Friday Follies

The Fed changes numbers

Every Friday afternoon at precisely 4:10, the Federal Reserve releases the money-supply figures for the previous week to an eagerly waiting financial community. Short-term interest rates often immediately shoot up or sink on the basis of that report.

The Federal Reserve has long complained that investors pay too much attention to the Friday-afternoon statistics. It argues that the weekly figures gyrate far too much to be reliable guides to the growth of the money supply. Officials also fret that the wide swings in the numbers, which can rise or fall by billions of dollars in a single week, cause public doubts about the Federal Reserve's ability to control the growth of money.

Last week the Fed indicated that it wants to change the script of the Friday follies. It proposed publishing seasonally adjusted figures for a four-week period rather than for just one week. Statistics for the longer period are not expected to show the often wild fluctuations of the weekly ones. The board is to make a final decision within four weeks.

The changes may help calm troubled money markets, but many experts are unimpressed. Says Edward Yardeni, a financial economist for E.F. Hutton: "There will soon be a cottage industry of economists who will figure the weekly numbers and give out the data anyway." Despite the Federal Reserve's efforts, the new money-supply figures will probably be tracked as closely as the old ones.

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