In
monetary policy of the United States
Monetary policy of The United States concerns those policies related to the minting & printing of money, policies governing the legal exchange of currency, demand deposits, the money supply, etc. In the United States, the central bank, The Fed ...
, the term Fedspeak (also known as Greenspeak) is what
Alan Blinder
Alan Stuart Blinder (, born October 14, 1945) is an American economics professor at Princeton University and is listed among the most influential economists in the world according to IDEAS/RePEc. He is a leading macroeconomist, politically liber ...
called "a turgid dialect of English" used by
Federal Reserve Board
The Board of Governors of the Federal Reserve System, commonly known as the Federal Reserve Board, is the main governing body of the Federal Reserve System. It is charged with overseeing the Federal Reserve Banks and with helping implement the mon ...
chairmen in making wordy, vague, and ambiguous statements.
The strategy, which was used most prominently by
Alan Greenspan
Alan Greenspan (born March 6, 1926) is an American economist who served as the 13th chairman of the Federal Reserve from 1987 to 2006. He works as a private adviser and provides consulting for firms through his company, Greenspan Associates LLC. ...
, was used to prevent financial markets from overreacting to the chairman's remarks.
The coinage is an intentional parallel to
Newspeak
Newspeak is the fictional language of Oceania, a totalitarian superstate that is the setting of the 1949 dystopian novel ''Nineteen Eighty-Four'', by George Orwell. In the novel, the Party created Newspeak to meet the ideological requirements ...
.
Fedspeak when used by Alan Greenspan is often called Greenspeak. An alternative definition of Greenspeak is "the coded and careful language employed by U.S. Federal Reserve Board Chairman Alan Greenspan."
Edwin le Heron and Emmanuel Carre state that "Nowadays, 'Fedspeak' (Bernanke, 2004) means clear and extensive communication of the Fed's action."
Chairman
Ben Bernanke
Ben Shalom Bernanke ( ; born December 13, 1953) is an American economist who served as the 14th chairman of the Federal Reserve from 2006 to 2014. After leaving the Fed, he was appointed a distinguished fellow at the Brookings Institution. Durin ...
and Chairwoman
Yellen have effected a major change in Fed communication policy departing from the obfuscation that characterized the previous three decades. In 2014 a new detailed level of Fed communication was dubbed Fedspeak 3.0.
In 2018, Chairman
Jerome Powell
Jerome Hayden "Jay" Powell (born February 4, 1953) is an American attorney and investment banker who has served as the 16th chair of the Federal Reserve since 2018.
After earning a degree in politics from Princeton University in 1975 and a Jur ...
would begin
press conferences
A press conference or news conference is a media event in which notable individuals or organizations invite journalists to hear them speak and ask questions. Press conferences are often held by politicians, corporations, non-governmental organ ...
with a summary statement in
plain English
Plain English (or layman's terms) are groups of words that are to be clear and easy to know. It usually avoids the use of rare words and uncommon euphemisms to explain the subject. Plain English wording is intended to be suitable for almost anyone, ...
, in contrast to his predecessors who would read lengthy prepared statements loaded with
monetary policy
Monetary policy is the policy adopted by the monetary authority of a nation to control either the interest rate payable for very short-term borrowing (borrowing by banks from each other to meet their short-term needs) or the money supply, often a ...
jargon
Jargon is the specialized terminology associated with a particular field or area of activity. Jargon is normally employed in a particular Context (language use), communicative context and may not be well understood outside that context. The conte ...
.
In 2021, Powell used a
recursive
Recursion (adjective: ''recursive'') occurs when a thing is defined in terms of itself or of its type. Recursion is used in a variety of disciplines ranging from linguistics to logic. The most common application of recursion is in mathematics ...
syntax in saying that "you can think of this meeting that we had as the ‘talking about talking about’ meeting." He added, "I now suggest that we retire that term."
Origin
The notion of fed speak originated from the fact that financial markets placed a heavy value on the statements made by Federal Reserve governors, which could in turn lead to a
self-fulfilling prophecy
A self-fulfilling prophecy is a prediction that comes true at least in part as a result of a person's or group of persons' belief or expectation that said prediction would come true. This suggests that people's beliefs influence their actions. ...
. To prevent this, the governors developed a language, termed Fedspeak, in which ambiguous and cautious statements were made to purposefully obscure and detract meaning from the statement.
Though previous "Fed" chairmen
Arthur Burns
Arthur Frank Burns (April 27, 1904 – June 26, 1987) was an American economist and diplomat who served as the 10th chairman of the Federal Reserve from 1970 to 1978. He previously chaired the Council of Economic Advisers under President Dwight ...
and
Paul Volcker
Paul Adolph Volcker Jr. (September 5, 1927 – December 8, 2019) was an American economist who served as the 12th chairman of the Federal Reserve from 1979 to 1987. During his tenure as chairman, Volcker was widely credited with having ended the ...
were known for blowing smoke, both literally and figuratively, when appearing before Congress, Alan Greenspan is credited with making Fedspeak a "high-art".
It is unclear whether the term Fedspeak was used widely prior to Greenspan, but with historical hindsight the modern term could be used to describe Burns's and Volcker's method.
Usage by Alan Greenspan
Although it was originally believed by some that
Alan Greenspan
Alan Greenspan (born March 6, 1926) is an American economist who served as the 13th chairman of the Federal Reserve from 1987 to 2006. He works as a private adviser and provides consulting for firms through his company, Greenspan Associates LLC. ...
, who is generally credited for popularizing Fedspeak, may have used such language unintentionally, he revealed in his 2007 book ''
The Age of Turbulence
''The Age of Turbulence: Adventures in a New World'' is a 2007 memoir of former Chairman of the Federal Reserve Alan Greenspan, co-authored by Peter Petre, a former executive editor at Fortune magazine. Published on September 17, 2007, the book de ...
