*  *  *  The “Paolo Baffi” Centre for Monetary and Financial Economics has invited me to give this talk to revive the custom of the “Reflections on Monetary and Financial Policy” that had been interrupted for a decade.
I thought it would be appropriate to start off the new series by exploring the personality and monetary policy of Paolo Baffi, to whom the centre is dedicated. Baffi was Governor of the Bank of Italy during five of the most difficult years this country has known.