kakeith406/op-fed huggingface dataset:
Prior discussion:
speaker: CHAIRMAN VOLCKER.
text: I see him sometimes anyway and there is going to be a certain amount of hullabaloo about it. 
speaker: MR. SCHULTZ.
text: We have real costs in terms of credibility if we change the targets. We ought to change them only if we have good, strong reasons. And I disagree with Larry Roos; I think if we have good strong reasons to change them, we are better off changing them in March or April than right now. 

CHAIRMAN VOLCKER. "If we came out of the clear blue sky and said we are going to change them, that is one thing."

Full utterance: But the problems that Larry mentioned are, of course, there. It just depends upon the setting. If we came out of the clear blue sky and said we are going to change them, that is one thing. If people saw the economy in bad shape, interest rates at 18 percent and so on, we have a different setting. It is awfully hard to predict these things.

Opinion: no
Prior discussion:
speaker: MR. GRAMLEY.
text: I grant that there may be some arguments to the effect that that problem will be a little less in the future. But, as Governor Partee pointed out, we do not know what these IRA accounts are going to do to the magnitude of M2; and more importantly we do not know what will happen to M2 growth if in fact we get a one point or thereabouts increase in the saving rate. That could add [to M2] considerably. And I would much prefer a target range that had some realistic hope of being realized within the context of a growth in nominal GNP in the 8 to 9 percent range. Therefore, I think a persuasive case could be made for raising the M2 range to 7 to 10 percent. 

MR. BOEHNE. "I second Governor Gramley's comment."

Full utterance: I second Governor Gramley's comment.

Opinion: yes
About monetary policy: yes
Stance toward easing (NLI): contradiction
Prior discussion:
speaker: MR. MORRIS.
text: I asked them how they're doing and they said that their domestic business is lousy; their export business, which tends to be quite large, has been hit hard by the rise in the dollar. But the defense business is booming and their only problem in defense is getting the production out. So, that will cushion New England, California, Texas, the leading [defense contractors are in those areas]. It's not going to do much for Si's Middle West, though. 
speaker: CHAIRMAN VOLCKER.
text: Governor Partee. 

MR. PARTEE. "But we should not say that there's a tremendous flow of credit in these markets."

Full utterance: Returning to this question of credit flows, which goes a little with your question, Tony: I was interested in that, too, because here we have rising interest rates and we're talking about crowding out. So, I wondered what the figures would show on credit raised by the economy. I find that in the last three quarters--that is, since [the start of] the period of downturn--the total funds raised in the third quarter, fourth quarter, and the first quarter this year as estimated amount to only 11.8 percent of the GNP. To give you an idea, that's almost exactly the same as in the 1974-75 recession in relation to the GNP. And that compares with 16 percent in 1979, 18-1/2 percent in 1978, and 17-1/2 percent in 1977. So, it's a very much smaller flow of funds to credit users than is typical. It's typical of a deep recession and continues to be typical of a deep recession in the first quarter even though interest rates turned up. And by the way, those figures include the government. If it weren't for the government, indeed, the figures would be close to recent historical lows of only 7 percent of GNP being now represented by credit to private sectors. If you look ahead, the interesting thing is that the staff's flow of funds forecast--they have a flow of funds forecast that's consistent with their Greenbook forecast--doesn't show any improvement at all in private credit flows compared with the GNP. What happens is that the government credit flows go up because of the deficit, but the private credit flows stay around the very low 7 percent area in relation to GNP. That says to me, really, that what is being forecast is whatever interest rate is necessary to keep private credit from getting going again. And that's the crowding out hypothesis, I think. But we should not say that there's a tremendous flow of credit in these markets. As a matter of fact the flow of credit is unusually small and it will remain unusually small relative to recent years even with these large government deficits.

Opinion: yes
About monetary policy: no
Prior discussion:
speaker: MR. BLACK.
text: So, to show our versatility and flexibility, we tried it at 4-1/2 percent and came out pretty much the same way. It really didn't change the [outcome] appreciably. But I do have a lot of differences with most of those who have spoken about what we ought to do with our long-run targets. I'm disappointed, of course, as I'm sure all of us are, that we're ending the first half with M1 and M2 apparently above the upper limits of our ranges. And depending upon what this new revision does to M1, that aggregate might be well above the upper end of its range. 

