Soft-pedaling Hard News About the Economy

News of the collapse of Silicon Valley Bank and Signature Bank have some consumers concerned about their own money. And despite the federal government’s quick work to guarantee depositors’ accounts, the prospect of a banking crisis adds a few more black clouds on the economic horizon.

When publicly traded companies have news to report, their marketing and communications departments work to wrap it in an overall bouquet of optimism. Dismissing present problems in favor of future prosperity, corporate reports are designed to ease the minds of nervous investors and calm Wall Street’s nerves.

But when it is a government statement meant to calm consumer fears, the messaging shifts from flowery prose to flaccid language. Where the private sector brushes past economic headwinds to proclaim a “Year of Efficiency,” public announcements offer vague pleasantries and boiler-plate platitudes.

In a recent speech on innovation in the banking system, Federal Reserve Board Gov. Michelle Bowman prefaced her remarks with a few words on current events. Characterizing the actions taken by the Fed, along with the Federal Deposit Insurance Corp. as designed to “limit the direct and indirect risks to the U.S. financial system,” she offered consumers assurances with a few well-worn words of wisdom.

“The U.S. banking system remains resilient and on a solid foundation, with strong capital and liquidity throughout the system,” Bowman said. “The (Federal Reserve) Board continues to carefully monitor developments in financial markets and across the financial system.”

If some of that sounds familiar, it should. Much of the same language appeared in press releases from the FDIC and in testimony from Treasury Secretary Janet Yellen before a Senate committee.

“I can reassure members of the Committee that our banking system remains sound, and that Americans can be confident that their deposits will be there when they need them,” Yellen said in prepared remarks.

The same prose found its way into yet another official statement, this time from Yellen and Fed Chair Jerome Powell in a response to the problems at Credit Suisse, with praise for the Swiss government and assurances to the American public.

“The capital and liquidity positions of the U.S. banking system are strong, and the U.S. financial system is resilient,” the release stated.

Hopeful yes, but not particularly inspiring. And most Americans expect the Fed to always be monitoring developments in the financial markets – and across the economy at large.

But in our instant information age, where a lie gets around the world in the time it takes the truth to boot up its computer – hat tip to Mark Twain – generalized statements that are the rhetorical equivalent of “Don’t worry about it” aren’t going to be enough.

While it is expected that the prose style of government bureaucracies tends to be formalistic and stilted – when it is not buried under statistics and jargon – public announcements should offer more than cut-and-paste wording that sounds like it comes from a file of buzz words and catch phrases organized by the nature of the current emergency. It almost makes one curious what nuggets the folder market “global depression” has inside it. Let’s hope we never find out.

In the meantime, with concerns about the economy a daily media topic, clear language and honest explanations from government officials is not too much for ask for. But it may be too much to expect.