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VOLCKER ON THE CRASH
PAUL VOLCKER'S characteristic approach to problem-solving is not to assume that the future is out there and that one must go about divining it. Rather, he believes that those charged with running things must take control and not let events develop on their own. In Emersonian terms, he fears times when ''Things are in the saddle, / And ride mankind.''
When it comes to policy, he is the ultimate pragmatist. Rules and economic theorems have to be set aside. The decision-maker has to proceed by ''judgment'' and to rely on his ability to sense the mood - or incipient panic - in the markets.
Volcker is therefore impatient with people wondering whether the real danger now facing the economy is deflation or inflation. ''The point I would make is that we don't have to sit here helplessly amid all these kinds of speculation or let them work themselves out in the marketplace. We can control events, if we do the right things. I'm not saying we can fine-tune it. You can get a situation that is so upset and filled with risk that there is no right policy. I don't think it has to get that way.
etc.
PAUL VOLCKER'S characteristic approach to problem-solving is not to assume that the future is out there and that one must go about divining it. Rather, he believes that those charged with running things must take control and not let events develop on their own. In Emersonian terms, he fears times when ''Things are in the saddle, / And ride mankind.''
When it comes to policy, he is the ultimate pragmatist. Rules and economic theorems have to be set aside. The decision-maker has to proceed by ''judgment'' and to rely on his ability to sense the mood - or incipient panic - in the markets.
Volcker is therefore impatient with people wondering whether the real danger now facing the economy is deflation or inflation. ''The point I would make is that we don't have to sit here helplessly amid all these kinds of speculation or let them work themselves out in the marketplace. We can control events, if we do the right things. I'm not saying we can fine-tune it. You can get a situation that is so upset and filled with risk that there is no right policy. I don't think it has to get that way.
etc.
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