Fed Watch

Powell To Review Ethics Codes, Next Meeting To Illuminate Tapering Plans

The Federal Reserve Chairman himself has become embroiled in the ethics concerns we reported on last week caused by the admission of Bank Presidents Kaplan and Rosengren that they had traded in securities that would have likely been affected by the Fed’s purchasing activities. It has now come out that Jay Powell himself owned municipal bonds, which was one of the assets purchased by the Fed during their emergency pandemic response.

This comes also at a somewhat sensitive time for Powell since the Biden Admin is expected to shortly announce a decision on whether they will re-establish the precedent of re-nominating Fed Chairman selected by their predecessor of the previous party. One of Powell’s main achievements was political, aside from all his actions on the policy side, President Trump personally targeted Fed independence in way not seen since the early days of the Cold War.

Powell simply responded that President Trump did not have the authority to fire him and kept doing what he thought he should. The urge of the Biden administration to restore political normalcy after the Trump years likely will look favorably on this performance by Powell despite his support of easing regulations. Betting markets have his odds of renomination at about 85%.

Elizabeth Warren sen...

Unlock this article with a FREE 30-Day Trial!

An FSI Pro, or FSI Macro subscription is required in order to access this content.

*Free trial available only on a monthly plan

Disclosures (show)

Get invaluable analysis of the market and stocks. Cancel at any time. Start Free Trial

Articles Read 2/2

🎁 Unlock 1 extra article by joining our Community!

You’ve reached your limit of 2 free monthly articles. Please enter your email to unlock 1 more articles.

Already have an account? Sign In

Want to receive Regular Market Updates to your Inbox?

I am your default error :)