Bernanke keeps 2x4s on his desk to remind him of inflationMarch 22, 2012: 1:37 PM ET
Fun fact from Bernanke's lecture today: The Federal Reserve Chairman keeps bits of 2x4s -- as in pieces of timber used in construction -- on his desk to remind him of hyperinflation in the 1970s and the early 1980s recession that followed.
Speaking in his second lecture at George Washington University, Bernanke talked to students about former Fed Chairman Paul Volcker's efforts to quell rapid inflation. While Volcker hiked interest rates to tame inflation, he simultaneously plunged the U.S. economy into a deep recession. Reflecting on that period, Bernanke said:
During this period it was a common practice to mail to the Fed bits of 2x4s, and on the 2x4s it would say: Stop killing construction. Or save the farmer, or whatever it might be, because the high interest rates were having very negative effects on the economy. And I have a few of these on my desk just to remind me that inflation is a concern, and that we always have to pay attention to price stability.
The Fed plans to post a full video of Bernanke's lecture online.