Chasing Ben Bernanke.

President George W. Bush stands with Federal Reserve Chairman Ben Bernanke, left, SEC Chairman Chris Cox, right, and Treasury Secretary Hank Paulson as he delivers a statement on the economy Friday, Sept. 19, 2008, in the Rose Garden of the White House. (Photo credit: Wikipedia)

Posted October 3, 2013

by Jerry Alatalo

Federal Reserve Chairman Ben Bernanke had a press conference recently and I decided to take notes while listening to it. Let me first say that this is the second time I listened to this press conference, the first time was when it occurred on September 18. Let me then say that listening for the second time found me astounded at how rapidly this man talks. Mr. Bernanke reminds one of that fellow who used to do commercials, referred to as “the world’s fastest talking human”. At one point Ben says he does not want to discuss his plans for after he leaves the Fed chairmanship. If he remains undecided, surely he could match or even better the success of the “world’s fastest talking human” and find plenty of work in the advertising field.

At this point I am going to issue a challenge to every man or woman reading this. Try, just try, to take coherent notes while listening to Ben Bernanke here. Just for fun give it your best shot. After viewing the press conference let everyone know what you gained from listening to it and taking notes, if anything, in the comments section. Maybe I’m unsophisticated on monetary issues, especially as they relate to the Federal Reserve. I am open-minded enough to admit a lack of knowledge on certain subjects (of which there are many) and that may explain my inability to “hear” what Ben Bernanke is conveying here.

At any rate here are all the notes I took while listening. I wish you luck in gathering a more coherent message than I did..

“Rationales, Moderate, satisfactory, acceptation, participation, discouragement, diminishment, restrain on growth, downside risk, inflation development, inflation to 2%, individual economic projections, moderate growth, central tendency of projections, longer run normal levels, highly accommodative policies, asset purchases, agency mortgage-backed securities, $45 billion per month, $85 billion per month, meaningful progress, fiscal headwinds, cumulative progress, subsequent year or so, moderate pace of purchases, evolution of economic outlook, broad contours, sufficient confirmation, fiscal debates, continue to monitor closely”

“remain contingent on economic outlook, thresholds-not triggers generally consistent-2015/2016, policy accommodation, longer run normal value, headwinds to recovery-patient approach, forward guidance, substantial improvement in labor market, rates guidance highly accommodative, cyclical component-aging population, not a fully representative indicator, we try to communicate as meaningfully as possible, fully contingent of ratification of our outlook, failing to communicate large divergence could have led to problems down the road, continue as long as data is contingent, provide support for economy to recover and provide jobs”

“if data confirm our basic outlook, tied to the data-same basic framework, unemployment rate not necessarily the best measure-overall employment market, I’d prefer not to talk about my own plans, financial conditions-sure, tighter financial conditions, we want to explain the best we can-very important, larger reaction in prices and rates, the situation is sustainable, we want to communicate clearly, restate key point, voting and non-voting members, 2% in 2016 best projections, we expect a number of factors, may still prove to be headwinds, the equilibrium rate-aggregate demand rate”

“over-optimistic about out-year growth, (at this point I wrote “fast-talking all the way through-on some type of drug?”) slower productivity figures, important to recognize cyclical, unemployment fallen faster than expected, we will continue to do the best we can, press conferences, eight meetings per year, we can arrange press conferences, you’re seeing interest rate and inflation rates, inflation floor would be in addition to guidance, complicit in policy to reach inflation goal, don’t recall, do the right thing for the economy, we try our best to communicate to markets”

“government shutdown, fiscal policy decisions very complicated battles-I won’t get into, serious consequences, our ability to offset shocks is limited, biggest regret?-I have many, didn’t forestall economic crisis, did what we could, motivated entirely by the interest of the broader public, even more severe by many times, all money has been paid back with interest, lot of progress, large firms are better capitalized, orderly liquidation authority, wind-down failing financial firm, all of this “stuff”- measures to shore up problems, how will you ever get out of quantitative easing?, strongest sector like housing or autos have been intra-sensitive, justifying Fed’s performance, we do what we can do, criterion is substantial improvement in labor statistics”

“regulated-we will tailor regime appropriate to firm, want to focus on resolution authority-derivatives-interconnectedness, tougher supervision-stress tests, and all the rest, our policy decisions making economy easier is desirable, precautionary step-wait a little longer-to see if economy conforms to our outlook, numerous tools to manage interest rates, Federal Reserve independent/non-partisan/continue to be important institution, the committee has regularly reviewed the forward guidance, important that understand all of the implications-number of options-but today we decided not to make any changes in the guidance, incomes-poverty-complex measurement issues, more unequal-lots of reasons for this-Fed has no tools to address”

“people in middle to lower part of the distribution, limits to what we can do, Congress and administration have that responsibility, emerging markets-international hard to follow, we are watching these developments very carefully, there are other factors-a lot of factors are there playing a role, we pay close attention to what is happening in those countries, my colleagues in other emerging market countries appreciate strengthening the U.S. economy-helps emerging markets as well.”

It’s your turn. Good luck.

****

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