Paul Volcker, Market Psychologist

a very important and timely book. Not only is she one of my favorite colleagues, but she also helped former Federal Reserve Chair Paul Volker write his memoirs and Taboot. She has a fascinating piece out in the latest issue of Business Week about Boker's reputation as an inflation fighting superhero and what lessons his experience holds for the current FED as it tries to play that same role. But first, Pill Donna, confess, have you read the whole book of

the book? Yes, and I have proof. Well, you don't spoil the ending for me. This won't spoiled the the ending for you, but I know you'll know that I read all the way through because the acknowledgement section. I even read that, and Wolker in it talks about our guests so so nicely. And this is all at the end of the book. So this is my proof. All right, Well, you just spoiler. That was a spoiler of the acknowledgment. I'd never make it to the You didn't read the footnotes,

did you? Of course I did? Are you kidding? My goodness? I was hoping to learn from them and learn I did well. I confess I've read most of the book. I had a very busy weekend. You know. It was parents weekend at my my daughter's college, so there was a football game and a tailgate, and that's lot of activity for a guy my name, guy my age. I I hardly even got a single map in all weekend. But I think I read most of it. If you count the pages in the middle with the pictures, then

I read most of it. You read most of it, okay? Just to make it to make you feel even worse, the Bills were playing on Sunday, and I didn't watch the game because I sat around reading the book. Oh my goodness. Yeah, So I hope you feel really bad. That's that's commitment. I do feel bad, but it's what I read is excellent. So when you bring our guests in here we're speaking soon. Let's hear what she has to say about you not reading. It's Christine Harper. She's

editor of Bloomberg Markets magazine. Christine, thanks so much for coming on the show. Thank you so much for having me. And to be fair, I don't even read all the stories I edit. Sometimes you know it's uh. But Christie, why don't you start and just tell us how um you got involved in this project and sort of what the division of labor is when you write a book

with with such a legendary figure like that. Well, I can't speak for how this normally works, because I think this was a really exceptional sort of lightning bolt experience for me. I'd never written a book, and I just happened to know somebody who is in the publishing business and a friend, a mutual friend, came to me and said he suggested my my name to this friend and the publishing business as somebody who might be able to

help Paul Vulcan write his memoir. So the guy in the publishing business, who name is Peter Ostos, calls me up and he says, would you'd be interested in doing this? Paul Wolker, he's getting quite old, he wants to write his memoir and uh, he just needs a little help. And I said, well, you know, I know nothing about writing books, so and I'm not really an expert economics, so I don't know why. And he was like, listen,

just you know, go talk to him. It should be somebody in New York and and we want to make it his book and not bringing somebody who's going to make it their book. And I said, well, that's fine, I'll do that. So and I thought to myself, no matter what goes wrong, here, the worst case scenario as I get to spend a bunch of time with Paul Volker.

How great is that? So so I had an introductory meeting with him in his Rockefeller Center office in a sort of late summer, and he was absolutely charming and absolutely you know, great, and clearly had no qualms about working with an untested person like me. And so we just started meeting on a very regular basis at his office at his home. He would tell me stories, I would record them, I would get them transcribed. We would talk.

We would talking and then eventually he started writing and handing me pages and and handing his secretary pages his hype up and and I would give him feedback and we would talk about it, and so yeah, it was just it was great collaboration. He wrote a lot of

it himself a longhand on a yellow legal pads. I had it typed up by his amazing secretariat, who uh, who could read his handwriting, which is not an easy not an easy thing, and then uh and then I would sort of edit it and and make notes and changes, and he would read it and then he in his allegible handwriting right all these notes on it. He was very, very involved. He would he had a great uh attention to detail, a great interest in making sure we always

chose the exact right word. And I wasn't expecting that. But as I worked with him, and as I learned more about his career, it became clear to me that so much of being in the roles he had was about really perfect communication. If you read some of the FED minutes from his time as chairman, the discussions are all about how to convey exactly the right way in their you know, in their statements and in their communications.

