Behind the Fed’s Curtain: What They Really Think

The Federal Reserve is upheld as a scientific and prestigious institution capable of reining in the excesses of an unregulated economy. In public, Fed officials project confidence and candor, but in private they sometimes acknowledge the problems with centrally planning money.

The following article was originally published by the Mises Institute. The opinions expressed do not necessarily reflect those of Peter Schiff or SchiffGold.

Fed Governor Christopher Waller visited Auburn University on Friday, and I had the unusual opportunity not only to hear his public talk but also to have lunch with him and a few Auburn faculty members beforehand. While I pay more attention to the Fed than the average person, my exposure to it was limited to their public talks, announcements, and press conferences. At the open-door lunch, I got the chance to sit down with a Fed official and ask away. It was a strange situation for me: as much as I wanted to be combative, I knew that I had to be polite so he’d keep answering my questions with as much honesty as a central banker can muster.

There was a big contrast in his informal remarks over lunch versus his public talk. Over lunch, Waller was more candid, more dismissive, and rough around the edges. In the public setting, he cleaned up the language and adopted the more measured tone one would expect from a central banker. I could immediately tell when he switched on the Fedspeak at the beginning of his talk. There was nothing really noteworthy about his talk—it was a boring boilerplate speech from a Fed official. What was noteworthy was the contrast: the Fed projects confidence and honesty in public, but cannot withstand the slightest bit of inquiry without evasion, rhetorical tricks, and outright contradiction.