Opening Speech

The first and most important lesson that history teaches about what monetary policy can do—and it is a lesson of the most profound importance—is that monetary policy can prevent money itself from being a major source of economic disturbance . . . There is therefore a positive and important task for the monetary authority—to suggest improvements in the [monetary] machine that will reduce the chances that it will get out of order, and to use its own powers so as to keep the machine in good working order . . . A second thing monetary policy can do is [to] provide a stable background for the economy . . . Our economic system will work best when producers and consumers, employers and employees, can proceed with full confidence that the average level of prices will behave in a known way in the future—preferably that it will be highly stable.