What they were trying to achieve because of course back then they didn't they didn't announce what the FED funds target was. You know, they just it's sort of they would do it the open markets of desk would uh would make it happen. They did announce the discount rate, but it was it was a lot of it was

just communication. So, um, he's a he was a great word smith, a great communicator, really cared about how to tell the story, had a lot of stories to tell, didn't really want to focus mostly on the inflation episode. That was one chapter for him of a career that's full of amazing chapters. And uh, it was just delightful and uh he he and I worked on it really quickly, got it done in I guess less than a year,

which is really impressive. Yeah, and um, but you know, he was a motivated guy who's very disciplined, so you know, and then unfortunately he got sick right towards the end um and and was died a year after he came out. So it's really sad because you know, he would he would have a lot to say today. But I think in a way he knew that his lessons would be a value to people in many ways going forward, and so he tries to he tries to impart them as

as clearly and uh and impact as he can. And I want to get to all those things, but I want to ask you one more question about the actual process, because I really like the stories about his childhood right at the start of the book and how I think there was one story about how he had this allowance, that it was the same amount he was getting weekly or monthly that his sister's years beforehand had been getting,

and what that taught him about inflation. Um. And then I think later on in the book he mentioned something like he had been pulling out files specifically for the book, and he was surprised by the things and that he found in the notes that he had scribbled in the margins. So maybe you can just talk a little bit more about the process and what it was like where he you know, for him to be digging out this these

historical documents. Yeah, I mean it was great fun because not only did he have documents that either had been sent to him by people he had grown up with, or you know, he'd sort of come across at some point, um. But occasionally I would come up with something, uh that you know, he may have over booked and uh, and

so he was always delighted when something came. And and there were also some stories he told me in our discussions that I recorded that when I said, oh, should we tell this story, he'd say, no, let let's leave that one. So uh yeah. And actually one of the funniest moments, um, right towards the very end of writing the book, Um, I think actually we'd already it was already in galleys, it was pretty far along. And uh.

He I was in his study in his apartment and he said he had like a first edition of like Canes or something in his in his library there. And so I was looking around on the bookshelf trying to find it, and I couldn't find it. But I found this other slim volume which was an economics textbook from the nineteen twenties or maybe even before, I think maybe the nineteen tents that had been his his mother's textbook

in college. And and it was filled with MARGINALI if they note she had written and he if you'd ever realized he had it, he had totally forgotten about it. So he was sort of you know, discovering this I had handed it to him. We were looking at it. It It was amazing and uh, from her time advassaor advassor exactly, and it was I think the FED had not been created.

It was like really amazing and so um. So one of the notes she'd written to herself was about how psychology was the real key to so much of what was happening in what happened in economics and finance, and uh, and I think that really was kind of a eye opener because he credits his father a lot with his interests in public service, but he also credits his mother as having been quite interested in markets and quite smart about them, and he quotes her a few times in

the book. But we ended up adding this little bit about his mother's economics textbook and her note to herself about how psychology was really important, because, of course, if you look at what Volker did during his career, he really understood the psychology of investors, the psychology of consumers and business people, and so much of what he did in the inflation fight was basically around changing the psychology. So it was cool to realize that his mother kind

of knew that too. That's that's pretty amazing. Yeah, setting the expectations, I guess is so important for a central pak. But I became fascinated with his father a little bit too, because Christine, I think you and I both sort of cut our teeth in journalism covering you know, small towns, small municipalities in uh Pennsylvania and I was in Pennsylvania for a while. In New Jersey, I know, I think you were in good old Delco outside of Philly for a while. Yeah. And and so Paul's father was a

like a town manager. And I'm not sure if if everyone appreciates in these small towns how that works. You have a sort of a part time, you know, unpaid or lowly paid counsel and a lowly paid mayor, and then you bring in a manager who was supposed to be non political at all, and that was that was fulkers father, I guess in what in Cape may and in te Neock, New Jersey, a few other towns. Actually.

