The Reserve Bank is the public institution that can make or break businesses, the wealth dreams of investors along with the hopes and bottom lines of mortgage holders. Our big bank is being dragged out of its century of secrecy, with its new interest rate setting board to reveal how the vote on what happens to what we pay for borrowing money was made.

The best-selling book The Secret (written by Aussie Rhonda Byrne) sold over 30 million copies. Based on the pseudoscientific belief of the law of attraction, which claims that thoughts can change a person's life directly, it was translated into 50 languages. This book does have some parallels with the RBA.

You see, economics isn’t a real science. It’s what academics call a ‘social’ science because society (i.e. people) isn’t predictable. Like many aspects of science, there’s always a degree of mystery about how collective decisions about money and demand, etc. by a population are made. It was no surprise that our central bank kept its cards close to its chest when it cut, raised or kept interest rates unchanged.

Unlike the Bank of England and the Federal Reserve in the USA, the RBA didn’t reveal much about its decisions. Economists, trained for ‘guessing’ the economy, were recruited by banks, the media and money websites to ‘guess’ what would happen at each meeting of the old Reserve Bank board.

When I was a younger participant in the media, I used to commit to economic surveys on what the RBA would do. Eventually I decided too many dumb decisions by previous boards meant I knew I wasn’t qualified to ‘guess’ what these often ‘weirdly selected’ people would decide. I excused myself from such surveys by arguing I was trained as an academic economist to say what the RBA should do, rather than speculating what they would do.

Now, because of reforms championed by Treasurer Jim Chalmers, there are three boards that run the many jobs the RBA does. And here are those three jobs:

1. There’s an interest rate setting board that most Aussies care about for obvious reasons as it will impact the rates on their loans and savings deposits.
2. A governance board for the organisational affairs and operations of the RBA, including delivery of banking services, note issuance and payments operations.
3. The Payment Systems board.

What I like is that the new interest rate (or Monetary Policy) Board will do a ‘show-and-tell’ after every decision, so we’ll know how the board voted when rates either change or don’t change. Recently, we saw something new from the RBA after the May 0.25% cut in the official cash rate of interest: there actually was debate about whether the reduction should have been a quarter or half a percent!

That was helpful information, not only about what the board debated but why some members were in favour of a bigger cut. You see, the views of board members on the size of the cut would’ve been driven by their assessment of the state of the economy. While the half percenters didn’t get up, it gave economists the clue that if the economy looks sicker after the May cut, then a July cut was a good chance.

In fact, the weak economic growth number for the March quarter of 0.2% has done exactly that. As a consequence, the majority of economists surveyed have switched from a July cut rather than the once-held August cut.

So, who are our interest rate deciders? Let me list them and their claim to fame:

1. Governor/Chair of the RBA, Michele Bullock.
2. Deputy Governor/Chair Andrew Hauser, a UK economist.
3. Marnie Baker, ex-CEO of Bendigo Bank.
4. Renee Fry-McKibbin, a smart ANU economist.
5. Ian Harper, one of Australia’s brightest economists.
6. Carolyn Hewson, former top investment banker.
7. Steve Kennedy, the country’s Treasury Secretary.
8. Ian Ross, former union leader and President of the Fair Work Commission.
9. Alison Watkins, former CEO of Coca-Cola Amatil.

While this is a good collection of smart people, ultimately, they’ll be assessed on the quality of their decisions. So far, they’ve made the right decision to cut in May. July will be a crucial test.

You have to hope that this new team will do better than many of their predecessors who made some terrible decisions and didn’t have the guts to gang up on the Governor when bad judgements were forced on the board.

While I won’t name names, there have been plenty of mistakes made by RBA leaders who were too cautious, but I do like reminding people of what Paul Keating said of the Bank in the past: "When a real crisis is upon us, the RBA is invariably late to the party”.  Keating told us this on numerous occasions and I totally agree with him on this, which isn’t always the case