Factbox-How Fed policymaker investments stack up against each other -Breaking
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© Reuters. FILE PHOTO – An eagle flies above the facade of Washington’s U.S. Federal Reserve Building, July 31, 2013. REUTERS/Jonathan Ernst/File Photograph(Reuters) – On Thursday, the U.S. Federal Reserve prohibited individual stock purchases from top bank officials and announced a range of additional restrictions regarding their investing activities. This was approximately six weeks after reports about active trading by senior policymakers sparked an ethical uproar.
Each year, the Fed Board of Governors members are required to submit financial disclosures that are made public. These disclosures vary in terms of financial complexity and depth.
Fed Board of Governors Jerome Powell, Fed Chair and Vice Chairman Randal Quarles are both former private equity investors. Vice Chair Richard Clarida was a former investment manager.
This is an overview of all the recent investment trends made by Fed Governors:
GOVERNOR LAEL LAEL BRAINARD
According to disclosures, Brainard is being considered for the Biden administration’s Vice Chair for Supervision and Fed Chair. He made no transactions during 2020.
It’s an improvement over years: Disclosures reveal that she has transacted 37 transactions in 2019, 133 in 2018 and 85 in 2017. She also traded 84 and 85 times respectively in 2017 and 2016. And as many as 17 times during 2015. She did not trade individual stocks, corporate bonds or exchange-traded funds.
In 2020 her largest holding of a single security was $500,000 to $1 million in an exchange-traded fund linked to the (SPDR S&P 500 ETF (NYSE:)).
A home she owns has a mortgage between $1million and $5 million, at a rate of 4.25%. She has never refinanced it since her time at the Fed.
VICE CHAIR CLARIDA RICHARD CLARIDA
Clarida was involved in five transactions during 2020. They included the sale, Feb. 27, of bond funds shares, and then the acquisition, the next day, of two stock indices. All this occurred on the heels of Fed Chair Jerome Powell’s declaration indicating possible Fed policy action to address the COVID-19 pandemic.
He sold one stock-index fund that was broad and purchased more stock in another stock fund he had bought in February.
He made seven transactions in 2019 and 14 in 2018. In 2018, his first year on the Board, he sold Amazon stock (NASDAQ:). His spouse held the Vanguard Information Technology Index, and he did so as per his ethics agreement.
He held $5m to $25m in PIMCO Muni Bond Fund, his biggest single holding for 2020.
FED CHAIR JEROME POOWELL
In 2020, Powell was involved in 26 transactions. He made 26 transactions in 2020, including 16 transactions that were individually dated and 25 multi-transaction transactions. He completed 16 individual dated transactions (mostly muni bonds and indexes) in 2018 as well 23 “multiple”, most of which were between $1,001-$15,000. 2017 saw 46 transactions. Half of them were classified as multiple.
In 2020 his largest holding of a single security was $5 million to $25 million in the SPDR S&P 500 ETF, the largest U.S. exchange-traded fund, which tracks the S&P 500 Index.
GOVERNOR MICHELLE BOWMAN
Bowman closed five transactions last year. All of them were in retirement funds. She made four transactions in 2019, including the sale of Kansas’ commercial building for $50,001 to $100,000.
The largest amount she held in any one security during 2020 was $100,001 to $250,000 in retirement funds (Principal LifeTime Hybrid 2035 CIT). She also had larger holdings: $250,001-$500,000 in retirement funds and the same amount in MIO Special Situations, which are both part of her McKinsey 401K. He also owned Apple (NASDAQ) stock.
There are two other mortgages she has: one that is between $50,000 and $100,000 and one with a rate of 4.36% and one with a rate between $1million and $5 million. The second one is for between $50,001 to $100,000 and has a rate of 2.75%.
GOVERNOR RANDAL QUARLES
Quarles holds are among the largest and most opaque in the group.
Last year, Hope Eccles was involved in two transactions with Cynosure Group. The Cynosure Group is a Utah-based private investing firm that he founded with Hope Eccles’ family. These were the acquisition of Cynosure Investment Partners class 2020 Venture (April 2) and its sale on Dec 21.
He reported 15 transactions for 2019, which included the sale of Union Pacific GE stock, and other securities that are classified as private credit funds. In 2018, his 42 transactions were almost all stock sales, but included interests in UK shipping operators and venture capital groups. He made 12 transactions in 2017, including the acquisition of Target (NYSE: Pfizer (NYSE: ) shares, several stock-index fund funds and Glaxo SmithKline’s sale
Quarles stated that he has “more than $1,000,000” in assets. These include a restaurant and hotel, as well as real estate at the Deer Valley Ski Resort (Utah) and ranches in Idaho. Quarles also holds several stocks including Union Pacific Corp. (NYSE:). General Electric (NYSE:) Co and Wabtec plus $1 million to $5 million in several funds, including the SPDR S&P 500.
A mortgage is attached to his home. Wells Fargo (NYSE: ) between $1 million to $5 million with a 3.15% rate of interest. He also paid off a Wells Fargo Home Equity Line of Credit secured by an investment/rental asset in 2020.
GOVERNOR CHRISTOPHER WALER
Christopher Waller (ex-St. Louis Fed research chief) was elected the Fed’s new governor in December 2013. Because he did not serve more than 60 days in 2020 he wasn’t required to make an annual disclosure. However, his initial annual filing will be made for 2021.
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