had this 402 00:21:50,040 --> 00:21:52,159 Speaker 1: idea that they would have an upper limit and that 403 00:21:52,240 --> 00:21:54,520 Speaker 1: they would revisit it. You know, if rates got to 404 00:21:54,600 --> 00:21:56,359 Speaker 1: an upper limit, they would look at it. And it 405 00:21:56,480 --> 00:21:58,520 Speaker 1: kept getting to the upper limit, and they kept saying, Okay, 406 00:21:58,560 --> 00:21:59,960 Speaker 1: we gotta let it go, we gotta let it go. 407 00:22:00,560 --> 00:22:02,560 Speaker 1: He says in the book that if he had realized 408 00:22:02,600 --> 00:22:05,640 Speaker 1: that at the outset how high rates had would get, 409 00:22:06,119 --> 00:22:07,919 Speaker 1: he might not have been able to do it. And 410 00:22:07,960 --> 00:22:10,760 Speaker 1: so I think that's a sign of how successful that 411 00:22:10,840 --> 00:22:13,520 Speaker 1: strategy was, because if he had had to, as a 412 00:22:13,600 --> 00:22:16,800 Speaker 1: human being, vote for those kind of interest rates, he 413 00:22:16,840 --> 00:22:19,600 Speaker 1: would have found it too difficult. But when he was 414 00:22:19,640 --> 00:22:22,440 Speaker 1: able to say, this is not our decision, it's what's 415 00:22:22,440 --> 00:22:26,399 Speaker 1: happening because of our money supplied decisions, it was it 416 00:22:26,480 --> 00:22:29,119 Speaker 1: was a little easier to stomach. So it was purely 417 00:22:29,160 --> 00:22:31,120 Speaker 1: it was kind of like used as a psychological trick, 418 00:22:31,560 --> 00:22:33,720 Speaker 1: and then they abandoned it as soon as they found 419 00:22:33,760 --> 00:22:37,439 Speaker 1: it kind of inconvenient. So it wasn't ever pure monetorism. 420 00:22:37,520 --> 00:22:41,680 Speaker 1: But that's why he calls it practical monitorism. Maybe one 421 00:22:41,680 --> 00:22:43,479 Speaker 1: thing that we can't get out of the book is 422 00:22:43,520 --> 00:22:47,560 Speaker 1: the maybe uncertainty that he had felt, or unease or 423 00:22:47,640 --> 00:22:51,000 Speaker 1: confusion or I don't even know us any any words 424 00:22:51,320 --> 00:22:55,399 Speaker 1: that are synonymous with that. And possibly he told you 425 00:22:55,440 --> 00:22:58,399 Speaker 1: about that time period and what it actually felt like 426 00:22:58,560 --> 00:23:01,480 Speaker 1: for him to be working through. Can you talk about that? Well, 427 00:23:01,480 --> 00:23:04,280 Speaker 1: it's funny, he he he was a little unwilling to 428 00:23:04,359 --> 00:23:07,280 Speaker 1: really engage. I mean, there are there are some biographies 429 00:23:07,320 --> 00:23:09,439 Speaker 1: that have been written about him, will which tell stories 430 00:23:09,480 --> 00:23:11,840 Speaker 1: about how like when he got nervous, he would go 431 00:23:11,880 --> 00:23:13,760 Speaker 1: to the men's room a bunch of times or things 432 00:23:13,800 --> 00:23:16,600 Speaker 1: like that. You know, so, I mean he definitely felt it, 433 00:23:16,960 --> 00:23:19,200 Speaker 1: but at the point when I was working with him, 434 00:23:19,359 --> 00:23:22,639 Speaker 1: he kind of he a little bit sort of you know, 435 00:23:22,680 --> 00:23:25,840 Speaker 1: brushed it aside. But even so I could still tell, 436 00:23:26,040 --> 00:23:28,920 Speaker 1: even at age ninety, it was still it was still 437 00:23:28,960 --> 00:23:32,760 Speaker 1: weighing on him whether he'd really he felt the criticisms 438 00:23:32,760 --> 00:23:35,160 Speaker 1: that are still leveled at him today from like people 439 00:23:35,160 --> 00:23:37,520 Speaker 1: on the left or people on the right that you know, 440 00:23:37,680 --> 00:23:39,840 Speaker 1: there would have been another way, and so he wrestled 441 00:23:39,840 --> 00:23:41,720 Speaker 1: with that. I remember, you know, there's a famous book 442 00:23:41,760 --> 00:23:45,440 Speaker 1: called Secrets of the Temple by William Prider, right, he 443 00:23:45,560 --> 00:23:48,199 Speaker 1: was reading it when I was working with him. He 444 00:23:48,320 --> 00:23:51,040 Speaker 1: was like he would he would talk to me about stuff. 445 00:23:51,040 --> 00:23:53,080 Speaker 1: He was reading these criticisms and how he didn't just 446 00:23:53,240 --> 00:23:55,760 Speaker 1: he didn't agree with them, but like he wasn't he 447 00:23:55,800 --> 00:23:59,200 Speaker 1: wasn't ignoring them. And I thought that was really interesting 448 00:23:59,280 --> 00:24:01,760 Speaker 1: because he still you could still tell that he wished 449 00:24:01,800 --> 00:24:05,119 Speaker 1: there had been another way. He felt the pain that 450 00:24:05,200 --> 00:24:10,040 Speaker 1: he had caused. He struggled with it, but ultimately he couldn't. 451 00:24:10,080 --> 00:24:12,280 Speaker 1: He couldn't think of any other way, and he understood 452 00:24:12,280 --> 00:24:14,760 Speaker 1: that the value that bringing down inflation had for the 453 00:24:15,000 --> 00:24:19,080 Speaker 1: for the people. And you know, it's interesting. I think 454 00:24:19,119 --> 00:24:21,800 Speaker 1: ever since the FED was created, there's there's been a 455 00:24:21,800 --> 00:24:26,239 Speaker 1: backlash against the FED and sort of critics and uh 456 00:24:26,320 --> 00:24:29,080 Speaker 1: and the FED or on the FED type of people. 