New Federal Reserve Bank Chairmen and Deputy Chairmen Have Been Announced for Year 2006

The Fed Reserve Board has announced the appointment of new chairmen and new deputy chairmen for the nation's 12 Reserve Banks for 2006. Details can be found below in the snippet from the press release issued today:

"The Federal Reserve Board on Wednesday announced the appointment of the chairmen and deputy chairmen of the twelve Federal Reserve Banks for 2006.

Each Reserve Bank has a nine-member board of directors. The Board of Governors in Washington appoints three of these directors and each year designates one of its appointees as chairman and a second as deputy chairman.

Following are the names of the chairmen and deputy chairmen appointed by the Board for 2006:

Boston
Blenda J. Wilson, President and Chief Executive Officer, Nellie Mae Education Foundation, Quincy, Massachusetts, named Chairman.

Lisa M. Lynch, Academic Dean and William L. Clayton Professor of International Economic Affairs, The Fletcher School, Tufts University, Medford, Massachusetts, named Deputy Chairman.

New York
John E. Sexton, President, New York University, New York, New York, renamed Chairman.

Jerry I. Speyer, President and Chief Executive Officer, Tishman Speyer Properties, New York, New York, renamed Deputy Chairman.

Philadelphia
Doris M. Damm, President and Chief Executive Officer, ACCU Staffing Services, Cherry Hill, New Jersey, named Chairman.

William F. Hecht, Chairman, President, and Chief Executive Officer, PPL Corporation, Allentown, Pennsylvania, named Deputy Chairman.

Cleveland
Charles E. Bunch, Chairman and Chief Executive Officer, PPG Industries, Inc., Pittsburgh, Pennsylvania, named Chairman.

Tanny Crane, President and Chief Executive Officer, Crane Group, Cleveland, Ohio, named Deputy Chairman.

Richmond
Thomas J. Mackell, Jr., Director, National Investment Managers, Inc., Warrenton, Virginia, renamed Chairman.

Theresa M. Stone, Chief Financial Officer, Jefferson-Pilot Corporation, and President, Jefferson-Pilot Communications Company, Greensboro, North Carolina, renamed Deputy Chairman.

Atlanta
David M. Ratcliffe, Chairman, President, and Chief Executive Officer, Southern Company, Atlanta, Georgia, renamed Chairman.

V. Larkin Martin, Managing Partner, Martin Farm, Courtland, Alabama, renamed Deputy Chairman.

Chicago
Miles D. White, Chairman and Chief Executive Officer, Abbott Laboratories, Abbott Park, Illinois, named Chairman.

John A. Canning, Jr., Chairman and Chief Executive Officer, Madison Dearborn Partners, Inc., Chicago, Illinois, named Deputy Chairman.

St. Louis
Walter L. Metcalfe, Jr., Partner, Bryan Cave LLP, St. Louis, Missouri, renamed Chairman.

Irl F. Engelhardt, Chairman and Chief Executive Officer, Peabody Energy, St. Louis, Missouri, named Deputy Chairman.

Minneapolis
Frank L. Sims, Corporate Vice President, Transportation, Cargill, Inc., Wayzata, Minnesota, named Chairman.

James J. Hynes, Executive Administrator, Twin City Pipe Trades Service Association, St. Paul, Minnesota, named Deputy Chairman.

Kansas City
Robert A. Funk, Chairman of the Board and Chief Executive Officer, Express Personnel Services International, Oklahoma City, Oklahoma, renamed Chairman.

Lu M. Cordova, President, CTEK Venture Centers, Denver, Colorado, named Deputy Chairman.

Dallas
Ray L. Hunt, Chairman, President, and Chief Executive Officer, Hunt Consolidated, Inc., Dallas, Texas, renamed Chairman.

Anthony R. Chase, Chairman and Chief Executive Officer, ChaseCom, L.P., Houston, Texas, named Deputy Chairman.

San Francisco
David K. Y. Tang, Partner, Preston Gates & Ellis LLP, Seattle, Washington, named Chairman.

T. Gary Rogers, Chairman and Chief Executive Officer, Dreyer's Grand Ice Cream, Oakland, California, named Deputy Chairman."

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Fed Funds Rate Goes Up Another 25 Basis Points; The Published WSJ Prime Rate Set To Do The Same

Today, The Fed decided to continue with their incremental rate raising strategy and raised the Fed Funds Rate (FFR) by 25 basis points (or 0.25 percentage points) to 4.0%. This is the 12^th consecutive 25 basis point increase of the FFR, and the Fed probably won't stop raising the FFR until the so called "neutral" rate is reached (intelligent guesstimates have the neutral centered @ 4.5%.), so you can expect another 25 basis point increase when the Federal Open Market Committee (FOMC) meets again in December.

Fuel prices are still relatively high, and hurricane season won't be over until the end of November(!) But the economy is still doing OK, growing by an estimated 3.8% in the 3^rd quarter, so today's increase didn't meet any resistance by any of the FOMC members.

Within a day or two, the published Wall Street Journal Prime Rate will go up by 25 basis points to an even 7%. Another 25 basis point increase to the published prime rate is expected after the Fed meets in December.

Here's a snippet from a press release issued by the FOMC today:

"The Federal Open Market Committee decided today to raise its target for the federal funds rate by 25 basis points to 4 percent.

Elevated energy prices and hurricane-related disruptions in economic activity have temporarily depressed output and employment. However, monetary policy accommodation, coupled with robust underlying growth in productivity, is providing ongoing support to economic activity that will likely be augmented by planned rebuilding in the hurricane-affected areas. The cumulative rise in energy and other costs has the potential to add to inflation pressures; however, core inflation has been relatively low in recent months and longer-term inflation expectations remain contained.

The Committee perceives that, with appropriate monetary policy action, the upside and downside risks to the attainment of both sustainable growth and price stability should be kept roughly equal. With underlying inflation expected to be contained, the Committee believes that policy accommodation can be removed at a pace that is likely to be measured. Nonetheless, the Committee will respond to changes in economic prospects as needed to fulfill its obligation to maintain price stability.

Voting for the FOMC monetary policy action were: Alan Greenspan, Chairman; Timothy F. Geithner, Vice Chairman; Susan S. Bies; Roger W. Ferguson, Jr.; Richard W. Fisher; Donald L. Kohn; Michael H. Moskow; Mark W. Olson; Anthony M. Santomero; and Gary H. Stern."

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