Vildanna might know this from having read the acknowledgements, because he he does say in that his very very kind of words about me at the end of the book that I actually thought his father was the real hero, because I did become fairly obsessed with his father. The more I learned about his father, his father was a

huge deal in New Jersey. And it was because so his father was the son of German immigrants, grew up in Brooklyn studying engineering, became an engineer, worked on the Erie Canal, met Fulker's mother up in the town on the Erie Canal, but then ended up discovering that there was this interest in kind of city managers, right, like these professionalized city managers, because you know, that was the era of like total corrupt in I mean, American politics

had gotten into the cess pool. I mean, you know, you can argue, but I mean it was all crony ism all and so somehow, like New Jersey had passed this law allowing these like city managers to be appointed to be kind of professionalized the way cities were run. And Paul Volker Sr. Was the first ever in New Jersey, first in Cape May and then eventually in Neck, and he had a remarkable effect on these communities. It was

really an incredible turnaround stories. And so I was very keen on sort of opening the book because actually when Paul would talk to me about the book, one of the key points he wanted to make was about public service. This was his real mission at the end of his life, is trying to professionalize and better educate people for public administration. He cared a lot about it, and that's what the Vulgar Alliance he founded is dedicated to. And it was

all really what his father had taught him. Yeah, well I was gonna, I was gonna. Does that? Do you think that influence of his father sort of having to be above the politics and you know, non non political played an influence on how he approached the FED being

you know, the same thing basically outside of politics. Yes, I mean, I think in all ways, but you know, like I think when people think about Paul Volker, they think of him as somebody who could kind of, you know, see every side of the political argument and stay kind of above it um. But also in the way that he sort of believed in a certain humility and sort

of not not seeing himself as above the people. Right Like, So his father, you know, gave himself a pay cut during the depression, you know, spent weekends going out and meeting with the families of all the city workers, whether they were the you know, uh, sanitation workers or whatever. It just like didn't matter. He was very you know, sort of engaged in in this sort of very you know, uh democratic with a with a small d way with

the people. And I think that was also something that Paul Walker brought to, you know, the his belief in, like you know, being a certain basically kind of a servant to the to the people more than like a ruler, you know. I mean, so he was above politics, but he always you know, saw himself as sort of there

to serve. And Mike mentioned that you have this piece out in Business Week that recaps a lot of what what we were just talking about and what's in the book, But maybe you can just lay out for us what the environment was like back then when he became FED chair and and what some of the comparisons are to what we're seeing today because we had high oil prices. I think it's one of the main things he had

been talking about. So maybe just lay out the the environment. Yeah. Yeah, So he came he was appointed by Jimmy Carter to be FED chair at this period of horrible inflation in nineteen seventy nine. Really things have gotten out of control. You've had a huge energy um crisis with you know, there was a big issue with the Saudis and the other Arab states and uh, and so nobody had been

able to deal with the inflation problem. There was also quite a lot of power in the labor unions back then, so um, uh, the negotiations for you know, wages were much different from I think they are today, So that I think is a difference. But um, but yeah, it was. I mean the inflation problem was much more entrenched back then.

It had been going on through most of the seventies. Uh. It had people that sort of failed to recognize during the late sixties and early seventies how much the war spending had was contributing to inflation, the war, Big Vietnam, um. And there were just a lot of factors, you know, even the role that M. Vulker was involved in taking the dollar off the gold standard at the beginning of

the seventies under Nixon, and that played a role. I mean, basically the dollar was no longer anchored to you know old Um. So there was this you know, decade long kind of you know creep in in prices, and it had gotten so that people just assumed prices were going to go up double digits every year, and his predecessors that FED chairman had basically kind of thrown up their hands.

