By Shayndi Raice
Despite some signs of a recovering economy, the Federal Reserve's monetary policy meetings in 2011 were still rife with divisions about the best way to get the U.S. economy back on track.
But the interest-rate-setting Federal Open Market Committee did manage some levity. In fact, laughter was on the rise at the 2011 meetings. A total of 317 laugh lines show up in the transcripts from meetings and conference calls that year, up from 222 in the previous year.
Here's our annual roundup of some of the best (and worst) jokes cracked at the meetings, taken from transcripts released Thursday. The policy makers cracked several jokes about the economic relevance of the marriage of Prince William to Kate Middleton and couldn't seem to fit in enough baseball references. There was also some hazing of new members and roasting of departing ones. We also have included some group bonding moments that got some giggles, like when a regional bank president snuck in beers after a World Series bet or when the group enjoyed some cake (including a gluten-free carrot variety) for Chairman Ben Bernanke's birthday.
(Note: This is all in fun. For a more serious analysis of the monetary policy making that occurred in those meetings, read our Real Time blog.)
(Fed Chairman Ben Bernanke lets everyone know he meets the residency requirements for leading the Federal Reserve.)
CHAIRMAN BERNANKE. This is our organizational meeting, so we have our usual items. The first item is electing Committee officers. Governor [Janet] Yellen, do you have a motion?
MS. YELLEN. I would like to move the nomination of Ben Bernanke as Chairman.
CHAIRMAN BERNANKE. And I would like it to beknown that I meet the residency requirement. [Laughter]
( David Stockton, director of the Federal Reserve's division of research and statistics, cracks a joke about the length of a summary of reports on structural unemployment.)
MR. STOCKTON: While we consider the work we've done thus far to be more of a progress report than "the final word" on the topic, last week we did post 10 papers and a rather lengthy summary memo, and I think the page length was roughly equivalent to that of War and Peace. [Laughter]
( John Moore, first vice president of the San Francisco Fed, gets giggles at the mention of underwear.)
MR. MOORE. Thank you, Mr. Chairman. In the 12th District, holiday sales for retailers generally exceeded expectations. My contacts also noted a shift in spending away from generic products towards more luxury items. My staff has discouraged me from describing these luxury items in any detail after my comments on Spanx at our last meeting [laughter], so I won't do that, but I will say that this shift towards these luxury items suggests a more secure, less cautious consumer.
(Chicago Fed President Charles Evans compares his city's football team to the economy.)
MR. EVANS: I've been in Chicago now for almost 20 years, and I've reluctantly come to embrace the Bears. This year, the Bears really weren't that great of a team -- the fundamentals weren't really that good. But, somehow, things picked up, and they made the playoffs, and they made the championship game. Then, with all of the buzz in town, people got excited. And if you lost your discipline, you could sort of convince yourself that the Bears were really quite good. [Laughter] And, you know, they were quite good. However, they ran into a team that beat them, and that's because the fundamentals really were not as good as everybody had come to believe. And I think that the economy is a little bit like that.
(Fed governor Sarah Bloom Raskin on being accosted by a neighbor at the supermarket.)
MS. RASKIN: As the communications experts know best, there are several audiences listening and critiquing the performance of this Committee, and these audiences include financial participants on Wall Street as well as business participants on Main Street. They include politicians of all ambitions. In my case they include a neighbor who continues to corner me in the express lane at the grocery store right when I'm pinned in between the tabloids and the gum, asking for clarification. [Laughter]
(San Francisco Fed President John Williams gets hazed by his new FOMC colleagues.)
CHAIRMAN BERNANKE: Good morning, everybody. I would like to begin by welcoming John Williams to the table. John has been at 18 previous meetings, so it is not a new experience for him, but this is a new position. We welcome you, and wish you the best of luck.
MR. TARULLO: Doesn't he have to sing? [Laughter]
MR. FISHER: The FOMC song; it's a great one. [Laughter]
MR. WILLIAMS: I've been around long enough to know the tune: "It's a Small World." [Laughter]
(Kansas City Fed President Thomas Hoenig to Fed economist Nathan Sheets on the predictive abilities of the Fed.)
MR. HOENIG: Thank you, Mr. Chairman. To Nathan, I want to just suggest that when I became a member of the FOMC, I had a friend give me a crystal ball to use, and over the years it has done just about as well as our models. [Laughter] So feel free, if it would be any help to you.
