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Pastimes : Discussion Thread -- Ignore unavailable to you. Want to Upgrade?

To: c.hinton who wrote (1650)	8/12/2008 4:55:29 PM
From: c.hinton	Respond to of 3816

exerpt...One of the major Fed problems during the late 1920s — the most heated speculative period for stocks — was a disconnect, personal and professional, between the New York Fed and the system's Board of Governors in the person of NY's president, George Harrison, who had succeeded the legendary Benjamin Strong, Harrison's board, and the Fed Board's chairman, Roy Young. The central disagreement was over bank loans used for stock speculation, and what, if anything, to do about it. The New York bank wanted to raise the discount rate and voted to do so several times in 1929. The Board demurred, preferring to pursue a policy it called "direct pressure," or verbally chastising those banks that appeared to be funding "excessive" speculation. I don't want to engage in loose speculation here, but this policy of direct pressure seems to have failed.