’ m sure that many of you have questions about that journey. the answers to all of your questions – and probably more – are on a new website that the fed has created at federalreservehistory. org. i encourage you to visit this site to learn more about the people, places and events that have shaped federal reserve history. i won ’ t say too much more about fed history – perhaps to the relief of some of you! – but i do want to address one of the things that i think has changed the most over the federal reserve ’ s history : our communication with the public. a hundred years ago, congress created a system that was designed specifically so that the residents of main street would have a voice in monetary policy. technology has changed a lot since 1914 – i ’ m told that they didn ’ t even have smartphones back then – and so the ways that we gather information from main street have changed. but this fact - finding is still an important part of the making of monetary policy. indeed, earlier today, i met with fargo business leaders to gather exactly this kind of information. communication is a two - way street, however. during the past century, the federal reserve ’ s communications to the public about its monetary policy actions have also evolved greatly. the pace of change was especially rapid in the past eight years under chairman bernanke ’ s leadership. during that time, the federal reserve specified an explicit target for inflation, began holding regular press conferences and greatly expanded its use of forward guidance – that is, its communications about the likely future evolution of policy. so, as the federal bis central bankers ’ speeches reserve system plans for its second century, i would say that the importance of two - way communication is a key lesson from the system ’ s first century. in order for the fed to continue to be effective, it needs to communicate its policy decisions transparently to the public. conversely, it also needs the public ’ s input into how those policies are affecting them. events like the one today, and my meeting with business leaders earlier today, are a key part of fostering that two - way communication. with that background in mind, let me turn back to the federal open market committee and the making of monetary policy. i mentioned that the fomc meets eight times per year. at those meetings, we decide on the level of monetary stimulus for the economy. i won ’ t get into too many details of what that term “ monetary stimulus ”

means, although i ’ m sure that i ’ ll be taking questions about it later. what is the fomc seeking to achieve by varying the level of monetary stimulus? congress has charged the fomc with making monetary policy to promote price stability and to promote maximum employment. the fomc has interpreted the first goal, price stability, to mean keeping inflation close to 2 percent. the fomc ’ s job is to vary monetary stimulus over time to meet these mandated objectives. right now, personal consumption expenditure ( pce ) inflation is running well below 2 percent and is expected to continue to do so for several years. by many measures, employment remains low and is expected to remain so for several years. those results are not as good as they should be – we ’ re undershooting on inflation and underperforming on employment. i look forward to working with my colleagues to use our monetary policy tools to achieve better macroeconomic outcomes. thanks again, and now let ’ s move on to your questions. bis central bankers ’ speeches