Federal Reserve leaders to sell stocks to avoid perception of conflict of interest.
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Dallas Fed Chairman Robert Kaplan holds 27 stock, fund or alternative asset holdings valued at over $1 million each, according to financial information he disclosed to The Wall Street Journal.
Before joining the Dallas Fed, Kaplan spent 23 years at Goldman Sachs. At Goldman Sachs, he became a partner in 1990 and went on to become vice-chairman and then senior director of the firm.
“While my financial transactions conducted during my years as Dallas Fed president have complied with the Federal Reserve’s ethics rules, to avoid even the appearance of any conflict of interest, I have decided to change my personal investment practices,” Kaplan said in his statement.
In disclosure statements initially made public by the Wall Street Journal, Kaplan had 27 stock, fund or alternative asset holdings valued at over $1 million each, including Apple, Alibaba, Amazon, Facebook, Google, Tesla, Delta Airlines, Chevron and Boeing . He also had 22 buying or selling transactions valued at over $1 million each.
A disclosure from the Boston Fed showed that its president, Eric Rosengren, also was an active trader last year.
Both men defended their actions as consistent with their respective bank’s code of conduct policies, but said they didn’t wish to create any perception that their trading of securities and investments would conflict with their role in setting monetary policy. Both men said the sale of their holdings would be complete by Sept. 30.
Rosengren and Kaplan’s trading activities drew sharp criticism at a time the Fed is already under fire from some quarters for monetary policies that have elevated asset prices, which disproportionately benefit wealthier Americans.
“At a time when they are being roundly criticized and to the extent to which the policies have made the rich richer, you need to question the optics of what these guys were doing,” said Mark Spindel, chief investment officer of Potomac River Capital in Washington.
“Doing things like this, although not prohibited by the rules, shows poor judgment and really hurts the reputation of the Fed,” said Roberto Perli, a partner at Cornerstone Macro LLC and a former Fed economist.
Rosengren’s disclosure listed stakes in four separate real estate investment trusts and disclosed multiple purchases and sales in those and other securities. Those investments raised eyebrows because he has publicly warned about the risks in commerical real estate. He has also advocated for the Fed to consider scaling back its MBS purchases faster than Treasuries to avoid overheating the housing market.
Claims that not only is the market rigged and manipulated by the Fed but that it is rigged directly for the benefit of Fed members like Kaplan and Rosengren who – whether they intended or not – benefited monetarily from their own decisions and their inside information that nobody else was privy to.” — Zero Hedge
Data Now Suggest September Taper Announcement Start October.
Kaplan: “Dump it all”…
I looked up Robert Kaplan in a book called “Fed Up”. The author mentions him on only two pages but I thought those two pages were interesting. Excerpts from “Fed Up”….
“Harvard professor Robert S. Kaplan was named president of the Dallas Fed. During his 23 years at Goldman Sachs, Kaplan rose to vice-chairman of Goldman Sachs Group. When he left in 2006, he was bestowed the honorary title of Senior Director.”
“By 2009, one-third of the Federal District Banks — four out of twelve were now controlled by Goldman alums. The result was predictable.”
“Goldman has positioned players on the Fed’s chessboard, including paying $675,000 to Democratic presidential candidate Hillary Clinton for three speeches.”
“In 2017, four out of the five District Bank presidents eligible to vote on the FOMC (The Federal Open Market Committee — which is the monetary policymaking body of the Federal Reserve System) will be Goldman alums.
“They (Members of The Fed) are arguably more powerful than political leaders chosen by voters.”
September 10, 2021 at 3:23 PM #444840salemcourtParticipant
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September 10, 2021 at 3:46 PM #444844
September 10, 2021 at 3:59 PM #444847gordyflParticipant
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Plutocrats at some point in their lives say to themselves “I can’t believe I’m getting away with this!”
September 10, 2021 at 5:49 PM #444854
September 13, 2021 at 10:07 AM #445221
September 19, 2021 at 5:03 PM #446195
September 19, 2021 at 5:10 PM #446199
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