They didn't know how to do anything about it because every time they would try to start raising prices, you know, they'd get all this pushback, or try raising interest rates, they'd get a lot of pushback, so much political opposition for obvious reasons. There was you know, um law passed in Congress which known as uh, you know now the dual mandate. They talked about it, which was sort of required the Fed to make employment one of its goals

as well as price stability. So um, you know, when Volker became FED chairman, he knew he'd been New York Fed President that the problem he needed to address was inflation. He told Jimmy Carter that when he went to meet with him, he thought maybe that prevent him from getting the job, because he said, I'm going to raise rates a lot, and Jimmy Carter appointed him anyway, and he really admired that Carter did that because it you know, he thinks it contributed to him only being a one

term president. But um, but he he went, he came into the role saying, inflation is the job I have to focus on I'm going to ignore all the other factors. You know, he said, the Fed economists at the time, we're telling him they were the economy was about to go into recession, but he kind of just disregarded them, and uh, and he had to, you know, raise rates

as as strongly as he could. One thing I think is underappreciated, Christine that I've I've really come to realize by by reading the book is that, um, so much focus was on that aggressive campaign to to raise rates. I mean sometimes would be a few rate hikes within a few weeks, right, I mean they were. They were

very fast and aggressive about it. But there's also the notion of he sort of embraced to some extent the ideas of Milton Friedman and the so called monitorists, you know, uh, the idea that's to control inflation, you also had to sort of control growth of the of the monitor money supply. UM and he he referred to it as practical monitorism. So I wonder if you could talk a little bit about what that means. But also, you know, I I get there the impression that he maybe wasn't sure what

exactly the role that played in taming in inflation. Compared to the interest rate increases. You know that from one thing, it's just so hard to measure the supply of money. He ran in some difficulties with that. But but talk us through what you think, you know, the legacy of that sort of part of his inflation fighting campaign is you know, was that was that an important part of it? Do you think? Yeah? Absolutely? But I think that goes back to the stuff we were talking about with his

his mom and the whole psychology thing. Because when he was earlier in his career, when the idea of monetorism was first being introduced by Milton Friedman and other people, Um, the idea was much more mechanistic. It was sort of that the to the degree that there should be a fed at all, you know, and some people didn't even

believe you needed a group of human beings. It should just be about figuring out what the optimal supply of money in the economy was to prevent inflation, but also to allow the economy to grow and just keep that supply, you know, steady, and make sure it didn't get you know, beyond that and and and nothing else. No other human judgment should be involved. It should be like automated basically.

And obviously, you know, when he was early in his career at the New York Fed, nobody he worked with agreed with that, right, and there are a bunch of people were against central banks. So he was kind of raised with this, this is a foolish idea. Monitorism is kind of you know, crazy, and it won't work. When he got to be FED chair it's actually interesting looking

at some of the correspondence. I have some of it where ah, he's writing to Milton Friedman actually after he was appointed FED chairman and sort of hinting that you know, he may, you know, he may do some things that that Freeman would agree with, but he was sure Freedman was still criticize him. I think what he knew going into the job was that what they were doing wasn't

really working right. So just like setting interest rates higher and higher, because as long as you were able to, as long as politicians and everybody could see human beings were setting these interest rates, there was always going to be pushed back. They're always gonna be human beings who couldn't stomach it, right. So in the second time they raised rates when he was FED chairman, there was a split on the on the committee, and he he was confident that the four people who were voting for higher

rates would keep doing it. But he realized the market wasn't convinced, so he had to do something different. So he basically used monitorism as kind of a tool. So he didn't employ it in the pure way that the real monitorism monitors would have wanted. He just basically used

it as a psychological crutch. So he the Saturday Night Special October six ninety nine, called This Saturday Press Conference, announced a series of changes, including a rate increase and a whole bunch of, you know, different factors, but the main thing was from now on, we're gonna we're gonna target the money supply. And what that essentially did is it sort of tied their hands. It said to it said to the market. You know, it's not us human

beings who are gonna be setting interest rates anymore. We're just gonna focus on the money supply, and the interest rates will do what they do. You know, we're gonna work up, but we're gonna focus on the quantity of money, not the price of money. The price of money, you know what it'll do, what it does, you know, interest rates will do what they do. So they had this idea that they would have an upper limit and that they would revisit it. You know, if rates got to

an upper limit, they would look at it. And it kept getting to the upper limit, and they kept saying, Okay, we gotta let it go, we gotta let it go. He says in the book that if he had realized that at the outset how high rates had would get, he might not have been able to do it. And so I think that's a sign of how successful that strategy was, because if he had had to, as a human being, vote for those kind of interest rates, he

would have found it too difficult. But when he was able to say, this is not our decision, it's what's happening because of our money supplied decisions, it was it was a little easier to stomach. So it was purely it was kind of like used as a psychological trick, and then they abandoned it as soon as they found it kind of inconvenient. So it wasn't ever pure monetorism.

