As with my Solow quote sleuthing, you’re not going to think this is interesting unless you’re a stickler for details, but—thanks to a tip from John Weinberg of the Richmond Fed—I’ve got a semi-definitive citation for the line (phrased in a variety of different ways) about how the job of the Fed is to take away the punch bowl just as the party gets going.
The good news is that there’s a solid quote, from the last page of “Address of Wm. McC. Martin, Jr., Chairman, Board of Governors of the Federal Reserve System, before the New York Group of the Investment Bankers Association of America, Waldorf Astoria Hotel, New York City, October 19, 1955″.
The bad news is that the quote makes it clear that Martin didn’t come up with the quote himself:
The Federal Reserve, as one writer put it, after the recent increase in the discount rate, is in the position of the chaperone who has ordered the punch bowl removed just when the party was really warming up.
I suppose the next step (gulp) would be to try to track down the writer in question. It looks like “the recent increase in the discount rate” refers to an increase on September 9, 1955, but it could also refer to the increase of August 15, 1955.