By
Matthew
Russell Lee
UNITED
NATIONS, July
2 -- When the
International
Monetary
Fund's
Christine
Lagarde introduced
Federal
Reserve chair
Janet Yellen
to give the first
Michel
Camdessus
Central
Banking
Lecture on
July 2, she
did not
repeated what
she
said only two
weeks earlier,
that the Fed
should
communicate
more
frequently.
In laying out
lessons
learned from
the subprime
financial
meltdown of
2008, Lagarde
did not question
the role of
the Federal
Reserve in
failing to
take action on
the predatory
lending by the
Big Four
banks, or the
pooling and
pitching by
investment
banks of predatory
mortgages by
Ameriquest,
New Century,
et al.
So what,
really, was
learned?
On
July 2,
Lagarde
compared
central
bankers to
mountaineers,
and told
Yellen,
"Janet, you
may not be
surprised to
know that when
you give your
press
conferences a
group of
passionate
staff here at
the IMF get
together to
watch you live
on screen. I
am told they
even bring pop
corn to the
meetings!"
Back on June
16 the IMF
assessment was
that
"Enhancing
the Fed’s
communication
toolkit would
be a natural
evolution that
could help
temper the
likelihood of
market
volatility
along the exit
path. This
could include
scheduling
press
conferences by
the Fed Chair
after each
FOMC meeting
(to provide a
more frequent,
structured
environment to
explain the
committee’s
evolving
thinking). It
could also
involve
publishing a
quarterly
monetary
policy report,
that is
endorsed by
the FOMC and
which conveys
more detail
about the
majority view
of the FOMC on
the outlook,
policies, and
the nature of
uncertainties
around the
baseline. Such
a report may
also convey
dissenting
views on the
FOMC as well
as broader
information on
how the FOMC
thinks about
policy
reactions in
plausible,
non-baseline
scenarios.
Finally, the
FOMC could
provide
greater
clarity about
how financial
stability
considerations
figure into
its monetary
policy
calculus."
She might have
added: the Fed
can and should
do better
under the
Freedom of
Information
Act, on which
in full
disclosure
Inner City
Press has
litigated with
the Fed. Then
again, at
least the Fed
accepts that
it is covered
by FOIA - the
United Nations
doesn't (see
below).
While the IMF
is more
frequently
taking Press
questions
online, we
note for
example that a
repeatedly
asked question
about whether
the IMF
includes
Western Sahara
in Morocco's
data has been
stonewalled,
including the
days Lagarde
was in Rabat.
Lagarde was
asked who she
favors in the
World Cup and
said she was
"delighted to
see French
team did as it
did." Well,
that's some
transparency.
The UN
also has a
position on
the US Federal
Reserve, it
emerged on May
21, at least a
position
favoring new
Fed chair
Janet Yellen
over her
predecessor
Ben Bernanke.
Inner
City Press
asked Pingfan
Hong of the UN
Department of
Economic and
Social Affairs
about DESA's
mid-year
update of the
UN World
Economic
Situation and
Prospects,
which called
on the Fed to
communicate
more clearly
as it tapers
away from
quantitative
easing -- does
the UN favor
an audit of
the Fed, and
what of the
impact on
tapering QE on
emerging
markets? Video
here.
Pingfan
Hong
recounted that
an IMFC
meeting he
attended,
Yellen
admitted to
negative
impacts on
emerging
markets, which
he said
Bernanke
obfuscated by
claiming
positive
impacts too.
(Bernanke now
is speaking at
$250,000
dinners, so
criticism from
DESA may not
concern him.)
Inner
City Press
also asked
Pingfan Hong
about the
WESP's call
for the
implementation
of IMF quota
reform -- was
this really
related to the
IMF's ability
to lend to
Ukraine, and
what are its
economic
impacts?
Pingfan
Hong
replied that
it is more of
a “long term”
issue, but
that countries
should follow
through on
what they
commit to.
What about
democracy,
though? And
what about
democratizing
the Federal
Reserve? We'll
have more on
that. Watch
this site.
, 
