Fed to ban policymakers from owning individual stocks • Hacker News Board

Re: Fed to ban policymakers from owning individual stocks

#61

Post by spaetzleesser » Thu, Oct 21, 2021, 9:31 PM UTC

FormerBandmate wrote: post #20

awb wrote: post #7

The relatively low salaries compared to the huge amounts of power is almost begging for insider trading, influence peddling, etc. > The salary of a Congress member varies based on the job title of the congressman or senator. Most senators, representatives, delegates and the resident commissioner from Puerto Rico make a salary of $174,000 per year. https://www.indeed.com/career-advice/pay-salary/congressman-... Then a…

Honestly, we should give the Federal Reserve performance-based pay. Elon Musk has literally been paid billions for Tesla's phenomenal stock outperformance, why shouldn't we pay the Fed Chairs tens of millions for sustained real GDP growth above 4% balanced with low wealth inequality, low inflation, and low unemployment? They have the most important job in America and they should be paid like it if they do well

That invites short term decisions to pump up markets. I think the Fed should be concerned with long term health of the economy.

Re: Fed to ban policymakers from owning individual stocks

#62

Post by dragonwriter » Thu, Oct 21, 2021, 9:32 PM UTC

brodouevencode wrote: post #2

Does anyone think the SEC will take similar actions against elected officials? Given there have been plenty of stories about this happening it seems like it should be up for consideration.

> Does anyone think the SEC will take similar actions against elected officials?

No, because the SEC doesn’t have authority to do that.

Congress did that, once, but then delayed it becoming effective until finally they decided to repeal it.

Re: Fed to ban policymakers from owning individual stocks

#63

Post by spaetzleesser » Thu, Oct 21, 2021, 9:32 PM UTC

srcreigh wrote: post #30

errantmind wrote: post #22

Earlier quoted context omitted.

This breaks down when multi-term policy decisions need to be made. This would only push them to kick the can down the road

What if they are paid based on performance in 10 years, after they are out?

It’s the same problem as CEO pay. But measuring success is even harder.

Re: Fed to ban policymakers from owning individual stocks

#64

Post by FpUser » Thu, Oct 21, 2021, 9:32 PM UTC

99_00 wrote: post #47

awb wrote: post #7

The relatively low salaries compared to the huge amounts of power is almost begging for insider trading, influence peddling, etc. > The salary of a Congress member varies based on the job title of the congressman or senator. Most senators, representatives, delegates and the resident commissioner from Puerto Rico make a salary of $174,000 per year. https://www.indeed.com/career-advice/pay-salary/congressman-... Then a…

If Jerome Powell was greedy he would simply get a job in the private sector. Anyone who is capable of getting the job as Fed Chairman will have no problem making a lot, easily and legally. Believe it or not, some people go into public service with the desire to serve the public. Sometimes there are people who have already achieved tremendous financial success.

>"Believe it or not, some people go into public service with the desire to serve the public."

If under "public" you mean riches who buy those "public servants" in bulk using legalized bribes and cushy corporate jobs after terms then I would agree.

I am sure there are few good exceptions but they do not paint the whole picture.

Re: Fed to ban policymakers from owning individual stocks

#65

Post by tessierashpool » Thu, Oct 21, 2021, 9:33 PM UTC

smolder wrote: post #14

awb wrote: post #7

The relatively low salaries compared to the huge amounts of power is almost begging for insider trading, influence peddling, etc. > The salary of a Congress member varies based on the job title of the congressman or senator. Most senators, representatives, delegates and the resident commissioner from Puerto Rico make a salary of $174,000 per year. https://www.indeed.com/career-advice/pay-salary/congressman-... Then a…

This is about the Fed banning it's own policymakers from owning them, not about congress.

thank you for this extremely important correction. I was reading the comments instead of the article and wondering in the back of my mind how the Fed even had jurisdiction over Congress.

sure hope it remains visible in the comment hierarchy.

Re: Fed to ban policymakers from owning individual stocks

#66

Post by tessierashpool » Thu, Oct 21, 2021, 9:34 PM UTC

tshaddox wrote: post #45

davesque wrote: post #38

Earlier quoted context omitted.

