FEDERAL RESERVE DILEMMA: 1974

The mid 1970s experienced a variety of economically profound events. Among these were post Vietnam volatility in U.S. markets, oil price shocks, economically questionable fiscal policies, middle-east unrest, and a period of high unemployment combined with high inflation, confounding the conventional...

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Bibliographic Details
Published in:Journal of the International Academy for Case Studies 2010-01, Vol.16, p.81
Main Authors: Tuttle, Mark, Stretcher, Robert
Format: Article
Language:English
Subjects:
Budget deficits
Consumer Price Index
Consumer spending
Consumers
Consumption
Costs
Economic development
Energy consumption
Federal Reserve monetary policy
GDP
Gross Domestic Product
Households
Inflation
Interest rates
Mortgages
Political behavior
Politics
Price increases
Recessions
Truces & cease fires
Unemployment
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Summary:The mid 1970s experienced a variety of economically profound events. Among these were post Vietnam volatility in U.S. markets, oil price shocks, economically questionable fiscal policies, middle-east unrest, and a period of high unemployment combined with high inflation, confounding the conventional economic wisdom of the day. This case presents background, data and commentary concerning this period, and tasks the reader with deriving "appropriate" policy responses by the Federal Reserve. Readers must discern the uniqueness of the situation from past history, reconcile conflicting policies that had been pursued in the past, either targeting high inflation or high unemployment (not both at the same time), and deal with policy prescriptions that differed among various policy objectives. [PUBLICATION ABSTRACT]
ISSN:1078-4950
1532-5822