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To: Bob Dobbs who wrote (25072)	12/30/1998 10:22:00 AM
From: long-gone	Read Replies (1) \| Respond to of 116955

And could this mean something? NEW YORK, Dec 23 (Reuters) - Federal Reserve Chairman Alan Greenspan will probably face fewer dissenting votes from regional bank presidents on the policy-setting FOMC next year than he did in 1998, Fed watchers said on Wednesday. The seven Fed Board governors and the New York Fed president are permanent voting members of the Federal Open Market Committee while the other 11 regional bank presidents rotate annually to fill four voting slots. Outgoing Cleveland Fed President Jerry Jordan dissented in five FOMC votes so far this year and the Cleveland Fed's William Poole dissented once. They feared that rapid money supply growth and credit creation would fuel inflation. But the four presidents who will vote in 1999 are expected to be more flexible and are not as committed as Jordan and Poole are to monetarist theories which place great importance on money supply growth, economists said. The new composition of the FOMC is not expected to alter the course of monetary policy but economists said they expect the incoming voting members to bring a more moderate tone in policy debates next year. Also, the apparent success of the Fed's three interest rate cuts from September-November in averting a credit crunch and cushioning the U.S. economy from global turbulence have cemented Greenspan's dominance in setting policy, experts said. ''I think given the success of these rapid-fire easing steps in September, October and November...Greenspan is probably more firmly in the drivers seat than he has ever been,'' said David Jones, chief economist at Aubrey G. Lanston and Co. Inc. ''There is certainly a more moderate tone in the new group of voting presidents and some shift away from hawkishness of Jordan and, to a lesser extent Poole. My sense is there will be fewer dissents,'' Jones added. Among the four outgoing presidents, Cleveland Fed's Jerry Jordan cast five dissenting votes in 1998 as of the November 17 meeting. The November FOMC meeting minutes, which included word of Jordan's fifth dissent, were released on Wednesday. Jordan dissented four times from March-August against steady policy in favor of higher rates and in November he voted against a quarter percent cut in the federal funds rate. St. Louis Fed President William Poole dissented once so far this year, at the May 21 FOMC meeting, against a decision to keep rates steady. He favored a tightening of monetary policy. Jordan, Poole, the Boston Fed's Cathy Minehan and the Kansas City Fed's Thomas Hoenig will be replaced in 1999 by Robert McTeer of Dallas, Gary Stern of Minneapolis, Michael Moskow of Chicago and Edward Boehne of Philadelphia. ''You will find most of the governors now (in 1999) less willing to dissent because they aren't so deeply theoretical,'' said William Griggs, managing director of Griggs & Santow Inc. and a former Fed economist. ''What you get is an FOMC in which you are less likely to see dissents recorded. These things are never as harmonious as it comes out in the FOMC minutes. There are always disagreements but it doesn't arise to the level of dissents on the record,'' he added. After the three rate cuts from September-November slashed the fed funds rate to 4.75 percent from 5.50 percent, the FOMC left rates unchanged at its final meeting of the year on Tuesday. It will not be known if there were any more dissenting votes until the minutes come out in the early February. If Greenspan sees a need for further rate cuts next year because of tepid U.S. growth or more global upheaval, analysts said he will face less resistance from voting bank presidents. ''They are more likely to be attracted to the middle ground and follow the chairman's leadership,'' said Dana Johnson, managing director and head of research at First Chicago Capital Markets Inc. Johnson a former economist with the Fed board in Washington, said presidents who came from within the Fed system were taught to debate things internally, then close ranks. ''Dissent was kept within the house, not aired outside of it,'' he said. biz.yahoo.com