457 00:24:29,560 --> 00:24:34,919 Speaker 1: But boy, that really reached a fever pitch during his chairmanship. 458 00:24:34,920 --> 00:24:36,879 Speaker 1: Could talk to us a little bit about some of 459 00:24:36,920 --> 00:24:40,720 Speaker 1: the protests and some of the backlash that he faced. Yeah, no, 460 00:24:40,880 --> 00:24:44,080 Speaker 1: he I mean he had the so the farmers who 461 00:24:44,160 --> 00:24:46,960 Speaker 1: you know, rely on borrowed money for planting their crops. 462 00:24:47,000 --> 00:24:50,720 Speaker 1: They surrounded the FED headquarters with tractors at one point. 463 00:24:50,760 --> 00:24:53,920 Speaker 1: The home builders who you know, because mortgage rates eventually 464 00:24:53,920 --> 00:24:58,040 Speaker 1: got up beyond above like eighty they all were sending 465 00:24:58,080 --> 00:25:02,520 Speaker 1: two by fours to to the FED with like angry messages. Um, 466 00:25:02,600 --> 00:25:06,440 Speaker 1: you know, his speeches would be interrupted by screaming protesters. 467 00:25:06,480 --> 00:25:10,920 Speaker 1: He apparently once somebody released rats in the audience of 468 00:25:11,000 --> 00:25:13,280 Speaker 1: one of his speeches. I mean, whenever I would bring 469 00:25:13,320 --> 00:25:15,160 Speaker 1: these things up, he would sort of go like, oh, 470 00:25:15,200 --> 00:25:17,800 Speaker 1: it was a bunch of Linden LaRouche fans. Like he 471 00:25:17,800 --> 00:25:19,719 Speaker 1: he sort of brushed it off as like, you know, 472 00:25:20,240 --> 00:25:23,600 Speaker 1: that wasn't what the people really felt. And I get security, right, 473 00:25:23,680 --> 00:25:25,520 Speaker 1: and he had to. I mean, yeah, he didn't even 474 00:25:25,600 --> 00:25:28,199 Speaker 1: remember this. I found this in some of the documents 475 00:25:28,200 --> 00:25:30,560 Speaker 1: in the in the Vulgar archives, like the letters that 476 00:25:30,560 --> 00:25:33,040 Speaker 1: were written to him by the you know, the FED 477 00:25:33,080 --> 00:25:37,120 Speaker 1: and Security Department saying we have to get you personal. Yeah, 478 00:25:37,119 --> 00:25:40,159 Speaker 1: he's he was a tall guy, really imposing and actually 479 00:25:40,160 --> 00:25:43,600 Speaker 1: a really fascinating thing is that I found this story 480 00:25:43,720 --> 00:25:46,399 Speaker 1: from about a year after You got the Bodyguard, about 481 00:25:46,440 --> 00:25:50,440 Speaker 1: this armed man who went into the headquarters of the FED. 482 00:25:50,480 --> 00:25:51,880 Speaker 1: I think he was carrying a knife in a gun 483 00:25:52,000 --> 00:25:54,000 Speaker 1: or something. He was he was angry about inflation and 484 00:25:54,119 --> 00:25:58,360 Speaker 1: interest rates, and he uh, luckily didn't get near any 485 00:25:58,359 --> 00:26:01,880 Speaker 1: of the FED people, but he was he was arrested, 486 00:26:02,760 --> 00:26:05,280 Speaker 1: but I found it that same guy later ended up 487 00:26:05,400 --> 00:26:07,879 Speaker 1: killing somebody like you, I mean after he got there 488 00:26:07,920 --> 00:26:10,000 Speaker 1: to jail. Yeah, I think he was a guy who 489 00:26:10,080 --> 00:26:12,919 Speaker 1: killed the security guard in front of the like Holocaust 490 00:26:13,000 --> 00:26:15,480 Speaker 1: Museum or something, you know, down to d C anyway. 491 00:26:15,520 --> 00:26:18,960 Speaker 1: So I mean, yeah, there were there were threatening situations, 492 00:26:19,040 --> 00:26:21,760 Speaker 1: but like you know, he Vulker didn't really like to 493 00:26:22,480 --> 00:26:24,639 Speaker 1: dwell on that because I don't think he ever felt 494 00:26:25,040 --> 00:26:27,120 Speaker 1: he was in danger. He always felt people made too 495 00:26:27,160 --> 00:26:29,480 Speaker 1: much of it. And I think one of the most 496 00:26:29,480 --> 00:26:32,800 Speaker 1: interesting things is that when he was FED chair, you know, 497 00:26:33,119 --> 00:26:35,879 Speaker 1: a group of five protesters showed up at one point 498 00:26:36,359 --> 00:26:40,479 Speaker 1: outside and his um, you know, pr people were like, 499 00:26:40,520 --> 00:26:42,040 Speaker 1: you know, what should we do? Will send them away? 500 00:26:42,359 --> 00:26:44,199 Speaker 1: And he said, no, I