Political Hardball Inside The Fed

Using the press, regional banks may force Greenspan's hand

The Federal Reserve prides itself on its collegiality and its sober deliberations, free of backroom politicking. When deep divisions surface, though, the Fed's monetary mandarins are not beyond playing Beltway hardball. That became abundantly clear on Sept. 17, when an extraordinary leak seeped out of the secrecy-obsessed central bank: Eight of its 12 regional banks have requested at least a quarter-point hike in the key discount rate, with three of the eight--Minneapolis, San Francisco, and Richmond, Va.--pushing for a half-point boost.

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