Filmmakers have Cannes. Billionaires have Davos. Economists? They have Jackson Hole.
The world’s most exclusive economic gathering is taking place this week in the valley at the foot of the Teton mountains, at a lodge 34 miles from Jackson, Wyo.
Here, in a western-chic hotel donated to the national park that surrounds it by a member of the Rockefeller family, about 120 economists descend each late August to discuss a set of curated papers centered on a policy-related theme. Top officials from around the world can often be seen gazing out the lobby’s floor-to-ceiling windows — presumably hoping for a moose sighting — or debating the merits of a given inflation model over huckleberry cocktails.
This shindig, while a nerdy one, became the main focus of investors, academics and the Wall Street press. The host of the conference, the Federal Reserve Bank of Kansas City, seems to know a thing or two about the laws of supply and demand: It’s inviting fewer people than it wants to attend, which only serves to increase the its prestige. But more critically, Jackson Hole tends to generate big news.
The most anticipated event is a speech by the Fed chair which usually takes place on Friday morning and is often used as an opportunity for the central bank to send a signal about policy. Jerome H. Powell, the current head of the Fed, made headlines each and each one of his Jackson Hole speeches, with investors waiting anxiously for this year. It was the only part of the closed-door conference that was broadcast to the public.
Mr. will speak. Powell at a moment when the Fed’s next moves are uncertain because inflation moderates but the economy maintains a surprising amount of momentum. Wall Street is trying to figure out whether Fed officials think they need to raise interest rates this year, and if so, whether that move is likely to come in September. So far, policymakers have given few clear signals about their plans. They raised interest rates to 5.25 to 5.5 percent from near zero in March 2022, and left their options open to do more.
People will pay attention to Mr. Powell’s speech, but “I think it’s about tone,” said Seth Carpenter, a former Fed economist who is now at Morgan Stanley. “What I don’t think he wants to do is signal or commit to any near-term policy measures.”
For all its modern fame, the Jackson Hole conference, set for Thursday evening through Saturday, is not always the talk of Washington and New York. Here’s how it became what it is today.
It is set in the old wild West.
Jackson previously played host to another diverse cast of characters: The town was once so remote that it was a hideout for outlaws.
In 1920, when Jackson’s population was about 300, The New York Times harked back at a time not so distant when “whenever a serious crime was committed between the Mississippi River and the Pacific Coast, it was fairly safe to guess that the person responsible for it was on his way to Jackson’s Hole or had already arrived.”
Jackson’s isolation also meant that the area’s high, rugged mountains and rolling valleys remained pristine, making it prime territory for conservationists. Financier and philanthropist John D. Rockefeller Jr. secretly obtained and then donated much of the land that would later become the Jackson Hole part of Grand Teton National Park. And in the 1950s, he began building the Jackson Lake Lodge.
The modern architecture of the lodge is not love first of locals. (“A slab-sided, concrete abomination’ is one of the milder epithets hurled at the massive structure,” The Times quipped in 1955.) Among other complaints, Rockefeller’s donation to the park included no resort perks: no golf course, no spa. .
But in 1982, its ample space and scenic views drew attention to the Kansas City Fed, seeking a new location for a conference it had begun holding in 1978.
The gathering has been happening there since 1982.
High on the list of charms, Jackson Lake Lodge close to great fly fishing — a surefire way to appeal to the Fed chair at the time, Paul A. Volcker. He arrived, and between the A-list attendees and the natural beauty of the location, Jackson Hole quickly became the Fed event of the year.
“Almost half of the 137 people invited this year attended, a very high response,” The Times reported in 1985.
The size of the conference hasn’t changed much since: It averages about 115 to 120 attendees each year, according to the Kansas City Fed. The response rate has risen sharply since 1985, though the Fed declined to specify by how much.
But the local context has changed.
Teton County, home of Jackson (now a bustling town of 11,000) and Jackson Hole, host more millionaires than criminal cowboys these days. It became the most unequal place in America through several steps, with gaping wealth and income dividing The event, billed as rustic, now struggles to pretend its backdrop isn’t ostentatious.
And the Fed gathering itself has gained more and more cachet. Alan Greenspan delivered the opening address at the Jackson Hole conference in 1991, when he was Fed chair, and then maintained that tradition for 14 summers until he stepped down.
His successors have largely followed suit. Mr. Powell used his speeches to caution against overconfidence on hard-to-determine economic variables, to present an entirely new framework for monetary policy and to promise that the Fed will do what is necessary to combat rapid inflation.
But this is changing.
Attention to Jackson Hole also deepened in the wake of the 2008 global financial crisis, when central banks bailed out markets and propped up economies in ways that expanded their influence. In the years that followed, uninvited journalists, Wall Street analysts and protest groups began camping out in the lodge’s lobby during proceedings. Speaking at or chairing a Jackson Hole session increasingly marks an economist as an academic rock star.
Esther George, president of the Kansas City Fed between 2011 and early 2023, has been in charge since the event gained more notice. He and his team have responded to the intensified spotlight somewhat by shaking up who’s been heating it up.
Fewer economists in the banking and finance industry were hired event invitations since 2014, partly in response to public attention on the Fed’s Wall Street connections after the financial crisis. The people making the list tend to be current and former top economic officials and up-and-coming academics. Increasingly, they are women, people of different races and people with different economic views.
Ms. began to hold George of an informal happy hour for female economists in 2012, when there were so few women that “we all sat around a little table,” she recalls. He thought: “Why aren’t there other voices here?”
Last year, including happy hour dozens of women.
But the Jackson Hole conference could be entering a new era. Ms. had to George to retire in 2023 according to Fed rules, so while he helped plan this conference, he will pass the baton for future events at his successor, Jeffrey Schmid, a university administrator and former chief executive of Mutual of Omaha Bank. He started as president of the Kansas City Fed on Monday and will make his debut as a Fed official at this week’s meeting.
