Fed language

Doug Henwood dhenwood at panix.com
Thu Feb 4 11:46:31 PST 1999


For those of you tired of postmodern obscurantism, how about this paragraph from the freshly released minutes of the Federal Open Market Committee's December meeting! The full text is available on the Fed's website, at <http://www.bog.frb.fed.us/FOMC/minutes/19981222.HTM>.

Doug

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"Prior to its vote on policy at this meeting, the Committee discussed the wording of the operating paragraph of the directive, building on progress made toward a consensus at previous meetings. Attention focused in part on proposed new wording to describe the possibility of intermeeting actions. There were minor differences about specific wording, but no strongly held opinions, and all the members agreed that the new wording preferred by a majority of the members represented an improvement over the traditional language in that it would communicate more clearly and succinctly the substance of the Committee's policy decisions. The Committee also discussed deleting the last sentence in the operating paragraph relating to the outlook for the growth of money; another paragraph in the directive would continue to report the long-run ranges for such growth that the Federal Reserve Act requires the Committee to establish. With regard to the proposed deletion, some felt it was desirable for the central bank to retain a reference to money in the operating paragraph; more members supported the deletion on the ground that, as had been explained to the Congress, money growth had not had any special significance for some time in the formulation of monetary policy owing to often unexplained and unexpected changes in velocity. The rewording of the sentence on symmetry and the deletion of the sentence on money were not intended to imply any change in policy or the Committee's approach to policy or its decisionmaking."



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