Tag: Fed head Jerome Powell on maintaining his fitness and playing God

  • Fed head Jerome Powell on maintaining his fitness and playing God

    Fed head Jerome Powell on maintaining his fitness and playing God

    “Do you really feel like a God?” This was the question Raghuram Rajan, the former governor of the Reserve Bank of India (RBI), posed to US Federal Reserve (Fed) chair Jerome Powell in a fascinating conversation organised recently by the Economic Club of Chicago. That a central banker should be seeking an answer to this from another central banker made it all the more amazing. While we are not sure what Rajan thought about this himself and whether during his term at the RBI felt like a God or not but here is what Powell had to say: “In terms of being a God, I would say, we are blessed with a large number of amply compensated critics who would kind of tend to undercut that (feeling).” While Powell blamed his critics for this apparent inability to experience this joy, he did feel being a central banker was indeed “the best job in government” and that he did “enjoy and love the job” which, at times, was also “quite humbling because everybody makes mistakes. The economy is (after all) just not very predictable.”

    On a question at a more personal level as what was it that Powell Liked “to do most at home after an exhausting day?” The Fed chair had a simple and straight answer: “I play one of my guitars, I do zoom calls with my kids and my grandkids and I go to gym too just to stay in shape.”

    Albeit Powell stayed clear of giving pointed responses to key questions on inflationary implications of the tariffs imposed by the US government or what change in approach, if any, the Fed could adopt (other than the one taken to contain inflation) in situations where there was a supply shock (possibly triggered by the high tariffs on Chinese goods) or even on the independence of the Fed, Raghuram Rajan did begin the conversation stating clearly that as a former central banker he had been cautioned by the organisers not to lapse into any “central bank-speak.” Interrogate the internet and the full interview is available and is indeed worth listening to.

    But then each central banker is a study in caution, never to be caught unguarded when speaking at a public forum. After all, Alan Greenspan, the much celebrated former chairman of the Federal Reserve, has often been quoted for what he once famously said in a testimony to the US Congress: “Since I’ve become a central banker, I’ve learned to mumble with great incoherence. If I seem unduly clear to you, you must have misunderstood what I said.” Or closer home, as Dr Y V Reddy, the former RBI governor much earlier to Raghuram Rajan, once told this writer and also in some interviews, “we speak a lot but convey very little.”

    But then apparently, when it is a conversation between two central bankers they both seem to know what to convey and what matters when it comes to matters concerning the mood and the mission.