Anecdotal Inormation MakesRaw Data Breathe
By David A. Sapenaro, frst vice president o the Federal Reserve Bank o St. Louis
he ollowing is a hypothetical snapshot o sixmonths in a small Midwestern town: A banker decides to open a branch oce in a neighboringtown. A actory has to cut its labor orce. A armer has a mixed growing season. A residential real estaterm reduces prices to sell more o its inventory.Those stories by themselves are mere anecdotes. Butanecdotal inormation rom people who make day-to-day business decisions is extremely useul to the FederalReserve because such inormation helps us clearly seewhat is happening in the economy and understandwhat fuctuations in ormal data may mean.When the Federal Open Market Committee(FOMC) meets, the Fed’s Board o Governors andReserve bank presidents give their views on theeconomic outlook. In crating monetary policy,the FOMC consults several ormal and inormalsources—which include anecdotes. Among thesources we use in the Eighth District are:
We invite bankers, businessowners, academics, community leaders and othersto these networking orums. While the primaryinternal Fed “audience” is St. Louis Fed President BillPoole, I oten participate in these orums as well togain a better understanding o the communities in our Fed region to ensure that the orums are designed andacilitated in a manner that provides Mr. Poole withthe best inormation possible.
We established these councilsthis year to acquire high-level reports on the agri-business, health care, real estate and transportationindustries in the Eighth District. Leaders in thoseindustries meet with Mr. Poole to discuss trends andissues in their respective business sectors.
Business leader luncheons.
We oten invitebusiness leaders to a lunch with Mr. Poole and someo our senior ocers and economists. One o thepurposes is a mutual exchange o inormation on thelocal/regional economy.
is publishedtwo weeks beore each FOMC meeting. It’s a closelywatched document o economic trends based oninormation and data gathered rom reliable sourcesthroughout the nation, including Mr. Poole’s sourcesin the Eighth District.
Boards of directors.
Finally, we have our boardso directors, each o which is amiliar with the eco-nomic and credit conditions in the District and pro-vides Mr. Poole with inormation on a monthly basis.We have the board o directors or the St. Louis oce(nine members), and also or each o our three branchoces (seven members each).Bankers in the Eighth District are integrallyinvolved in these activities including our economiccouncils and our boards o directors. Without theanecdotal inormation that you and others provide,we’re let with raw data—which can tell us onlyso much. Your assistance makes the raw databreathe, and helps the Fed and FOMC makeinormed decisions.
w w w . s t l o u i s f e d . o r g
he Federal Reserve System and the Clearing House Payments Co.recently conducted a joint research study into the wire transerprocess to understand and anticipate the uture o wire payments.(The Clearing House is a company that provides payment servicesand is jointly owned by several U.S. banking afliates.)The study,
Business to Business Wire Transfer Payments: Customer Preferences and Opportunities for Financial Institutions
, examinesthe issues acing organizations that routinely make wire transerpayments, the motivations driving payment decisions and potentialopportunities or growth in wire payments.Among other fndings, the study concludes that most corporatepayments today are paper-based, but they are likely to migrate toelectronic payments such as wire transers and ACH, over time. Smalland large companies are looking or a more streamlined way to makewire transers, and they are willing to pay or a more efcient process.Read the study at www.rbservices.org/Wholesale/pd/wire_transer_research_fnal.pd.
Joint Study Explores Future of Wire Payments