Re: Thank you James Earl Carter
Posted by:
LOL! x LOL!
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Date: July 28, 2016 08:53PM
vbTTv Wrote:
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> The sign of Jimmy's time Wrote:
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> "no-help-wanted.jpg"
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> LOL! The unemployment rate was 7.5% when Carter
> took office and 7.5% when he left. In between, he
> had cut it to 5.6%. It had been 9% under Nixon
> and would soar to well above 10% under Reagan.
LOL! And quickly rising... LOL! You want to count the same way for Obama? LOL!
Volcker’s first attempt to lower inflation and inflationary expectations proved insufficient. The credit-control program initiated in March 1980 by the Carter administration precipitated a sharp recession (Schreft 1990). As unemployment mounted, the Fed eased up, an action reminiscent of the “stop-go” policies the public had come to expect. In late 1980 and early 1981, the Fed once again tightened the money supply, allowing the federal funds rate to approach 20 percent. Despite this, long-run interest rates continued to rise. The ten-year Treasury bond rate increased from about 11 percent in October 1980 to more than 15 percent a year later, possibly because the market believed the Fed would back down from its tight policy when unemployment rose (Goodfriend and King 2005). This time, however, Volcker was adamant that the Fed not back down: “We have set our course to restrain growth in money and credit. We mean to stick with it” (Volcker 1981a).
The economy officially entered a recession in the third quarter of 1981, as high interest rates put pressure on sectors of the economy reliant on borrowing, like manufacturing and construction. Unemployment grew from 7.4 percent at the start of the recession to nearly 10 percent a year later. As the recession worsened, Volcker faced repeated calls from Congress to loosen monetary policy, but he maintained that failing to bring down long-run inflation expectations now would result in “more serious economic circumstances over a much longer period of time” (Monetary Policy Report 1982, 67).
LOL!
LOL!