On Richmond Fed President Jeffrey Lacker's Unceremonious Exit From the Bank and Why I Still Love Jeff Lacker
Eight years ago, I was but a humble CPA review hack and rogue Fedbasher, protesting the bank and writing up insults toward the Fed in my spare time as the economy fell apart. I hated them all. But then I found Richmond Fed president Jeff Lacker. As the economy was taking a giant shit, he was the one fighting for reason, and he kept doing it while the Fed was throwing free money at the problem.
On March 3 2009 I wrote:
DEAR JEFFREY LACKER, I LOVE YOU. I mean, at least as much as an anti-Federal Reserve sound money advocate can love a Fedhead.
For a Federal Reserve president, Richmond Fed's Jeffrey Lacker is pretty bold. He's already shown that he isn't afraid of a little dissent and has opposed Big Daddy Bernanke on more than one issue.
And now he's at it again, this time questioning the "independence" of the Fed in the face of unique credit programs it's pulling out of its ever-loving ass to thaw credit in the United States.
I believed it, too. Jeff Lacker was the Fed president we all needed. He was going to save us from oblivion.
I put hearts on that shit and everything. And so I watched him closely, all the while I was protesting the San Francisco Fed with "THE FED WANTS YOUR GRANDMA TO EAT ALPO" signs, getting a custom "End the Fed" t-shirt done by the shop near my office which SF Citizen caught me wearing at an End the Fed rally. I was all in on hating on the Fed, but still I held out hope that Jeffrey Lacker had our backs. He was the cockblocker of the FOMC, surely he couldn't be that bad.
I moved to Washington DC shortly after that and still showed up to lame anti-Fed protests at the Board, all the while knowing Jeff Lacker was holding it down being a salty asshole for the economy's sake. It would be OK.
In 2011, the Richmond Fed flew a rainbow flag and the good ole boys flipped. I celebrated their gayness, I supported the Fed flying that gay God damn flag. And I scammed an "I gay love the Fed" t-shirt from that whole debacle.
While serving as Managing Editor for an accounting publication, I hiked by the bank and rescued cats in Richmond and all the while kept faith that Jeff Lacker was the Fed president we all needed. I stopped focusing on the Fed because I was mired in accounting news, but every time I hauled ass up past the bank I smiled knowing the economy still had a chance because Lacker was going to question this whole free money thing that has left us at unprecedented interest rates since shit hit the fan.
I even named a rescue kitten I fostered after our esteemed Fed president. Ugliest cat I ever met. But still, named her after him (before I realized "she" wasn't a he).
Jeffrey got adopted with her brother James (named after former Fed general counsel) and stopped being ugly like a year or two ago. Maybe she's still ugly, I dunno.
So I suppose it goes without saying that this news about Jeffrey Lacker today has disappointed me. While I was marching back and forth in front of the San Francisco Fed in an End the Fed t-shirt years ago, I held this shred of faith in the humble economist I'd grown to admire. And on its surface, what came out today about Jeff Lacker's fall from grace might shatter all that. But it doesn't.
Despite how awful it all seems -- and it is -- with the #crooksgonnacrook hashtags and calls to lock him up, I can't help but believe there was no nefarious intent in his leaks. He likes to talk about this stuff. He just so happened to talk too much in this one instance.
Perhaps I'm giving him too much credit. But when he was the lone voice of reason in a time when the free money whores at the Fed were throwing money they had no right to manufacture from thin air at the economy swirling down the drain nearly a decade ago, how big of an issue is this really?
Binyamin Appelbaum writes in the New York Times:
Jeffrey M. Lacker, the president of the Federal Reserve Bank of Richmond in Virginia, resigned abruptly on Tuesday, saying that he had broken the Fed’s rules in 2012 by speaking with a financial analyst about confidential deliberations.
Mr. Lacker said he also failed to disclose the details of the conversation even when he was questioned directly in an internal investigation.The confession and resignation shed light on a nearly five-year-old mystery. In October 2012, Medley Global Advisors, a firm that tracks policy developments for financial investors, sent a note to its clients describing previously undisclosed details of the Fed’s plans for a new phase in its bond-buying campaign.
Someone inside the Fed has been leaking directly to Jon Hilsenrath for years, why exactly is this any different? Because he got caught? Because he owned up to making the mistake of overtalking with an analyst because he nerds out hard on this stuff and loves to talk about it? There is no evidence that Jeffrey Lacker stood to gain anything from this "leak," financially or otherwise. It is my belief that he did not have ill intent, and I remind you once again that I've been painted up carrying signs protesting the Federal Reserve for, oh, eight or nine years at least? If anyone wanted to vilify a Fed asshat for this it would be me.
Lacker's statement on his exit feels like a sputtering out, where he had the potential to leave a glorious legacy of cockblocking and shit-disturbing throughout his tenure at the bank at its most difficult time.
I don't think I've felt anything like this since I was 13 and Kurt Cobain killed himself, when his widow Courtney Love read his suicide letter to a crowd gathered in Seattle. "It's better to burn out than fade away," Cobain wrote before he shot a lethal dose of heroin and blew his brains out.
I still love you, Jeffrey Lacker. You stood up during the darkest times of our economy to say "can you just fucking not" while all your colleagues were throwing money that wasn't theirs after the problem, and I will not believe this takes away from that. Call me delusional. Call me a fan girl. But the esteemed cockblocking bad ass of the Richmond Fed I know isn't a crook and he isn't a piece of shit and his legacy deserves more than to say he went out like this. That's what I have to say.