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Economic Perspectives, Vol. 3, 3rd, No. 13, July 1979
The Economy and the Banking System

Banking, as we all know, is inextricably linked with conditions in the economy. How can the strength of banking be maintained in the face of the tremendous economic problems that appear to confront us?

The answer, I think, is becoming increasingly clear. I am convinced that the longer-term success of the economy and of banking in our free world is dependent upon a revitalization of the free marketplace.

Solutions to general economic problems—whether energy, inflation, or recession—cannot be based on short-term myopia or short-circuiting of the free market. Time and time again we have seen shortsighted, stop-gap measures fail, only to witness the reemergence of the same problems with greater intensity a short time later. We are in danger of being drugged.

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