The 2009 FOMC Laugh Track: Fed Humor in a Bleak Economic Year – Real Time Economics

Ben Bernanke in July 2009
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Federal Reserve policy makers faced a dark economic outlook as 2009 began. They cut some of the tension at Federal Open Market Committee meetings with their usual brand of central banking humor. The FOMC’s 11 meetings and phone calls in 2009 featured 303 moments of laughter–marked in the transcripts, released Wednesday, by a “[Laughter]” tag. We’ve collected some of the best and worst ones here.

Many of these were lame cracks to bring a bit of levity to an otherwise long and dreary gathering. If you read the transcripts for the humor (Pro tip: Don’t do this) you’d be perplexed by many of the inside jokes about bureaucracy or the challenges of crafting the FOMC statement. So just remember this: They’re economists. You don’t pay them to be funny.

(Note: The transcripts run for thousands of pages, featuring serious discussions on a very long list of topics. Read our comprehensive coverage here on Real Time Economics to capture those serious discussions.)

Jan. 27-28

The year must begin by electing a chairman of the FOMC, a post everyone knows will be filled by the Fed chairman. Fed Vice Chairman Donald Kohn did the honors:

MR. KOHN. Mr. Chairman, it is a pleasure and an honor to recommend Ben Bernanke to be chairman of this committee. I am not sure what sins you committed in an earlier life, but I sure hope you had fun. [Laughter]
MR. HOENIG. It’s the first nomination I’ve heard like that. [Laughter]


Later, Fed staff funnyman David Stockton:

CHAIRMAN BERNANKE. …Let me turn now to the economic situation. Boy, I think it has been a while since we were three and a half hours into the meeting before we got to the staff forecast.
MR. STOCKTON. The GDP is a little smaller than it was at the start of the meeting.


Fed officials go around the table offering their assessments of the economy. Here is then-San Francisco Fed President Janet Yellen:

MS. YELLEN. …The residential housing sector has now shrunk so much that the only real assurance that it will ever stabilize seems to be the fact that construction spending cannot go negative. This is just about the only zero lower bound that is working on our side. [Laughter]


This is how the sausage is made. Much of the laughter comes around the debate involved in finding the right language for FOMC statements:

VICE CHAIRMAN DUDLEY. …Given that our ability to enact this program is subject to some degree to the Treasury’s coming along with us in a timely fashion, I think it would be better to change “next month” to “later this winter,” which will give us until March 21, giving us a few more weeks. Thank you, Mr. Chairman.
CHAIRMAN BERNANKE. That last thing worries me quite a bit. I don’t know. What did we have in December?
MR. LACKER. “Later this season.”
MR. WARSH. How about “later”? [Laughter]
MR. LACKER. “In the future.”
MR. MADIGAN. Another possibility might be just to say “soon.”
CHAIRMAN BERNANKE. I thought of that as well, but does that satisfy you there, Vice Chairman?
VICE CHAIRMAN DUDLEY. I think “later this winter” does provide an endpoint. I am not sure how long “soon” is.
MR. WARSH. It is always winter somewhere. [Laughter]


Fed governor Kevin Warsh watches television:

CHAIRMAN 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.
MR. 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.

Soon after:

MR. WARSH. To conflate game shows, I don’t want to be voted off the island. [Laughter]


What color is the Fed chairman?

CHAIRMAN BERNANKE. …I probably should mention that there will be opportunities for us to communicate about our views further. In particular, I have a testimony on Feb. 10 on our transparency and our communication. I have a speech at the National Press Club, which will have more of a press conference type of flavor, sort of between a speech and a press conference, on Feb. 18. Then, I have the Humphrey-Hawkins hearings, followed by Budget Committee hearings, so you will be seeing a lot of me on television. My complexion is not usually green but probably will be by then. [Laughter] So we will have a chance to communicate.


Feb, 7 conference call


CHAIRMAN BERNANKE. Okay. Other comments? President Fisher.
MR. FISHER. May I just take this opportunity to welcome Governor Tarullo on board and give him an option to leave if he decides to do so. [Laughter]
MR. TARULLO. Thank you, Richard.
CHAIRMAN BERNANKE. I’d like to point out Governor Tarullo has a 14-year term. [Laughter]
MS. DUKE. Sentence? [Laughter]
CHAIRMAN BERNANKE. A term, not a sentence. Thank you, everybody.


March 17-18

Hope and change across Washington:

CHAIRMAN BERNANKE. Do you think there’s an aggregation externality in liquidity—getting activity going again so that people issue and so on? That would be one reason why it would stimulate additional activity.
MR. EVANS. Yeah. It seems like a hope at the moment. And I’m not opposed to hoping a lot. [Laughter]


What happens when you buy up mortgage securities?

