I’m appreciating this recent book by Nick Timiraos of the Wall Street Journal. He writes about the response to the pandemic.
Timiraos goes back into history. There were tensions between the Fed and President Truman. Truman, you’ll recall, had had some rough experiences in business prior to becoming President and didn't quite grasp why the Fed would want to raise interest rates to cool off an inflationary environment. As Mark Twain remarked, “History doesn’t repeat itself…but it rhymes.”
So why is it helpful to read books like this? The reason is good writers who do historical research can help put matters in a context. To do so dials down the apoplectic froth and enhances understanding.
Fed Chair Jerome Powell isn't an economist by training. However, he makes up for it by studying hard and doing his homework. He also has an impressive capacity to remember small details from long ago.
Most news outlets don't provide much in the way of historic contextualization these days. Evidence of this dearth is in obvious display. I get it (sort of.) People are busy and consume fast food sound bites while scurrying through the information drive thru.
But to really grasp the importance of our disruptive and disorienting recent events it does help to sit back and take a patient look at what’s come before.
Timiraos offers some very helpful background here.