The Federal Reserve has a committee studying how to improve communications with the public. But change was not in evidence in the latest statement issued today following the rate-setting meeting of the central bank.
In a bid to be more open with investors and the general public, the Fed should adopt a less stilted post-meeting announcement of its rate decision. Sure, each word the Fed utters must be carefully chosen because each word will be subject to over-the-top analysis by market types and analysts. But still, the Fed should indicate it doesn’t live in a cave.
Bill Ford, executive chairman of Ford Motor Co., worries about traffic gridlock on a global basis.
Zhengrong Shi, chairman and chief executive of China’s Suntech Power Holdings, one of the world’s largest solar panel companies, wonders whether “perhaps there’s too much democracy” in the U.S., making it difficult for the nation to adopt a coherent and consistent industrial policy.
“There are no decisions being made,” he said. “It’s like in a company. Sometimes you hear all the voices. The CEO knows what the right decision is and sometimes they just want to bang the table and say, ‘Let’s do it.’”
This may be a case of over-the-top tea-leaf reading.
So, by definition, it will be convoluted. But here goes. My interpretation of some comments made today byFederal Reserve Vice Chair Janet L. Yellen indicates the central bank will feel no rush to remove the famous “extended period” language from its post-meeting statements.
The reason for that, essentially, is that Yellen thinks the Fed’s conditionality around that phrase has been sufficient to allow market participants to change their views about when the central bank may finally come off its long-standing emergency easy policy, which features zero short-term interest rates. Said another way, the phrase “extended period” is flexible.
Disappointment is the word recently used by a commissioner of the Securities and Exchange Commission about the percentage of corporate directors at big U.S. public companies who are women.
The figure cited by SEC Commissioner Elisse B. Walter in a Feb. 10 speech was 15.7%. That’s the percentage of board seats held by women at Fortune 500 companies, according to the 2010 Catalyst Census.
Here is the fuller quote from Walter, who fills one of the Democratic seats of the five-person commission:
“I think it’s fair to say that there are significant challenges for those who want to see true gender diversity in corporate governance,” Walter said in the text of a speech to the DirectWomen Board Institute. “While I will not offer up a personal analysis as to why women are underrepresented on corporate boards – I’ll leave that to the experts – I can tell you that my initial reaction to the statistics is disappointment.”
Some good quotes from Robert Khuzami, head of the Securities and Exchange Commission’s enforcement division, as he laid out how people associated with an “expert networking” or “matchmaking” firm allegedly shared inside information about some of the big companies that employed them with hedge fund employees.
Said Khuzami in a statement issued today: “Today we pull back the curtain and reveal that the only matching that was going on here was to match theft with greed.”
And lest anyone not understand what’s allegedly involved, Khuzami employed analogy to good use. He said: “These trusted employees chose to steal information that belonged not to them, but to the company and its shareholders. They lined their pockets with tens of thousands of dollars by trafficking in that stolen information in a manner that is not unlike an employee who drives to the loading dock late at night and fills the trunk of his car with valuable office equipment and sells it to his neighbor.”
Posted by Neal Lipschutz
on February 08, 2011
, Corporate Governance
, United States
The U.S.’s largest public pension funds reports further progress in its useful quest to get more publicly traded companies to adopt majority voting for directors.
Simply put, majority voting requires a director in an uncontested election to receive more “for” votes from shareholders than “withhold” votes to continue to serve on the board of directors.
The 58 companies targeted in March 2010 by The California Public Employees’ Retirement System (CalPERS) were holding onto the plurality system. Under that system, a single “for” vote could re-elect a director.
There are facts. There is political reality. As those two clash, it won’t come out well for the Securities and Exchange Commission.
The SEC’s chairman, Mary L. Schapiro, marshalled facts in a speech today, hitting hard that the watchdog agency needs more money to modernize to fulfill its role, especially in light of the additional responsibilities handed the SEC by the Dodd-Frank Act.
The reality is the SEC had better review all its operations, set its priorities and stop some things so it can do others well. The top priorities should be enforcement and watching ever-more-sophisticated stock market patterns. Other functions, such as investor education, will have to fall by the wayside.
The incongruity wasn’t lost on the Federal Reserve chairman or the crowd.
“But before asking the last question, a couple of very important matters to take care of,” intoned the moderator at Fed Chairman Ben Bernanke’s rare press conference today in Washington at the National Press Club. “Want to remind our members and guests of future speakers. Harry Shearer, the comedian and humorist, a voice of ‘The Simpsons,’ will discuss media myths on March 14.
“And we might even try to get him to do a few voices for us,” the moderator added, according to a transcript.
Posted by Neal Lipschutz
on January 22, 2011
If the battle over U.S. government spending and what to do about outsized federal deficits were decided by which side has the best quotes, score a point for the deep-budget-cut-now types.
The quote is from Tim Pawlenty, former governor of Minnesota, who is considered a possible Republican presidential hopeful for 2012. I read it this morning in an email roundup from Mike Allen of POLITICO. A quick search shows Pawlenty had been using the thrust of the quote often as he speaks publicly, sometimes promoting his just published book.
Posted by Neal Lipschutz
on January 21, 2011
, United States
A quote from Jeffrey R. Immelt, the chairman and chief executive of General Electric who was just tabbed by President Obama to lead a government council on job creation, sums up quite well a key aspect of the American economic dilemma.
“The assumption made by many that the United States could transition from a technology based, export-oriented economic powerhouse to a services-led, consumption-based economy without any serious loss of jobs, prosperity or prestige was fundamentally wrong,” Immelt wrote in an “op-ed” piece in today’s Washington Post.
I’ll take issue with one aspect of the quote: the implication that someone planned it that way, that someone thought this was a good idea. The transition, which threatens the long-standard American advantage of a broad and robust midlle class, was the result of market forces. Globalization works all sorts of ways.