The Fed announced today that Ben Bernanke is going to start holding regularly scheduled press conferences. I’m open to persuasion, but this seems like a bad idea to me.
Expectations are a very important part of monetary policy. That’s why Open Market Committee meetings end with the release of a written statement offering public guidance about what’s happening and not just a 140 character tweet about interest rates. That statement is assembled, one hopes, with care and precise wording. In a live press conference there’s a lot that could go wrong, and I see relatively little upside.
On some level, though, this is clearly intended as some kind of pushback to the political criticism the Fed’s been getting for the past year. That makes sense, but it underscores the fact that there needs to be a progressive anchor to this debate and not just a circling of the wagons around an institution that has, in fact, failed.