The Warsh press conferences aren't going to work in their current form, and it isn't because he's dodging.
The post-meeting press conference is a vehicle for forward guidance. Warsh has stopped it and restated that today at the top he is "steering clear of forecasting," and "market participants are learning to play the ball, not the referee."
Today he took 20 questions from 11 reporters, and by my count 14 asked for a future path or reaction function, 8 of them outright. That's not a lazy press corps. It's a room with no other established question, asking the only one it knows eight different ways and getting declined eight times. Everyone did their job, and the exercise still produced almost nothing.
The few reporters who asked him to characterize the committee rather than the path got real answers.
The missing half is the dissenters. Asked about them, Warsh said, "I'll let the dissenters speak for themselves." The problem is they have nowhere to do it. The statement names them and stops. Their reasoning arrives three weeks later in the minutes as "some participants," unattributed, unless they do it on their own after the blackout period ends two days later.
So the fix is mechanical. Publish two paragraphs from each dissenter with the statement. Then ask the chairman to characterize the majority he voted with, and to respond to what the dissenters actually wrote.
Stop asking him to steelman the side he voted against, as he was today; he said, "I guess I shouldn't give you their best arguments," which is a fair answer to an unfair question.
By the way, forward guidance hasn't disappeared. It has moved to the vote. See the increased dissents in recent months. The communications format needs to change.
Conveniently, Mervyn King co-chairs Warsh's communications task force. He ran the central bank that already publishes the vote split and the dissent's reasoning at the same moment as the decision. Findings are due by year-end.
Until then, expect awkwardness at the pressers.
Quoted context
These are the quoted author’s words.
A guide to Warsh's rhetorical techniques. (since we'll living with it for the next 5 years)
Here's 8: :
1. Replace the question with a broader one (otherwise known as "bridging), i.e. when someone ask X, you answer Y. Q: Was today's decision close? Answer: The vote was 9-3. The broader discussion showed a lot of agreement. We had commonality on the questions....
2. Reject the reporter's premise. I.e. Q: What's the argument for a pause? Answer: I wouldn't characterize what we did as anything like a pause.
3. When asked about conclusions, answer with process. Q: What haven't you hiked? A: We spent an inordinate amount of time looking at monetary policy strategy...thinking hard...looking at data...
4. Admit uncertainty, but only about the economy, not objectives. i.e. he never expresses uncertainty about the 2% inflation target or the Fed's mission, but he freely admits uncertainty about anything about the economy.
5. Create memorable slogans to create rhetorical anchors. i.e. "Watchful thinking, not watchful waiting." "Family fight." "We're in the performance business." "No magic wand."
6. Controlled self-deprecation to diffuse tension. i.e. "Believe it or not, this press conference is not all I've done today."
7. Use questions to answer questions. He presented the four questions that the FOMC discussed, but never provide answers.
8. Divert attention to the markets but does not provide market analysis. Q from reporter: what are you hearing from the markets? A: Markets are the best source of information.
AnnaEconomist ↗