Saturday, September 27, 2014

The Fed is corrupted by its Wall Street targets

This is a fascinating story on the corruption in the New York Fed, tasked with investigating Wall Street conflicts of interest. The Fed realized that their own investigators were too deferential to Wall Street, often looking the other way, or not including factual findings contrary to Wall Street's wishes. So the Fed decided to change its own corrupt policies in this regard and hired investigators to work inside Wall Street banks. These investigators had to be "out of the box thinkers," even "disruptive personalities." They wanted them to be contrarian and question the orthodoxy of the Fed's lapdog culture.

Carman Segarra was one such investigator, and when she did exactly as she was told she was fired by the very kind of deferential supervisory staff the Fed originally intended to eradicate. And she was fired. Bottom line: the whole Fed fix was a good story to feed everyone so as to believe they were taking care of the problem, but it was just spin, never intended to be taken seriously. Just ask Ms. Segarra, who taped conversations with said staff as well as her Wall Street bosses.

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