MS. MOSSER. There’s a completely different set of limitations, namely, how much the payment and settlement system can handle, depending on how compressed we make these purchases. We have not done this yet for Treasuries, but for mortgage-backed securities, we think that if we tried to buy $1½ to $2 trillion more this year, we would come close to breaking it.
MR. BULLARD. It’s great to know these kinds of constraints.
MS. MOSSER. It’s possible there’s a workaround for those sorts of things. But if there is, we’d have to start it tomorrow.
CHAIRMAN BERNANKE. We could just acquire Fannie and Freddie directly. [Laughter]


There are liquidity facilities, and then there are liquidity facilities: 

MS. MOSSER. …I’m encouraged that, as rates come down, and in particular, as we basically get underbid by the market, the facility usage drops off pretty quickly. So as long as that trend continues, I think we’re fine. Whether, in the end, we have to take it away is a possibility—we’ve had those discussions with the other central banks.
CHAIRMAN BERNANKE. Speaking of facility usage—[laughter]—why don’t we take a coffee break for about 15 minutes, and then we will recommence around 4:30. Thank you.


You’ll find lots of metaphors in the transcripts. Here’s one from Fed governor Elizabeth Duke:

MS. DUKE. …Before I move to asset purchases, I’d like to start with the story of an elderly wealthy gentleman who had taken a young bride and begun to spend money like crazy. His friends got very concerned that he was going to go through his entire fortune, and they elected one of their number to go and talk to him about it. He said, “Sam, we’re really concerned. We want to make sure that you know that you can’t buy love.” Sam said, “I know you can’t buy love, but if you spend enough money, you can buy something that looks so close you can hardly tell the difference.” [Laughter] So I think if we spent enough money, got enough of a hit right now, it would look like a floor on house prices, and we might have something every bit as good as a floor on house prices.


Here’s Fed staffer David Stockton, at it again:

MR. STOCKTON. Thank you, Mr. Chairman. In looking at the myriad ways in which we were surprised by the incoming data and forced by evolving economic and financial circumstances to revise our forecast, I began to think that maybe my wife was on to something when she recently gave me a T-shirt that reads “Mind of an Athlete–Body of a Genius.” [Laughter] Well, as you know from reading the Greenbook, we did mark down substantially our forecast this round. We are now projecting that real GDP will fall 2¼% this year and increase just 1½% next year; those are downward revisions of about 1½ and 1 percentage point, respectively, from our January projection. Given that weaker outlook for activity, we expect that the unemployment rate will rise to 9½% in early 2010, where it will remain through the end of the year.


Dallas Fed president Richard Fisher also has a T-shirt reference to make, followed by several other jokes:

MR. FISHER. I was first going to say to Dave Stockton that our wives have an affinity for T-shirts. My wife, a smart Wellesley woman who spent most of her time at MIT, arrived at Oxford noting that the ratio of women to men was 1 to 11. She had a T-shirt for other women which she sold briskly, and it said, “Come to Oxford where the odds are good, but the goods are odd.” [Laughter]

….Mr. Chairman, I want to report on the microeconomic input I received from my corporate contacts, which numbered some 29 CEOs around the country whom I talked to before this meeting. Unfortunately, it confirms what Dave and Steve presented. In fact, one actually called me and said, “Do you want some good news?” And I said, “Please.” He said, “Call somebody else.” [Laughter]

…I couldn’t find any silver linings. There is, I suppose, a pewter lining, as I like to call it. And, Governor Tarullo, without any insult to your industry, one of the virtues is that the legal industry is also contracting [laughter]; 6,000 people were laid off from major law firms year to date.


Yes, Ben Bernanke has a highway interchange named after him:  

CHAIRMAN BERNANKE. Thank you. President Lockhart.
MR. LOCKHART. Thank you, Mr. Chairman. Let me start by congratulating you on having a highway interchange named after you. I’m sure we all envy you having your own off-ramp. [Laughter]


Yellen makes a 401(k) joke, in vogue at the time, and then had a piggy bank anecdote:

CHAIRMAN BERNANKE. Thank you. President Yellen.
MS. YELLEN. Thank you, Mr. Chairman. The economic and financial news has been grim. Things are now so bad that I actually open the Greenbook with greater trepidation than my 401(k). [Laughter] The awful employment and spending data have not been much of a surprise, but they do dispel remaining hopes that we might see a turnaround any time soon. This conclusion is reinforced by what I’m hearing from my business contacts. Their already sour mood is taking another sharp turn for the worse. One director reported that businesses were so shaken that it would take a sustained period of positive data, on the order of six to nine months, before they would begin to consider expanding production and employment. Another disturbing sign of how tough things are getting is that people appear to be breaking into their piggybanks to make ends meet—the Cash Product Office reports huge increases in the amount of coins being brought into our inventory. [Laughter] The December inventories of quarters and dollar coins were up more than 50% from 2007, and even pennies were up nearly 25%.


