Federal Reserve Chairman Ben Bernanke has a big day today. At 2 PM ET, the Fed will release its latest FOMC monetary policy decision and updated macroeconomic forecasts. Then, at 2:30, Bernanke will take the stage for a highly-anticipated press conference and Q&A.
Of course, the biggest thing everyone wants to know from the Fed today pertains to tapering back the pace of bond buying. Should investors really expect the Fed to begin tapering this year?
If the language in the FOMC statement out at 2 strikes a dovish tone, markets will imply that the answer is "no."
Either way, though, the market will probably get the answer before Bernanke's press conference.
And in the event that markets don't get their answer from the statement...
"None of the journalists attending today’s FOMC press conference will want to waste a question on something as simple as when he might taper, because surely, someone else will do that for the benefit of everyone else in the room," says Miller Tabak Chief Economic Strategist Andrew Wilkinson.
Wilkinson argues that "perhaps [the journalists at the FOMC presser] need to imagine sitting down as the shrink prodding for his recent thoughts as the Fed chief overcomes his nerves in the psychiatrist’s chair."
"If you think that way," he writes in a note to clients this morning, "perhaps you will find out what is really on the Chairman’s mind and what drives his decision-making process."
Wilkinson offers 29 suggestions:
- If you could you grade the US economy right now, what letter grade would you give it?
- What grade does the economy need to graduate?
- How about the labor market; what grade would you give that?
- What makes you feel good about things – in general?
- Does the way you feel make you say things differently?
- Do you care what people think about you?
- Do you let peoples’ reaction to what you do affect how you act in future?
- What are you really watching: The unemployment rate or how many weeks the longer-term unemployed are out of work?
- Do you think people understand what you and your colleagues are trying to do at the Fed?
- Do you ever engage in so-called Fedspeak like Alan Greenspan just because you don’t really have a good answer?
- How do you feel about the market’s response to your May testimony to Congress?
- Does the loss of $3 trillion from global equity markets change the way you think?
- How does that responsibility make you feel?
- What did you expect might happen to bond yields when you stated that tapering might happen soon?
- Do you feel that the market’s response is counter-productive to what the Fed is trying to do?
- Will the shift in the yield curve detract from earlier medicine you and your colleagues gave the patient?
- Does that make you less inclined to even consider tapering now?
- Your comments made the dollar lose value: Can you explain that?
- Is that outcome more or less as you expected?
- If you didn’t expect that outcome, can you be sure of the impact of future decisions?
- Do you worry about your kids?
- How about those outside your household - other peoples’ kids?
- If you have to come down hard on your kids to keep them in-line do you care what impact it has on their friends?
- Do you worry about losing the friendship of their parents as a result or are you confident in your decisions?
- Do you let your feelings influence what you say to journalists?
- Knowing the outcome of your words to Congress, would you say anything differently if you could turn back the clock?
- Do you ever feel over-analyzed and how does that make you feel?
- What about your job: Do you ever worry about losing your job?
- Would you feel a sense of relief or disappointment?
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