From The Big Picture:

NY Federal Reserve Chairman Resigns Suddenly
By Barry Ritholtz – May 7th, 2009, 8:41PM

Wow, that has to be a record for shortest tenure ever at the NY Fed.

His resignation letter (below), is as Dealbook notes, rather disingenuous:

Mr. Friedman was chairman of the New York Fed at the same time he was a member of Goldman’s board. He also had a substantial stake in the firm as the Fed was crafting a solution to keep Wall Street banks afloat. Denis M. Hughes, deputy chair of the board, will take over as the interim chairman, the New York Fed said in a statement. (Read Mr. Friedman’s letter after the jump.)

Because the New York Fed approved a request by Goldman to become a bank holding company, the chairman’s involvement in Goldman was a violation of Fed policy, The Wall Street Journal said in an article earlier this week.

The New York Fed asked for a waiver, which, after about two and a half months, the Fed granted, the newspaper said. During that time, Mr. Friedman bought 37,300 more Goldman shares in December, which have since risen $1.7 million in value

Why is this a problem?

RobM, who gave us the hat tip explains why:

He had permission to both serve on the board of Goldman Sachs abd be he President of the NY FED. It is his actions while on it that are despicable. He bought 37000+ shares of Goldman Sachs while Prresident of the Fed. Ususally your money is in a blind trust and not permitted to engage in traades w/ any company you are involved in.


A mofo’ing CROOK.

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