The meeting saw several references to Chairman Bernanke’s appearance on CBS’s “60 Minutes,” where he referred to “green shoots” in the economy:

MR. FISHER. Thank you, Mr. Chairman. First, to state the obvious: We’re at the zero bound, we’re resorting to extraordinary tools to offset the deflationary and other consequences of overly tight monetary policy, and we have to deploy that extraordinary tool kit effectively, deliberately, and with clarity. President Lockhart injected a little humor by congratulating you on your having an interchange named after you and pointing out there is an off-ramp. There is no off-ramp right now, unfortunately. And President Pianalto pointed to your “60 Minutes” performance, which I also wanted to applaud, except to point out there was one weakness: You were opposite George Clooney in that time slot. [Laughter]


April 28-29

One meeting later and the “green shoots” references kept coming. Here’s Fed staffer David Stockton again:

MR. STOCKTON. Thank you, Mr. Chairman. Nathan and I are going to be referring to the two exhibits entitled “Recent Economic Indicators.” The question everyone seems to be asking is whether, in the parlance of our chairman, we are now seeing “green shoots” in economic developments both here and abroad. Nathan and I thought that we would take a crack at addressing that question this afternoon. I should note right up front that my track record for spotting green shoots is not inspiring. While in high school, I had a brief job with a lawn service. One day while I was riding my tractor, a woman came running out her back door gesticulating wildly. It turns out that the patch of unruly weeds I had just mowed down were, in fact, the green shoots of her emerging asparagus garden. [Laughter] Two weeks later, I was working in a local slaughterhouse. That life lesson taught me that an inability to distinguish the green shoots from the weeds can have unpleasant consequences for one’s career path.


Richard Fisher, of the Dallas Fed, on diplomacy:

MR. FISHER. …I am going to focus the remainder of my remarks on the impressions gained from my trip from April 6 to April 22 to Tokyo, Singapore, Beijing, Shanghai, and Seoul, with a focus on China. First, I would like to preface it by saying that here at home all of the bank presidents have their views, but I’m not sure that’s understood by the public. We always say it, but abroad nobody understands that distinction. As I told you, Mr. Chairman, before I left for the trip, I stuck to the party line, remembering the old definition that a diplomat is someone who is sent abroad to lie for their country. [Laughter] I was just extremely diplomatic, faithfully toed the line, and just basically listened very carefully. Here is what I heard.


The Richmond Fed’s Jeffrey Lacker offers his economic roundup:

MR. LACKER. The Fifth District hospitality sector seems to have been hurt by a fear of adverse publicity. One director whose firm stages trade shows says that “fun” appears to be the new F word. [Laughter] A contact who runs a resort on the South Carolina coast reports corporations canceling bookings for which they have already paid in full. People apparently don’t want to risk the bad publicity of showing up, which is puzzling because critics presumably object to the expenditure not the utility derived. [Laughter]

…Finally, Mr. Chairman, down in North Carolina the bankers are distributing these lapel pins. They’re little round green things and they say “EGBAR.” Now I am not going to be able to do justice to a North Carolina drawl, but it comes out something like this: “Everything’s going to be all right.” [Laughter] I don’t know whether they believe it or whether they just want their customers to believe it. But in any event, they don’t say when it’s going to be all right, so I’m not sure that we should put much faith in this either. Thank you, Mr. Chairman.
CHAIRMAN BERNANKE. Any charge for the pins?
MR. LACKER. I got this one for free, and that means it is worth less than $20. [Laughter]
CHAIRMAN BERNANKE. Your drawl will be reflected in the transcript. [Laughter]


Green shoots? Fed governor Kevin Warsh has some thoughts, and so does Fed governor Daniel Tarullo:

MR. WARSH. Thank you, Mr. Chairman. After the despair at our last meeting, we may have expected to find ourselves with locusts, floods, and plagues. [Laughter] So I suspect the swine flu pandemic and the leaked stress-test results do seem like veritable green shoots in comparison. [Laughter] May that be the ninth and last reference to green shoots today, unless my colleagues choose to reference that as well.

