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How the Fed’s Past Crises Are Key to Tackling the Next Recession

Bad news: The Federal Reserve has lost control of inflation, and the cost of bringing it back on target may well be a recession. Even worse news: Whenever the next really serious downturn hits, the Fed won’t have adequate tools to fight it.

Since its creation more than a century ago, the Fed as, an institution, often gets it wrong—and sometimes ­disastrously like in the 1930s and 1970s. But it also learns from its mistakes and adapts.