Is Wall Street front-running the stock trades they do for the Fed?

Front running

Matt Taibbi thinks so

It’s becoming abundantly clear that at some point we’re going to start to hear details about monstrous front-running operations involving the major banks on Wall Street.

Here’s why this will be explosive. Let’s assume the Fed manipulates the stock market. Big Wall Street brokerages do the trading for them. A brokerage gets an order from the Fed to buy 100,000 shares of Citi (to push the price up.) The brokerage first a) buys 10,000 shares for themselves, b) executes the Fed order which pushes the price of Citi up, then c) sells the 10,000 shares they bought seconds ago at a profit. That’s front-running. It’s way illegal.

This may be why the Fed resists so vehemently against being audited. They say such actions might endanger their independence, but that’s evasion and deception. An audit, something businesses and governmental agencies routinely undergo, would not even slightly hurt their independence.

Unless of course they are hiding something.