actually bring bring some of 501 00:26:44,200 --> 00:26:47,080 Speaker 1: the leaders into my office. And so, you know, I 502 00:26:47,119 --> 00:26:49,280 Speaker 1: don't know how many people would do that today, just 503 00:26:49,320 --> 00:26:53,400 Speaker 1: sort of spontaneously said let these strangers in, but he did, 504 00:26:53,520 --> 00:26:56,320 Speaker 1: and a whole group of people were in his office 505 00:26:56,359 --> 00:26:58,840 Speaker 1: debating it with him, and he ended up on the 506 00:26:58,840 --> 00:27:01,040 Speaker 1: steps of the FED after is giving a sort of 507 00:27:01,040 --> 00:27:04,320 Speaker 1: impromptu press conference with the leader of this UH National 508 00:27:04,320 --> 00:27:07,719 Speaker 1: People's Action Group, I think it was called. So, um, 509 00:27:07,800 --> 00:27:10,960 Speaker 1: he didn't he didn't shy away from engaging with people 510 00:27:11,000 --> 00:27:14,560 Speaker 1: even though clearly people were really angry. And what about 511 00:27:14,600 --> 00:27:16,600 Speaker 1: the view of what he and the FED were doing 512 00:27:16,840 --> 00:27:19,080 Speaker 1: outside of the US, because I know he talks a 513 00:27:19,080 --> 00:27:22,440 Speaker 1: lot about meeting with his counterparts in Germany and Japan 514 00:27:22,680 --> 00:27:24,919 Speaker 1: and going through Europe on these like three or four 515 00:27:25,000 --> 00:27:28,720 Speaker 1: day trips, and so what was the view outside? Yeah, 516 00:27:28,800 --> 00:27:31,400 Speaker 1: so as you as you saw in the book, I mean, 517 00:27:31,520 --> 00:27:33,880 Speaker 1: he early in his career was working in the Treasury 518 00:27:33,920 --> 00:27:36,600 Speaker 1: Department under Nixon, and he spent a lot of time 519 00:27:36,600 --> 00:27:39,240 Speaker 1: traveling around the world, including having to explain to all 520 00:27:39,280 --> 00:27:42,000 Speaker 1: of our you know, allies around the world, what why 521 00:27:42,040 --> 00:27:44,680 Speaker 1: we're going off the gold standard. So he had really 522 00:27:44,680 --> 00:27:49,080 Speaker 1: good relationships with people in Germany and in Japan, in 523 00:27:50,080 --> 00:27:53,280 Speaker 1: you know, the UK, Italy, So he was kind of 524 00:27:53,320 --> 00:27:58,520 Speaker 1: like a monetary diplomat in a way. And when he 525 00:27:58,680 --> 00:28:02,880 Speaker 1: was owing to try that before he did the Saturday 526 00:28:02,960 --> 00:28:05,000 Speaker 1: Night specially went to Belgrade for a big I m 527 00:28:05,040 --> 00:28:09,320 Speaker 1: F conference and and Burns gave a lecture there about, um, 528 00:28:09,359 --> 00:28:11,680 Speaker 1: you know, how central bankers could no longer do anything 529 00:28:11,680 --> 00:28:15,840 Speaker 1: about inflation. But by that time already Bulker had met 530 00:28:15,880 --> 00:28:20,159 Speaker 1: with the German I think chancellor and central bankers, and 531 00:28:20,200 --> 00:28:22,879 Speaker 1: they were they were going crazy that the US had 532 00:28:22,880 --> 00:28:25,320 Speaker 1: allowed inflation to get so out of control, and they 533 00:28:25,400 --> 00:28:27,600 Speaker 1: felt like the dollar was too weak and had to 534 00:28:27,640 --> 00:28:30,400 Speaker 1: do something. So they were they were desperate for him 535 00:28:30,440 --> 00:28:32,840 Speaker 1: to do something, and he sort of basically said, don't worry, 536 00:28:32,880 --> 00:28:35,639 Speaker 1: I'll get it under control. So he got He He 537 00:28:35,880 --> 00:28:40,080 Speaker 1: cared a lot about our relationships overseas as well as 538 00:28:40,480 --> 00:28:58,160 Speaker 1: you know, what was happening domestically. One thing I think 539 00:28:58,320 --> 00:29:01,080 Speaker 1: is fascinating when when we think a vulcar in this 540 00:29:01,200 --> 00:29:03,640 Speaker 1: day and age in this sort of an inflation, I 541 00:29:03,680 --> 00:29:05,600 Speaker 1: don't know if you call it a crisis, but an 542 00:29:05,640 --> 00:29:08,600 Speaker 1: acute problem that we have with inflation. All you ever 543 00:29:08,640 --> 00:29:13,080 Speaker 1: hear about is uh, you know this inflation fighting efforts 544 00:29:13,440 --> 00:29:17,520 Speaker 1: uh that he had. But you're reading the book, it's 545 00:29:17,520 --> 00:29:20,120 Speaker 1: it's fascinating how many other fires he had to put 546 00:29:20,120 --> 00:29:23,520 Speaker 1: out along the way. You know, I didn't appreciate how 547 00:29:23,560 --> 00:29:27,480 Speaker 1: involved he was with the Chrysler restructuring, for example, But 548 00:29:27,560 --> 00:29:30,400 Speaker 1: what do you think, what what would he rank sort 549 00:29:30,400 --> 00:29:32,520 Speaker 1: of his legacy of some of those other issues he 550 00:29:32,600 --> 00:29:35,960 Speaker 1: dealt with. You know, the the lad Am debt crisis. 