The Federal Reserve Engages the World (1970-2000): An Insider's Narrative of the Transition to Managed Floating and Financial Turbulence

54 Pages Posted: 23 Aug 2014

See all articles by Edwin M. Truman

Edwin M. Truman

Institute for International Economics (IIE)

Date Written: August 22, 2014

Abstract

This paper traces the evolution of the Federal Reserve and its engagement with the global economy over the last three decades of the 20th century: 1970 to 2000. The paper examines the Federal Reserve’s role in international economic and financial policy and analysis covering four areas: the emergence and taming of the great inflation, developments in US external accounts, foreign exchange analysis and activities, and external financial crises. It concludes that during this period the US central bank emerged to become the closest the world has to a global central bank.

Keywords: Federal Reserve, Federal Open Market Committee, inflation, macroeconomic policies, monetary policy, external balance, exchange rates, exchange market intervention, financial crises, third world debt crises, Mexican crisis, Asian financial crises

JEL Classification: F3, F31, F32, F33, F34, E4, E42, F5, F52, F53

Suggested Citation

Truman, Edwin M., The Federal Reserve Engages the World (1970-2000): An Insider's Narrative of the Transition to Managed Floating and Financial Turbulence (August 22, 2014). Peterson Institute for International Economics Working Paper No. 14-5, Available at SSRN: https://ssrn.com/abstract=2485440 or http://dx.doi.org/10.2139/ssrn.2485440

Edwin M. Truman (Contact Author)

Institute for International Economics (IIE) ( email )

1750 Massachusetts Avenue, NW
Washington, DC 20036
United States

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