Chairman's Message

Bon Voyage, Captain Poole

I can’t think of a better way to characterize Bill Poole’s 10-year presidency at the Federal Reserve Bank of St. Louis than to summon an old expression: When sailing through rough waters, keep a steady hand at the wheel.

Whether we’re talking about the national and international economic scene or the changing operating environment here at the Bank, choppy surf has been the rule rather than the exception over the past decade—a period during which the St. Louis Fed was fortunate to have Bill, an avid sailor, at the helm. On the Federal Open Market Committee, Bill’s steady hand proved invaluable during crises such as the Asian financial meltdown, the 9/11 terrorist attacks and the recent subprime mortgage debacle.

What assuredly will be one of Bill’s lasting legacies was his advocacy of clear communications—keeping surprises to a minimum while helping the markets understand the underlying principles behind FOMC decisions. Practicing what he preaches, Bill gave nearly 150 speeches during his presidency, often speaking on the record with reporters afterward to answer their questions and help eliminate confusion. Sometimes the Federal Reserve is accused of being overly and unnecessarily mysterious. Through his actions, Bill sought to alleviate any misunderstandings or misconceptions about the Fed.

Despite serving as the Bank’s CEO for 10 years, Bill likes to say that he is always an academic at heart. And it’s the teacher in him that the Bank’s directors, both past and present, really appreciated. Typically, we board members are neither economists nor experts on the inner workings of the Federal Reserve. We rely on the president to educate us on the ramifications of FOMC actions, as well as the best options for us to consider on decisions we need to make. In this role, Professor Poole was unfailingly helpful to us.

I have been a member of the Bank’s board of directors since 2005 and have observed Bill deal with change in a calm, yet nimble, manner that befits a seasoned executive more than it does a career academic. In fact, from the time Bill arrived in 1998, he encountered a rapidly evolving business model—one that private sector companies are used to, but the Fed was not. Nevertheless, Bill and his management team embraced the changes and made decisions that proved beneficial both to the Eighth District and the Federal Reserve System. An example of an innovative efficiency during Bill’s tenure occurred in 2002, when the St. Louis and Cleveland Reserve banks formed a joint partnership to share sales and marketing functions.

In support of System-generated efficiencies, the St. Louis Fed was an early advocate of efforts to reduce redundancies across Reserve banks by converting to common software platforms for human resources and certain accounting functions. Bill also contributed to the System by serving a term as chairman of the Information Technology Oversight Committee, whose responsibilities include approving overall technology strategies and budgets for the Federal Reserve. Identifying efficiencies, though, is only one part of the story of Bill’s success. The Bank can also boast of many areas of growth and leadership during the Poole era. Three worth noting are:

• U.S. Treasury support: Since 2001, the St. Louis Fed has been the home of the Fed’s Treasury Relations and Support Office, which oversees all of the System’s U.S. Treasury-related responsibilities and manages the relationship between the two organizations. In addition, the St. Louis Bank provides a wide range of tax collection and cash management applications and services for the Treasury.

• World-class economic data: The Research division’s robust sets of online economic information and data services are renowned and relied upon worldwide. Led by the popular FRED (Federal Reserve Economic Data) database, Research’s web pages received around 60 million visits in 2007.

• Community connections: Under Bill, the four offices in the District have redoubled their focus on areas such as regional economic research, community development and economic education. Maintaining a strong link between the Fed and local communities is critical. As we have learned with the subprime mortgage crisis, many consumers have a dire need for greater understanding of economic and personal financial issues.

Before Bill embarked on his next journey—which will include being a distinguished scholar in residence at the University of Delaware and a senior fellow at the Cato Institute, and, naturally, sailing on the Chesapeake Bay near his new Maryland home—we caught up with him for a final interview. Here in the St. Louis Fed’s 2007 Annual Report, I invite you to read Bill’s reflections.

Bill, on behalf of my fellow directors and the rest of the crew here in the Eighth District, I thank you for steering us through 10 often tumultuous years. We will miss your guidance, insight and wisdom, and we wish all the best to you and your wife, Gerie.

Irl F. Engelhardt
Chairman
Board of Directors
Federal Reserve Bank of St. Louis