551 00:29:36,120 --> 00:29:40,000 Speaker 1: And uh, I was fascinating to learn that the idea 552 00:29:40,000 --> 00:29:43,040 Speaker 1: of too big to fail actually dates back to his time. 553 00:29:43,240 --> 00:29:44,760 Speaker 1: So what you know, talk to us about some of 554 00:29:44,760 --> 00:29:47,960 Speaker 1: those other fires that he put out. Yeah, well, I mean, 555 00:29:48,040 --> 00:29:50,360 Speaker 1: I think you know, his his earliest one was the 556 00:29:50,400 --> 00:29:52,920 Speaker 1: one I just mentioned about, you know, the taking the 557 00:29:52,960 --> 00:29:56,600 Speaker 1: dollar off the gold standard. That was a gigantic moment 558 00:29:56,760 --> 00:30:00,760 Speaker 1: in this country's history. Uh, when Nixon decided to sever 559 00:30:00,880 --> 00:30:04,320 Speaker 1: that link and and and that was a huge crisis 560 00:30:04,440 --> 00:30:06,480 Speaker 1: in its own way, and Vulker was read at the 561 00:30:06,480 --> 00:30:09,880 Speaker 1: center of it, within Secretary of the Treasury John Connolly, 562 00:30:09,960 --> 00:30:11,920 Speaker 1: and he has some great stories to tell about that. 563 00:30:12,400 --> 00:30:16,280 Speaker 1: So he'd sort of already like become this crisis hardened 564 00:30:16,320 --> 00:30:19,480 Speaker 1: person by the time he got to the Fed UM. 565 00:30:19,760 --> 00:30:24,120 Speaker 1: So inflation, you know, was job one. But the result 566 00:30:24,240 --> 00:30:26,960 Speaker 1: of higher interest rates, as I think some people in 567 00:30:27,000 --> 00:30:30,280 Speaker 1: the markets now are worried about as well, is that 568 00:30:30,360 --> 00:30:33,000 Speaker 1: there are often if you've had a period of easy money, 569 00:30:33,040 --> 00:30:36,120 Speaker 1: there are often a lot of bubbles that are forming, 570 00:30:36,800 --> 00:30:38,800 Speaker 1: and then when race go up more than people are 571 00:30:38,800 --> 00:30:42,680 Speaker 1: really ready for, you know, accidents happen. And so you 572 00:30:42,800 --> 00:30:48,720 Speaker 1: see in the book. Uh, this section on fighting inflation 573 00:30:48,800 --> 00:30:52,400 Speaker 1: basically the experiment with monetarism and all that, and then 574 00:30:52,440 --> 00:30:56,000 Speaker 1: you see the sort of catastrophes that resulted and how 575 00:30:56,040 --> 00:30:58,840 Speaker 1: he had to clean them up. Right, So you mentioned, uh, 576 00:30:59,080 --> 00:31:01,480 Speaker 1: you know, well Chrysler was sort of a little separate, 577 00:31:01,480 --> 00:31:04,600 Speaker 1: but but you had a Continental Illinois, which was a 578 00:31:04,680 --> 00:31:09,040 Speaker 1: huge bank which had exposure to these speculative oil loans 579 00:31:09,160 --> 00:31:12,560 Speaker 1: that this bank Pin Square had originated at Pin Square 580 00:31:12,600 --> 00:31:17,320 Speaker 1: went under first, Pennsylvania Bank had to be rescued. Uh, 581 00:31:17,600 --> 00:31:21,560 Speaker 1: you had the savings and loan crisis. A few years later. Um, 582 00:31:21,680 --> 00:31:23,760 Speaker 1: you had the Hunt Brothers, which is great, you know, 583 00:31:23,760 --> 00:31:26,960 Speaker 1: a story of just these billionaire brothers who had speculated 584 00:31:27,000 --> 00:31:29,640 Speaker 1: on silver because of of course silver would never stop 585 00:31:29,640 --> 00:31:32,360 Speaker 1: going up because inflation was never going to get under control, 586 00:31:32,840 --> 00:31:34,920 Speaker 1: and then when raids went up, they couldn't meet their 587 00:31:34,960 --> 00:31:37,880 Speaker 1: margin calls. So all these brokers started calling the FED 588 00:31:37,920 --> 00:31:40,440 Speaker 1: would help us, help us, and he had to get involved, 589 00:31:40,440 --> 00:31:42,640 Speaker 1: even though you didn't think the FED should be involved 590 00:31:42,680 --> 00:31:48,080 Speaker 1: in that. Um, but yeah, he he discovered the dangers 591 00:31:48,120 --> 00:31:52,320 Speaker 1: that the financial system, you know, it has embedded in it. 592 00:31:52,760 --> 00:31:56,200 Speaker 1: And then of course the biggest one was the US 593 00:31:56,280 --> 00:31:58,840 Speaker 1: and European banks had these huge loans to Latin American 594 00:31:58,880 --> 00:32:02,200 Speaker 1: countries funded by all the petrol dollars from the oil 595 00:32:02,320 --> 00:32:07,240 Speaker 1: rich Middle East, and and they these Latin American countries 596 00:32:07,240 --> 00:32:09,000 Speaker 1: were no longer going to be able to pay them back. 597 00:32:09,120 --> 00:32:12,680 Speaker 1: And in some cases these loans were more than twice 598 00:32:12,760 --> 00:32:15,680 Speaker 1: the you know, capital of the