Is the New York Fed Too Deeply Conflicted to Regul
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Posted On: 12/31/2013 2:48:11 PM
Is the New York Fed Too Deeply Conflicted to Regulate Wall Street?
By Pam Martens
December 30, 2013
William C. (Bill) Dudley, President of the Federal Reserve Bank of New York
The Federal Reserve System that is charged with setting monetary policy in the United States consists of a Board of Governors in Washington, D.C. and 12 regional Federal Reserve Banks. The Board of Governors functions as an independent government agency – its Board is appointed by the President of the United States but its funding comes from the regional Federal Reserve Banks.
Slowly, like a tiny Goldfish in a large tank of water that grows over time into a monster fish capable of clobbering anything else placed in the tank, one of the 12 regional Federal Reserve Banks has obtained unique powers not shared by the 11 other regional Federal Reserve Banks.
This is just a partial list of how the New York Fed is unique among its peers:
The President of the New York Fed sits permanently on the Federal Open Market Committee (FOMC). The Presidents of the other 11 regional banks rotate on the FOMC;
Although there is no law requiring that the New York Fed should be the sole regional Fed Bank to conduct the open market operations of the FOMC, it has uniquely served in this function since 1935;
It is the only regional Fed Bank to have its own trading floor and speed dials to the largest firms on Wall Street;
It is the only regional Fed Bank to be allowed to intervene in foreign exchange markets;
The New York Fed, uniquely among the regional Fed Banks, stores gold for foreign central banks, governments and international agencies;
The New York Fed played a uniquely controlling role in the disbursement of trillions of dollars in loans to foreign and domestic banks during the 2007 to 2010 meltdown of Wall Street;
And, problematically, while needing the good will of Wall Street firms to carry out its open market operations mandate, it simultaneously functions as a primary regulator to some of the largest firms.
The Trading Desk at the New York Fed Has Speed Dials to Wall Street Firms and Bloomberg Terminals
Over the past several years, Wall Street On Parade has identified for its readers a raft of conflicts of interests at the New York Fed that would not be tolerated at any other financial regulator. For example, its Board of Directors has routinely included the CEOs of the very same Wall Street firms it regulates.
Continued at:
http://wallstreetonparade.com/2013/12/is-the-...ll-street/
By Pam Martens
December 30, 2013
William C. (Bill) Dudley, President of the Federal Reserve Bank of New York
The Federal Reserve System that is charged with setting monetary policy in the United States consists of a Board of Governors in Washington, D.C. and 12 regional Federal Reserve Banks. The Board of Governors functions as an independent government agency – its Board is appointed by the President of the United States but its funding comes from the regional Federal Reserve Banks.
Slowly, like a tiny Goldfish in a large tank of water that grows over time into a monster fish capable of clobbering anything else placed in the tank, one of the 12 regional Federal Reserve Banks has obtained unique powers not shared by the 11 other regional Federal Reserve Banks.
This is just a partial list of how the New York Fed is unique among its peers:
The President of the New York Fed sits permanently on the Federal Open Market Committee (FOMC). The Presidents of the other 11 regional banks rotate on the FOMC;
Although there is no law requiring that the New York Fed should be the sole regional Fed Bank to conduct the open market operations of the FOMC, it has uniquely served in this function since 1935;
It is the only regional Fed Bank to have its own trading floor and speed dials to the largest firms on Wall Street;
It is the only regional Fed Bank to be allowed to intervene in foreign exchange markets;
The New York Fed, uniquely among the regional Fed Banks, stores gold for foreign central banks, governments and international agencies;
The New York Fed played a uniquely controlling role in the disbursement of trillions of dollars in loans to foreign and domestic banks during the 2007 to 2010 meltdown of Wall Street;
And, problematically, while needing the good will of Wall Street firms to carry out its open market operations mandate, it simultaneously functions as a primary regulator to some of the largest firms.
The Trading Desk at the New York Fed Has Speed Dials to Wall Street Firms and Bloomberg Terminals
Over the past several years, Wall Street On Parade has identified for its readers a raft of conflicts of interests at the New York Fed that would not be tolerated at any other financial regulator. For example, its Board of Directors has routinely included the CEOs of the very same Wall Street firms it regulates.
Continued at:
http://wallstreetonparade.com/2013/12/is-the-...ll-street/
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