Federal Reserve Chair Jerome Powell has ordered a review on the rules surrounding investments by central bank officials after some were caught making massive stock trades during the recession inflicted by COVID-related lockdowns.
According to The Daily Wire, some of the large investments were in companies that benefited from the lockdowns, such as Amazon.
Largest upward transfer of wealth
The Wall Street Journal first reported that the Fed’s Dallas president, Robert Kaplan, held investments of more than $1 million or made stock trades of similar value in companies like Apple, Amazon, and Boeing last year. He also invested in Delta Airlines, CNBC reported.
Boston Fed President Eric Rosengren held investments worth up to hundreds of thousands in companies like Pfizer, Chevron, and AT&T.
Other Fed presidents didn’t trade, but held on to investments worth more than $1 million, CNBC reported.
The investments are noteworthy because Fed officials are entrusted with massive power over the economy, and they came at a time when COVID-related lockdowns were crushing small businesses and causing massive lay-offs.
Even as the lockdowns flattened the economy, the Fed and Congress responded with massive stimulus programs that critics say largely benefited airlines, tech conglomerates, and other large companies, in what has been called the largest upward transfer of wealth in modern history.
Fed officials will investigate themselves
The economy still has not recovered completely, with unemployment above pre-pandemic levels, according to CNBC, and inflation at its highest in 13 years, further burdening middle-class consumers. Still, the Fed has yet to pull back from its pandemic-era loose monetary policy.
Kaplan and Rosengren have said they will sell off their holdings in individual stocks and transfer them to index funds, The Daily Wire noted.
In a statement, the Federal Reserve said they found nothing untoward about the investments, but promised to investigate themselves anyway.
According to Reuters, the statement said Powell will “take a fresh and comprehensive look at the ethics rules” because the “trust of the American people is essential for the Federal Reserve to effectively carry out our important mission.” Right.
As the enormously powerful Fed promises to hold itself accountable, the central bank is continuing to print money like there is no tomorrow. Washington crooks looking out for each other as the little guy gets shafted: What else is new?