Book Review: Holmes’ Economy of Words

Holmes, Douglas R. Economy of Words: Communicative Imperatives in Central Banks. Chicago: University of Chicago Press, 2014. 280 pgs; $30.00.

Douglas Holmes traces how inflation targeting, a traditional analytical focus of central banker’s regulatory interventions, was enlisted in what he terms “communicative experiments” (p. 1) on the part of central banks, based on more than a decade-long ethnographic engagement with central bankers at the Reserve Bank of New Zealand, the Sveriges Riksbank in Sweden, the Bank of England in the United Kingdom, the Federal Reserve System in the United States, and at the European Central Bank in Frankfurt. These experiments, taking the form of public statements, meeting minutes, and speeches, engendered a novel monetary regime which Holmes – adopting the terminology of Mervyn King, former governor of the Bank of England – terms “public currency” (p. 19). Holmes argues that the novelty of this monetary regime rests on the premise that “the public broadly must be recruited to collaborate with central banks in achieving the ends of monetary policy, namely, ‘stable prices and confidence in the currency’” (p. 1).

Building on the insights of anthropology and the social studies of finance literature, Holmes maintains that markets are reflexive, socially created phenomena – that markets are made by people and in turn markets make up people, creating subjectivities and behavioral dispositions. Anthropologists working within the rubric of social studies of finance have brought ethnographic methods to bear on financial phenomena such as bond markets, stock markets, derivatives, elite networks, proprietary trading arms of investment banks, and the technical and legal apparatus of finance. Social studies of finance scholars have, thereby, provided a richer, more nuanced conceptualization of the behavior of actors within markets as well as accounts of experts’ analytical practices that diverge from rational choice, game theory, and other quantitative models. Holmes adds to this literature by showing how central bank technocrats recruit the public in a shared pedagogical framework, conveying a formula for interpreting policy. In particular, he is concerned with the spoken and written public communications of central bankers as they model, through language, credible and stable relationships between currencies and publics. For Holmes “markets are a function of language” (pp. 23, 61) because, given the time lag on statistical representations of the economy and the need for immediate policy action, central banks must project their representations of markets through language both forward and backward in time. Central bankers are thus shaping economic and monetary conditions “prospectively,” persuading the public that their proposed future (in the form of inflation targets, or employment targets, or exchange rate targets) can and should be made actual (pp. 5, 65, 77, 85, 94, 133).

In communicating these proposed futures, central bankers are not just interpreting economic data but making the economy both as a communicative field and an empirical fact. And, especially in relation to the financial crisis of 2007-2008, Holmes shows that central bankers are both aware of this and seek to exploit the performative nature of their representations of the econom. (pp. 23-24). In other words, it is not just numbers but also the interpretive framework imposed on qualitative and quantitative data that persuades the public and enlists their engagement and support. Addressing information asymmetries from the central banks’ point of view, Holmes provides an intriguing empirical exploration of central banker’s research practices. Moving between countries, he shows how central bankers supplement quantitative data with qualitative data gathered through fieldwork, interviews, surveys, and conversations with people in business, finance, and government. Indeed he argues that collecting information in context, rather than in the lab, forms a crucial part of central bankers’ analytical repertoire. These research practices are then used by central bankers to model the proposed reflexive relationship between the bankers and their publics. For example, qualitative data are pooled to provide knowledge about the social and cultural character of the economy that has been stripped out of quantitative data (p. 46). This carefully contrived, collaborative relationship is what Holmes views as the “radical” feature of the monetary regime of “public currency” (pp. 5-6). Indeed, he argues that because experiments “to overcome the limitations inherent in econometric projections and to address circumstances that arise at the limits of calculation and measurement” go in both directions between policy makers and the public, central bankers through their communicative experiments have “reconfigured the parameters of performativity” (pp. 24-26).

Viewing communicative competency as a defining feature of contemporary monetary policy, Holmes suggests that anthropologists who are interested in exploring future-oriented cultural practices may learn from the practices of central bankers as they pursue their “sophisticated anthropological experiments” and vice versa (p. x). For example, after attending a pre-Monetary Policy Committee meeting at the Bank of England, Holmes realized that the Bank of England might, through its qualitative analytical procedures “tap into the creative acumen” of its network (p. 187). He reasons that adding case studies of bellwether firms to the informational menu of these meetings might be one way to render these insights a basis for policy. While Holmes notes that he communicated his insight through a post-meeting questionnaire, readers are left wondering if the Bank of England’s received his reflexive feedback and acted upon it.

The issue of whether Holmes’ feedback will be heard and processed points to an important lacuna in this book: Which public is being reflexively communicated with? Holmes shows readers that the composition of central banks’ informational networks includes managers of major multinational corporations who have access to proprietary data that they can share, at least anecdotally, and seek to shape policy. And these networks also include small businesses, at least in the UK (p. 160). But, overall, it is clear that these informational networks are elite networks. While these elite networks are certainly important, they will not yield the dispositions or sensibilities or “structures of feeling” (p. 45) of non-elites. For this reason, Holmes’ claim that central bankers “are operating in concert with the public” (p. 52) remains unconvincing. As many anthropologists have shown, ordinary consumers face coercive relationships of credit and debt that differ fundamentally from those of bankers and central banks. Holmes does point to public presentations where institutional investors such as hedge funds, insurance funds, and pension funds compose the public addressed (pp. 34, 139, 141, 179-180). Yet, he does not track how collaborating with institutional investors as opposed to ordinary investors and savers may limit prospective analyses. This is a problem because regulatory capture (meaning that the financial industry captures the policy making process) has been one of the major trends of the late 20th and early 21st century. Insofar as central bankers, and supranational clubs of central bankers like the Bank of International Settlements (an institution not analyzed by Holmes) respond to elite informational networks, reflexive collaboration between central bankers and the public Holmes describes may look more like policy capture than policy collaboration. For example, the public cannot know what the European Central Bank considers compelling information gathering because, as Holmes points out, their deliberations are secret (p. 86). What other central banks say in their “open mouth operations” (p. 77) and what they do in their open market operations may be open statements about social values, but these statements may leave large swaths of the public out of the conversation.

Laura Elder, Saint Mary’s College




About Matthew Wolf-Meyer

Matthew Wolf-Meyer is an anthropologist and historian of science and medicine in the United States. He is author of The Slumbering Masses: Sleep, Medicine & Modern American Life (UMN Press, 2012), Theory for the World to Come: Speculative Fiction and Apocalyptic Anthropology (UMN Press, 2019), and Unraveling: Remaking Personhood in a Neurodiverse Age (UMN Press, 2020). He blogs at and

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