bank, so they were 599 00:32:15,680 --> 00:32:18,960 Speaker 1: going to go under. So I think ultimately it was 600 00:32:20,160 --> 00:32:23,640 Speaker 1: what really caused Volker and the FED to stop the 601 00:32:23,680 --> 00:32:28,680 Speaker 1: inflation fight was they had to rescue the banks. And so, 602 00:32:29,360 --> 00:32:34,120 Speaker 1: you know, I think one thing to watch today is whether, 603 00:32:34,400 --> 00:32:36,600 Speaker 1: you know, we find ourselves in a similar situation. If 604 00:32:36,600 --> 00:32:38,600 Speaker 1: you read the end of the book, he talks about 605 00:32:38,640 --> 00:32:42,480 Speaker 1: like the biggest risk that the biggest caution he has 606 00:32:42,520 --> 00:32:46,160 Speaker 1: for central bankers is not only don't let inflation get 607 00:32:46,200 --> 00:32:49,400 Speaker 1: out of control, but don't let the speculation that goes 608 00:32:49,480 --> 00:32:53,640 Speaker 1: with inflation get out of control, because the combination of 609 00:32:53,960 --> 00:32:57,720 Speaker 1: you know, out of control monetary policy and out of 610 00:32:57,720 --> 00:33:01,520 Speaker 1: control financial speculation is the most damaging potential thing to 611 00:33:01,600 --> 00:33:05,120 Speaker 1: the to the economy. Well, let's talk a little bit 612 00:33:05,160 --> 00:33:08,080 Speaker 1: more about today, because you wrote in the Business Week piece, 613 00:33:08,960 --> 00:33:12,000 Speaker 1: uh to see the challenge ahead for Powell it's useful 614 00:33:12,040 --> 00:33:15,720 Speaker 1: to revisit Vulcar's bumpy path to victory. And then I remember, 615 00:33:15,800 --> 00:33:17,720 Speaker 1: I think it was at the Jackson Hole meeting a 616 00:33:17,720 --> 00:33:21,680 Speaker 1: couple of months ago that Powell used a phrase that 617 00:33:22,000 --> 00:33:25,480 Speaker 1: everybody recognizes being the title of your book, which was 618 00:33:25,600 --> 00:33:28,880 Speaker 1: that they were going to be keeping at it. And 619 00:33:29,800 --> 00:33:31,120 Speaker 1: I think a lot of people were trying to make 620 00:33:31,120 --> 00:33:33,520 Speaker 1: that connection between Powell and Vulker. So can you talk 621 00:33:33,560 --> 00:33:36,200 Speaker 1: about maybe some of the lessons or what actually is 622 00:33:36,200 --> 00:33:40,240 Speaker 1: happening today that although I like the wise old parrot, 623 00:33:42,720 --> 00:33:46,160 Speaker 1: I wish they would have gone with that. Um. Yeah, 624 00:33:46,360 --> 00:33:51,120 Speaker 1: So I mean, so you know, uh, when I would 625 00:33:51,160 --> 00:33:55,840 Speaker 1: talk to Volker about who should be fed chair um 626 00:33:55,880 --> 00:33:59,520 Speaker 1: at the time, when like Trump was considering new alternative, 627 00:34:00,000 --> 00:34:05,000 Speaker 1: always expressed, uh, his view that having had himself experienced 628 00:34:05,040 --> 00:34:09,279 Speaker 1: in the private sector and in Treasury Department, that having 629 00:34:09,320 --> 00:34:13,600 Speaker 1: that kind of practical experience outside of academia he thought 630 00:34:13,680 --> 00:34:16,759 Speaker 1: was incredibly valuable and important. And so he was a 631 00:34:16,760 --> 00:34:20,600 Speaker 1: big supporter of somebody with J. Powell's background because he 632 00:34:20,680 --> 00:34:23,680 Speaker 1: thought that brings you a little more more in touch 633 00:34:23,719 --> 00:34:26,920 Speaker 1: with sort of the effects of monetary policy and a 634 00:34:26,960 --> 00:34:31,280 Speaker 1: little less less focused on the theory. So I think 635 00:34:31,400 --> 00:34:35,080 Speaker 1: when you look at today, um, he would be encouraged 636 00:34:35,120 --> 00:34:39,680 Speaker 1: that Powell is in the spot. He he would be 637 00:34:39,800 --> 00:34:42,239 Speaker 1: very upset, and he expresses this in the book. Even 638 00:34:42,320 --> 00:34:45,960 Speaker 1: before some of the later experiments with you know, sort 639 00:34:45,960 --> 00:34:48,480 Speaker 1: of inflation targeting, he thought it was always a mistake 640 00:34:48,560 --> 00:34:52,200 Speaker 1: for central banks to be like trying to create two 641 00:34:52,200 --> 00:34:55,400 Speaker 1: percent inflation. He didn't understand what that was. He he 642 00:34:55,480 --> 00:34:57,440 Speaker 1: thought that was a mistake and they were playing with fire, 643 00:34:57,560 --> 00:35:00,319 Speaker 1: and of course it turns out they were. Um, I 644 00:35:00,360 --> 00:35:02,960 Speaker 1: think he would be glad that, you know, Powell is 645 00:35:03,120 --> 00:35:06,200 Speaker 1: talking a lot about trying to be more like vulgar 646 00:35:06,920 --> 00:35:11,680 Speaker 1: and uh. I think he would just be concerned that, 647 00:35:11,760 --> 00:35:14,280 