by Crazy Horse
Mon Sep 29th, 2014 at 02:13:21 PM EST
I haven't read through (or listened to) a story Michael Lewis is pushing regarding the NY Fed's "Regulation" of Big Banks ; with a transaction between Goldman and Santander as a highlight.
I don't know if this story appears elsewhere on ET in the past days, but immediately felt I should post it here.
front-paged by afew
Perhaps it needs a Diary, especially to discuss what "civilization" should do, or how to react to this story. The story revolves around secret tapes made by a Fed employee which detail a Vampire Squid's activities.
Jake Bernstein Carmen says this wasn't an isolated incident. In December -not even two months into her job -a business line specialist came to Carmen and told her that her minutes from a key meeting with Goldman executives were wrong, that people didn't say some of the things Carmen noted in the minutes. The business line specialist wanted her to change them. Carmen didn't.
That same day, Carmen was called into the office of a guy named Mike Silva. Silva had worked at the Fed for almost twenty years. He was now the senior Fed official stationed inside Goldman. What Mike Silva said to Carmen made her very uncomfortable. She scribbled notes as he talked to her.
Carmen Segarra Even looking at my own meeting minutes, I see the handwriting is like nervous handwriting. It's like you can tell. He started off by talking about he wanted to give me some mentoring feedback. And then he started talking about the importance of credibility. And he said, you know, credibility at the Fed is about subtleties and about perceptions, as opposed to reality.
Brian Reed Wait he said that?
Carmen Segarra Yes.
Brian Reed What does that even mean?
Carmen Segarra I found it to be completely incredible. For somebody to tell me that credibility is about perception as opposed to reality? I mean, I come from the world of legal and compliance, we deal with hard evidence. It's like, we don't deal with, you know, perceptions.
So find out what's changed my Sunday completely...
Ira Glass Which brings us to the secret recordings. For over a hundred years, the Fed has done everything it could to keep its behind-the-scenes interactions with banks from
being seen by the public. But what Carmen Segarra witnessed going on at the Fed was so alarming, she started secretly making recordings of what she experienced as a bank examiner -recordings that raise serious questions about whether the Fed has changed enough since 2008 to protect us from another financial disaster.
This is a spoiler but just to put it out there: things went very badly for Carmen Segarra in her new job. She's currently suing the Fed over this. So what you're going to hear today is a dispute between an employee and her bosses, though of course what we're interested in is not the he-said-she-said of all that but in what her secret recordings show us about how the Fed works.
Throughout this hour you're going to hear her recordings of what she saw at the Fed and you're going to hear more from David Beim's 2009 report, which lays out the way the Fed should be operating. He explained the changes the Fed needed to make. With Carmen's tapes, we get to see if they actually made those changes. And it is not reassuring. From WBEZ Chicago, it's This American Life, I'm Ira Glass. Stay with us.
Viel Spass, Alle