Should this surprise anyone?
An interesting study by a Phd candidate at the University of Chicago is being released which shows a statistically high incidence in taxi trips between the NY Fed and big NY banks clustered around FOMC meetings:
Mr. Finer writes that “highly statistically significant patterns in New York City yellow taxi rides suggest that opportunities for information flow between individuals present at the New York Fed and individuals present at major commercial banks increase around” meetings of the interest-rate setting FOMC.
“Their geography, timing and passenger counts are consistent with an increase in planned meetings causally linked to the incidence of monetary-policy activities,” he wrote. “I find highly statistically significant evidence of increases in meetings at the New York Fed late at night and in off-site meetings during typical lunch hours,” which is suggestive of “informal or discreet communication.”
“As reported by the Wall St. Journal, but curiously absent from Fox Business reporting – both organizations are owned by Rupert Murdoch – Mr. Finer used government-provided GPS coordinates, vehicle information and other travel data to track taxi traffic between the addresses of the New York Fed and major banks. His research pointed to increased traffic between the destinations around lunch and late evening hours, which suggested informal meetings were taking place, Mr. Finer wrote in his paper. He found elevated numbers of rides around Federal Open Market Committee meetings, with most of them coming after the gathering.” (WSJ)
This should not surprise anyone. It actually makes sense. The Fed is owned by the Too Big Too Fail banks and, without question, have an inordinate amount of influence on Fed policy.
You can read the entire article here: Increase in Fed/NY Bank Meetings Around FOMC Meetings.