Speaker 1: you know, some of the speculation that we saw, especially 648 00:35:14,360 --> 00:35:17,279 Speaker 1: like if you think about one how crazy things got. 649 00:35:17,360 --> 00:35:20,239 Speaker 1: I feel certain that if he had been alive during that, 650 00:35:20,320 --> 00:35:25,279 Speaker 1: he would have been ringing the alarm bells pretty loudly. Um, 651 00:35:25,320 --> 00:35:27,239 Speaker 1: So he would I think he'd be disappointed that the 652 00:35:27,280 --> 00:35:31,840 Speaker 1: Fed hadn't kind of figured it out. Um. So Yeah, 653 00:35:32,440 --> 00:35:35,719 Speaker 1: it's just a fascinating book, Christine. There's so many little 654 00:35:35,760 --> 00:35:38,560 Speaker 1: anecdotes that I love, like when he noticed on his 655 00:35:38,680 --> 00:35:42,640 Speaker 1: driver the front seat of his driver's car. There's a 656 00:35:42,680 --> 00:35:46,600 Speaker 1: book called How to Live with Infliction, And and he 657 00:35:46,680 --> 00:35:49,880 Speaker 1: said that he knew he had he was on the 658 00:35:49,960 --> 00:35:51,920 Speaker 1: right path because the driver said, well, the ownerson I 659 00:35:52,000 --> 00:35:54,399 Speaker 1: bought it was the price was reduced from like ten 660 00:35:54,400 --> 00:35:59,360 Speaker 1: bucks to two bucks. But some of his uh and 661 00:35:59,400 --> 00:36:02,000 Speaker 1: I think we're gonna segue to the crazy things soon. 662 00:36:02,160 --> 00:36:05,439 Speaker 1: But a good segue for that is for me to ask, 663 00:36:05,480 --> 00:36:09,279 Speaker 1: which I think is admittedly a crazy question. Uh. So 664 00:36:09,280 --> 00:36:12,080 Speaker 1: I'm gonna go ahead and do that. But he's some 665 00:36:12,239 --> 00:36:15,560 Speaker 1: of his his wit is very self deprecating. You know, 666 00:36:15,560 --> 00:36:18,879 Speaker 1: he talks about being a procrastinator, and he often makes 667 00:36:18,960 --> 00:36:23,320 Speaker 1: jokes about his height, Um, you know, six seven. Honestly, 668 00:36:23,360 --> 00:36:27,760 Speaker 1: I gotta wonder if being such a big, imposing figure 669 00:36:28,920 --> 00:36:32,400 Speaker 1: was an asset to him when sort of history needed 670 00:36:32,560 --> 00:36:36,200 Speaker 1: this sort of very strong character. It might crazy to 671 00:36:36,239 --> 00:36:38,600 Speaker 1: think that. No, I don't think so. I mean he 672 00:36:38,640 --> 00:36:40,680 Speaker 1: had he had, I don't think. I'm not sure he 673 00:36:40,680 --> 00:36:43,400 Speaker 1: would have admitted this, But look at he really played 674 00:36:43,440 --> 00:36:45,640 Speaker 1: a character, right, he had that he had the whole 675 00:36:45,680 --> 00:36:48,680 Speaker 1: cigar thing. You know, he quit smoking by the time 676 00:36:48,680 --> 00:36:51,840 Speaker 1: I knew him, but he would sit there and testify 677 00:36:51,880 --> 00:36:55,279 Speaker 1: and smoke the cigar, and he was incredibly tall. He 678 00:36:55,320 --> 00:36:58,680 Speaker 1: had the deep voice, and he had this this air 679 00:36:58,719 --> 00:37:01,560 Speaker 1: of authority, and I think he knew that that was 680 00:37:01,640 --> 00:37:03,640 Speaker 1: you know. I mean again back to his father. His 681 00:37:03,719 --> 00:37:06,920 Speaker 1: father had basically ruled this city and gotten it into shape. 682 00:37:06,920 --> 00:37:10,120 Speaker 1: And his father was just as tall um. So I 683 00:37:10,160 --> 00:37:14,719 Speaker 1: think I think he understood against the psychology of you know, 684 00:37:14,880 --> 00:37:19,239 Speaker 1: how to assert authority, how to how to you know, 685 00:37:19,280 --> 00:37:22,200 Speaker 1: he'd watch the politicians he'd worked with. He'd watch John 686 00:37:22,280 --> 00:37:25,279 Speaker 1: Connolly out fox some of the other people in the 687 00:37:25,400 --> 00:37:30,000 Speaker 1: Nixon administration. He was quite a quite astute student of 688 00:37:31,239 --> 00:37:35,239 Speaker 1: people and how they are effective and how they aren't effective. 689 00:37:35,360 --> 00:37:38,360 Speaker 1: He knew what he was that psychological effect of a 690 00:37:38,400 --> 00:37:43,320 Speaker 1: big six seven cigar chopping, you know. But it reminds 691 00:37:43,320 --> 00:37:46,560 Speaker 1: me of those old memes used to see of you know, 692 00:37:46,680 --> 00:37:48,799 Speaker 1: a graph of interest rates and the height of the 693 00:37:48,800 --> 00:37:51,320 Speaker 1: Fed chairman. You know, it went from Vulker to Janet 694 00:37:51,360 --> 00:37:54,319 Speaker 1: Yellen being the shortest. That's sure enough. Here we are, 695 00:37:54,960 --> 00:37:57,600 Speaker 1: uh with Powell, you know, and rates are going back up. 696 00:37:57,640 --> 00:38:01,640 Speaker 1: So yeah, maybe there's something to it. But