April 27. Mark the date in your diary.
It’s the Federal Reserve’s first quarterly news conference — Ben Bernanke’s chance to answer his critics and speak up for his policies (and opportunity for the fourth estate to indulge in a spot of Fed bashing).
– Neil Hume, FT Alphaville
Let’s spend a few moments on this…
Federal Reserve Chairman Ben Bernanke on Thursday announced he will hold regular press conferences for the first time in the central bank’s history, at a time when hostility to the central bank among both the public and Congress is on the rise.
Bernanke will deliver the conferences following interest rate decisions, four times per year.
Some of my assorted observations:
1. It’s not that big a deal.
2. This is the Fed adapting to the internet era, make no mistake about it. In a world where anyone with a WordPress password or a Twitter account can have a bullhorn as loud and widely heard as the Wall Street Journal, the Fed must counter as much of the misinformation as it can and this is its forum to do so.
3. The press conference format allows them to take media questions out in the open and to be more transparent, in theory. We shall see what it looks like in practice shortly.
4. The press conference is at least dignified, I’m glad they didn’t try to get all Social Media-y on us. As long as they don’t start Zero Fed or @TheRealBernank…
5. Yes, a lot of this is because of political pressure. Between Ron Paul and Rand Paul and any other Paul that gets swept into office on a tide of “End the Fed” zeitgeist, the 100-year-old institution has its hands full. The presser gives them a chance to “open the kimono” thus countering the criticism that they are essentially operating as a shadow government, reporting only to the Rockefellers, the Rothschilds and the Winfrey-Steadmans . It won’t matter, by the way; the zealotry and tenacity of your average political Fed critic rivals that of the Taliban.
5. I’m hoping that the sell-side analysts are kept out of these things. If I hear the Q&A portion begin with one of those “Congratulations on a great quarter” quips, I’m probably gonna scream.
6. Is Bernanke now officially the CEO of Fed Inc as my friend Dynamic Hedge is calling him? Perhaps.
6. When we look back on Bernanke’s announcement to do this it will seem just like Bob Dylan’s decision to go electric at the Newport Folk Festival in 1965 – derided at the time but ultimately inevitable.
It’s a Brave New World, the Fed is finding its way through just like the rest of us.