A More Transparent Fed?

Highlights include Citigroup Inc. (C), JPMorgan Chase & Co., Inc. (JPM), Goldman Sachs Group, Inc. (GS), Bank of America Corp. (BAC) and Wells Fargo & Co. (WFC).

The U.S. Federal Reserve may become more like the European Central Bank, as it considers holding regular press conferences. While we suspect there could be some concerns about the potential to confuse markets and the public, Ben Bernanke’s long question-and-answer session with reporters at the National Press Club in February could be perceived as a successful “dry run” - that the Fed could hold press events without confusing markets or being obtuse.

Since 1994, the Fed has been attempting to become more open (when it began to target for short-term interest rates). Presently, policymakers at the Federal Reserve economic forecasts four times a year and the Fed chairman gives detailed reports on the economy to congressional committees twice a year.

While the Fed has had a history of being less than crystal clear, we would err on the side of more information than less. For most of the 2000’s so far, companies have and continue to hide behind Regulation FD (Fair Disclosure). Any enhanced information from the Fed could result in better information being disseminated from financial institutions such as but not limited to Citigroup (C), JPMorgan Chase (JPM), Goldman Sachs (GS), Bank of America (BAC) and Wells Fargo (WFC).

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