But that's why he calls it practical monitorism. Maybe one thing that we can't get out of the book is the maybe uncertainty that he had felt, or unease or confusion or I don't even know us any any words that are synonymous with that. And possibly he told you about that time period and what it actually felt like for him to be working through. Can you talk about that? Well, it's funny, he he he was a little unwilling to

really engage. I mean, there are there are some biographies that have been written about him, will which tell stories about how like when he got nervous, he would go to the men's room a bunch of times or things like that. You know, so, I mean he definitely felt it, but at the point when I was working with him, he kind of he a little bit sort of you know,

brushed it aside. But even so I could still tell, even at age ninety, it was still it was still weighing on him whether he'd really he felt the criticisms that are still leveled at him today from like people on the left or people on the right that you know, there would have been another way, and so he wrestled with that. I remember, you know, there's a famous book called Secrets of the Temple by William Prider, right, he

was reading it when I was working with him. He was like he would he would talk to me about stuff. He was reading these criticisms and how he didn't just he didn't agree with them, but like he wasn't he wasn't ignoring them. And I thought that was really interesting because he still you could still tell that he wished there had been another way. He felt the pain that he had caused. He struggled with it, but ultimately he couldn't.

He couldn't think of any other way, and he understood that the value that bringing down inflation had for the for the people. And you know, it's interesting. I think ever since the FED was created, there's there's been a backlash against the FED and sort of critics and uh and the FED or on the FED type of people. But boy, that really reached a fever pitch during his chairmanship. Could talk to us a little bit about some of

the protests and some of the backlash that he faced. Yeah, no, he I mean he had the so the farmers who you know, rely on borrowed money for planting their crops. They surrounded the FED headquarters with tractors at one point. The home builders who you know, because mortgage rates eventually got up beyond above like eighty they all were sending two by fours to to the FED with like angry messages. Um, you know, his speeches would be interrupted by screaming protesters.

He apparently once somebody released rats in the audience of one of his speeches. I mean, whenever I would bring these things up, he would sort of go like, oh, it was a bunch of Linden LaRouche fans. Like he he sort of brushed it off as like, you know, that wasn't what the people really felt. And I get security, right, and he had to. I mean, yeah, he didn't even

remember this. I found this in some of the documents in the in the Vulgar archives, like the letters that were written to him by the you know, the FED and Security Department saying we have to get you personal. Yeah, he's he was a tall guy, really imposing and actually a really fascinating thing is that I found this story from about a year after You got the Bodyguard, about this armed man who went into the headquarters of the FED. I think he was carrying a knife in a gun

or something. He was he was angry about inflation and interest rates, and he uh, luckily didn't get near any of the FED people, but he was he was arrested, but I found it that same guy later ended up killing somebody like you, I mean after he got there to jail. Yeah, I think he was a guy who killed the security guard in front of the like Holocaust Museum or something, you know, down to d C anyway.

So I mean, yeah, there were there were threatening situations, but like you know, he Vulker didn't really like to dwell on that because I don't think he ever felt he was in danger. He always felt people made too much of it. And I think one of the most interesting things is that when he was FED chair, you know, a group of five protesters showed up at one point outside and his um, you know, pr people were like, you know, what should we do? Will send them away?

