Word: wenglowski
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Dates: during 1980-1989
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...strength of sales was puzzling to the board. Guest Member Gary Wenglowski, of the Wall Street investment firm Goldman Sachs, explained the willingness of consumers to spend and spend by arguing that inflation has so bloated the value of residential housing that anyone with a home of his own has now come to look on it as a sort of savings account that one can live in. The result, he said, is that people have been increasingly willing to dip into their nest eggs or go into debt to support their living standards. Joseph Pechman of Washington's Brookings...
...Retail sales in January rose an unexpectedly sharp 2.3% over the December level, and the board now foresees no downturn in the first quarter at all. After a very mild 1.7% overall decline, the members expect a return to real growth by early 1981. Indeed, some board members, including Wenglowski and Pechman, are beginning to wonder whether anything worthy of being called a recession is likely to develop...
...Viet Nam era, the peril created by runaway spending was an ever widening budget deficit and a consequent escalation of inflation. But to Wenglowski, the danger now is that surging inflation will keep pushing people into higher and higher tax brackets, draining the private economy of funds for wealth-and job-creating investment. That in turn crimps productivity and gives yet another source of upward momentum to inflation. The dilemma, of course, is that cutting taxes to stimulate investment simply balloons the deficit, which also tends to nudge up inflation. Said Tax Expert Pechman: "Unless expenditures are cut, there...