Yeah, the other day this really hit home for me. I don't know why I hadn't previously thought about it in such clear terms. Being a congressperson has to be one of the most morally hazardous occupations in the world. I mean, you have more direct control over how our entire society works than almost anyone else. So you become the perfect target for bribery and gain access to countless levers that you could pull in you…

How about just actually making the bad stuff illegal and actually investigating and prosecuting it? Note that we’re discussing known bad things that congresspeople are doing.

in many, many cases the bad stuff is already illegal, and it's the investigations and prosecutions that are missing.

Re: Fed to ban policymakers from owning individual stocks

#67

Post by mywittyname » Thu, Oct 21, 2021, 9:35 PM UTC

N0tAThr0wAway wrote: post #21

Someone once told me that a stipulation for public service should involve converting all your holdings into index funds only. Thought that was an interesting proposal.

Hi Senator, congratulations on the election results!

I'm u/mywittyname with Beutsche Dank I run an index fund for senators. How it works is, you give me a call anytime you hear about an opportunity and my team of crack investors will look into it, making the trade if we feel it is a good fit. We currently have 200 congresspeople on board and have been beating the S&P500 benchmark by 500% annually.

It's a $1,000,000 minimum, but we can line up financing if you can't swing that just yet.

Re: Fed to ban policymakers from owning individual stocks

#68

Post by missedthecue » Thu, Oct 21, 2021, 9:35 PM UTC

awb wrote: post #7

The relatively low salaries compared to the huge amounts of power is almost begging for insider trading, influence peddling, etc. > The salary of a Congress member varies based on the job title of the congressman or senator. Most senators, representatives, delegates and the resident commissioner from Puerto Rico make a salary of $174,000 per year. https://www.indeed.com/career-advice/pay-salary/congressman-... Then a…

CEOs make $20 million a year and have done crimes like insider trading. Lots of congresspeople are already independently wealthy.

I don't think a pay raise would impact it at all

Re: Fed to ban policymakers from owning individual stocks

#69

Post by Roboprog » Thu, Oct 21, 2021, 9:35 PM UTC

smolder wrote: post #14

awb wrote: post #7

The relatively low salaries compared to the huge amounts of power is almost begging for insider trading, influence peddling, etc. > The salary of a Congress member varies based on the job title of the congressman or senator. Most senators, representatives, delegates and the resident commissioner from Puerto Rico make a salary of $174,000 per year. https://www.indeed.com/career-advice/pay-salary/congressman-... Then a…

This is about the Fed banning it's own policymakers from owning them, not about congress.

Perhaps someone will start a “Speaker of the House” index fund which the officers from the Federal Reserve can buy, since they won’t be able to buy individual stocks.

Re: Fed to ban policymakers from owning individual stocks

#70

Post by onlyrealcuzzo » Thu, Oct 21, 2021, 9:36 PM UTC

toomuchtodo wrote: post #12

awb wrote: post #7

The relatively low salaries compared to the huge amounts of power is almost begging for insider trading, influence peddling, etc. > The salary of a Congress member varies based on the job title of the congressman or senator. Most senators, representatives, delegates and the resident commissioner from Puerto Rico make a salary of $174,000 per year. https://www.indeed.com/career-advice/pay-salary/congressman-... Then a…

Your last sentence is really the key thesis. This isn't an argument to pay representatives (whether that be Congressional or at monetary policy orgs) more, but to have robust controls to better detect and action corruption. Greed knows no bounds (see: corrupt billionaires and Dark Triad personality traits [1]) and humans will be humans, so strong systems must be designed and implemented to defend against improper beh…

Alternatively - maybe it's not so great that government is so big and central and has so much power. Politicians are gonna find ways to corrupt that power no matter what.

The same could be said for megacorps.

Unfortunately, we don't live in an ideal world. China and Chinese SOEs are going to be big and powerful and centralized for the foreseeable future no matter what - and if we don't have anything to oppose them - that doesn't seem great either.