So This Central Banker Walks Into a Bar….

The Federal Reserve recently released the full transcripts of its meetings from 2005. By glancing at them, you might be surprised by the amount of wise-cracking they do.

Ladies and gentlemen, check out the comedy stylings of the FOMC:

February 1-2, 2005:

#1:

MR. GRAMLICH. I nominate Alan Greenspan to be Chairman.
MR. FERGUSON. And do you have a nomination for Vice-Chairman?
MR. GRAMLICH. I nominate Timothy Geithner as Vice-Chairman.
MR. FERGUSON. Is there a second to those nominations?
SEVERAL. Second.
MR. FERGUSON. Any other nominations? Any objections? Any comments? Well, we’re
not in an era of great democracy. [Laughter] Let the record show a unanimous vote for Messrs.
Greenspan and Geithner to be Chairman and Vice-Chairman of the FOMC until its first regularly
scheduled meeting of 2006. Congratulations.
CHAIRMAN GREENSPAN. Thank you very much. I wish to note that there was no voter
fraud that I could perceive. [Laughter]
MR. FERGUSON. And we have a turnout of 100 percent!

#2:

CHAIRMAN GREENSPAN. Without objection, that is approved. The next item on the
agenda is the selection of a Federal Reserve Bank to execute transactions for the System Open Market Account. My notes indicate to me, and I quote, “New York is the odds-on favorite.” [Laughter]

#3:

MR. GRAMLICH. Thank you, Mr. Chairman. A lot of points have been put on the table
already, so I feel a bit like I’m taking an oral exam, but here goes. First question, is low inflation desirable? Yes, I definitely think it is.
MS. MINEHAN. That’s one right answer! [Laughter]

#4:

MR. MOSKOW. One result of the relatively poor performance of the Big Three is that Michigan now has the highest unemployment rate in the nation.
MR. GRAMLICH. You’ve got to be first in something! [Laughter]
MR. MOSKOW. Actually, Illinois is leading the Big Ten in basketball. [Laughter] They are undefeated so far.

#5:

CHAIRMAN GREENSPAN. First Vice-President Holcomb.
MS. HOLCOMB. Thank you, Mr. Chairman. This is only the third FOMC meeting that
I’ve had the privilege of attending, and I cannot help but notice how much the U.S. economy has
improved in that short time. [Laughter]
CHAIRMAN GREENSPAN. You’re welcome to attend any time!

March 22, 2005

#1:

VICE-CHAIRMAN GEITHNER. Karen, could you give us a fair and balanced view—
[laughter]—of the significance of the changes to the Stability and Growth Pact?

#2:

MR. KOS. Mr. Chairman, if I could just add a point on the market effect. As some of
you know, Greece issued a 30-year bond recently at 26 basis points above the rate on Bunds, or
about ½ point below the U.S. 10-year rate and about 100 basis points below the 30-year rate.
CHAIRMAN GREENSPAN. Can we borrow from the Greeks? [Laughter]

#3:

MS. HOLCOMB. Turning to the national economy, I’d like to provide support for the Greenbook’s conclusion about the extra positive thrust in the economy by noting that congressional hearings have been focusing on the use of steroids in major league baseball rather than the economy. [Laughter]

#4:

VICE-CHAIRMAN GEITHNER. I have no humor in my statement and nothing that differs from the consensus.
CHAIRMAN GREENSPAN. Your straightforward remarks are very humorous. [Laughter]
VICE-CHAIRMAN GEITHNER. Careful. [Laughter]

May 3, 2005

#1:

MR. OLSON. So I suspect that we may be closer to a pothole or perhaps even the head fake that the entire Chicago Bulls went for last night when Juan Dixon went up for his jump shot, which he made consistently.
MR. MOSKOW. That’s unfair. [Laughter]
MR. OLSON. It has been 17 years, Michael. It has been a long time.

#2:

MR. FERGUSON. To put it another way, while I’m comfortable with the strategy for today, I think we’re really entering the neutral zone. And for those of you who are Star Trek fans, you may recall that when you enter the neutral zone that’s when the aliens are most likely to attack. [Laughter] It is quite clear to me that we have executed one exit strategy, but unfortunately I think we’re entering a mode where we need a new exit strategy from the exit strategy! [Laughter]

#3:

MR. MOSKOW. Now, I am not going to respond to Governor Olson’s very unfair comment about the Chicago Bulls except to say that we will see how the Washington Wizards do when they lose their home court advantage in the next game and have to face the Chicago Bulls in the friendly confines of the United Center. [Laughter]
MR. OLSON. Let me point out that it isn’t how they do but how they communicate what they do. [Laughter]
MR. MOSKOW. Touché.
CHAIRMAN GREENSPAN. Is that the end of your—[laughter]?
MR. MOSKOW. Yes.

June 29-30, 2005

#1:

CHAIRMAN GREENSPAN. The argument for the rapid rise in land prices in 1837 was that land was fixed in quantity. [Laughter] So, new ideas are very rare. Vice-Chair.
VICE-CHAIRMAN GEITHNER. I remember that bubble! [Laughter]

#2:

VICE-CHAIRMAN GEITHNER. I meant in our history. In our history, have we used that tool to good or ill effect? Have we used it wisely and with foresight?
CHAIRMAN GREENSPAN. You’re biasing the answer. [Laughter]
MR. FERGUSON. The answer is obviously “yes.” [Laughter]

#3:

MR. POOLE. Just for the hell of it, I’d like to offer the hypothesis that property values are too low rather than too high. [Laughter]

#4:

MR. FISHER. Mr. Chairman, I’d like to propose that he buy my house in Washington, [laughter] given that confidence.
MR. POOLE. If I’m right, you won’t need me to buy it.

#5:

MR. GRAMLICH. Sticker shock question: In the history of the world, has a country ever run a $1 trillion current account deficit?
MS. JOHNSON. I don’t think so. [Laughter]
CHAIRMAN GREENSPAN. Is that your question?
MR. GRAMLICH. Yes. I didn’t say it was heavy! [Laughter]

#6:

CHAIRMAN GREENSPAN. I get quoted on everything under the sun that is irrelevant, but that was a really meaningful insight and it got lost! [Laughter]

#7:

CHAIRMAN GREENSPAN. One thing we can be sure of is that the value of the dollar will be worth 100 cents. [Laughter]

#8:

MR. GRAMLICH. What should monetary policy do about bubbles? I was enlisted as a speaker in this session, and I then characterized my views in Gilbert & Sullivan terms as, “Well, never. Oh, hardly ever.” [Laughter]

#9:

MR. GRAMLICH. Imagine what Steve Roach and John Makin would say about that! If I can coin a term, this would be viewed as a Greenspan “shotput.” [Laughter]

August 9, 2005

#1:

MR. WILCOX. There used to be a view—I’m thinking back to the Brookings 1960s view—of an L-shaped supply curve.
CHAIRMAN GREENSPAN. Well, how about a J? [Laughter]
MR. WILCOX. I’ll give you J. [Laughter]

#2:

CHAIRMAN GREENSPAN. So I’d prefer to have poor but clear language [laughter] because we certainly don’t want to convey a message that will bring the long-term forward rates down.

Posted by on January 18th, 2011 at 11:08 am


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.