thomas p. mccabe resigned under pressure from truman.was replaced by william mcchesney martin, a key negotiator of the accord and a treasury undersecretary. following the accord the fed was free to conduct monetary policies unhampered bytreasury constraints. the fed had flexed its muscle and won. using open-market operations in the fifties it proved to be very effective in combating inflation. the lationship with the treasury became more equaland symbiotic. for more on open-market operations we talked with richard gill. when the fed made open-market puhases of government securities as it diprior to 1951, it was effecvely ireasing the reserves availab the commercial nking system. and thus potentially making more money available the economyn general. here's how it works. the fed purchases, say billion ogornment bon from the tasury. it pays for these bonds by adding 1 biion to thereasury's account. the treasu uses is torite checks toeoe who are providing services tohe government. ese private individuals posit ese checks in tir own commercia