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The Federal Reserve is feeling blue

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If money bought happiness, the Federal Reserve would be the happiest place on earth.

Over the past few years, the Fed has enormously expanded its balance sheet—literally creating dollar denominated banking reserves out of thin air with a series of keyboard strokes. It's been granted new authority over a vast array of financial and non-financial companies. And it's monetary policy is widely credited with helping the U.S. avoid a depression following the financial crisis.

As it turns out, however, the rise of the Federal Reserve in power, prestige and economic salience has not been accompanied by buoyant spirits.


Shahien Nasiripour of the Huffington Post wrangled an internal Fed survey revealing that the central bank's workforce is frowny-faced.

The findings from the April survey of roughly 400 employees, presented to Fed staff during multiple meetings in June and July and obtained by The Huffington Post, show a workforce that is demoralized, and an institution where teamwork is non-existent, innovation and creativity are discouraged and employees feel underutilized.

An overwhelming majority of Fed regulators are proud to work at the central bank and believe in its mission of supervising the financial system and ensuring stability. They also trust and have good relationships with their immediate supervisors. But most say that top leaders are failing the organization, in part by not communicating honestly, and that employees are in the wrong jobs, or are poorly managed.

The Fed, concerned about employee morale and its impact on performance, has held numerous group meetings to discuss the survey findings.

Hilariously, the report blames Alan Greenspan and the culture of deregulation. Greenspan left the Federal Reserve in 2006. I'd hazard a guess that a great many of the Fed's policy employees never worked under Greenspan. Ben Bernanke took the helm in 2006. After seven years, you don't really get to keep blaming your predecessor.

There's also another really weird bit in the report:

The culture of non-regulation is gone, but the Fed has a new problem. Several current and former Fed regulators blame the morale shortcomings on senior officials such as Dan Tarullo, the Fed governor who oversees the central bank's regulatory and supervision staff, and his top lieutenants. Tarullo is viewed as a polarizing figure intensely disliked by big bank executives, but admired by financial reformers. He is an ideological break from Greenspan, but carrying out the regulatory mission has proven difficult.

So it is Greenspan's fault for deregulating and also Tarullo's fault for being disliked by bank executives!

It appears that confusion is a sign of demoralization.

—By CNBC's John Carney. Follow me on Twitter @Carney.

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