My thanks to a query from Sven N. Thommesen for stimulating this line of thought.
Member banks within each of the 12 districts of the Fed elect 6 of the 9 regional board members and the president for that district. The New York district is especially important.
The Treasury intends to take minority equity stakes in some banks of its choosing. It will therefore have a partial control over the Fed. This further diminishes the Fed’s independence, which was always something of an illusion anyway.
10:59 am on October 9, 2008
