McCracken Sees Well-Timed Shift in Fed Money Policy
Former Economic Council Chairman Paul W, McCracken said yesterday that the nation may be witnes-sessing "one of the best timed turnabouts away from a restrictive monetary policy in the Federal ReserveÛªs history.Û</br></br>Testifying before the congressional Joint Economic Committee, McCrackenÛÓnow a professor at the University of MichiganÛÓimplied that if an easing in fact is taking place, the Fred may have averted a recession for 1974.</br></br>Two fellow panelists at the Committee session, however, saw various degrees of slowdown as certain for next year. Nobel Laureate Paul Samuelson predicted ÛÏstagflationÛ with the excesses of ÛÏthe election year 1972Û giving way to "what is called growth recession (less than 4 per cent real growth) between now and the end of 1974.Û</br></br>And Michael K. Evans of Chase Econometric Assoc-ates, Inc. said there would be a slowdown with rising unemployment next year, but not a full-fledged recession.</br></br>All three were highly critical of the proposal made by Federal Reserve Chairman Arthur F. Burns for a tax increase to fight inflation. Evens said that such a proposal "has no redeeming feature,Û and would merely bring on recession without curbing inflation.