[lbo-talk] Government by Goldman

Jordan Hayes jmhayes at j-o-r-d-a-n.com
Fri May 8 14:36:01 PDT 2009



> It is being reported that the N.Y. Fed chairman has
> resigned over his relationship with Goldman.

If by "relationship with" you mean "bought tons of stock during an ethical grey area time" ... sure, he's on the Board, but

This is from the WSJ the other day:

http://online.wsj.com/article/SB124139546243981801.html

The Federal Reserve Bank of New York shaped Washington's

response to the financial crisis late last year, which

buoyed Goldman Sachs Group Inc. and other Wall Street

firms. Goldman received speedy approval to become a bank

holding company in September and a $10 billion capital

injection soon after.

During that time, the New York Fed's chairman, Stephen

Friedman, sat on Goldman's board and had a large holding

in Goldman stock, which because of Goldman's new status

as a bank holding company was a violation of Federal

Reserve policy.

The New York Fed asked for a waiver, which, after about

2½ months, the Fed granted. While it was weighing the

request, Mr. Friedman bought 37,300 more Goldman shares

in December. They've since risen $1.7 million in value.

/jordan



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