(San Francisco Fed President John Williams on more cultural references, less discussion of underwear -- see January meeting.)
MR. WILLIAMS: Thank you, Mr. Chairman. It is a great honor and privilege to be here. My immediate predecessors in this seat left big shoes to fill, both in terms of intellect andwit. Regarding the latter, I expect I will fall well short in my ability to integrate references to cultural icons like Lady Gaga into our discussions. I do promise, however, to keep my comments about control undergarments to the bare minimum. [Laughter]
(Fed Vice Chairwoman Janet Yellen gets a laugh when she analogizes Fed strategy to an airport landing.)
MS. YELLEN: An analogy might be helpful in explaining what I have in mind. Imagine that our Committee is the flight crew of a Boeing 747. We need to land at night at a nearly deserted airport, but we discover that the air traffic controller has fallen asleep on the job. [Laughter]
(San Francisco Fed President John Williams garners laughs when he brings up San Francisco's Major League Baseball team.)
MR. WILLIAMS: The open question is whether my optimism, both regarding the Giants and the economy, reflects an accurate reading of fundamentals or just aform of denial. [Laughter]
(Dallas Fed President Richard Fisher suggests Chairman Ben Bernanke's comments will thankfully get less attention than the royal wedding.)
MR. FISHER: In looking at the statement, I think less attention will be paid to the statement than is normal. Almost as much attention will be paid to you as is being paid to what Kate Middleton will wear at her wedding. [Laughter] And I am grateful for that distraction.
( Fed Vice Chairwoman Janet Yellen returns to analogies for a laugh.)
MS. YELLEN: As an analogy, one might think of these principles as corresponding to the Ten Commandments, while the list of examples is akin to Talmudic commentary. [Laughter]
(Fed Chairman Ben Bernanke roasts Kansas City Fed President Thomas Hoenig upon his departure.)
MR. BERNANKE: The only problem I've ever had with Tom is that I'm unable to get him to say what he really thinks. [Laughter] It's a 20-year record of service through three recessions -- I'm not implying any causality -- and we have all benefited very much, Tom, from your perspective, your banker's insights, and your wide range of experience.
(Fed Chairman Ben Bernanke connects economics to Prince William and Kate Middleton's wedding.)
MR. BERNANKE: What do we think is the GDP effect of the Royal Wedding? [Laughter]
(William Waschser, senior associate director, division of research and statistics at the Fed, on the perplexing behavior of teenagers.)
MR. WASCHER: Much of the surprise is in the teenage categories, and that's always been an age group that's been difficult to understand. [Laughter]
(Dallas Fed President Richard Fisher brings up some quirky data from his district to show troubling consumer caution.)
MR. FISHER: For example, we heard from a supplier of waffle ingredients that while sales at the stores he servicesare up, average waffle size has taken a hit. [Laughter] Presumably, that means people are ordering smaller ice cream cones and waffles on average.
( Mr. Fisher, next allays some fears, and causes some giggles, by noting people in Texas still aren't willing to give up on nose jobs.)
MR. FISCHER: I do want to note from my corporate contacts that, regardless of the sector, whether it's rail activity, electricity usage, cargo hauled through the air or on the seas, airline traffic advance bookings, restaurant pricing, or even one of my favorite leading indicators, elective surgery -- which, by the way, has declined significantly nationwide, but showing the difference between my District's performance and elsewhere, cosmetic and elective surgery is up in Texas [laughter] -- there is no question that we are seeing, in the reports given by business leaders, a mystically stated "slowdown in the pace of play."
(Baseball seems to always gets laughs at the FOMC, Chicago Fed President Charles Evans finds.)
MR. EVANS: Mr. Chairman, I thought that you were exactly on target when you opened up by saying that this is sort of like having in our statement something like, "Well, it's going to be this way until the Red Sox win the pennant." We could go further. We could do it and say "until the Chicago Cubs win the World Series." [Laughter]
CHAIRMAN BERNANKE: Incredible. [Laughter]
(Boston Fed President Eric Rosengren joins the fun.)
MR. ROSENGREN: But I must say that I am disheartened that the staff probability of a recession increasingly exceeds the probability of the Red Sox winning the pennant. [Laughter]
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