Reserve Soft-Pedals 'Easy Money' Policy: News Analysis
tern has quietly shifted its emphasis away from* easy money and thereby was taken a calculated economic and political risk.</br></br>The central bank has moved to a stance of less easy credit at the very time that the econ omy is sluggish.</br></br>The monetary authorities can make out an ingenious case for their new position. But if the current level of output and income persists or tails off into a decline in the next six months the FedÛªs shift could touch off a barrage from Democrats and professional economists that might drastically reshape the way the central bank docs business.</br></br>Chairman William Mc-Chesney Martin of the FedÛªs board is a man of deep conviction who is not unused to fire. There is no sign that he is flinching, and it is a safe bet that he fully appreciates the risks he is running.</br></br>For the past six weeks, the Fed has let the supply of money decline a little. Interest rates ,the price of money, have been moving up slowly. From the beginning of June to mid-July, the price that the Government has had to pay for 90-day loans has advanced from 2.656 per cent to 2.974 per cent; the yield on long-term Government bonds has moved up from 3.89 to 4.02 per cent.