Thursday, July 30, 2015

Did Janet Yellen Just Take Out a Dow Jones Reporter....

...for asking probing questions about the circumstances surrounding Yellen and the Fed and  leaked information about Fed policy thinking.

There appears to be a war going on between Fed chair Janet Yellen and unknown behind the scenes forces. Pedro da Costa may have just been taken out by Yellen as the battle rages.


Here's Zero Hedge on the Da Costa-Yellen back and forth, and takedown:

This is the Q&A that got Pedro in hot water with Janet Yellen during the March press conference:
PEDRO DA COSTA. Pedro da Costa with Dow Jones Newswires. I guess I have two follow-ups, one with regard to Craig’s question. So, before the IG’s investigation, according to Republican Congressman Hensarling’s letter to your office, he says that, “It is my understanding that although the Federal Reserve’s General Counsel was initially involved in this investigation, the inquiry was dropped at the request of several members of the FOMC.” Now, that predates the IG. I want to know if you could tell us who are these members of the FOMC who struck down this investigation? And doesn’t not revealing these facts kind of go directly against the sort of transparency and accountability that you’re trying to bring to the central bank?

CHAIR YELLEN. That is an allegation that I don’t believe has any basis in fact. I’m not going to go into the details, but I don’t know where that piece of information could possibly have come from.

PEDRO DA COSTA. If I could follow up on his question. I think when you get asked about financial crimes and the public hears you talk about compliance, you get a sense that there’s not enough enforcement involved in these actions, and that it’s merely a case of kind of trying to achieve settlements after the fact. Is there a sense in the regulatory community that financial crimes need to be punished sort of more forcefully in order for them to be—for there to be an actual deterrent against unethical behavior?

CHAIR YELLEN. So, the—you’re talking about within banking organizations? So, the focus of regulators—the banking regulators—is safety and soundness, and what we want to see is changes made as rapidly as possible that will eliminate practices that are unsafe and unsound.

We can’t—only the Justice Department can bring criminal action, and they have taken up cases where they think that that’s appropriate. In some situations, when we are able to identify individuals who were responsible for misdeeds, we can put in place prohibitions that bar them from participating in banking, and we have done so and will continue to do so.
The difficult question starts at around 45:30 - look at Yellen's face when asked the question for a clue as to her next move.




Shortly aftert this exchange we learned that indeed the Justice Department did launch a criminal probe for leaks at the Fed itself as was disclosed shortly after the above exchange, a probe which may very well implicate anyone, including Janet herself hence her eagerness to avoid any "touchy" questions.
Nonetheless, after "shutting down" Pedro, the result was a "chilling effect" on any actually probing questions, and the same day that Pedro announced he would not be present at the June Fed press conference, not a single other journalist dared to ask anything on the topic. 

I have reported several times here at EPJ about the ongoing investigation of the leak and the indication that Yellen is a target. This appears as though Yellen just took out a foot soldier used in the attack against her.  

 -RW 

1 comment:

  1. More likely the institution did the dirty work.

    ReplyDelete