Janet Goes To Pimco
They had to be lying.
To be fair, it wasn’t an out-of-the blue guess.
This is from 2018, after she left her Fed Chair gig:
Exclusive: Yellen gets post-Fed payday in private meetings with Wall St. elite
Janet Yellen cashed in with her first paid visit to Wall Street since stepping down as Federal Reserve chair, discussing rate hikes and U.S. President Donald Trump at events on Monday that included a dinner for 40 at a CEO’s Manhattan penthouse.
Two people familiar with the events hosted by investment bank Jefferies, including the evening gathering with its chief executive Richard Handler and billionaire investors Carl Icahn and Daniel Loeb, said it was billed as Yellen’s first such engagement since leaving the Fed two months ago…
Later, over the penthouse dinner of lobster, beef short ribs and matzo in the trendy Tribeca neighborhood, Yellen held court with executives from hedge funds, private equity firms and companies, according to two people briefed on the gathering…she considered inflation to be in check and unlikely to spike, so rates would stay relatively low…
Cashing in after years in public service is a well-trodden path for U.S. policymakers and regulators, highlighting the demand among investors for any exclusive insights they can offer.
In the case of former Fed chiefs, who can earn an annual salary in one night and have no constraints on expressing their views provided they do not broach confidential matters, those insights could potentially move markets.
Yellen’s predecessor Ben Bernanke waited just over a month after leaving the Fed in 2014 before earning some $250,000 for a private talk in Abu Dhabi. He followed that up with similarly priced private dinners with investors in New York, at which he predicted rates would remain low for a long time.
Former Fed Chair Alan Greenspan waited only a week after stepping down before addressing a private dinner in 2006 hosted by Lehman Brothers, the investment bank whose collapse two years later sent the global financial crisis into high gear…
“The biggest beneficiary is probably the speaker ... who is obviously rewarded fairly handsomely, and to some extent the organizers who are then seen in a better light by their clients,” added Hatheway, who is now group head of investment solutions at GAM Investment Management, in Zurich.
Reuters was not able to reach David Zervos, the Jefferies Group LLC [JGLL.UL] chief strategist who conducted the larger forum for investors and who later tweeted a link to a photograph of himself with a smiling Yellen on Instagram. “An amazing evening last night hosting Janet Yellen for our clients in NY,” read the tweet, posted Tuesday.
Yellen Earned $7.2 Million In Speaking Fees Over Last Two Years
“Yellen has also earned $350,000 in consulting and speaking fees from Magellan Financial Group, an Australia-based asset management company”
Neel Kashkari’s Quiet Path to Pimco: "Bloggers joked about how — in their view — he had all along been doing the company’s work in Washington."
The central bank has tapped Blackrock to help it direct money into both new and already-issued corporate bonds, assisting the Fed in its recently adopted role as lender of last resort for businesses. The Fed is expected to launch the program in coming days.
The Fed also has given Pacific Investment Management Co., or Pimco, the job of helping it purchase commercial paper, or companies’ short-term borrowings. That program is already up and running.
The two firms could eventually invest hundreds of billions of central-bank dollars.
Fed Pick Clarida Holds at Least $9 Million in Job-Related Financial Assets
Richard Clarida, President Donald Trump’s nominee for Federal Reserve vice chairman, holds employment-related financial assets valued at between $9 million and $39 million, according to documents certified by the U.S. Office of Government Ethics.
Most of those assets come from deferred compensation, anticipated bonuses and other funds from his job as a managing director at Pacific Investment Management Co. and from retirement accounts from Columbia University, where he is a professor.
Mr. Clarida earned $418,376 in salary and $6.7 million in bonuses from the firm over the past year, the report showed. He earned $182,731 from his teaching position.
Mr. Clarida holds other assets valued at between $12 million and $54 million, the report said. The financial disclosure forms place asset values within certain numerical ranges rather than reveal specific amounts.
Clarida’s back at Pimco by the way.
Where do you think the Fed’s priorities lie? With you?
Giant US bond managers suffer March bloodbath
US bond fund heavyweights Pimco and Lord Abbett were rocked by heavy outflows last month as investors abandoned fixed income over fears that the coronavirus pandemic would trigger a wave of corporate defaults.
Pimco, the largest bond investor in the world, bled a net $27bn in March, its highest monthly redemptions since the departure of co-founder Bill Gross in October 2014.
“I almost think they had to be lying when they said ‘transitory,’ and for Powell to make a joke at Jackson Hole - you know, the good ship transitory has sailed - I mean, I just wanted to puke. Here he is joking about the inflation the rest of the country suffers from - he doesn’t suffer from, because he’s a multi-millionaire.”
“A 30-40% market correction would simply bring valuations back to historical norms, not signal economic collapse.”
- Money Tree Investing Podcast
President Jackson's Veto Message Regarding the Bank of the United States; July 10, 1832
“It is maintained by some that the bank is a means of executing the constitutional power "to coin money and regulate the value thereof." Congress have established a mint to coin money and passed laws to regulate the value thereof. The money so coined, with its value so regulated, and such foreign coins as Congress may adopt are the only currency known to the Constitution. But if they have other power to regulate the currency, it was conferred to be exercised by themselves, and not to be transferred to a corporation [e.g., the Federal Reserve]
If the bank be established for that purpose, with a charter unalterable without its consent, Congress have parted with their power for a term of years, during which the Constitution is a dead letter. It is neither necessary nor proper to transfer its legislative power to such a bank, and therefore unconstitutional.”
I think this post is full. Have a number of interviews in the queue. For what it’s worth, I did two podcasts myself in recent weeks - this one Monday and this one a week or two ago. Note in general that I never write the titles of the podcast or pick the highlights. That’s all done by the hosts.
I’ll also attempt to do a Twitter Spaces today (Wednesday) at 4:15pm Eastern with mild-mannered chemistry professor Dave Collum. Godspeed.
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