As it happened, Reagan, no stranger to hard-money conservative thought, had doubts as to whether the Fed was actually needed. He’d asked that question of both Volcker and his own economic advisors in 1981. Moreover, the president’s political advisors were largely hostile to Volcker, seeing him as a danger to Reagan’s reelection.Whole thing here.
But Reagan put sound policy ahead of political considerations. If we were to have a Fed, he realized, it needed to have an independent ability to make monetary decisions regardless of whether they yielded short-term benefits for incumbent politicians.
Some further reading on the Fed and related matters:
“Ron Paul’s New Book: More Exaggeration and Conspiracy-Mongering"
“The Fed and Its Enemies”
“The Tumultuous 19th Century"
“T.R. vs. J.P.”
“Stocks, Gold and War”
“The Gleam of Gold”
UPDATE: For those who think the Fed doesn't know how to have fun.