Elizabeth Warren: The Feds Are Far Too “Cozy” With Wall Street

Cliff Owen/AP

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Pointing to recently leaked audio recordings between officials at the Federal Reserve and Goldman Sachs bankers, Sen. Elizabeth Warren (D-Mass.) is slamming regulators for being far too timid and compliant when it comes to laying down the law with big banks.

“Well, ultimately this report tells us exactly what we already knew — that the relationship between regulators and the financial institutions they oversee is too cozy to provide the kind of tough oversight that’s really needed,” Warren said in an interview with NPR.

While the secret recordings, which were captured by former bank examiner for the Federal Reserve Carmen Segarra, do not expose any flagrant wrongdoing by either side, they do reveal an uncomfortable, wholly inappropriate eagerness to please Goldman Sachs. And let’s keep in mind Segarra’s secret tapes were recorded in 2012, at least four solid years after the financial crisis.

After This American Life and ProPublica jointly released the tapes last week, Warren and Sherrod Brown (D-Ohio) have also called for a federal investigation into the dealings of the New York Federal Reserve.

The New York Fed has since “categorically rejected” the accusations, but Warren tells NPR the public needs more individuals like Segerra who are willing to speak up against institutions deemed “too big to fail.”

“We need to look at whether or not we’ve got the right tools to protect the kind of people who will speak up. But, but what we’ve got to start with is we’ve got to expose what happened here, we’ve got to look at what the available tools are, but we’ve got to give the message loud and clear to the Fed: Um, this isn’t gonna work — you work for the American people, you don’t work for the big banks.”

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You expect the big picture, and it's our job at Mother Jones to give it to you. And right now, so many of the troubles we face are the making not of a virus, but of the quest for profit, political or economic (and not just from the man in the White House who could have offered leadership and comfort but instead gave us bleach).

In "News Is Just Like Waste Management," we unpack what the coronavirus crisis has meant for journalism, including Mother Jones’, and how we can rise to the challenge. If you're able to, this is a critical moment to support our nonprofit journalism with a donation: We've scoured our budget and made the cuts we can without impairing our mission, and we hope to raise $400,000 from our community of online readers to help keep our big reporting projects going because this extraordinary pandemic-plus-election year is no time to pull back.

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