Leading economic thinkers, including President Obama’s Senior Economic Advisor Paul Volcker and Vice Chairman of the Federal Reserve Donald Kohn, came together this spring at the Owen School to talk about the current financial crisis for the 22nd annual Financial Markets Research Center Conference.
In his remarks, Volcker, who was Chairman of the U.S. Federal Reserve from 1979 to 1987, said that the United States’ economic recovery would be a “long slog” but that the rate of decline should slow. He added that the country was not in another depression, but “in a great recession for sure.” He also talked about the outlook for the Federal Reserve’s role as a regulator of financial markets and accounting standards. (You can watch Volcker’s full speech at www.youtube.com/Vanderbilt.)
Kohn said that the federal government’s heavy financial bailout of banks and other businesses would help the stock market and was “necessary, safe and effective.” Kohn also talked about the impact of the central bank’s emergency lending programs on taxpayers, credit market capital allocation, the stress tests of U.S. banks and the outlook for the U.S. economy.
Kohn and Volcker had a lively back-and-forth following Kohn’s speech when Volcker questioned statements he made about a 2 percent inflation rate being appropriate for the economy in the long term. (The exchange and Kohn’s full speech are on Vanderbilt’s YouTube page.)
Volcker, Kohn and dozens of current and former members of the Federal Reserve, along with other economic and political heavyweights, came to Owen to honor Dewey Daane, Frank K. Houston Professor of Finance, Emeritus, and former Governor of the Federal Reserve Board, for his 90th birthday. Many of the economic leaders have lectured in Daane’s seminar on monetary and fiscal policy. The seminar has been in continuous operation since Daane joined the Owen faculty in 1974.