'', that the method of avoiding the issues directly when a clear message was not desired was indeed intentional. Greenspan states that the confusion, which often resulted in conflicting interpretations, was used to prevent unintended jolts to the markets as confusing statements were typically ignored.
He noted that he came upon the dialect while at the Fed: "What I've learned at the Federal Reserve is a new language which is called 'Fed-speak'. You soon learn to mumble with great incoherence."
In an interview with ''
60 Minutes
''60 Minutes'' is an American television news magazine broadcast on the CBS television network. Debuting in 1968, the program was created by Don Hewitt and Bill Leonard, who chose to set it apart from other news programs by using a unique styl ...
''s
Lesley Stahl
Lesley Rene Stahl (born December 16, 1941) is an American television journalist. She has spent most of her career with CBS News, where she began as a producer in 1971. Since 1991, she has reported for CBS's ''60 Minutes''. She is known for her ne ...
on September 16, 2007, Stahl stated how "In public, Greenspan was inscrutable whenever congress asked about interest rates. He resorted to an indecipherable delphic dialect known as fedspeak" to which Greenspan responded that "I would engage in some form of syntax destruction which sounded as though I were answering the question, but in fact, had not."
When Stahl noted that Greenspan's responses were "impenetrably profound" and that this resulted in "two newspapers getting opposing headlines coming out of the same hearing", Greenspan responded that "I succeeded".
In an interview with
CNBC
CNBC (formerly Consumer News and Business Channel) is an American basic cable business news channel. It provides business news programming on weekdays from 5:00 a.m. to 7:00 p.m., Eastern Time, while broadcasting talk sho ...
's
Maria Bartiromo
Maria Sara Bartiromo (born September 11, 1967) is an American financial journalist, television personality, news anchor, and author. She is the host of ''Mornings with Maria'' and '' Maria Bartiromo's Wall Street'' on the Fox Business Network as ...
on September 17, 2007, when asked to describe Fedspeak, Greenspan described it as:
In an interview with ''
BusinessWeek
''Bloomberg Businessweek'', previously known as ''BusinessWeek'', is an American weekly business magazine published fifty times a year. Since 2009, the magazine is owned by New York City-based Bloomberg L.P. The magazine debuted in New York City ...
'' in August 2012, when asked "about practicing the art of constructive ambiguity", Greenspan replied:
Examples of Greenspeak
, the
Federal Reserve Bank of Dallas
The Federal Reserve Bank of Dallas covers the Eleventh Federal Reserve District, which includes Texas, northern Louisiana and southern New Mexico, a district sometimes referred to as the Oil Patch.
The Federal Reserve Bank of Dallas is one of 12 ...
website still maintains a "Greenspeak" page with dozens of excerpts from Greenspan's past statements as head of the Federal Reserve Bank. Each quotation has a pointer to its full context in his speech, and is posted without commentary or interpretation.
Other usage
![Fomcprojtabl20170315](https://upload.wikimedia.org/wikipedia/commons/b/bd/Fomcprojtabl20170315.png)
In the 2010s, the
Federal Reserve
The Federal Reserve System (often shortened to the Federal Reserve, or simply the Fed) is the central banking system of the United States of America. It was created on December 23, 1913, with the enactment of the Federal Reserve Act, after a ...
Open Market rate-setting committee (FOMC) began publishing
dot plots to tabulate all individual committee member projections of target interest rates in a single graphic.
[ In 2016, the president of the St. Louis Fed James Bullard began a movement away from the dot plot exercise, citing a gap of opinion between market economists and FOMC members. , the FOMC has continued to publish dot plots in its economic projections, detailing the variety of opinions of the committee members for the "appropriate target range for the federal funds rate" in future years.]
Commentary
The University of Virginia Writing Program Instructor Site offers some selected quotations from Greenspan, with a suggestion that students be given writing exercise assignments of clarifying their expression of ideas.
A public relations
Public relations (PR) is the practice of managing and disseminating information from an individual or an organization (such as a business, government agency, or a nonprofit organization) to the public in order to influence their perception. P ...
firm cites an example of "Greenspeak" as the statement of one of the "master practitioners of creative ambiguity over the years". The brief essay mentions two other master practitioners of obfuscation, Hubert H. Humphrey
Hubert Horatio Humphrey Jr. (May 27, 1911 – January 13, 1978) was an American pharmacist and politician who served as the 38th vice president of the United States from 1965 to 1969. He twice served in the United States Senate, representing Mi ...
and Casey Stengel
Charles Dillon "Casey" Stengel (; July 30, 1890 – September 29, 1975) was an American Major League Baseball right fielder and manager, best known as the manager of the championship New York Yankees of the 1950s and later, the expansion New York ...
. The overall tone of the essay is one of awed admiration for a sometimes-necessary skill in obscurantism. In closing, the writer notes that, "As professional performers say, to deliberately sing off-key requires a highly skilled singer."
See also
* Index of public relations-related articles
*Security through obscurity
Security through obscurity (or security by obscurity) is the reliance in security engineering on design or implementation secrecy as the main method of providing security to a system or component.
History
An early opponent of security through ob ...
*Technobabble
Technobabble (a portmanteau of ''technology'' and ''babble''), also called technospeak, is a type of nonsense that consists of buzzwords, esoteric language, or technical jargon. It is common in science fiction.
See also
* Academese
* Bullshit
...
References
Further reading
*
External links
Fedspeak
Remarks by Governor Ben S. Bernanke
{{Federal Reserve System
Monetary policy of the United States
Business terms
Corporate jargon
Federal Reserve System
Political terminology
Euphemisms
Forms of English