CHAIRMAN VOLCKER. "I don't know what your interpretation of well above is."

Full utterance: It can't be well above. Of course, that does depend upon what one assumes for June but it can't be well above. I don't know what your interpretation of well above is. This week we'll be within the range.

Opinion: no
Prior discussion:
speaker: MR. ROOS.
text: It was Mark Antony's. 
speaker: CHAIRMAN VOLCKER.
text: We will get to the issue of what to do with M1 a little later, but I-- 
speaker: VICE CHAIRMAN SOLOMON.
text: Just one last question on the DIDC instrument: Based on your information, what kind of rate do you think the depository institutions will pay as the so-called market rate? Will they simply be competitive and vary it with the average money market fund rate or will they pay a Treasury bill-type rate? What do you think they will pay? 

CHAIRMAN VOLCKER. "I'm just guessing."

Full utterance: I think there will be a tendency among some to pay a money market funds rate plus; the question is whether the market gets driven there. I'm just guessing. Among other things, we approved what I think of as the "bucket shop relief regulation" at the last DIDC meeting, where an institution can broker all of this money. So, we'll have people advertising all over the country. These will be insured deposits and people will keep it with the guy paying the highest rate. And that will tend to force the rates higher. I would think there would be two tendencies initially: To pay a money market funds rate plus, or to pay something related to the Treasury bill rate. My guess would be that the bill rate fellows might get forced higher. In a tight money situation, I would feel rather confident of that result. With rates going down, if they are going down, I think banks would be cautious. But I think those will be the two polarities. The question is where it will end up.

Opinion: no
Prior discussion:
speaker: CHAIRMAN VOLCKER.
text: But not the previous two months. 
speaker: MR. GRAMLEY.
text: I know, but the previous two months presumably were affected by the fact that interest rates came down. We have to ask ourselves whether we're talking about a movement along the demand function or a shift in the demand function. And as far as I know, the recent evidence does not strongly point toward an upward shift in demand for money. And that's the way I interpret the staff's comments in the briefing. 

CHAIRMAN VOLCKER. "Well, I'm not sure that's right."

Full utterance: Well, I'm not sure that's right. Their velocity is rising.

Opinion: yes
About monetary policy: yes
Prior discussion:
speaker: MR. CORRIGAN.
text: If we put out the directive on the day of the meeting, in the form in which it is now written, we inevitably are going to get reporters snooping around asking "What does this really mean?" and trying to get interpretations. And we will end up with more confusion and not less. 
speaker: MR. BALLES.
text: Not if we don't talk to them. 
speaker: MS. TEETERS.
text: That's right. We don't have to take their calls. 

MR. CORRIGAN. "That's easy to say."

Full utterance: That's easy to say. But over a period of time--say we've put an absolute restriction on talking to the press for a week or something like that--that doesn't solve the problem.

Opinion: yes
About monetary policy: no
Prior discussion:
speaker: CHAIRMAN VOLCKER.
text: He will be here tomorrow morning and we can discuss the international aspects then. Why don't you go ahead and get your report out of the way, which I think is also background. 
speaker: MR. STERNLIGHT.
text: Okay, fine. [Statement--see Appendix.] 
speaker: CHAIRMAN VOLCKER.
text: Any questions or comments? 

MR. BOEHNE. "Would you attribute that to technical reasons or is there anything there that might be a harbinger of a change in expectations with regard to Fed policy and inflation?"


Opinion: no
Prior discussion:
speaker: MR. KEEHN.
text: But the people I talk to, particularly on the industrial side, as I said earlier, continue to be very, very pessimistic. I think we should put a very heavy eye on interest rates, not only domestically but as they pertain internationally. We simply cannot at this point afford to have any increase in the rates we have some level of control over--mainly on the short-term side--for fear of the possibility that a recovery will be snuffed out. So, I'd be in favor of M2 but I also would be putting a very careful eye on following the interest rates. 
speaker: CHAIRMAN VOLCKER.
text: It falls to you, Governor Partee, to pronounce an interim blessing. 

MR. PARTEE. "Even if, as Steve suggests, after the stock adjustment we get back to a place where two-thirds of M1 is transactions money, one-third of it won't be."


