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How Did The Fomc View The Great Recession As It Was Happening?: Evaluating The Minutes From Fomc Meetings, 2006-2010

Author

Listed:
  • Herman O. Stekler

    (The George Washington University)

  • Hilary Symington

    (Barnard College)

Abstract

In setting monetary policy, the Federal Open Market Committee uses forecasts and other information to assess the current and future states of the US economy. Numerous studies have evaluated the Greenbook forecasts but did not determine why a forecast was made, what factors were considered or the uncertainty that was involved. The minutes of the FOMC provide such information. While the minutes are qualitative, using a quantitative index, we show that the FOMC saw the possibility of a recession but did not predict it. Using textual analysis, we determined which variables informed the forecasts.

Suggested Citation

  • Herman O. Stekler & Hilary Symington, 2014. "How Did The Fomc View The Great Recession As It Was Happening?: Evaluating The Minutes From Fomc Meetings, 2006-2010," Working Papers 2014-005, The George Washington University, Department of Economics, H. O. Stekler Research Program on Forecasting.
    • Handle: RePEc:gwc:wpaper:2014-005
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    References listed on IDEAS

    as
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    Cited by:

    1. Ericsson, Neil R., 2016. "Eliciting GDP forecasts from the FOMC’s minutes around the financial crisis," International Journal of Forecasting, Elsevier, vol. 32(2), pages 571-583.
    2. Ulrich Heilemann & Susanne Schnorr-Bäcker, 2016. "Could The Start Of The German Recession 2008-2009 Have Been Foreseen? Evidence From Real-Time Data," Working Papers 2016-003, The George Washington University, Department of Economics, H. O. Stekler Research Program on Forecasting.
    3. Heilemann Ullrich & Schnorr-Bäcker Susanne, 2017. "Could the start of the German recession 2008–2009 have been foreseen? Evidence from Real-Time Data," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 237(1), pages 29-62, February.
    4. Daniel Culbertson & Tara Sinclair, 2014. "The Failure of Forecasts in the Great Recession," Challenge, Taylor & Francis Journals, vol. 57(6), pages 34-45.

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    Keywords

    FOMC forecasts; forecast evaluation; uncertainty; Great Recession; textual analysis;
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