that's the 697 00:38:01,640 --> 00:38:04,200 Speaker 1: craziest question I had. But I'm glad you played ball 698 00:38:04,280 --> 00:38:06,360 Speaker 1: with that I'm not not as crazy have a question 699 00:38:06,360 --> 00:38:09,200 Speaker 1: as I thought it was. I guess no, No, there's 700 00:38:09,719 --> 00:38:12,120 Speaker 1: there's a great story that I once heard Bill Bradley, 701 00:38:12,120 --> 00:38:16,560 Speaker 1: the former New Jersey Senator, tell about how he remembered 702 00:38:16,600 --> 00:38:19,719 Speaker 1: when you know, Paul Wolker used to go back to 703 00:38:19,760 --> 00:38:22,560 Speaker 1: New York City every weekend. You know, his wife still 704 00:38:22,560 --> 00:38:26,000 Speaker 1: lived in New York. So, uh, Bill Bradley would be 705 00:38:26,040 --> 00:38:29,080 Speaker 1: going back to New Jersey for the weekend, and and 706 00:38:29,080 --> 00:38:32,200 Speaker 1: they'd get on the shuttle, which you know doesn't really 707 00:38:32,239 --> 00:38:35,400 Speaker 1: exist in the same format anymore, but the Washington the 708 00:38:35,400 --> 00:38:37,760 Speaker 1: plane that went from Washington New York, like on the hour, 709 00:38:38,400 --> 00:38:40,240 Speaker 1: and they would just go and they'd sit an economy 710 00:38:40,239 --> 00:38:43,040 Speaker 1: class on Friday night or Friday afternoon and get like, 711 00:38:43,400 --> 00:38:46,680 Speaker 1: you know, they'd be like seat you know, you know, 712 00:38:46,760 --> 00:38:49,359 Speaker 1: huddled up with their knees in the chest and you know, 713 00:38:49,440 --> 00:38:52,160 Speaker 1: surrounded by other people. And yeah, it was just a 714 00:38:52,160 --> 00:38:58,080 Speaker 1: different time. Another Princeton basketball playing exactly right, even taller 715 00:38:58,120 --> 00:39:03,680 Speaker 1: than Paul. Great stuff, Christine. We really appreciate your time. 716 00:39:03,680 --> 00:39:08,120 Speaker 1: And again I can't recommend this book us as strongly 717 00:39:08,160 --> 00:39:11,000 Speaker 1: as I can. I mean, it's such an important look 718 00:39:11,160 --> 00:39:13,560 Speaker 1: at period of history. That I think is is very 719 00:39:14,080 --> 00:39:16,799 Speaker 1: echoing loudly these days. So we appreciate your time, but 720 00:39:17,280 --> 00:39:19,040 Speaker 1: we're not gonna let you go until we hear the 721 00:39:19,080 --> 00:39:22,359 Speaker 1: craziest thing you've seen in markets recently. So I think 722 00:39:22,400 --> 00:39:26,080 Speaker 1: we'll start with you though. I have a pretty good one, okay, 723 00:39:26,200 --> 00:39:30,360 Speaker 1: but you usually do. It's Elon musk related. Oh no, no, 724 00:39:31,040 --> 00:39:34,239 Speaker 1: there's nothing crazy. But I think we might have the 725 00:39:34,280 --> 00:39:37,319 Speaker 1: same one. Oh no, I hope not. But he's done 726 00:39:37,320 --> 00:39:40,400 Speaker 1: so many things this week that honestly, it's it's possible. 727 00:39:40,400 --> 00:39:44,920 Speaker 1: That's anyway. He's promoting a new perfume, same one, you 728 00:39:44,960 --> 00:39:50,120 Speaker 1: have the same one. Shoot, but it's so good? Is good? Okay? 729 00:39:50,200 --> 00:39:54,000 Speaker 1: He said, it's called this is so disgusting burnt hair. 730 00:39:54,680 --> 00:39:58,520 Speaker 1: It's the essence of repugnant desire. It's a hundred dollars 731 00:39:58,520 --> 00:40:02,680 Speaker 1: a bottle, and he tweeted, of course, that ten thousand 732 00:40:02,719 --> 00:40:06,879 Speaker 1: bottles had already been swailed. And I don't know, I mean, 733 00:40:06,920 --> 00:40:09,680 Speaker 1: I guess this is really happening. He's not joking around. 734 00:40:09,680 --> 00:40:11,600 Speaker 1: I I it's you've never done with this guy, like 735 00:40:11,640 --> 00:40:15,400 Speaker 1: the shorts, remember he sold shorts to try get short sellers, 736 00:40:15,480 --> 00:40:19,880 Speaker 1: and also the flamethrower the flamethrower, and he said something 737 00:40:20,160 --> 00:40:23,520 Speaker 1: to the effect of, uh, with with my last name, 738 00:40:23,560 --> 00:40:26,360 Speaker 1: it was inevitable that I'd get into men's per clone. 