Opinion: no
Prior discussion:
speaker: MR. KEEHN.
text: But the people I talk to, particularly on the industrial side, as I said earlier, continue to be very, very pessimistic. I think we should put a very heavy eye on interest rates, not only domestically but as they pertain internationally. We simply cannot at this point afford to have any increase in the rates we have some level of control over--mainly on the short-term side--for fear of the possibility that a recovery will be snuffed out. So, I'd be in favor of M2 but I also would be putting a very careful eye on following the interest rates. 
speaker: CHAIRMAN VOLCKER.
text: It falls to you, Governor Partee, to pronounce an interim blessing. 

MR. PARTEE. "The other connective that I can see is credit."

Full utterance: Well, I actually agreed with a good deal of what Frank Morris had to say. First of all, I think it's clear that we have to have in mind the nominal GNP under the conditions of whatever time period we're looking at. And I guess that has a little something to do with what Bill Ford said. We don't want a really low nominal GNP because it might just take us right on down the hill. On the other hand, of course, we can't have too much monetary expansion over a period of time or it will affect the inflation rate over the longer run. Today, given 4 to 5 percent inflation, I suppose we ought to look for nominal GNP of about 9 percent, which would be 5 to 4 percent real growth. Now, I don't mean that we should target it, but we have to have it in mind; that really is what we're trying to get at any point in time. We have to have some linkage to the nominal GNP. Well, one linkage is transaction balances. And that, of course, is the old M1. I supported that [aggregate] for quite a while. But I really think it is badly damaged and is going to be badly damaged for quite a while. Even if, as Steve suggests, after the stock adjustment we get back to a place where two-thirds of M1 is transactions money, one-third of it won't be. And that one-third will always have a considerable potential for movement that will muddy what is happening in the transaction relationship between what we're doing with money and the nominal GNP that we really would like to see over a period of time ahead. The other connective that I can see is credit. It seems to me that credit flows are very closely related to the performance of GNP some time out. I agree with Frank in that I don't see this causality argument running any more against credit than it does against money. It's just the way people look at things that makes them say it in the one case and not in the other. My problem is that I just don't think we are prepared to go to credit. We don't have the background work done. We don't have the figures and we don't know what the behavioral characteristics are; and, therefore, we can't do it now. But I hope we will do it in the period to come. "L" adjusted actually is the best figure in the set of tables, Paul. That's an interesting thing. Adjusted "L" is the best result.

Opinion: no
Prior discussion:
speaker: MR. AXILROD.
text: And in '71 when they didn't go up cyclically, the increase was 2.9 or something like that on velocity. 
speaker: MR. ROBERTS.
text: Interest rates are now going up, however. 
speaker: MR. AXILROD.
text: Well, we're not projecting [that] as part of this whole projection. 
speaker: MR. ROBERTS.
text: It could be wrong. 
speaker: MR. GRAMLEY.
text: In which case the staff's forecast probably also will be wrong--not in the direction of more nominal GNP but less. 

MR. BLACK. "We just don't know who is the most wrong."

Full utterance: Well, we know everybody is wrong. We just don't know who is the most wrong.

Opinion: yes
Prior discussion:
speaker: CHAIRMAN VOLCKER.
text: Again, I think that is dependent upon what we say in the next paragraph. I just think it's better this way if it has a little less emphasis precisely because it does have less emphasis. 
speaker: MR. BOYKIN.
text: I guess my basic problem is that I wonder if I would give it quite that much less emphasis. 
speaker: CHAIRMAN VOLCKER.
text: Well, that's going to come up in the next paragraph. Let's turn to the next paragraph, which starts out by saying "[In implementing monetary policy,] the Committee agreed that substantial weight would be placed on behavior of the broader aggregates." 

MR. CORRIGAN. "Now, if we find ourselves in that situation, M1 with all its imperfections and everything else is really the only device to use, in terms of the way we run monetary policy, to be able to snug up."

