Search Results for: is the new york fed too conflicted

By Pam Martens and Russ Martens: April 7, 2015  Thanks to the Federal Reserve feeding its habit for six years, the U.S. stock market now reacts like a junkie who needs a constant fix from the reassurance of zero, or extremely low, interest rates. William (Bill) Dudley, the President of the New York Fed, was peculiarly on hand yesterday morning to feed the addiction with a speech to members of the Business Partners Roundtable at the New Jersey Performing Arts Center in Newark, New Jersey. Anytime a President of a regional Fed Bank makes a public statement on the timing of interest rate hikes or the pace of economic activity that influences that timing, it is well established that it moves stock, bond and currency markets. But yesterday was not just any routine day – it was a particularly odd day for any Fed President to speak before the stock … Continue reading →

By Pam Martens and Russ Martens: February 26, 2015 The Republicans are making good on their campaign pledge to turn up the heat on the Federal Reserve. Sparks flew in the House Financial Services Committee hearing room yesterday as Fed Chair Janet Yellen appeared to present her semi-annual testimony. At times, the exchanges between Yellen and Republican members of the Committee were sharp and tense. In his opening statement to the Committee, Jeb Hensarling (R-Tx), who chairs the Committee, blamed the “anemic” recovery on Obamacare, Dodd-Frank and regulatory costs. He went on to say that “Then there’s the doubt, uncertainty and regulatory burden that grows as more and more unbridled, discretionary authority is given to unaccountable government agencies.  Although monetary policy cannot remedy this, it can help.” Republicans are locked in some kind of mind warp where the remedy for every problem is to deregulate. Despite six years of books, … Continue reading →

By Pam Martens and Russ Martens: November 24, 2014 Last Friday, the Senate Subcommittee on Financial Institutions and Consumer Protection, chaired by Sherrod Brown, effectively put William Dudley, President of the Federal Reserve Bank of New York, in stocks in the village square and engaged in a rather brilliant style of public shaming. With each well-formed question posed by the panel, Dudley’s jaded leadership of a hubristic regulator came into ever sharper focus. There were a number of elephants in the room during the lengthy session that were only briefly touched upon but deserve greater scrutiny by the press. First, Congress knew that the New York Fed was a failed, crony regulator during the lead up to the financial collapse in 2008, but it granted it an even greater supervisory role under the Dodd-Frank financial reform legislation in 2010. This Congress has also failed to engage in public shaming of … Continue reading →

By Pam Martens and Russ Martens: November 3, 2014 The Federal Reserve Board of Governors in Washington, D.C., which functions as the central bank of the United States, has farmed out much of its Quantitative Easing (QE) programs to the Federal Reserve Bank of New York since the financial crisis of 2008. The Federal Reserve Bank of New York has, in turn, contractually farmed out a hefty chunk of the logistics of that work to JPMorgan Chase in the last six years. Sitting quietly on the Federal Reserve Bank of New York’s web site is a vendor agreement and other documents indicating that JPMorgan Chase holds all of the Mortgage Backed Securities (MBS) that the New York Fed has purchased under its various Quantitative Easing programs. As of last Wednesday, that figure was $1.7 trillion dollars. (The New York Fed has confirmed that JPMorgan is custodian for these assets.) In … Continue reading →

By Pam Martens and Russ Martens: September 26, 2014 Jake Bernstein has a financial blockbuster up today at ProPublica on the secret tape recordings made inside the New York Fed and Goldman Sachs by bank examiner turned whistleblower, Carmen Segarra, who was fired by the New York Fed after she refused to change her examination findings on Goldman Sachs. Segarra is one gutsy bank examiner and lawyer: according to the article, she went to the Spy Store, bought a tiny microphone, and proceeded to tape record two of the most powerful financial institutions in the world — 46 hours worth of tapes. Read our past coverage of the Carmen Segarra story and the deeply conflicted New York Fed at these links: Blowing the Whistle on the New York Fed and Goldman Sachs The Carmen Segarra Case: Welcome to New York, Wall Street and McJustice A Mangled Case of Justice on Wall Street … Continue reading →

By Pam Martens and Russ Martens: August 20, 2014 According to the Oxford Dictionary, the word cartel can mean either businesses that seek to restrict competition or a coalition “intended to promote a mutual interest.” Under at least the second definition, the Federal Reserve Bank of New York, a key regulator of the biggest Wall Street banks’ holding companies, has been sponsoring (yes, sponsoring) a cartel for decades. To grasp the sheer insanity of what the New York Fed is doing, imagine going to the Securities and Exchange Commission’s web site (another Wall Street regulator) and finding that it has loaned out its web site and its imprimatur to multiple Wall Street cartels writing their own rules of conduct. It sounds Orwellian doesn’t it. And yet this is the web site address for the New York Fed-sponsored Foreign Exchange Committee: http://www.newyorkfed.org/fxc/ which has been operating for the past 36 years … Continue reading →

By Pam Martens and Russ Martens: May 27, 2014 Last week, the Partnership for Civil Justice Fund (PCJF) released a trove of some 4,000 documents it obtained under the Freedom of Information Act showing that the movements of the mostly peaceful participants in the Occupy Wall Street protests were subjected to an “enormous spying and monitoring apparatus” that included coordination between the Pentagon, FBI, Department of Homeland Security, local police, private security contractors and corporate interests. Increasingly, Americans’ time-honored First Amendment rights to peacefully assemble and dissent are playing out as open-season on protesters and mass arrests, followed by years of evidence destruction or tampering in court cases. As Wall Street On Parade perused the new documents from PCJF, one in particular raised red flags. Its subject line referred to the Occupy Wall Street movement as “Friggin Occupy” and it came from a veteran police officer. The PCJF is currently … Continue reading →

By Pam Martens: November 14, 2013 The Federal Reserve system turns 100 this coming December 23. Today, for the first time, a woman will undergo a Senate confirmation hearing to lead the Fed – an historic first. But gender is the last thing on anyone’s mind today when it comes to the new Fed Chairman. The Republicans are simmering over what they feel are “easy money” policies at the Fed. Wall Street will be measuring every syllable for a hint of when the Fed’s cash punchbowl of $85 billion a month in bond purchases might end. A few Democrats will delicately quiz Yellen on her views on ending too big to fail banks. What is very unlikely to emerge amid the theatrics in the Senate Banking confirmation hearing this morning, is the most basic question of all: how did a 100-year old institution created to implement independent monetary policy in … Continue reading →

By Pam Martens: June 27, 2012 Peter Madoff, brother of convicted Ponzi artist, Bernard (Bernie) Madoff, will plead guilty this week to conspiracy to commit securities fraud and other offenses according to court papers filed today in Federal court in Manhattan.  Peter Madoff worked with his brother as chief compliance officer of the broker-dealer but has in the past denied involvement or knowledge of the Ponzi scheme which was carried out on another floor of the building from where the broker-dealer was housed.  But in the tony towns of the North Shore of Long Island, few people have ever bought that story.  Since at least 1978, Peter and Bernie Madoff solicited funds for management from wealthy country club members on the North Shore of Long Island.  The brothers promised a fixed rate of return of as much as 13 percent on a stock portfolio.  It is illegal to guarantee a fixed rate … Continue reading →