Transcripts of the monetary policymaking body of the Federal Reserve from 2002–2008.

Thanks. Much as Gary Stern has said, as an academic I was never particularly enamored of the statement. But actually having seen how it evolves, how it is built—usually when you see the way the sausage is made, that upsets your stomach, but it has actually been the opposite. [Laughter] Maybe I have been eating the sausage for too long now. I don’t know. [Laughter] I’ve been taken in by it. But I think, as Governor Kohn has said, it has evolved in a way that many of the elements that I was more critical of a few years ago are not there now. I think it operates in a perfectly reasonable way.

Some people have mentioned how the statement could change if we speed up the minutes. We’re never going to speed up the minutes beyond say a week. Even if we were to get it to a week, which I don’t think is feasible, the statement can’t change all that much. We have to convey the information that’s in the statement. I don’t think we can say, “Well, gee, because next week we’re going to say something, we can just cut it down to two sentences or three sentences.” As long as there’s a week in between, and I can’t imagine there being any less than a week in between, the statement is going to have the kind of information that it has in it, which I think has evolved in a perfectly reasonable way.

On governance, since the process is working, I don’t really see the need to change it. There’s a possibility that down the line that concurring opinions could be put out so that people agree to whatever the monetary policy movement is but, like the Supreme Court, write their own statement. Since the process seems to be working well without leaving that possibility for coming in, I don’t see that it’s necessary to make the change, although I’m open on that. Thank you, Mr. Chairman.

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