paul_volcker

With prices on the rise in the U.S. economy, the Federal Reserve is expected to announce on Wednesday an increase in interest rates, essentially pouring a cold glass of water on the economy.

Why would the central bank do that? The answer lies in the inflation crisis of the 1970s, when a failure to react quickly enough still looms large in the memory.

Guest: Jeanna Smialek, a reporter covering the Federal Reserve and the economy for The New York Times.

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Background reading: 

• The Federal Reserve is facing the fastest inflation most Americans have ever seen. The response may require some aggressive — and painful — measures.
• What is inflation, why is it up, and whom does it hurt? Here’s what to know.

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Paul Volcker is widely-regarded as single-handedly halting a period of severe inflation in the U.S. during the late 1970s and early 1980s. But the former chairmen of the Federal Reserve’s reputation wasn't always so secure. So how does he view his legacy? Christine Harper, the editor of Bloomberg Markets, spent two years working with Volcker to co-author his autobiography, “Keeping At It: The Quest for Sound Money and Good Government.” 

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