ConnectOne Bank CEO: what Kevin Warsh’s ‘quieter Fed’ can teach CEOs about communicating uncertainty
Source: Fortune ·
There is an important difference between giving people certainty and giving them clarity, and Kevin Warsh is wrestling with that distinction in real time.
From the source
In business, economic uncertainty has a way of putting pressure on leaders to provide answers before they actually have them. Employees want to know where the company is headed, clients want to know what comes next, and investors want to understand what you are seeing. The more complicated the environment, the greater that pressure becomes, and often the real challenge is that you simply do not have an answer yet. That is why I have always believed there is an important difference between giving people certainty and giving them clarity, and we are watching Federal Reserve Chair Kevin Warsh wrestle with that distinction in real time. Warsh has made it clear that he wants a Fed that communicates differently. He has pulled back from the kind of forward guidance markets have become accustomed to and has been more guarded about predicting what the Fed might do next. The basic idea makes sense: why lock yourself into tomorrow’s decision when tomorrow’s facts may be different? You do not…