…MR. TARULLO. Mr. Chairman, I have to say here that the one thing you may regret from your “60 Minutes” appearance is the use of this phrase. Third, there is considerable uncertainty whether these are green shoots promising blossoms to come or a school of red herring swimming across the sea of death. [Laughter]


What it’s like to pay back your TARP injection, via Fed governor Elizabeth Duke:

MS. DUKE. …One bank that did give back the TARP capital has seen no improvement in its stock price and no discernible improvement anywhere else. However, I heard from a smaller bank that did give back the capital, and the contact reported much rejoicing in his community, a surge in new customers, and congratulations all around. But the scariest part is that his mother cried in joy and pride when he returned his government capital. I swear. [Laughter]


Who’s on first? This was a somewhat confusing discussion of statement wording:

MR. LACKER. The word “somewhat” in the first sentence just snags my brain.
CHAIRMAN BERNANKE. We don’t want that. [Laughter]
MR. LACKER. “Somewhat” is great the way we usually use it—you know, somewhat higher, somewhat lower. That is a long and honored tradition in central banking. [Laughter] But “slowing somewhat”—
CHAIRMAN BERNANKE. How about “appears to be somewhat slower”?
MR. LACKER. That would be much more direct.
CHAIRMAN BERNANKE. I guess that pace requires an adjective—appears to be somewhat slower, the pace is slower. Isn’t that right?
MR. LACKER. I am not a good enough writer to know why.
CHAIRMAN BERNANKE. Isn’t that right, Brian? Okay. “The pace of contraction appears to be somewhat slower.”
MR. LACKER. Perfect.
CHAIRMAN BERNANKE. Any grammarians with concerns? You know, this is actually kind of fun here. [Laughter] I have always enjoyed it. Other comments? All right.


June 23-24

Bernanke recalls the early days:

CHAIRMAN BERNANKE. …I’m reminded of an experience I had when I first took this job, when we were still raising interest rates. Remember that? I told a congressional committee that the time would come, eventually, when we would have to stop raising interest rates. Of course, the expectation of an immediate rate change went right through the market, and I was completely flabbergasted by the inability of the markets to understand plain English. [Laughter] But, unfortunately, that’s reality.


Aug. 11-12

Everyone likes a good joke about adjustable-rate mortgages, or ARMs:

CHAIRMAN BERNANKE. Let the record show that President Lacker’s reference to ARMs dealers had to do with mortgages and not with other things. [Laughter]


Yes, here’s a Fed governor discussing the word “patience” in 2009 as if it were 2014 or 2015:

MR. TARULLO. …If this is a reasonable way of looking at things, our best-advised posture for at least a few more, and maybe more than a few more, meetings may be the somewhat unsatisfactory and awkward one of neither lifting another implement out of our toolbox nor closing the box up and declaring the job finished. Mom was right at least sometimes: Patience really can be a virtue. [Laughter]


Yellen on Churchill, and Bernanke:

MS. YELLEN. Thank you, Mr. Chairman. Winston Churchill once remarked that nothing in life is so exhilarating as to be shot at without result. [Laughter] Well, exhilaration may be an exaggeration, but I am at least hugely relieved that our financial system appears to have survived a near-death experience. And I am optimistic that you will not be the chairman who presided over the second Great Depression. [Laughter]


September 22–23

CHAIRMAN BERNANKE.  I think it is literally the case that since I’ve been chairman, there has not been a single quarter in which residential construction has added to the GDP. [Laughter] I won’t go down as the “housing chairman,” but the third quarter, apparently, may be different.


Is that President Yellen or President Yeltsin?

MR. ROSENGREN. Thank you, Mr. Chairman. I support alternative B. The Greenbook forecasts disinflation and high unemployment rates over the next two years. I agree with this forecast. These outcomes occur with an assumption that the federal funds rate will remain at exceptionally low levels for an extended period of time, so I am very comfortable continuing to say that in the statement. In terms of the LSAP program, we should purchase the entire $1¼ trillion in mortgagebacked securities. We should also taper the program, though I would prefer to leave the completion date flexible depending on market conditions. I have a strong preference not to end the program prematurely. I agree with Presidents Evans and Yeltsin—Yellen—[Laughter]

MR. FISHER. I’ve gone drinking with Janet. She’s no Yeltsin. [Laughter]
CHAIRMAN BERNANKE. Okay. The last two minutes will be struck. [Laughter]


Nov. 3–4

Lots of baseball references after the World Series:

CHAIRMAN BERNANKE. Thank you very much. Questions for our colleagues? It must be a very good briefing.
MR. STOCKTON. As we used to say in Little League, Mr. Chairman, a walk is as good as a hit. [Laughter]


MR. PLOSSER. Thank you, Mr. Chairman. I guess I’m up second. So I don’t know what that means I’m supposed to do as a baseball player. Get on base, right?
MR. TARULLO. Advance the runner.
MR. PLOSSER. Advance the ball? [Laughter]
CHAIRMAN BERNANKE. Hit to the right side. [Laughter]
MR. PLOSSER. Hit to the right side behind the runner, right? That should be easy.


