August 16th, 2012
(Guardian) – Vice-presidential candidate denies he profited from a 2008 meeting with Fed chairman in which officials outlined fears for financial crisis
Paul Ryan, Mitt Romney‘s vice-presidential running mate, sold stock in US banks on the same day he attended a confidential meeting where top level officials disclosed the sector was heading for a deep crisis.
The congressman on Monday denied profiting from information gleaned from the meeting on 18 September 2008 when Federal Reserve chairman Ben Bernanke, then treasury secretary Hank Paulson and others outlined their fears for the banking sector. His office said he had no control over the trades.
Public records show that on the same day as the meeting, Ryan sold stock in troubled banks including Wachovia and Citigroup and bought shares in Goldman Sachs, Paulson’s old employer and a bank that had been disclosed to be stronger than many of its rivals. The sale was not illegal at the time.
Not long after the meeting, Wachovia’s already troubled share price went into free fall. It plunged 39% on the afternoon of 26 September alone as investors worried the bank would collapse. It was eventually taken over by Wells Fargo for $15bn, a fraction of its former value.
Citigroup’s share price fell soon after the meeting. In October 2008 Citigroup was among the largest beneficiary of the troubled asset relief program (Tarp), the taxpayer-funded bailout of the banking sector. Read More Here
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