The Federal Reserve released transcripts from its 2009 meetings this week, and two things jump out. First, current Federal Reserve head Janet Yellen, who was president of the Federal Reserve Bank of San Francisco at the time, was making some predictions accurate enough that it is hard to believe she didn’t time-travel to 2015 in order to retrieve the Grays Sports Almanac of economic data.
The Wall Street Journal ranked the economic forecasts made by Federal Reserve policymakers, and Yellen came in first place. She was mainly worried that the U.S. was facing a painfully slow recovery, even if the worst of the recession appeared to be over in 2009. Her statements in Federal Reserve meetings can be summed up as “I have a bad feeling about this.”
• “We are in the midst of a very deep and protracted downturn, and I have to squint really hard to see any light at the end of the tunnel.”
• “Looking ahead, however, I foresee a slow recovery over the next several years with stubbornly high unemployment and very low price inflation, not the sharp rebound that typically follows deep recessions.”
• “Unfortunately, the road ahead is littered with headlines of defaults, bankruptcies and rising unemployment.”
• “[The recovery] will be tepid by historical standards, leaving unemployment unacceptably high for a long time to come.”
• “The recovery is shaping up as a long, difficult slog for several reasons, including the extraordinary depth of the recession, the pressure on financial firms and households to repair their balance sheets, and the zero bound’s considerable constraint on monetary policy.”
The other thing that’s clear is that our leading economic minds still make awful jokes, although mentions of laughter in Fed meetings were also in the middle of a bit of a recession, according to data analysis at Bloomberg. Here are a few of the jokes that made economists laugh in 2009.
Game-show jokes were very popular.
Chairman Ben Bernanke: So, Governor Warsh, there is an “if” here. I mean, that certainly implies that our action is conditional on certain things happening that may or may not happen.
Fed Governor Kevin Warsh: May I use a life line? [Laughter] Brian, do you read it, as written, to say that we have reached a decision and our decision is contingent upon facts of the world in the future or that we have reached a decision and, if the world proceeds as we expect it will, then we will do this? I am not sure I picked up from your introduction which you think you and markets would read.
Warsh: To conflate game shows, I don’t want to be voted off the island. [Laughter]
Fed Governor Daniel Tarullo: Thank you, Mr. Chairman. Let me first say I know how pleased everyone must be that we are getting through the go-round this afternoon so that we will have plenty of time tomorrow for our special, though regrettably untelevised, version of “Who Wants to Be an Inflation Fighter.”
People in the meetings also had some trouble with Janet Yellen’s name, one time confusing her with former Russian president Boris Yeltsin.
Eric Rosengren, President of the Boston Fed: … I agree with Presidents Evans and Yeltsin—Yellen—[Laughter]
Richard Fisher, President of the Dallas Fed: I’ve gone drinking with Janet. She’s no Yeltsin. [Laughter]
Bernanke: Okay. The last two minutes will be struck. [Laughter]