By Paul Kiernan
Federal Reserve Chairman Jerome Powell has worked hard to explain the central bank's policies to ordinary people, hoping to shore up trust at a time of wavering public faith in institutions. The effort has produced some unintended results.
On Wednesday, for instance, Mr. Powell outlined the Fed's new policy of seeking inflation that temporarily overshoots its 2% target.
"For the last decade, you've seen central banks around the world really struggle to reach a 2% goal, and in some cases are fighting outright deflation," Mr. Powell said in a virtual event with the Economic Club of Washington.
As he spoke, a message board streaming alongside Yahoo Finance's webcast of the event on YouTube lit up.
"IF INFLATION ISN'T A THING WHY DOES THE MCDONALDS DOLLAR MENU NO LONGER EXIST," a user identified as Nelson Ting wrote in a message visible to the 5,000 viewers who had tuned in to watch Mr. Powell.
Such are the pitfalls of public outreach in a digital age.
To the dismay of some longtime Fed watchers, Mr. Powell's online video appearances often are accompanied by live chat-room commentary. The content, to say the least, doesn't always reflect the gravitas of the world's most powerful central banker as he lays out Fed efforts to fight the economic impact of the Covid-19 pandemic.
"Pump pump pump!!! Print the money!!!" a YouTube user identified as Kyle Bushner wrote during a virtual event by the Bay Area Council business association in November, which featured the Fed chief alongside a stream of comments. Efforts to reach Mr. Ting and Mr. Bushner weren't successful.
Mr. Powell had just reiterated his intention to maintain easy-money policies until the economy's recovery is complete, a stance many analysts say has also propped up stocks, commodities and cryptocurrencies.
Markets for such assets have boomed over the past year, drawing legions of novice investors armed with stimulus checks and spare time. Some have developed an interest in the U.S. central bank, which investors around the world follow closely.
Mr. Powell's speaking schedule has become busier as he aims to explain the Fed's expanded role in the economy following the recession. He made 36 public appearances between April 16, 2020, and April 16 of this year, versus 27 in the prior 12 months, according to a Wall Street Journal tally.
His online followers frequently address him directly using his internet nickname, JPow. Some urge viewers to buy gold or cryptocurrencies such as bitcoin, an asset class Mr. Powell recently described as "highly volatile...and therefore not really useful as a store of value."
The supposed imminent demise of the U.S. currency is a favorite topic of commenters, and conspiracy theories abound. It's hard to know what's meant to be a joke. "I can't wait till they start talking about their depopulation program to help with the climate change problem," a user wrote in the chat that accompanied the International Monetary Fund's YouTube stream of an event featuring Mr. Powell and other global policy makers on April 8.
Mixed in are off-the-wall quips. "How do you like your eggs?" asked one commenter during a Zoom event in January featuring the Fed chief and a Princeton University economics professor. Another replied, "Thanks for asking, I like them almost firm yolk! What about you?"
David Wilcox, a former Fed director of research, said he finds the chat windows infuriating. He closes them when he can. If that isn't possible, he said, he leans a pad of paper against his computer monitor to block his view of the messages.
"I know this makes me sound like a technological Luddite," Mr. Wilcox said. "If I'm going to get something useful out of Powell's remarks, I have to screen out the blather that's going on."
The potential for snarky commentary doesn't factor into decisions about Mr. Powell's speaking schedule, a person familiar with the matter said. The Fed disables live comments for events shown on its own YouTube page, including the chairman's regular news conferences.
Serious observations occasionally appear in the chat rooms, but they are few and far between.
Some professionals say they pay scant attention. Nela Richardson, chief economist at payroll giant Automatic Data Processing Inc., said she has never even noticed the message boards because she is usually multitasking while Mr. Powell speaks, with only the sound on.
It's impossible to identify many commenters because YouTube, where most of Mr. Powell's live events are broadcast, displays only usernames. Many appear to be traders or investors. Some complain about having to stay awake late at night to watch Mr. Powell speak, suggesting they are in distant time zones.
"Don't taper plz," wrote Nigel Ng, a day trader in Singapore, during the Princeton University event in January.
Tapering refers to the eventual scaling-back of asset purchases by the Fed, which has been buying at least $120 billion a month of Treasury and mortgage-backed securities since June to hold down borrowing costs. The Fed says it doesn't plan to begin to taper until the economy recovers further.
Reached via Facebook, Mr. Ng said he had only recently begun following the Fed chairman's appearances and was just joking around on the message board. He added he thought that Mr. Powell's voice sounded weird and that his background, a living room with a kitchen behind it and no visible windows, "wasn't very flattering."
An especially popular refrain in the chats is a Fed-related meme, "Brrrr" That's the sound of the central bank printing money, according to the joke. It emerged in March 2020 as the Fed aggressively eased monetary policy to help the economy withstand lockdowns.
Some liken the Fed's asset purchases, a process that takes place entirely over computer networks, to money printing. Physical currency is produced by the U.S. Bureau of Engraving and Printing, a part of the Treasury Department.
Kyle Koshiyama, a 24-year-old cryptocurrency trader in Ann Arbor, Mich., said he tunes in to at least one or two appearances by Mr. Powell a month and routinely wades into the conversation.
"If I'm going to watch it, I'm 100% jumping in on the message board," Mr. Koshiyama said. "I'm trying to throw feelers out, seeing what people think about certain asset classes, or what's the general sentiment regarding any specific thing Powell's talking about."
He described the chats as an "intellectual king of the hill," in which certain participants try to drive the direction of the conversation.
The chat boards' content often can run counter to the messages the Fed wants to convey. During the January event, a Korean-language commenter asked for a translation of Mr. Powell's remarks.
Another viewer responded: "It's a bubble right now. I'm going to raise the interest rate."
Mr. Powell has played down the risk of financial bubbles and has repeatedly said rate increases are a long way off.
Write to Paul Kiernan at paul.kiernan@wsj.com
(END) Dow Jones Newswires
04-16-21 1639ET