Dec. 15–16

The funniest Fed staffer in the transcripts, David Stockton, was out sick. Here you have deputy funnyman David Wilcox stepping in:

CHAIRMAN BERNANKE. Any other questions? [No response.] I could press on just a bit more. Our friend Dave Stockton is a victim of H1N1 flu virus. David Wilcox has stepped into the breach, so let me turn it over to David.
MR. WILCOX. Thank you, Mr. Chairman. I will be delivering remarks this morning that were, for the most part, prepared by Dave Stockton, who can’t be with us today, as the chairman mentioned, because of illness. I should note that such circumstances may have little historical precedent. My colleagues and I have now completed an exhaustive search of the National Archives, checking all the critical original source material, and found no instance in which Robin had to clean up Gotham City on his own because Batman was indisposed; and no mention of Tonto ever having to face mortal peril by himself because the Lone Ranger was back at the ranch recuperating from the latest flu pandemic. My colleagues in public affairs often emphasize the importance of expectations management, so in that spirit, I have set myself the bar of hoping that today’s proceedings go better than when Captain Edward Smith asked First Officer Murdoch to take a turn at the helm of the Titanic [Laughter.]




MR. FISHER. Thank you, Mr. Chairman. As pointed out by First Officer Murdoch and his shipmate, Nathan Sheets, [laughter] we have seen some rather startling economic data recently….


The meeting brought a brief discussion of the similarities between forecasts by Goldman Sachs and New York Fed president William Dudley, a former Goldman Sachs economist:

MR. FISHER. …Having said all of that, my outlook for economic growth has not changed. I am not as pessimistic as the New York Fed appears to report—a number, by the way, which I note is strikingly close to what Goldman Sachs is forecasting. [Laughter] Nor is it as robust and optimistic as what the board staff is projecting. And given all that I’m seeing now, I stick to my previous forecast. I’m somewhere in between the two, and having said that, I don’t think it is too early to begin to think of how we will deleverage our balance sheet and pull back the monetary accommodation we have provided. Thank you, Mr. Chairman.
VICE CHAIRMAN DUDLEY. Can I make an interjection?
CHAIRMAN BERNANKE. I don’t blame you.

VICE CHAIRMAN DUDLEY. Two things. One, Mr. Hatzius, who is the chief U.S. economist at Goldman Sachs right now, did win the Blue Chip Forecasting award for accuracy this year. [Laughter].
MR. FISHER. That’s ex post, past tense.
VICE CHAIRMAN DUDLEY. And, two, I think I contributed something to his training. [Laughter]. So it’s not surprising that our views are not that far apart.

CHAIRMAN BERNANKE. President Lacker.
MR. LACKER. Thank you, Mr. Chairman. I am not sure I have ever seen President Dudley blush. [Laughter]


The transcript for the final meeting day of 2009 opened with this, a remarkable moment given how the economy looked when the year began:

Meeting attendees greeted Chairman Bernanke with a standing ovation when he entered the meeting room in recognition of his being named Time Magazine’s Person of the Year 2009.

CHAIRMAN BERNANKE. The power of the media. [Laughter] Thank you very much.


Want more? See some of the laughs from prior years:

The 2008 FOMC Laugh Track

The 2007 FOMC Laugh Track

The 2005 FOMC Laugh Track

The 2004 FOMC Laugh Track

The 2003 FOMC Laugh Track

The 2002 FOMC Laugh Track


Related reading:

Fed’s Yellen Fretted Over Weak Recovery in 2009, Transcripts Show

Five Takeaways from the 2009 Fed Transcripts

Live Tour: The Federal Reserve’s 2009 Transcripts

Six Charts That Tell the Story of the Unfathomably Bleak Economy the Fed Faced in 2009

Bernanke Guessed Right on Market Reaction to Treasury Bank Plan

A Timeline of the Federal Reserve in 2009

Who’s Who at the Federal Reserve in 2009

Interactive: Ranking Fed Forecasters

Interactive: Central Bank Watch

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