If finance is your career–or even just your hobby–then you know the vital part central banks play in the global economy.
While central banks have always been important to the markets, these institutions have developed an unprecedented level of influence since the financial crisis. But their power isn’t the only thing that has changed in recent years; central banks have also developed a new set of tools with which to express this power.
What are these tools? Communications.
The leaders of many of the largest central banks around the world have made themselves clear: communications will now be used as both a means of explaining policy and as policy in their own right. This stance represents a striking departure from the taciturn image once associated with central banks.
But these institutions are changing, and a new, vocal leadership will set the tone for the foreseeable future.
While central banks–and the financial world as a whole–have seen dramatic change over the last decade, the practice of “Fed watching” seems firmly rooted in the past. Instead of adapting their methods, analysts continue to use techniques that are better suited to Alan Greenspan in the 1980s than they are to Janet Yellen now.
Clearly, “Fed watching” needs evolve, and Prattle’s founders Evan Schnidman and William MacMillan believe that an innovative approach to sentiment analysis may be the key to that progression. In their groundbreaking book How the Fed Moves Markets, Evan and Bill explain why transparency has been embraced by many of the world’s leading central banks and why this development demands a radically different analytical approach–one based in combination of cutting-edge technology and deep domain expertise.
(“The Eccles Building”; by AgnosticPreachersKid )