No one needed to remind Fed officials that trading their personal accounts around Fed policy announcements was unethical and a breach of public trust. But the central bank’s ethics office sent out the reminder anyway, and several of the Fed officials executed opportunistic personal trades all the same. Wolves masquerading as shepherds do not deserve to keep their positions, professional status or profits. Unless we enforce clear lines, ethical degradation will continue to hinder social progress. If Powell is reappointed, the endorsement of destructive leadership continues. See Fed Ethics Office Warned Officials to Curb Unnecessary Trading During Rescue:
On March 23 last year, as the Federal Reserve was taking extraordinary steps to shore up financial markets at the onset of the pandemic, the central bank’s ethics office in Washington sent out a warning.
Officials might want to avoid unnecessary trading for a few months as the Fed dived deeper into markets, the Board of Governors’ ethics unit suggested in an email, a message that was passed along to regional bank presidents by their own ethics officers.The guidance came just as the Fed was unveiling a sweeping rescue package aimed at backstopping or rescuing markets, including those for corporate bonds and midsize-business debt…
The email could pose further trouble for the Fed, which declined to provide a copy, because it shows that central bank ethics officers — and officials in general — were aware that active trading could look bad when the Fed was taking emergency action to try to save markets and its policymakers had vast access to sensitive information. Despite the early warning, some top officials resumed trading after the most proactive phase of the Fed’s rescue ended, based on financial disclosures and background comments from regional bank spokespeople.
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