Rosengren, Dallas chief exiting Fed
Boston prez cites health; ethics cloud both moves
Two top Fed officials, including Eric Rosengren, longtime president of the Federal Reserve Bank of Boston, announced they’re retiring after ethics questions were raised this month over their trading activity in the financial markets.
In addition to Rosengren, Robert Kaplan will step down as president of the Federal Reserve Bank of Dallas early next month, the Dallas Fed announced Monday.
The two officials’ financial disclosures sparked criticism from government watchdogs after they revealed extensive stock trading in 2020, when the Fed was spending trillions of dollars stabilizing financial markets and boosting the economy.
Though the investments by Rosengren and Kaplan were permitted under the Fed’s rules, they raised at least the appearance of conflicts of interest, which Fed policy discourages. Sen. Elizabeth Warren, a Massachusetts Democrat, sharply criticized the trades and urged Fed Chair Jerome Powell to bar stock ownership by Fed officials.
Kaplan said he would resign Oct. 8.
Last year, Kaplan made trades worth at least $1 million.
Rosengren had invested in funds that owned mortgage-backed bonds, the same kind that the Fed has been buying hundreds of billions of dollars’ worth this year.
Rosengren said earlier Monday that he is retiring this week for health reasons. He became eligible last year for a kidney transplant and said the stress of working at the Fed during the pandemic recession worsened his health.
“It has become clear that I should aim to reduce my stress so that I can focus on my health issues,” Rosengren said in a written statement.