Can you think of a man who can better manage risk than the former Chief Risk Officer of an overleveraged bank that collapsed into itself? Apparently the Fed can’t, because on Halloween, they hired Michael Alix, the Chief Risk Officer from Bear Stearns, as a bank regulation adviser at the New York Fed (thx to Allen Short for the link).
See any problems there?
The appointment goes to the heart of a growing problem that has cropped up along with the myriad rescue efforts aimed at reviving the financial system: few people actually know what was in the risky mortgage bonds that brought the system to a halt.Analysts say this makes efforts at resolving the problems ripe for conflict of interests, or impropriety at the very least. This certainly seems to be the case in the New York Fed’s new hire. The New York Fed declined to comment on Alix’s appointment.