Prior discussion:
speaker: CHAIRMAN GREENSPAN.
text: There is an belief now, particularly among the Japanese, that sterilized intervention can put the exchange rate where they want it. 
speaker: MR. BOEHNE.
text: Well, that leads into my next question; I think you touched on it. Is the United States leading the charge on this or is it more a consortium of finance ministers who are leading the charge and central bankers are acting as their agents? Or is there a lot of enthusiasm on the part of central banks? I'm just trying to understand. 

CHAIRMAN GREENSPAN. "Our problem, basically, is that at this stage we could probably as central banks--we could at the Fed--create a really big fuss about this."

Full utterance: There is no enthusiasm among any of the central bankers. I don't think even the Bank of France is enthusiastic. The two leading prongs are the U.S. Treasury and the Ministry of Finance of Japan. There has been a pulling and tugging on this of rather large dimensions. My impression is that in the event this all fails and the dollar starts to creep back up this intervention effort will be abandoned. What we have to be careful about it is that as it becomes more and more difficult, they will want to increase [the amount of intervention] more and more. What we have been fending off, successfully so far, is pressure that was not too subtly brought forth before the G-7 meeting to bring the central banks into this whole game. In other words, essentially the G-7 would start to control monetary policy. And I think that was fended off pretty abruptly. There was a feeble attempt to put that in the Communique. That was knocked out very quickly before things got moving. Our problem, basically, is that at this stage we could probably as central banks--we could at the Fed--create a really big fuss about this. As you know, legally, the presumption is that the President, through the Secretary of the Treasury, has full control over the issue of intervention policy. It has never really been tested. We have always had a partial voice; in other words, when Messrs. Brady and Mulford started to talk about [a target of] 125 for the yen and 1.75 for the DM, I protested to a point where I suggested that they would pull the system apart. And I got that eliminated. So, they did have targets. The trouble is if we ever tried to get to those targets, we'd have the world's most awful mess on our hands. There is a limit as to what we can do short of confrontation. I don't think it serves either the Fed or the country to try to be actually up front and to bring this operation to an abrupt halt. I think we could do it. In other words, if that were our objective--forgetting all the secondary costs--I have no doubt that we could do it. I just think that it would be far better not to try that and, hopefully, keep this constrained at a level where the damage is minimal. I disagree with Manley on the issue of the secondary effects being scary; on the contrary, I was surprised at how minimal those effects were. Having seen an earlier version of intervention really almost kick over the bond market, I think in the last 10 days we got away with really minor results. I don't think we can depend on that continuing. I think that if we hammer at these markets, something will crack.

Opinion: yes
About monetary policy: no