Jerome Powell ‘failed’ as Fed Chairman

Sen. Elizabeth Warren, D-Mass., slammed Federal Reserve Chairman Jerome Powell in an interview with NBC News’ “Meet the Press” on Sunday, saying he “failed” in office and should not be in his role.

“He had two jobs. One is to deal with monetary policy. The other is to deal with regulation. He failed in both,” she said.

“Look, I don’t think he should be chairman of the Federal Reserve. I’ve said it as publicly as I know how to say it. I’ve said it to everyone,” said Warren, who sits on the committee. Banking Senate. .

Powell, first appointed by then-President Donald Trump in 2017, has come under fire for his handling of banking regulation following the collapse of Silicon Valley Bank.

Warren, who has pushed for tougher banking regulations, said Powell “took a flamethrower for regulation” when Trump took office, adding that Trump had given Congress the “power to lighten even more regulations”.

“And then the bank CEOs did exactly what we expected. They took risks that boosted their short-term profits. They gave themselves huge bonuses and salaries and blew up their banks,” he said. said Warren.

In a letter on Saturday, Warren urged the inspectors general of the Treasury Department, the Federal Deposit Insurance Corporation and the Federal Reserve Board of Governors to immediately initiate a “thorough independent investigation” to determine the causes of the bank management problems and regulation that led to the collapse of SVB and Signature Bank.

“The bank’s executives, who took unnecessary risks or failed to guard against entirely foreseeable threats, must be held accountable for these failures,” Warren wrote in the letter, asking that preliminary findings from investigation be forwarded to Congress within 30 days.

A group of Democrats led by Warren and Rep. Katie Porter of California last week unveiled legislation to restore banking regulations that were rolled back under the Trump administration in 2018 — an effort they say would address the cause of the collapse of SVB.

Around this time, Republicans in Congress introduced a bill—supported by some centrist Democrats—that relaxed Dodd-Frank financial regulations on midsize banks, raising the “too big to fail” threshold. from $50 billion in assets to $250 billion. The Warren-Porter bill, first reported by NBC News, would repeal that measure, but it faces a rocky road to passage through Congress.

Some Democrats who voted for the 2018 bill are keeping their voices going, joining Republicans in resisting greater scrutiny of the banks and arguing that the United States still has ways under current law to tackle the problem.

President Joe Biden reappointed Powell as chairman of the Federal Reserve in November 2021. The move was pushed back by some progressives and some Democrats had argued that Powell was too indifferent as a banking regulator.

At that time, Warren was a leading opponent of Powell, calling him a “dangerous man” who led an effort to weaken the country’s banking system during a hearing in late 2021.

Warren urged Powell to recuse himself from an internal investigation into SVB last week, saying his actions “directly contributed to these bank failures”.

“I opposed him because of his views on regulation,” Warren told “Meet the Press” on Sunday, “and what he was already doing to weaken regulation.”