And he said, no, I actually bring bring some of the leaders into my office. And so, you know, I don't know how many people would do that today, just sort of spontaneously said let these strangers in, but he did, and a whole group of people were in his office debating it with him, and he ended up on the steps of the FED after is giving a sort of impromptu press conference with the leader of this UH National

People's Action Group, I think it was called. So, um, he didn't he didn't shy away from engaging with people even though clearly people were really angry. And what about the view of what he and the FED were doing outside of the US, because I know he talks a lot about meeting with his counterparts in Germany and Japan and going through Europe on these like three or four

day trips, and so what was the view outside? Yeah, so as you as you saw in the book, I mean, he early in his career was working in the Treasury Department under Nixon, and he spent a lot of time traveling around the world, including having to explain to all of our you know, allies around the world, what why we're going off the gold standard. So he had really good relationships with people in Germany and in Japan, in you know, the UK, Italy, So he was kind of

like a monetary diplomat in a way. And when he was owing to try that before he did the Saturday Night specially went to Belgrade for a big I m F conference and and Burns gave a lecture there about, um, you know, how central bankers could no longer do anything

about inflation. But by that time already Bulker had met with the German I think chancellor and central bankers, and they were they were going crazy that the US had allowed inflation to get so out of control, and they felt like the dollar was too weak and had to do something. So they were they were desperate for him to do something, and he sort of basically said, don't worry, I'll get it under control. So he got He He cared a lot about our relationships overseas as well as

you know, what was happening domestically. One thing I think is fascinating when when we think a vulcar in this day and age in this sort of an inflation, I don't know if you call it a crisis, but an acute problem that we have with inflation. All you ever hear about is uh, you know this inflation fighting efforts uh that he had. But you're reading the book, it's it's fascinating how many other fires he had to put

out along the way. You know, I didn't appreciate how involved he was with the Chrysler restructuring, for example, But what do you think, what what would he rank sort of his legacy of some of those other issues he dealt with. You know, the the lad Am debt crisis. And uh, I was fascinating to learn that the idea of too big to fail actually dates back to his time. So what you know, talk to us about some of

those other fires that he put out. Yeah, well, I mean, I think you know, his his earliest one was the one I just mentioned about, you know, the taking the dollar off the gold standard. That was a gigantic moment in this country's history. Uh, when Nixon decided to sever that link and and and that was a huge crisis in its own way, and Vulker was read at the center of it, within Secretary of the Treasury John Connolly, and he has some great stories to tell about that.

So he'd sort of already like become this crisis hardened person by the time he got to the Fed UM. So inflation, you know, was job one. But the result of higher interest rates, as I think some people in the markets now are worried about as well, is that there are often if you've had a period of easy money, there are often a lot of bubbles that are forming, and then when race go up more than people are really ready for, you know, accidents happen. And so you

see in the book. Uh, this section on fighting inflation basically the experiment with monetarism and all that, and then you see the sort of catastrophes that resulted and how he had to clean them up. Right, So you mentioned, uh, you know, well Chrysler was sort of a little separate, but but you had a Continental Illinois, which was a huge bank which had exposure to these speculative oil loans that this bank Pin Square had originated at Pin Square

went under first, Pennsylvania Bank had to be rescued. Uh, you had the savings and loan crisis. A few years later. Um, you had the Hunt Brothers, which is great, you know, a story of just these billionaire brothers who had speculated on silver because of of course silver would never stop going up because inflation was never going to get under control, and then when raids went up, they couldn't meet their

margin calls. So all these brokers started calling the FED would help us, help us, and he had to get involved, even though you didn't think the FED should be involved in that. Um, but yeah, he he discovered the dangers that the financial system, you know, it has embedded in it.

And then of course the biggest one was the US and European banks had these huge loans to Latin American countries funded by all the petrol dollars from the oil rich Middle East, and and they these Latin American countries were no longer going to be able to pay them back. And in some cases these loans were more than twice the you know, capital of the bank, so they were going to go under. So I think ultimately it was what really caused Volker and the FED to stop the

inflation fight was they had to rescue the banks. And so, you know, I think one thing to watch today is whether,

you know, we find ourselves in a similar situation. If you read the end of the book, he talks about like the biggest risk that the biggest caution he has for central bankers is not only don't let inflation get out of control, but don't let the speculation that goes with inflation get out of control, because the combination of you know, out of control monetary policy and out of control financial speculation is the most damaging potential thing to

