When The Fed Chairman Speaks, Everyone Freaks

By: Hillary Profita
Topics: Media Issues

(Getty Images/Win McNamee)

For some reporters, the White House Correspondents Dinner is more than just another night at the prom. For CNBC's Maria Bartiromo, it turned out to be a working dinner – one in which she gained a piece of information from a fellow attendee that ended up having quite the effect on markets (as Fed chairmen's remarks so often do). From the Financial Times (via TVNewser):

Stocks fell on Monday after CNBC's Maria Bartiromo revealed on air that Ben Bernanke felt his testimony last week had been "misunderstood."

The anchor said Mr Bernanke had told her at the White House Correspondents' dinner in Washington on Saturday that he had not intended the markets to infer that the Fed was nearly done raising interest rates.

"I asked him whether the markets got it right after his congressional testimony and he said, flatly, no," Ms Bartiromo said. She was reporting live from floor of the Chicago Mercantile Exchange and the resulting trading roar almost drowned out the rest of her remarks.

FT procured one market strategist to interpret the situation. Said Alan Ruskin, a strategist at RBC Greenwich Capital: "It comes off as a great example of over-communication and a possible attempt to over-fine-tune, assuming he was willing to go on the record with these comments - CNBC is not the Fed's obvious port of call to correct market expectations."

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by peterbaldwin-2009 May 3, 2006 12:28 PM EDT: The selection of Bernanke is something of an anomaly for this administration, who have given us the likes of Chertoff and Brown. I don't think that Bernanke is on the Bush leash but rather is truly independent and uncorrupted, unlike his predecessor. Fortunately, he is a staunch adherent to the school of thought that inflation is our greatest economic threat. That ticking upward march of quarter point interest rate increases, like a time bomb, will have to continue, much to the chargrin of wall street investers. Otherwise, its Weimar time, a worse case scenario.; Reply to this comment


by alphaa10-2009 May 2, 2006 7:44 PM EDT: Bernanke will go on raising interest rates until Bush tells him to stop-- so much for his "independence". Everyone sucking away on the interest rates at Wall Street, in Beijing, in the UAE, Saudi Arabia, etc., is glad Bernanke is there. This is the evening of The Fat Cats, but nightmares are coming. Pity the rest of us.; Reply to this comment


by peterbaldwin-2009 May 2, 2006 4:27 PM EDT: That over-reaction is pathognomonic of the Schizophrenic nature of the stock market and is nothing new. The lemmings are ready to follow the lead of any dimwit's interpretation of any rumor, leading to panic buying or selling. Such volatility is senseless, but it puts a lot of easy money in the pockets of the brokers.; Reply to this comment