Fed Chair Powell signed Ethics Agreement last month requiring him to dump millions in muni bonds; failed to disclose EA to @SenateBanking at confirmation hearing; Biden gave nod despite Powell's own trading implicated in #FedScandal

Bombshell: @OGE quietly released a Dec. 3, 2021 Ethics Agreement signed by Powell requiring him to divest _all_ muni bonds. The language misleadingly states this is due to the Fed's "new investment restrictions," but also references waiver or exemption under 18 U.S.C. § 208. /2
18 U.S.C. § 208 prohibits conflicted decision-making by gov't officials and applied to Fed Chair for decades. The muni bonds in Ex. A are the exact ones the press highlighted as questionable in connection with the Fed's ethics scandal that just brought down Vice Chair Clarida. /3
As @CNBC's @SteveLiesman reported last year, Powell held between $1.25 and $2.5 million in muni bonds, all while directing the Fed's controversial foray into buying billions in munis, including the same Illinois muni bond that Powell had also purchased, to prop up bond prices. /4
In Sept. 2021, Liesman questioned Powell about the munis. Powell said: "I personally owned municipal securities for many, many years, and in 2019, I froze that...the lore was that the Fed would never buy municipal securities...and I reversed that."

Powell misled the public. /5
The munis in question were not all "bought many years ago" as asserted. In fact, Chair Powell actively bought and sold the munis leading up to the Fed decision. Barron's even wrote an article touting his moves as a potential trading strategy in 2019. /6

Powell also did not "freeze" his muni trading in 2019 before the Fed decision. As @revolvingdoorDC reported, Powell "neglected to mention that he’d personally purchased shares [in 2020] in several actively-managed [Goldman Sachs] municipal bond funds." /7

In October 2021, the Fed announced plans to adopt new trading rules after an internal review overseen by Chair Powell. While the rules purportedly prohibit holding individual bonds, federal conflicts statute 18 U.S.C. § 208 was already on the books. /8

The question is whether Powell violated Sec. 208 prior to the adoption of any new rules. Powell said he "checked with the Office of Government Ethics" which "said that I didn’t have a conflict." But this assertion stands at odds with the language in the new Ethics Agreement. /9
In order to "participate personally and substantially" in decisions relating to the munis, the EA requires Powell to obtain a written waiver or exemption under § 208 _until_ the bonds are divested. It makes no sense to require this if Powell did not have an existing conflict. /10
If Powell had an existing conflict, then did he lie that @OGE said he "didn't have a conflict"? If not, then how did OGE make that call? These are critical questions that the American public deserves to know before Powell is reinstalled as such a powerful unelected official. /11
At Powell's confirmation hearing before @SenateBanking this week, he refrained from disclosing the existence of the new Ethics Agreement despite being questioned on the Fed ethics scandal by three different Commitee members -- @SenWarren, @SenCortezMasto and Sen @Ossoff. /12
@SenWarren, who recently called Powell a "dangerous man" and indicated she will vote against his confirmation, has sent a letter requesting more details on the #FedScandal. At the hearing, Warren asked Powell to commit to a response by next Monday, but he declined to commit. /13
Powell's exchange with Sen. @Ossoff also made clear the Fed has not yet provided the details of its new trading rules to @SenateBanking. Ossoff asked that the details be provided as soon as possible, suggesting they only have the Fed press release. /14

Other Senators have joined @SenWarren in expressing grave concerns about Powell's renomination, including @SenWhitehouse and @SenJeffMerkley. Powell is also facing increased scrutiny for leading the Fed's controversial monetary policy that resulted in record high inflation. /15
Powell was appointed by Trump in 2017. Unlike past Fed Chairs, Powell is not an economist. He worked as a corporate lawyer (law license suspended) and then as an investment banker, primarily at Carlyle Group. Vice Chair nominee Lael Brainard was rumored to be favored by many. /16
If you liked this thread, please RT and contact your Senators to tell them to vote 'NO' on Powell's renomination given the ethics scandal. Follow us for more breaking news and #Fed coverage and contact us if you are interested in getting involved in the #OccupytheFed movement.

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