739 00:40:26,520 --> 00:40:31,799 Speaker 1: That's good, That's really good. Okay, well us, but I 740 00:40:31,880 --> 00:40:34,920 Speaker 1: was gonna I was gonna do prices precise on the 741 00:40:34,960 --> 00:40:38,200 Speaker 1: dollar value of the bottles of bottle. I shouldn't have 742 00:40:38,200 --> 00:40:43,399 Speaker 1: said it for for burnt hair perfume. Maybe he's put 743 00:40:43,440 --> 00:40:50,239 Speaker 1: those flamethrowers to work to get that sent possibly. Alright, well, 744 00:40:50,440 --> 00:40:52,759 Speaker 1: great minds think alike, I guess, or even even you 745 00:40:52,840 --> 00:40:57,240 Speaker 1: and I occasionally, how about you, Christine, what's the craziest 746 00:40:57,239 --> 00:41:00,319 Speaker 1: thing you've seen recently? Nothing quite as crazy? I mean, 747 00:41:00,360 --> 00:41:02,799 Speaker 1: I just I'm watching very closely what's happening with the 748 00:41:02,920 --> 00:41:06,080 Speaker 1: UK Central Bank, having lived in London and and having 749 00:41:06,120 --> 00:41:08,640 Speaker 1: a lot of friends over there, and watching the b 750 00:41:08,800 --> 00:41:10,959 Speaker 1: o E trying to tell people on the one hand 751 00:41:11,000 --> 00:41:13,360 Speaker 1: that they're going to support, you know, whatever happens. On 752 00:41:13,400 --> 00:41:14,920 Speaker 1: the other hand, you only have a few days to 753 00:41:14,960 --> 00:41:19,720 Speaker 1: clean it all up, and so so I think that's 754 00:41:19,960 --> 00:41:22,759 Speaker 1: as crazy as it's getting. But you know, I'm sure 755 00:41:22,840 --> 00:41:24,719 Speaker 1: it'll be more crazy. As soon as I walk out 756 00:41:24,719 --> 00:41:28,719 Speaker 1: of this booth. There'll be something crazier. Yeah, well, if 757 00:41:28,719 --> 00:41:32,480 Speaker 1: you had the challenge channel Paul Volker and give advice 758 00:41:32,520 --> 00:41:36,680 Speaker 1: to the BOE, what do you think he would tell him? Well? 759 00:41:36,760 --> 00:41:38,600 Speaker 1: I think he you know, he dealt with his share 760 00:41:38,600 --> 00:41:42,960 Speaker 1: of exchange rate crises also including helping helping Thatcher keep 761 00:41:43,040 --> 00:41:45,959 Speaker 1: the pound above the dollar, so I think he would 762 00:41:46,000 --> 00:41:48,040 Speaker 1: say though that You've got to deal with your domestic 763 00:41:48,680 --> 00:41:52,240 Speaker 1: situation first, So I think he would he would encourage 764 00:41:52,440 --> 00:41:55,520 Speaker 1: Powell to keep at it with the inflation fight and 765 00:41:55,600 --> 00:41:58,359 Speaker 1: not be distracted by helping the pound out right now, 766 00:41:58,440 --> 00:42:03,440 Speaker 1: probably that sounds a out right Yeah, Christine Harper, fascinating 767 00:42:04,000 --> 00:42:06,960 Speaker 1: conversation and a really great book. I hope everyone in 768 00:42:07,000 --> 00:42:09,719 Speaker 1: the What Goes Up book Club will go out and 769 00:42:09,760 --> 00:42:11,479 Speaker 1: read it. Who was in charge of this book club? 770 00:42:11,520 --> 00:42:14,800 Speaker 1: You are? I I it sounds like you want to 771 00:42:14,800 --> 00:42:17,399 Speaker 1: be in charge of it. I definitely do. All right, 772 00:42:17,480 --> 00:42:19,400 Speaker 1: you're you were the chair of the What Goes Up? 773 00:42:19,400 --> 00:42:21,880 Speaker 1: Book Club? Then my first sort of business is kicking 774 00:42:21,920 --> 00:42:25,959 Speaker 1: you out. I know it. I know it, just because 775 00:42:25,960 --> 00:42:30,400 Speaker 1: I didn't finish the book. Yeah, if you bring wine 776 00:42:30,440 --> 00:42:33,239 Speaker 1: to the next meeting, then you'll will be re I mean, 777 00:42:33,840 --> 00:42:36,680 Speaker 1: you're putting your children first, like, I think your priorities 778 00:42:36,680 --> 00:42:42,719 Speaker 1: are all mixed up. This is why you were kicked out. Well, 779 00:42:42,719 --> 00:42:44,560 Speaker 1: you got to write another book, Christine, and we'll have 780 00:42:44,600 --> 00:42:50,360 Speaker 1: you back. And by the way, read Markets Magazine, uh excellent, excellent, 781 00:42:50,719 --> 00:42:54,600 Speaker 1: Bloomberg Periodical Keeping at It by Paul Woker and Bloomberg 782 00:42:54,640 --> 00:42:57,959 Speaker 1: Markets Magazines to two must reads. That's our two must 783 00:42:57,960 --> 00:43:00,960 Speaker 1: reads for the week. Thank you Christine, Thank you guys, 784 00:43:01,000 --> 00:43:10,399 Speaker 1: Thank you Christine. What Goes Up. We'll be back next 785 00:43:10,400 --> 00:43:12,000 Speaker 1: week and soil. Then you can find us on the 786 00:43:12,000 --> 00:43:15,880 Speaker 1: Bloomberg Terminal website and app or wherever you get your podcast. 787 00:43:16,640 --> 00:43:18,239 Speaker 1: We love it if you took the time to rate 788 00:43:18,280 --> 00:43:21,240 Speaker 1: and review the show on Apple Podcasts, so more listeners 789 00:43:21,280 --> 00:43:23,600 Speaker 1: can find us. And you can find us on Twitter, 790 00:43:24,000 --> 00:43:28,360 Speaker 1: follow me at reag Anonymous. Bildanna Hirach is at Bildonna Hirach. 791 00:43:29,000 --> 00:43:33,480 Speaker 1: You can also follow Bloomberg Podcasts at Podcasts. What Goes 792 00:43:33,560 --> 00:43:36,279 Speaker 1: Up is produced by Stacy Wang. Thanks for listening. To 793 00:43:36,320 --> 00:43:37,040 Speaker 1: see you next time.