the to the economy. Well, let's talk a little bit more about today, because you wrote in the Business Week piece, uh to see the challenge ahead for Powell it's useful to revisit Vulcar's bumpy path to victory. And then I remember, I think it was at the Jackson Hole meeting a couple of months ago that Powell used a phrase that everybody recognizes being the title of your book, which was that they were going to be keeping at it. And I think a lot of people were trying to make

that connection between Powell and Vulker. So can you talk about maybe some of the lessons or what actually is happening today that although I like the wise old parrot,

I wish they would have gone with that. Um. Yeah, So I mean, so you know, uh, when I would talk to Volker about who should be fed chair um at the time, when like Trump was considering new alternative, always expressed, uh, his view that having had himself experienced in the private sector and in Treasury Department, that having that kind of practical experience outside of academia he thought

was incredibly valuable and important. And so he was a big supporter of somebody with J. Powell's background because he thought that brings you a little more more in touch with sort of the effects of monetary policy and a little less less focused on the theory. So I think when you look at today, um, he would be encouraged that Powell is in the spot. He he would be

very upset, and he expresses this in the book. Even before some of the later experiments with you know, sort of inflation targeting, he thought it was always a mistake for central banks to be like trying to create two percent inflation. He didn't understand what that was. He he thought that was a mistake and they were playing with fire, and of course it turns out they were. Um, I think he would be glad that, you know, Powell is talking a lot about trying to be more like vulgar

and uh. I think he would just be concerned that, you know, some of the speculation that we saw, especially like if you think about one how crazy things got. I feel certain that if he had been alive during that, he would have been ringing the alarm bells pretty loudly. Um, So he would I think he'd be disappointed that the Fed hadn't kind of figured it out. Um. So Yeah, it's just a fascinating book, Christine. There's so many little anecdotes that I love, like when he noticed on his

driver the front seat of his driver's car. There's a book called How to Live with Infliction, And and he said that he knew he had he was on the right path because the driver said, well, the ownerson I bought it was the price was reduced from like ten bucks to two bucks. But some of his uh and I think we're gonna segue to the crazy things soon. But a good segue for that is for me to ask, which I think is admittedly a crazy question. Uh. So I'm gonna go ahead and do that. But he's some

of his his wit is very self deprecating. You know, he talks about being a procrastinator, and he often makes jokes about his height, Um, you know, six seven. Honestly, I gotta wonder if being such a big, imposing figure was an asset to him when sort of history needed this sort of very strong character. It might crazy to think that. No, I don't think so. I mean he

had he had, I don't think. I'm not sure he would have admitted this, But look at he really played a character, right, he had that he had the whole cigar thing. You know, he quit smoking by the time I knew him, but he would sit there and testify and smoke the cigar, and he was incredibly tall. He had the deep voice, and he had this this air of authority, and I think he knew that that was you know. I mean again back to his father. His father had basically ruled this city and gotten it into shape.

And his father was just as tall um. So I think I think he understood against the psychology of you know, how to assert authority, how to how to you know, he'd watch the politicians he'd worked with. He'd watch John Connolly out fox some of the other people in the Nixon administration. He was quite a quite astute student of people and how they are effective and how they aren't effective. He knew what he was that psychological effect of a

big six seven cigar chopping, you know. But it reminds me of those old memes used to see of you know, a graph of interest rates and the height of the Fed chairman. You know, it went from Vulker to Janet Yellen being the shortest. That's sure enough. Here we are, uh with Powell, you know, and rates are going back up. So yeah, maybe there's something to it. But that's the craziest question I had. But I'm glad you played ball with that I'm not not as crazy have a question

as I thought it was. I guess no, No, there's there's a great story that I once heard Bill Bradley, the former New Jersey Senator, tell about how he remembered when you know, Paul Wolker used to go back to New York City every weekend. You know, his wife still