Full utterance: I do have a bit of a problem in terms of this question of emphasis on Ml. As I look at it, we're talking about targets in general that at least strike me as being toward the high side in a context in which there's at least a 50-50 chance that we are going to get some recovery, if not a fairly robust recovery, in velocity. Now, if we find ourselves in that situation, M1 with all its imperfections and everything else is really the only device to use, in terms of the way we run monetary policy, to be able to snug up. That may develop out in the year some time, but I--

Opinion: yes
About monetary policy: yes
Prior discussion:
speaker: MR. BALLES.
text: I understand that your forecast for the deflator as we get out into the balance of this year is dependent on some improvement in productivity which seems to be fairly significant--about 3 percent growth, if I remember the figures correctly. 
speaker: MR. ZEISEL.
text: About 3-1/2 percent. 
speaker: MR. BALLES.
text: 3-1/2 percent. Also, if my recollection is correct, that's pretty high in the range of historical experience; if not, tell me so. I'd like to know what makes you so confident that we're going to get this good accomplishment in productivity; I hope we do, but it's apparently essential to getting this good outcome on the inflation front that you people are predicting. 

MR. ZEISEL. "We've jacked up our trend productivity just a bit."


Opinion: no
Prior discussion:
speaker: CHAIRMAN VOLCKER.
text: A perfect inverse correlation! 
speaker: MS. TEETERS.
text: What interest rate are you aiming for? If you snug up, where do you want the rate to go? 
speaker: MR. MARTIN.
text: Maximum 9-1/2 percent. 
speaker: MS. TEETERS.
text: That's too much. 

CHAIRMAN VOLCKER. "But I don't have any particular objective in mind."

Full utterance: I think it would be unlikely to go that high and stay that high with the kind of borrowing we're talking about. I wouldn't say it wouldn't touch there on occasion but I think we're talking more 8-3/4 to 9 percent. But I don't have any particular objective in mind. I don't want to shock the market.

Opinion: yes
About monetary policy: yes
Prior discussion:
speaker: MR. MARTIN.
text: How long is it going to be before we can see what the relationship of this new one is with regard to the economy? I think we may, as a group, have a more favorable look at M1 and at a more automatic procedure later. I am sure that many in the markets will continue to feel, surmise, believe in, or have faith in M1 and its close relationship with economic activity. As long as that belief is out there, it's something we have to deal with. But now with the unknowns with regard to velocity and M1 and the risks to this economy by increasing the volatility of interest rates, I simply think we should wait. 

CHAIRMAN VOLCKER. "And if this process begins on February 2nd, inevitably I guess we're going to have to say something before then."


Opinion: yes
About monetary policy: no
Prior discussion:
speaker: MR. PARTEE.
text: So moved. 
speaker: MR. MARTIN.
text: Second. 
speaker: CHAIRMAN VOLCKER.
text: Without objection. Mr. Cross. 
speaker: MR. CROSS.
text: [Statement--see Appendix.] 

MR. WALLICH. "Sam, what I hear about negotiations with Argentina isn't very positive right now."

Full utterance: Sam, what I hear about negotiations with Argentina isn't very positive right now. Is there any time limit in terms of the Treasury's arrangements on when they need to arrive at a letter of intent?

Opinion: yes
About monetary policy: no
Prior discussion:
speaker: MR. TRUMAN.
text: And it's better, at least in terms of thinking about what the correct underlying rate of inflation might be and in trying to forecast the rate even though the short-run favorable developments on the inflation side might be continuing because of the dollar's value. 
speaker: CHAIRMAN VOLCKER.
text: Mr. Balles. 
speaker: MR. BALLES.
text: It's hard to pinpoint the precise reason why our staff forecast is a bit higher than the Board staff's on the inflation rate for next year. But I think it probably has to do with our estimate that as we get into 1985 we will be approaching or at the point, both in terms of the capacity utilization rising and the unemployment rate declining, where in the past we typically have seen an acceleration of inflation. 
speaker: CHAIRMAN VOLCKER.
text: Mr. Morris. 

MR. MORRIS. "I don't know who to ask, but the staff is forecasting a $115 billion current account deficit in 1985 and a decline in the exchange rate of the dollar against foreign currencies of 15 percent."


