Federal Reserve Buys U.S. Bonds in Turnabout: Federal Reserve Purchases Government Bonds in 1
The Federal Reserve System yesterday broke sharply with its past practice and! adopted a new technique toj Ight the business slump more' vigorously.	i</br></br>The central bank junked its ramous ÛÏbills mostlyÛª' policy and announced it is buying Government bonds.</br></br>This technical but impor-.ant change has two aims: frstly, attack long-term inter-;st rates directly to cheapen .he cost of investment by susiness and local govern-nents; secondly, keep money jasy without lowering short-:crm interest rates and so pushing more dollars overseas,</br></br>The new technique represents a major triumph for President Kennedy and Democrats like Sen. Paul If. Douglas (111.), Sen. Albert Gore</br></br>The New York Federal Reserve Bank and its principal economist, Robert V. Roosa, also called for the switch. Roosa, now an Under Sccrc- tar.v of the Treasury in the Kennedy Administration, undoubtedly played a major role in bringing about the change.