原文標題：
Powell orders ethics review after Fed presidents disclosed
multimillion-dollar investments
原文連結：
https://cnb.cx/3lA9Atl
發布時間：
PUBLISHED THU, SEP 16 202111:46 AM EDT
原文內容：
-Federal Reserve Chairman Jerome Powell directed staff to review the central
bank’s ethics rules after several Fed presidents disclosed large investments
and stock trades.
-News of Powell’s inquiry broke after Sen. Elizabeth Warren sent 12 letters
to the Fed’s regional bank presidents demanding stricter ethics around stock
buying.
-Documents revealed that Dallas Fed President Robert Kaplan traded Apple,
Amazon and Delta Air Lines stock in 2020.
Federal Reserve Chairman Jerome Powell directed staff to review the central
bank’s ethics rules for appropriate financial activities after disclosures
that several senior central bank officials made multiple multimillion-dollar
stock trades in 2020, while others held significant investments.
News of Powell’s inquiry broke after Sen. Elizabeth Warren sent 12 letters
to the Fed’s regional bank presidents demanding stricter ethics from the
nation’s top central bank officials.
The Massachusetts Democrat called on each Fed president to institute a ban on
the ownership and trading of individual stocks by senior officials at each
regional office.
Last week, financial disclosures filed by the Fed’s 12 regional presidents
revealed some had activity traded in 2020, while others held million-dollar
financial positions without making changes to their portfolios.
A Fed spokesman told CNBC that Powell last week ordered a “fresh and
comprehensive look at the ethics rules around permissible financial holdings
and activities by senior Fed officials.”
Powell ordered the review “because the trust of the American people is
essential for the Federal Reserve to effectively carry out our important
mission,” the spokesman said. “This review will assist in identifying ways
to further tighten those rules and standards. The Board will make changes, as
appropriate, and any changes will be added to the Reserve Bank Code of
Conduct.”
Documents released last week revealed that Dallas Fed President Robert Kaplan
made multiple trades worth $1 million or more last year in individual stocks
including Apple, Amazon and Delta Airlines.
Boston Fed President Eric Rosengren held stakes in four real estate
investment trusts and several purchases and sales of similar property-owning
vehicles, according to filings. He also held stock in Pfizer, Chevron and
AT&T. His investments were in the tens to hundreds of thousands of dollars.
Other Fed presidents, such as Richmond Fed President Thomas Barkin, disclosed
little to no trading activity but several financial holdings in excess of $1
million.
His stakes included Coca-Cola stock worth more than $500,000 but less than $1
million. Barkin’s largest holdings, worth $1 million or more, included a
variety of exchange-traded and mutual funds overseen by outside managers.
He had, for example, a holdings worth at least $1 million in Vanguard’s
Energy Fund Admiral Shares, a mutual fund that invests in energy companies
Even the appearance of self-dealing at the Fed could prove problematic to an
institution tasked with the impartial oversight of U.S. employment and
inflation.
The trades quickly came under scrutiny given the Fed’s critical role in
managing the U.S. economy as well as its influence over interest rates and
liquidity markets.
The Covid-19 pandemic and ensuing recession magnified the Fed’s power in
2020. Congress allows the Fed, with the Treasury Department’s approval, to
embark on a wide range of emergency lending measures to flush the economy
with cash during times of emergency.
Rosengren, Barkin and Kaplan serve as presidents of three of the Fed’s 12
regional banks that span the country. The regional bank presidents take turns
serving on the Federal Open Market Committee, the Fed’s policymaking body
that sets interest rates across the economy.
Amid the public backlash, both Kaplan and Rosengren have agreed to sell their
individual stock holdings.
Separately, Sen. Warren sent letters to all the Fed’s regional bank
presidents demanding tighter restrictions on the type of financial activity
officials can engage in.
Each letter, all dated Sept. 15, was similar to the next except for the two
addressed to Kaplan and Rosengren.
“As the Fed took extraordinary actions to address the risks to the economy
and the banking and financial systems from the COVID-19 pandemic, you and
your colleague Eric Rosengren made extensive trades in individual stocks and
real estate investment trusts,” Warren wrote in her letter to Kaplan.
That trading, she added, “has prompted concerns about conflicts of interest
among high-level officials with far-reaching policymaking influence and
extraordinary access to information about the economy.”
The Fed played a leading role in the U.S. economic recovery from the worst of
the coronavirus recession.
Economists say its political independence allowed it to move quicker than
Congress and that its monthly purchase of $120 billion in U.S. debt and
mortgage-backed securities helped sustain countless businesses that saw
business swoon last year.