The Federal Reserve System and Price Stabilization

Archive Report

The problem of price stabilization, and the part that may be played in its solution by governmental agencies, is again under consideration by the Banking and Currency Committee of the House of Representatives. Hearings on the new Strong stabilization bill, begun in March, will be resumed late in April. The general purpose of this bill is to place upon the Federal Reserve system responsibility for maintaining stability of the general price level, that is, of an average of such prices as may be deemed to be representative of the purchasing power of the dollar.

The Strong bill, in its present form, is rather vague as to the specific nature of the obligation it proposes to lay upon the Federal Reserve system. Its vagueness is the ...

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