For an analysis of inflation which suggests that the causes are “rooted deep in the nature of the mixed economy,” see SamuelsonPaul, “Worldwide Stagflation,”Morgan Guaranty Survey (June 1974).
2.
For the background and history of NOW accounts, see GibsonKatharine, “The Early History and Initial Impact of NOW Accounts,”Federal Reserve Bank of Boston, New England Economic Review (January/February 1975), pp. 17–26.
3.
For a discussion of alternative ways of linking the returns to a price index, see FriedmanMilton, “Monetary Correction,” in American Enterprise Institute for Public Policy Research, Essays on Inflation and Indexation, October 1974, pp. 39–40. From the point of view of the banks, the precise form of an optimal inflation index for long-term deposits would have to be determined in connection with any indexing arrangement for long-term loans (discussed later). As noted earlier, however, a detailed analysis of such a fully indexed system is beyond the scope of the present paper.
4.
See BurnsArthur, speech to the American Bankers Association, October 21, 1974.
5.
Ibid.
6.
HollandRobert, “Statement to Congress,”Federal Reserve Bulletin, November 1973, p. 801.
7.
This is an adaptation of Kaufman's analysis of the thrift institution problem. Cf. KaufmanGeorge G., “A Proposal for Eliminating Interest-Rate Ceilings on Thrift Institutions,”Journal of Money, Credit, and Banking, August 1972, pp. 735–743.
8.
See MooreGeoffrey H., “Economic Forecasting—How Good a Track Record?”Morgan Guaranty Survey, January 1975, p. 6.
9.
HelblingHansTurleyJames, “A Primer on Inflation: Its Conception, Its Costs, Its Consequences,”Federal Reserve Bank of St. Louis, Review, January 1975, p. 6, n. 9.
10.
See BowsherNorman N., “Usury Laws: Harmful When Effective,”Federal Reserve Bank of St. Louis, Review, August 1974, p. 22.
