Central Banking [has been] traditionally surrounded by a peculiar and protective political mystique. Criticism of Central Banks, if it occurred at all in the political arena, [has been] muted and infrequent. The Federal Reserve operated in the USA over decades with little criticism from the public or its political representatives. The same phenomenon can be found in many other countries. The political mystique of Central Banking was, and still is to some extent, widely expressed by an essentially metaphysical approach to monetary affairs and monetary policy-making. The possession of wisdom, perception and relevant knowledge is naturally attributed to the management of Central Banks. The possession of such knowledge and perception bearing on matters of concern to Central Banking is a function of the political position. The relevant knowledge seems automatically obtained with the appointment and could only be manifested to holders of the appropriate position. The mystique thrives on a pervasive impression that Central Banking is an esoteric art. Access to this art and its proper execution is confined to the initiated elite. The esoteric nature of the art is moreover revealed by an inherent impossibility to articulate its insights in explicit and intelligible words and sentences. Communication with the uninitiated breaks down. The proper attitude to be cultivated by the latter is trust and confidence in the initiated group's comprehension of the esoteric knowledge.Things have changed a great deal since then, and the pace of change has accelerated. In a recent speech, Fed Vice Chair Janet Yellen traced this "revolution" in central bank communication, which academic economists generally regard as an improvement. It was only in 1994 that the Fed began announcing changes in the federal funds rate target, and I was pretty surprised last year when Bernanke began holding press conferences.
Given all the recent changes, I shouldn't have been surprised to see a further step towards greater central bank openness - Federal Reserve banks are now sending jokey tweets: