Daniel Tarullo, Fed’s “Regulatory Point Man”, Unexpectedly Resigns

Last October, as part of the Podesta email leaks, we disclosed the particularly close relationship between Fed governor Dan Tarullo and Barack Obama, which emerged as part of a previously undisclosed memo involving the AIG bailout. We speculated that as a result of this now public disclosure it was possible that Tarullo's days at the Fed were numbered should Donald Trump win the election. Trump won, and moments ago Dan Tarullo unexpectedly announced that he is resigning in early April, just days after the Fed's general counsel Alvarez also announced that he is departing the Fed.

What makes Tarullo's resignation particularly notable is that Tarullo has been the Fed's "regulatory point man" since 2009, suggesting some regulatory friction has emerged.

In light of Trump's vow to crush Wall Street regulations, one can see why Tarullo thought his services are no longer necessary.

Tarullo’s brief resignation letter to Fed Chairwoman Janet Yellen didn’t give a reason for his departure. He said he has been privileged to serve at the Fed for eight years. The letter said his resignation will take effect “on or about” April 5.

As the WSJ further notes, "Tarullo’s future has been a matter of debate in the financial sector. He was appointed by President Barack Obama in January 2009 and overhauled the way the Fed oversees the largest U.S. banks.

His term doesn’t expire until 2022, but President Donald Trump is widely expected to appoint someone else to the currently vacant post of Federal Reserve vice chairman in charge of bank oversight.

 

Mr. Tarullo has effectively filled that role, even without that title. A Trump nominee likely would challenge Mr. Tarullo’s influence.

In a statement, Yellen said that "Dan led the Fed's work to craft a new framework for ensuring the safety and soundness of our financial system following the financial crisis and made invaluable contributions across the entire range of the Fed's responsibilities."

"My colleagues and I will truly miss his deep expertise, impeccable judgment, wise insight, and strategic counsel."

Tarullo, 64, was appointed to the Board by President Obama for an unexpired term ending January 31, 2022. During his time on the Board, he served as Chairman of the Board's Committee on Supervision and Regulation. He was also Chairman of the Financial Stability Board's Standing Committee on Supervisory and Regulatory Cooperation.

In his brief departure letter, Tarullo just said two sentences:

"After more than eight years as a member of the Board of Governors of the Federal Reserve System, I intend to resign my position on or around April 5, 2017. It has been a great privilege to work with former Chairman Bemanke and Chair Yellen during such a challenging period for the nation's economy and financial system."

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With his departure, the market appears even more confident that a substantial crackdown on Wall Street regulations is imminent, and has pushed stocks to new all time highs.

 

via http://ift.tt/2kXB7Ys Tyler Durden

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