Wednesday, May 16, 2007

Fed hit by Bush Brownie moves

Yesterday President Bush nominated two new members of the Federal Reserve Board to fill recently opened vacancies. Unless these individuals are brilliant beyond their resumes, they would be barely qualified, if qualified at all, to serve on the critically important overseer of our financial system. Are they trained in and experienced in economics, capital markets, or finance? No, it seems not, but certainly they must be good people. They do have backgrounds in banking, which is a plus, and not in horse jumping competitions. One is experienced in corporate trust services for a bank and global operations for a credit card company. This is really beyond a stretch. Bank operations has nothing to do with finance or economics, and the understanding of capital markets is focused on mechanics. Of course it's not lightweight experience, but it's in processing which means technology, legal issues, and managing white collar factories. It is really totally unrelated to the Fed's mandate. The second nominee is a career banker in small banks at the EVP level. That kind of banker is a relationship person and an administrative person who understands credit and deposits. She no doubt has excellent experience, but for the Federal Reserve?
(They are both living in Virginia so let's hope they were not chosen because of Robertsonian or Falwellian loyalties)

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