Greenspan Would Be Proud: A Lesson in Fed Speak
It has become a familiar sight over the past decade and a half: a supposedly venerable member of the financial elite tells us with utmost calm that what we think we are seeing isn’t really all that bad. The Fed already knows all about it and has already taken all necessary steps. Further, they are monitoring the situation closely and are ready to make any necessary adjustments with ease and alacrity.
Reading the Fed’s meeting minutes and picking through its actual activities reveals a much different picture. They are panicked and pushing every button: upping the federal funds rate, running off the balance sheet (quantitative tightening), maintaining the Fed’s overseas backstopping, and raising the interest rate paid on reserves. Surprise, surprise things are actually not fine, and they know it.
Fed Speak
From the technocratic elite’s perspective, managing a democracy is onerous and tedious. After all, the pesky plebs always demand to know what’s going on and why—as if they could understand!
Indeed, while what is actually going on is not complicated, one suspects the entire reason for the unnecessary opacity and unintelligibility of official policy and discourse is precisely to avoid such accountability.
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