Jul 30

Fed Reporter Pedro Da Costa Is Leaving The Wall Street Journal After Asking Yellen “Uncomfortable” Questions (ZeroHedge, July 30, 2015):

It was virtually inevitable.

As we reported on June 17, Pedro Da Costa, one of the more determined and controversial Fed reporters, was shocked to learn he was no longer welcome to ask Janet Yellen uncomfortable questions, questions related to the biggest scandal currently gripping the Fed: its leaks of proprietary information to “expert network” Medley Global (recently sold by Pearson to Japan’s Nikkei) and one which has since morphed into a criminal investigation.

As a reminder, this is the Q&A that got Pedro in hot water with Janet Yellen during the March press conference:

PEDRO DA COSTA. Pedro da Costa with Dow Jones Newswires. I guess I have two follow-ups, one with regard to Craig’s question. So, before the IG’s investigation, according to Republican Congressman Hensarling’s letter to your office, he says that, “It is my understanding that although the Federal Reserve’s General Counsel was initially involved in this investigation, the inquiry was dropped at the request of several members of the FOMC.” Now, that predates the IG. I want to know if you could tell us who are these members of the FOMC who struck down this investigation? And doesn’t not revealing these facts kind of go directly against the sort of transparency and accountability that you’re trying to bring to the central bank?

CHAIR YELLEN. That is an allegation that I don’t believe has any basis in fact. I’m not going to go into the details, but I don’t know where that piece of information could possibly have come from.

PEDRO DA COSTA. If I could follow up on his question. I think when you get asked about financial crimes and the public hears you talk about compliance, you get a sense that there’s not enough enforcement involved in these actions, and that it’s merely a case of kind of trying to achieve settlements after the fact. Is there a sense in the regulatory community that financial crimes need to be punished sort of more forcefully in order for them to be—for there to be an actual deterrent against unethical behavior?

CHAIR YELLEN. So, the—you’re talking about within banking organizations? So, the focus of regulators—the banking regulators—is safety and soundness, and what we want to see is changes made as rapidly as possible that will eliminate practices that are unsafe and unsound.

We can’t—only the Justice Department can bring criminal action, and they have taken up cases where they think that that’s appropriate. In some situations, when we are able to identify individuals who were responsible for misdeeds, we can put in place prohibitions that bar them from participating in banking, and we have done so and will continue to do so.

The difficult question starts at around 45:30 – look at Yellen’s face when asked the question for a clue as to her next move.

Shortly aftert this exchange we learned that indeed the Justice Department did launch a criminal probe for leaks at the Fed itself as was disclosed shortly after the above exchange, a probe which may very well implicate anyone, including Janet herself hence her eagerness to avoid any “touchy” questions.

Nonetheless, after “shutting down” Pedro, the result was a “chilling effect” on any actually probing questions, and the same day that Pedro announced he would not be present at the June Fed press conference, not a single other journalist dared to ask anything on the topic. We commented:

… In retrospect, we can understand why. In a world in which the Fed perceives itself as omnipotent, and where anyone even daring to question its motives, its methods or its track record, is a threat to be eradicated or at least barred from all future opportunities for further humiliation and disclosure that the emperor has indeed been naked from day one, at even such token events as a press conference where questioners are generously afforded 60 seconds in which to expose said emperor.

This is what Pedro found out the hard way today, a discovery which also allowed the rest of us to finally comprehend the farcial, hollow facade this country has passing off as its crack “financial journalists” asking “tough questions” all of whom ended up being nothing more than “access scribes”, terrified to open their mouths and lose their access, an outcome which incidentally just might force them to do some real reporting for once, instead of sending rhetorical letters to the middle class asking why it keeps being “stingy” instead of spending its hard-earned money, and making the beloved Fed’s life so difficult…

The hint in the last paragraph of course was that Pedro had also managed to rub certain of his colleagues and editors, some who are observed with far greater regard by the Fed because of their willingness to only ask preapproved questions.

Sure enough, moments ago all this was confirmed when Pedro just announced that tomorrow would be his last day at the Wall Street Journal.

And that, in a nutshell, is how the world’s “freest press” operates.


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One Response to “Fed Reporter Pedro Da Costa Is Leaving The Wall Street Journal After Asking Yellen “Uncomfortable” Questions (Video)”

  1. Marilyn Gjerdrum Says:

    Anyone who read the Wall Street Journal in 2008-2009 was fully warned and given full descriptions of MBS and other terrible Wall Street frauds. I was able to foretell the 2008-2009 crash thanks to the WSJ and the excellent financial reporting within.

    Now, just like the rest of the destroyed free press, the situation is too shaky to allow any truth to enter……We have lost our free press, and with it, our access to the truth of our leaders and the greedy gut bankers. Shutting down any viable questions to the FED tells me we are in deep trouble.

    I remember in the 1970s and 1980s we were paying for the Vietnam war, and we suffered deep inflation and high unemployment as a consequence. The free press covered the information accurately, and the FED had to act. At one point, their rates were at 22% bank to bank……The crap they are pulling now, giving the banks free cash year over year, while the rest of us pay would never have been allowed. The rates were nasty, home loans were unaffordable, but at least we got it fixed……..Now, they are not even attempting to pay for anything, they are pocketing all they can, and the people get all the costs.

    They lie about everything. We have an endless “recovery”, a 5.2% unemployment rate regardless we have nearly half the working age Americans suffering long term unemployment. Gallop comes out with an article with a carefully selected polling of 1000 corporate stooges claiming 90% job and wage satisfaction regardless wages have not gone up in decades……While housing, energy, medical, dental and food costs continue to skyrocket, but an average wage of $14.00 an hour is wonderful……

    Our credibility to the world is gone. I don’t know how many Americans believe the lies they are told daily, but I don’t believe their claims of 90%. Our government’s credibility is shot, so they now shut down the last avenue of truth…….financial reporting. Until recently, they valued those who invested enough to provide some truth……………Now that a few individuals controlling huge funds of hundreds of millions run the market, the average investor no longer matters. Regardless, the small investors make up some of the funds those few people control, they are of no consequence? The ones in control are given advanced warnings, and they control and manipulate the entire US stock market.

    This is really bad news, and the corporate media won’t cover any of it……Our wonderful free press is DOA. The amount of people who equate that clown in the white house to a JFK is appalling, but that happens when the Media becomes the Message…..in the words of Marshall McLuen 50+ years ago……

    “1984” is now the reality.

    So very depressing…..

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