…..But either way, I don’t give a damn what you think you’re entitled to!
It came to light this week that tensions between Federal Reserve Chairman Jay Powell and Senate Banking members Elizabeth Warren and Patrick Toomey are beginning to boil over regarding the Feds handling of its insider trading activity in 2020. It was disclosed from the Fed’s own investing activity disclosures that Federal Reserve Bank Presidents Robert Kaplan (Dallas), Eric Rosengren (Boston) and Vice Chairman Richard Clarida traded in their personal accounts in February and March of 2020 when Covid brought the financial markets to their knees only to be rescued by the Fed. Upon discovery Kaplan, Rosengren and Clarida took early retirement and no independent investigation was performed.
Bloomberg News reported on Thursday that, Senator Warren ,“sent letters to Powell and all 12 of the Fed’s regional branches in early August, requesting “all stock, bond, and other investment trades by senior officials” from January 2020 through August. Warren also wanted to see internal communications by Fed ethics officers warning officials away from trading in a period of Fed market intervention.”
This certainly seem like a reasonable request, especially after Kaplan, Rosengren and Clarida were caught trading the markets on the best inside information an insider- trading felon would ever get in the history of insider trading.
In a response to Senator Warren, Powell stated that the 12 district banks, “have fully cooperated with the board to implement the new rules.” He also told Warren to go to the Fed website for the disclosures she’s looking for. To this blatant brush off, Warren fired back, “This is the largest ethics scandal in Federal Reserve history, and I’m deeply concerned that Chair Powell risks undermining confidence in the Fed if this matter is not taken more seriously. The inspector general’s inadequate investigation is no substitute for congressional oversight. The Fed needs to turn over the requested information to Congress.”
It seems pretty apparent that the Fed could care less what Congress has to say about anything.
When the insider trading story first broke in 2021 I had a look at what Dallas Fed President Kaplan owned and it was pretty staggering. Besides actually trading S&P Futures during 2020, Kaplan owned Leverage Loan funds that without the Fed saving the world in 2020, would have been worth close to zero.
Here is some information on the leverage loan fund Kaplan owned. He also owned another BlackRock Leveraged Loan fund, same strategy, same leverage. His disclosure says that he did not trade this during 2020 but he made income through dividends over $500k on each for the year. He must have owned a ton and he saved his ass in the bailout. Without Fed action these funds and the assets in them were toast.
Fund Description A high yield, floating rate syndicated loan fund. As you can see below, it is leveraged by the fund manager (see the third line in the description). You buy a levered fund that essentially holds very highly leveraged assets if you have a strong “view” on the market. Supercharging the returns.
This is just the fund’s performance in 2020. Kaplan’s disclosure says he made > $500k on this investment. The fund, before dividends lost money in 2020 so I imagine he didn’t come into 2020 owning it.
Notice the Dividend Yield, over 6%.
Example of high yield loan owned by the fund. Notice the coupon is LIBOR + 3.50%. The only way you get a dividend yield of 6+% is through leverage. This loan was not in the fund for 2020 but it gives you an idea of was/is in this fund
Leverage Loan index performance for 2020
If you and I ever did something like this we’d be neighbors with El Chapo at Colorado Supermax!
That is all.
Ron Paul was right.
There is an epic glaring issue ( aside from the apocalyptic hell the no longer liberal Dems i.e. Big Brother global kleptocrats) that continues to go unaddressed.
The elephant in the room is decades old, no pun intended. It is the absolute unpopularity and inability of the GOP to connect with America’s demographic .
And they absolutely refuse to own it, instead, digging in.Repudiating any newness, modernization or willingness to get the hell out of their own way.
Combined with obsolescence, ineptitude, inability to message, lack of outreach , incuriosity, corruption, cowardice,homogeny, lousy candidates and a social platform rejected by 75% of the populous, they’ve placed us in a horrible lose/lose position.
I’m so disappointed in Trump. His 2016 platform was so fresh and filled with ideas. Great outreach, big umbrella, big promises. And then he won office, surrounded himself with the Swamp and then allowed himself to be co-opted by the fundamentalist religious right. And all the while, was horse trading with Bill Gates,Big Tech, Pharma, WEF , appointing awful cabinet members,only to replace bad with worse. And when his really top notch original cabinet members were sabotaged, he didn’t fight for them.
Trump’s fatal flaw is a compulsive need to be in the spotlight, regardless of creating the perfect storm for self inflicted wounds. The name calling, ad hominem attacks, puerile , impulsive/compulsive tweeting and failure to assume responsibility for his own poor judgment. He literally sets himself up and expects devotion from those he’s alienated. Expecting anything from the Republican idiots is already a losing issue, but alienating the entirety of the cabal and outsiders is completely self defeating.
I must make a confession. I know Trump personally, having worked alongside him on a major project for two years.Derek Jeter was a longtime client and hired me to design his newly purchased 90th floor penthouse in the NYC Trump World Tower. The project began in 2000 and it was major. I’d designed 3 homes for Tino Martinez- 2 in Tampa and the home he’d purchased from Mattingly in Tenalfy, NJ, Jorge Posada in Tampa,Steinbrenner in Tampa and A-Rod in Miami, but Jeter’s NYC crib was the crown jewel. Trump was a fixture. He was awesome. Incredibly sharp, capable, funny and uniquely fair. He treated everybody equally. Whether a plumber, janitor, electrician, staff member, Derek’s parents, homies, celebrities or me. He expected competence and quality, but never exhibited the arrogant elitism of anybody as a lesser being.And he was totally in touch with cultural reality.Most impressive was that he really did like and respect the blue collar workers.
In Trump’s world at that time, I’d be considered a nobody. A woman living in Tampa, not a big name entity, yet he was so warm and inquisitive. We’d gorge on McDonald’s in Derek’s kitchen and he’d pepper me with questions. He would laugh at the anecdotes about my family, miserable clients, was awesome when my children would fly to NYC to visit.. he was awesome.He was apolitical in the sense he was neither left nor right, but very pro-America. Being a New Yorker, he was able to deal with union workers and non-union. He had to.
And then the fateful beautiful, cloudless morning of 9/11 when the unimaginable became a reality. I was alone in Derek’s glass aerie . The tallest skyscraper in NYC second only to the Towers and a parallel vista directly into hell.Trump jumped into action with Rudy. OMG, they were phenomenal! Selfless.
So here’s a guy who boasted about knowing every player,,every dirty secret, everything that went on behind the scenes, scares the shit out of every bad actor, wins and is taken by every bad actor, fills the swamp to overflow and blames everybody else for his own failure to heed what he so confidently promised to thwart