Draining the Federal Reserve

Soon after I published my MINT column on Tuesday on the Federal Reserve came the news of resignation of the President of Richmond Federal Reserve, Jeff Lacker, because he affirmed – directly or indirectly – a confidential information in the hands of a private party (Medley Financial Advisors) and he did not report it to the Inspector-General who was investigating the Federal Reserve leak. This raises questions over his reappointment in March 2016.

Is Pedro da Costa suggesting here that the original source of the leak to Medley Advisors was the Fed Chair Janet Yellen herself? There is a cloud over the Federal Reserve and for it to clear, there should be a transparent investigation.

Second, we should not forget that this is the tip of the ice-berg because a paper published in 2015 shows that it is a systemic problem. Read the innocuously titled paper, ‘Stock returns over the FOMC cycle’. It is explosive, in my view.

My column calling on the American President to drain the monetary policy swamp was timely, then.

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