FED CHIEF BATTLED INFLATION.
Paul Volcker, the towering former Federal Reserve chairman who tamed U.S. inflation in the 1980s and decades later inspired tough Wall Street reforms in the wake of the global financial crisis, died Monday at age 92, said his daughter Janice Zima.
Volcker, who Zima said had been suffering from prostate cancer, was the first to bring celebrity status to the job of U.S. central banker, serving as chairman of the Federal Reserve from 1979 to 1987. Volcker could soothe or excite financial markets with just a vague murmur.
In 2018, he published a memoir, Keeping at It: The Quest for Sound Money and Good Government, and expressed concern about the direction of the federal government and the loss of respect for it.
“The central issue is we’re developing into a plutocracy,” he told the New York Times in October 2018. “We’ve got an enormous number of enormously rich people that have convinced themselves they’re rich because they’re smart and constructive. And they don’t like government and they don’t like to pay taxes.”
In 2009, Volcker became a key financial adviser to President Barack Obama and faced financial turmoil, government bailouts and fallout from the deepest recession since the 1930s Great Depression.
In working to help the U.S. economy recover from the 2008 crisis, he proposed what became known as the Volcker rule, which restricted banks from making highrisk investments with depositors’ cash. Since Donald Trump, who favours fewer regulations, became president in 2017, the rule has been under review.
Volcker smoked cheap cigars, wore old suits and spoke with a rumbling baritone, creating a mystique that intimidated members of Congress and even presidents. Part of his aura was due to the Fed’s unusual nature — being effectively answerable to no one.
In 2018, when Trump attacked the Fed as “crazy” for raising interest rates, Volcker advised Chairman Jerome Powell to ignore the criticism.
Powell said he was “deeply saddened” by Volcker’s death, and that his work had left “a lasting legacy.”
Born Sept. 5, 1927, in Cape May, N.J., Volcker was educated at Princeton, Harvard and the London School of Economics.
His wife of 44 years, Barbara, died in 1998. They had two children.