NY Fed

I gave a seminar at the NY Fed last Monday. They have assembled a lively and high quality applied micro group that made for a most enjoyable day.

I do, however, have to tell one story about the visit. My wife and I spent the weekend before my talk in NYC as tourists. Our luggage consists of two nearly identical black Tumi roller bags. On Sunday, when my wife went home, she ended up - all my fault, sadly - with the incorrect bag. Back to Ann Arbor went my razor and my clothes for the seminar while the dirty clothes from the weekend stayed in NYC.

So, on Monday morning I rushed around downtown NYC trying to find nicer clothes than the ratty jeans and old polo shirt that I had available to wear to my NY Fed seminar. I learned that the Gap and the Banana Republic in the World Financial Center - I was staying in a very nice Marriott one block from Ground Zero - though they open surprisingly early, serve only very thin people. Neither had a single pair of pants in my waist size (nor more than a token pair or two in sizes two or even four inches smaller). However, the clerk at the Banana Republic pointed me to the true NYC experience that is Century 21. Amidst its glorious chaos, which is much less posh than you would expect from the web page, and with the help of some cheerful but not really English-speaking clerks, I bought a pair of dress pants, four shirts, two ties and three pairs of black socks, name brands all, for about $150. If I had had more time, I would have bought more, but I was already a few minutes late for the start of my schedule at the Fed.

So I was feeling pretty good about myself when I showed up at the Fed in my new clothes. My good mood was only heightened by the disappointment felt by the two police officers at the entrance (both a bit carried away with the minor amount of power bestowed on them by their position) when they discover after 10 minutes of skeptical interaction with me that I am in fact a legitimate visitor who must be admitted to the sacred halls of the Fed. The only minor worry I had related to the fact that I did not have time to buy new shoes, and so was wearing some nice tennis shoes, but not dress shoes, with my spiffy new Century 21 pants, shirt and tie. But, since economists by and large do not pay any attention to shoes, I figured I would be okay.

While the economists did indeed appear not even to notice my tennis shoes, the host at the Fed's dining room did. It turns out that under the new NY Fed president who replaced Tim Geitner sartorial standards have been raised. Because of my tennis shoes, my hosts and I were refused entrance to the Fed dining room. This is not an isolated occurrence; one of my hosts had been kicked out of the dining room in the middle of a meal the previous week for wearing jeans.

What to think of this? Well, it makes for a good anecdote, and the cafeteria we went to instead had a very fine salad bar, so I may actually be better off in terms of my health and did not pay much, if any, price in terms of food quality.

On the other hand, this seems an odd way to treat guests. My hosts were very apologetic, though of course it was not their fault I was surprised rather than offended, but I can imagine that some guests might be quite offended indeed. Is the cost in terms of potentially offended guests (and annoyed staff) really worth it just to save the bankers and finance economists from having to look at labor economists experiencing a bad draw from the dress-up distribution?

I am also puzzled that the new president of the NY Fed would have time to bother with such things in the midst of a financial crisis. Perhaps the crisis is to be blamed on the poorly dressed? This choice sends a signal about form versus substance that I do not think the Fed really wants to send.