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Milton Friedman on Monetary policy and the Federal Reserve

The text for this paper, to paraphrase the famous remark attributed to Poincaré, is, “Money is too important to be left to the central bankers.”
Should There Be an Independent Monetary Authority?
Journal article, 1962, In Search of a Monetary Constitution, ed. Leland B. Yeager (Harvard University Press, 1962), pp. 219–243; reprinted in the House Banking and Currency Committee’s 1968 Compendium on Monetary Policy Guidelines and Federal Reserve Structure, pp. 205–214, p. 205 of the 1968 House reprint
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  1. To paraphrase Clemenceau, money is much too serious a matter to be left to the Central Bankers.
    Capitalism and Freedom
    Book, 1962, Ch. 3 The Control of Money, p. 50-51
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  2. The Fed is supposedly independent. But, as Dooley said of the Supreme Court, “It follows the election returns.” Its behavior reminds me of nothing so much as the remark attributed to a U.S. Army officer in Vietnam, “We destroyed the village in order to save it.” Similarly, the Fed refrains from using its independence because it is afraid of losing it.
    Why Inflation Persists
    Column, 1977, Newsweek (October 3, 1977); reprinted in full in the Congressional Record, Extensions of Remarks, September 29, 1977, p. 31684, introduced by Representative Parren J. Mitchell of Maryland, who gives it as appearing “in the October 3, 1977, issue of Newsweek”, Congressional Record, September 29, 1977, p. 31684
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  3. I then attributed the divergence of promise from performance to misunderstanding. The men who run the Fed, I wrote, have “taken the behavior of interest rates rather than the quantity of money as their guide—and this mistake has led them far astray from their intended path.”
    The Inflationary Fed
    Column, 1973, Newsweek, August 27, 1973; reprinted in the Congressional Record, Extensions of Remarks, November 7, 1973, p. 36327, introduced by Representative Robert Huber of Michigan as “Mr. Milton Friedman’s article that appeared in Newsweek of August 27, 1973”, Congressional Record, November 7, 1973, p. 36327
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