WASHINGTON - Federal Reserve Vice Chairman Alan Blinder, the 49-year- old economist from Princeton University appointed by President Clinton, has emerged as a full-fledged and articulate spokesman for the central bank.

Mr. Blinder joined the Fed last June after serving on Mr. Clinton's Council of Economic Advisers.

Lately he has come into his own, serving as an eloquent yet plain-spoken intellect who can explain the Fed's role in an increasingly global economy. It is a viewpoint with a refreshingly American twist, expressed in the idiom of common speech that Mr. Blinder polished during 20 years of writing and public speaking.

This is a role where Mr. Blinder has to tread carefully. Members of the seven-member board of governors typically have some latitude to view the world with an independent eye, but they also have to avoid public conflict with Fed Chairman Alan Greenspan.

Mr. Blinder has supported the Fed in raising interest rates, but he has also staked out some differences. While Mr. Greenspan has told Congress that he favors legislation that would make inflation fighting the Fed's central task, Mr. Blinder is comfortable with current law and its requirement that the Fed try to balance the goals of stable prices and maximum employment.

In a recent speech to the Institute of International Bankers, Mr. Blinder set forth some interesting views on the role of U.S. monetary policy in today's world of massive capital flows across national boundaries. He repeated his comments in a speech to community leaders in San Francisco.

"Pundits of all kinds, perhaps in an effort to appear chic and 'with it,' would have us believe that we now live in a brave - or perhaps scary - new world in which the old rules of economics no longer hold and in which America is less and less able to control its own destiny," said Mr. Blinder.

It is true that financial markets are growing more globalized and more fluid every year, he said. For example, at the end of 1993 foreign banks held 21.3% of U.S. banking assets, up from only 3.8% in 1973.

But Mr. Blinder also noted that at the end of 1993 - more recent official figures are not available - about 95% of the stocks owned by U.S. investors were U.S. stocks and about 97% of all bonds held by Americans were U.S. bonds. Foreigners owned only 6% of U.S. stocks, 14% of all corporate bonds, and 20% of all Treasury securities.

Moreover, roughly 90% of what Americans buy is made at home and about 90% of what we make is sold at home, Mr. Blinder said.

Mr. Blinder has also been frank to admit that the Fed does not always succeed in managing economic growth, and he warned that the goal of achieving a "soft landing" through higher interest rates is by no means assured.

When the dollar was taking a beating and global markets were watching the collapse of Barings PLC, the British investment bank, Mr. Blinder candidly admitted that "financial accidents will happen from time to time." But he said the task of regulators is to make sure big market dislocations happen rarely and are contained.

Normally, Fed officials speak in carefully hedged technical jargon when they appear in public, hoping to avoid controversy. Mr. Blinder's plain talk is a refreshing change.

The Bond Buyer is a sister publication of the American Banker.

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