(The opinions expressed here are those of the author, a

columnist for Reuters.)

By Jamie McGeever

ORLANDO, Florida, June 23 (Reuters) - As the world marks the

passing of former Federal Reserve Chair Alan Greenspan, who died

on Monday aged 100, it's almost fitting that the U.S. central

bank is entering a period of "less is more" when it comes to

communications - something the "maestro" himself would have

approved of.

Greenspan said many things during his 19-year tenure as Fed

chair, but one remark to lawmakers in 1987 resonated more than

most: "If I seem unduly clear to you, you must have

misunderstood what I said."

New chair Kevin Warsh has made it unduly clear that he wants

to steer the Fed away from its post-Global Financial Crisis path

of forward guidance, "dot plots" and running commentary on the

economy, moving back to the more opaque messaging of the

Greenspan era.

While having 19 Fed officials make regular public

appearances was always prone to creating too much noise and

mixed signals, veering too far the other way risks creating a

communications void. And voids tend to be filled with

speculation, uncertainty, and, for markets, volatility.

It's therefore perhaps unsurprising that investors right now

have as little visibility about Fed policy in the coming months

as they have had at any point in the two decades since Greenspan

stepped down.

CITI VS BOFA

The Warsh Fed will be very different from those presided

over by Ben Bernanke, Janet Yellen, and Jerome Powell, as last

week's policy statement and Warsh's first press conference

indicated.

UBS's Jonathan Pingle warns that market participants should

brace for a "communications vacuum" and figure out for

themselves what information and signals from the central bank

they should prioritize. "With less information provided, more

care might be needed," he and his team wrote on Monday. "That

may produce some trial and error."

That's already playing out. Analysts and investors are

struggling to get a sense of what Warsh's lodestar is, a

scramble reflected by a remarkable divergence in Fed rate calls

between two of Wall Street's biggest banks.

Economists at Bank of America ( BAC ) on Monday said they now expect

three 25-basis-point interest rate hikes this year. Previously,

they had said the Fed would stand pat this year and ease twice

in the second half of next year.

Meanwhile, economists at Citi, among the most dovish on the

Street, are standing by their long-held call for the Fed to cut

rates three times, although last week they pushed their timeline

back by a month. They now predict 75 basis points of easing by

January next year, as opposed to December this year.

The contrast between the two is remarkable: their respective

views on Fed policy over the next six months or so diverge by a

whopping 150 basis points. That would be a significant chasm

over a 12- or 18-month horizon, let alone a six-month one.

FED TRANSPARENCY - AN OBLIGATION?

This divergence is understandable, however, given the mixed

signals in today's economic data and the removal of forward

guidance.

Those arguing for tighter policy make the simple point that

inflation is too high. It has been above the Fed's 2% target for

five years and is fast approaching 4%. The cost of money must

rise to push inflation back to target.

The Fed's statement, staff projections and Warsh's press

conference also tipped the balance for BofA's team, with all

three indicating that the Fed's reaction function is likely to

be more hawkish than it was under Powell's stewardship.

Meanwhile, Citi's economists insist the labor market is more

important. It will notably weaken in the coming months, stoke

disinflation, and pave the way for rate cuts. The only reason

they pushed back the timing of these cuts is that they now

believe it will take longer for Fed officials to reach that

consensus.

Differing views are what make a market, right? And forcing

investors to focus on analyzing economic data - not "Fedspeak"

- may be exactly what Warsh wants.

But the transition for a generation of investors raised on a

surfeit of Fed communication will be bumpy. Pricing assets,

especially the front end of the Treasury market, may become a

particularly fraught endeavor.

While Greenspan's "misunderstood" quote from 1987 is one of

his most enduring, it's worth remembering that it was said

semi-jokingly. He frequently lauded Fed transparency, which he

said improved market functioning and enhanced the central bank's

credibility.

"Openness is an obligation of a central bank in a free and

democratic society," he said in 2001.

Warsh's view is that openness went too far, demanding a

dramatic correction. We'll soon find out if he is right.

(The opinions expressed here are those of the author, a

columnist for Reuters)

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(By Jamie McGeever

Editing by Marguerita Choy)