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To: Mark Marcellus who wrote (7529)	3/21/2001 1:05:36 PM
From: BillyJoe McCallister	Read Replies (2) \| Respond to of 17683

money supply is important, but it's also very difficult to measure in an economically meaningful way Monitoring the money supply instead of setting interest rates is dangerous business. If you try to peg M1 rather that set rates, for example, interest rates will be highly volatile. Volker experimented with this in 1980, and that's what happened. It was a colossal failure. Volker was willing to take the chance during an election year though because he didn't care much too if Carter was reelected. Volker was a very conservative Republican. In fact, one of Carter's closest banking friends, Bert Lance, told the President that "if you appoint Volker to head the Federal Reserve, you can kiss your chance of reelection good by." Carter appointed him anyway in '79 or '80 to appease Wall Street.