Today at 1:15 PM Central time the Fed will release it’s statement concerning interest rates.
Several years ago I had the opportunity to hear a former Greenspan era Fed Governor discuss what actually happens during a normal fed meeting. I suspect current meetings are similar to his comments.
His insights were very candid and interesting. Of course all meetings do not go the way of this explanation, but here is his actual statements, (name protected for privacy purposes).
Upon arrival in Washington D.C., most Fed Governor decisions have already been made through prior discussions, conference calls, and individual press releases. The first half of the first day is a discussion and confirmation of the vote. “The next day and one half, is spent wording the press release.”
Since we all review the press release from top to bottom, and compare the statement to prior statements, the main focus in the Greenspan era was simply to convey the appropriate meaning in the Fed Statement and later to be released minutes.
Again, this was during the Greenspan era, but I suspect Bernanke follows similar structure.
Today we expect no major changes in the press release and wonder how much time was spent wording the press release which we all pour over later in the afternoon.
We hope you enjoyed a little light shed on the processs.