Two-Way Spiral

The Administration still talked loudly about fighting inflation, but last week it quietly took a short step to combat deflation. Because retail sales and installment credit have been dropping, the Federal Reserve Board eased up on Regulation W, which restricts installment buying.

Buyers will now have 21 months (instead of 15 to 18) to pay for goods covered by the regulation. Minimum down payments were cut from 20% to 15% of the purchase price, except for automobiles (which stayed at one-third).

Retailers who had seen consumer credit dip during January, for the first...