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Federal Reserve Board Governor Daniel Tarullo (L) applauds new Federal Reserve Board Chairwoman Janet Yellen after administering the oath of office to Yellen at the Federal Reserve Board in Washington February 3, 2014.
Federal Reserve Board Governor Daniel Tarullo (L) applauds new Federal Reserve Board Chairwoman Janet Yellen after administering the oath of office to Yellen at the Federal Reserve Board in Washington February 3, 2014.
(Jim Bourg/Reuters)

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There’s nothing wrong with Fed’s forward guidance

Alan Greenspan had an important message to send about bubbling stock markets. So how did he do it? He buried it in a dozen dense sentences at the end of a speech at a boozy, black-tie dinner.

“It was pretty hard to process, especially if you’d had a drink or two during the cocktail hour and were hungry for dinner to be served,” Mr. Greenspan recalled in The Age of Turbulence, the former Federal Reserve chairman’s memoir from 2007.