Opinion: no
Prior discussion:
speaker: VICE CHAIRMAN SOLOMON.
text: Well, in New York, they got [6-3/4] percent. 
speaker: MR. GUFFEY.
text: Did I understand that most of these are one-year contracts? 
speaker: CHAIRMAN VOLCKER.
text: Well, no. I think a lot of them are two-year contracts and this gives the first year. There was a variety, but I think these numbers were for the first year. 

VICE CHAIRMAN SOLOMON. "One can either attribute that to the greater intensity of the recession than some earlier recessions or to some feeling that they can't pass on these wages as easily in price increases."


Opinion: no
Prior discussion:
speaker: MR. CORRIGAN.
text: You lost me on the last loop. 
speaker: CHAIRMAN VOLCKER.
text: Well, if we started off with an M1 figure of 4 percent and we began running above it, depending on where we are, I would not be very anxious to raise the borrowing level. 
speaker: MR. CORRIGAN.
text: That was the second point. I understood that. On the one after that you lost me. 

CHAIRMAN VOLCKER. "I don't remember the one after that."


Opinion: no
Prior discussion:
speaker: MS. HORN.
text: We have a basically positive outlook but a lot of concern is expressed; I think the concerns of many people arise in part because of how discouraged they are with the very strong import competition. Others focus on the long-term problems of the economy: the need for fiscal policy changes, the inflation problems, and so forth. Also, expectations are generally damped by the pause that we see. Although expectations are for growth next year, they are very shaky, and sometimes I wonder if they are held with enough confidence to get us over a few disappointments that we might see in the coming months. 
speaker: CHAIRMAN VOLCKER.
text: Mr. Boykin. 

MR. BOYKIN. "So, I'm not really complacent."

Full utterance: Mr. Chairman, I think it is fair to characterize the situation in the Eleventh District as one where we are continuing to see some improvement. Employment is increasing, industrial production is still moving up, and retail sales look fairly good. I will say that we have had slowdowns from earlier in the year. Weakness, of course, continues in the energy industry, and that might be getting a little worse. We also have had a downturn in construction but, as I indicated last time, I really don't think that's all that bad. I would pretty well agree with the Board staff's forecast. I would expect the fourth quarter obviously to look a little better than the third quarter. At least from the people I've talked to down our way, I have not picked up any real concern about a recession on the horizon as we go into 1985. The confidence factor, at least my own confidence factor, is not quite as strong as it was earlier. So, I'm not really complacent. On the other hand, my degree of discomfort, if you will, is probably not as great as that expressed by a number of people here. It seems to me that we're just coming into a period when there is uncertainty and when decisions become very difficult. I think there is an awfully great risk of overreacting to what might or might not happen.

Opinion: yes
Prior discussion:
speaker: MR. PARTEE.
text: The whole thing starts out with "decrease somewhat." I wonder whether we want the "somewhat." 
speaker: CHAIRMAN VOLCKER.
text: Let's get to that point. Is that general framework of the directive--just in terms of the language--all right? 
speaker: SPEAKER(?).
text: Mind over matter. 

CHAIRMAN VOLCKER. "It's more centered and we raised it not so long ago."


Opinion: no
Prior discussion:
speaker: MR. AXILROD.
text: Mr. Sternlight may have a different view, but I myself think that there's very little chance [of that] at this particular junction, looking over the next four or five or six weeks. But I really ought to say that if you're thinking of $250 million of borrowing, the funds rate is going to rise from the 7 percent area; it's likely to be somewhere around 8-1/2 percent, given the present discount rate. It's not the money market specs we worked out for alternative A. In our own minds [that entailed] an even lower level of borrowing and somewhat higher excess reserves to drive the funds rate further down. I thought I would add that minor point for clarity. 

MR. STERNLIGHT. "As to the long-term rates, I think there will be a slight declining effect from lower short-rates."

Full utterance: To add to that, I think the $250 million of borrowing is likely to give you a steady state kind of situation--a funds rate very close to the discount rate, although we're not really in a steady state and the market widely expects something to happen to the discount rate. So, I expect $250 million of borrowing for the next little while to be associated with fed funds trading closer to 8 percent on average as the market broadly expects something on the discount rate. As to the long-term rates, I think there will be a slight declining effect from lower short-rates. I wouldn't expect a perverse effect on this occasion.

Opinion: yes
About monetary policy: yes
Stance toward easing (NLI): neutral