With several Federal Reserve chairmen repeatedly criticized for their 2020 stock decisions, Fed chairman Jerome Powell has reiterated that he owns up to $ 1.5 million in municipal bonds. 19 pandemic.
Fed Chairman Jerome Powell
Will Jerome Powell own the same bonds the Fed bought during the pandemic?
Three days ago, the subject of senior members of the Federal Reserve making multi-million dollar stock deals in 2020 prompted Senator Elizabeth Warren to write a letter criticizing professional ethics. At the time, Chairman Jerome Powell said he would begin investigating this transactional behavior of the parties. Shortly after the media unearthed and exposed the information, reports showed that the chairman of the Federal Reserve also owns several types of municipal bonds, similar to bonds the Fed bailed out during the COVID-19 crisis last year.
Nor is it the first time Jerome Powell’s portfolio has been publicly scrutinized. Wallstreetonparade.com journalists Pam Martens and Russ Martens covered the matter and revealed that Powell has invested up to $ 11.6 million in Blackrock, the company that manages a $ 750 corporate bond bailout program.
On September 18, CNBC reported the incident and found that Powell’s financial moves did not appear to be in violation of the central bank’s code of conduct. CNBC’s Steve Liesman said the Fed’s Code of Conduct states that officials should be careful to avoid transactions or conduct that could create a conflict between personal interests and the interests of the system, as well as the interests of the system.
In addition, Liesman said Powell paid between $ 1.25 million and $ 2.5 million.
“Even though the bonds were bought before 2019, they were still held while the Fed bought more than $ 5 billion in bonds last year. Including an Illinois state bond bought by his family trust in 2016, “Liesman added.
Powell has been gripped by a torrent of negative news lately, and on September 1, several newspapers reported that US lawmakers Alexandria Ocasio-Cortez (AOC), Rashida Tlaib, and Ayanna Pressley wanted a new central bank in place. “A new chair will help mitigate the risks of climate change,” the AOC said in a recent statement. Despite urging from Democratic officials, confidential sources in the Washington Post suggested that Joe Biden would remove Jerome Powell to lead the Fed.
Meanwhile, Dennis Kelleher, CEO of the nonprofit Better Markets, told Liesman that the moves of senior Fed officials have not been beneficial. Kelleher emphasized:
“If you think such a transaction is acceptable, it will (supposedly) be approved by current Fed policy, which emphasizes that Fed policy is below par.
When informed that Fed officials could trade stocks because it wasn’t during a recession, the Better Markets CEO commented:
“This whole year should be viewed as a recession.”
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