The Fed's 'independence' conundrum

Washington

"The Federal Reserve is meant to be independent of parochial political interests. But it's got to operate - I think of this as a kind of band, sometimes wide, sometimes narrow - within the range of understanding of the public and the political system. You just can't go do something that is just outside the bounds of what people can understand, because you won't be independent for very long if you do that."

- Paul Volcker, chairman of the Federal Reserve Board, 1979-1987