Friday, October 12, 2012

Former Fed Governor Brimmer Dies

Former Federal Reserve Governor Andrew Brimmer has died at the age of 86.

Over the years, I ran into Brimmer a few times in Washington D.C. and had a few phone conversations with him. First, I have to say that I am amazed to read he was 86 years old. Judging from his appearance, I always thought he was in his late 70s.

In 1966, under appointment from President Lyndon Johnson, Brimmer began an eight-year term on the board of governors of the Federal Reserve, becoming the first black in that position.

That said, don't think for a minute that Brimmer was put on the Fed board as just an affirmative action appointment, without understanding of how the Fed operates. I recall my first conversation with him. It was surrounding a question about reserves. As the conversation continued, we got more and more into esoteric details of reserves and I remember thinking, "Boy, this guy really knows his stuff." (Unlike other Fed employees/officials). As that thought crossed my mind, he looked at me in sort of a surprised manner and said, "Are you really interested in this stuff?" I assured him I wise and he reached into his pocket handed me his card and said, "Call me."

We talked a few times more before he became ill. They were by far the most stimulating conversations I have ever had about the technicalities of such things as reserve requirements versus capital requirements and money sweeps.

BTW, Brimmer was no flunky when it came to understanding systemic risk, either. He wrote a paper on it long before the current crisis, in 1989.

Brimmer told me that as the current financial crisis developed that Ben Bernanke read his paper.

Brimmer was far from being an Austrian but as far as Fed people go, he was a very decent man and he really understood the technicalities of Fed operations better than even most other Fed governors.

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