lived in New York. So, uh, Bill Bradley would be going back to New Jersey for the weekend, and and they'd get on the shuttle, which you know doesn't really exist in the same format anymore, but the Washington the plane that went from Washington New York, like on the hour, and they would just go and they'd sit an economy class on Friday night or Friday afternoon and get like, you know, they'd be like seat you know, you know, huddled up with their knees in the chest and you know,

surrounded by other people. And yeah, it was just a different time. Another Princeton basketball playing exactly right, even taller than Paul. Great stuff, Christine. We really appreciate your time. And again I can't recommend this book us as strongly as I can. I mean, it's such an important look at period of history. That I think is is very echoing loudly these days. So we appreciate your time, but we're not gonna let you go until we hear the

craziest thing you've seen in markets recently. So I think we'll start with you though. I have a pretty good one, okay, but you usually do. It's Elon musk related. Oh no, no, there's nothing crazy. But I think we might have the same one. Oh no, I hope not. But he's done so many things this week that honestly, it's it's possible. That's anyway. He's promoting a new perfume, same one, you have the same one. Shoot, but it's so good? Is good? Okay?

He said, it's called this is so disgusting burnt hair. It's the essence of repugnant desire. It's a hundred dollars a bottle, and he tweeted, of course, that ten thousand bottles had already been swailed. And I don't know, I mean, I guess this is really happening. He's not joking around.

I I it's you've never done with this guy, like the shorts, remember he sold shorts to try get short sellers, and also the flamethrower the flamethrower, and he said something to the effect of, uh, with with my last name, it was inevitable that I'd get into men's per clone. That's good, That's really good. Okay, well us, but I was gonna I was gonna do prices precise on the dollar value of the bottles of bottle. I shouldn't have said it for for burnt hair perfume. Maybe he's put

those flamethrowers to work to get that sent possibly. Alright, well, great minds think alike, I guess, or even even you and I occasionally, how about you, Christine, what's the craziest thing you've seen recently? Nothing quite as crazy? I mean, I just I'm watching very closely what's happening with the UK Central Bank, having lived in London and and having a lot of friends over there, and watching the b o E trying to tell people on the one hand

that they're going to support, you know, whatever happens. On the other hand, you only have a few days to clean it all up, and so so I think that's as crazy as it's getting. But you know, I'm sure it'll be more crazy. As soon as I walk out of this booth. There'll be something crazier. Yeah, well, if you had the challenge channel Paul Volker and give advice to the BOE, what do you think he would tell him? Well?

I think he you know, he dealt with his share of exchange rate crises also including helping helping Thatcher keep the pound above the dollar, so I think he would say though that You've got to deal with your domestic situation first, So I think he would he would encourage Powell to keep at it with the inflation fight and not be distracted by helping the pound out right now, probably that sounds a out right Yeah, Christine Harper, fascinating

conversation and a really great book. I hope everyone in the What Goes Up book Club will go out and read it. Who was in charge of this book club? You are? I I it sounds like you want to be in charge of it. I definitely do. All right, you're you were the chair of the What Goes Up? Book Club? Then my first sort of business is kicking you out. I know it. I know it, just because

I didn't finish the book. Yeah, if you bring wine to the next meeting, then you'll will be re I mean, you're putting your children first, like, I think your priorities are all mixed up. This is why you were kicked out. Well, you got to write another book, Christine, and we'll have you back. And by the way, read Markets Magazine, uh excellent, excellent, Bloomberg Periodical Keeping at It by Paul Woker and Bloomberg Markets Magazines to two must reads. That's our two must

reads for the week. Thank you Christine, Thank you guys, Thank you Christine. What Goes Up. We'll be back next week and soil. Then you can find us on the Bloomberg Terminal website and app or wherever you get your podcast. We love it if you took the time to rate and review the show on Apple Podcasts, so more listeners can find us. And you can find us on Twitter, follow me at reag Anonymous. Bildanna Hirach is at Bildonna Hirach. You can also follow Bloomberg Podcasts at Podcasts. What Goes

Up is produced by Stacy Wang. Thanks for listening. To see you next time.