The New York FED, Essay Example

At the New York Fed, the culture prior to the financial crisis that was witnessed in 2008 was risk averse. According to Beim, the culture was one that employees were extremely deferential towards their seniors, and were reluctant to put up a spirited fight on the bad things. They simply followed the rules issued by the authority (Denison 112). In other words, the workers were more or less like the armies who would execute any order issued by the seniors. Even so, the culture has slowly faded in most companies and a decentralized culture has been accommodated. The culture tends to push decisions to the people on the grass root (Greider 20).

This organizational culture presented problems to the firm because most people who were well meaning, intelligent and hard working just sat and watch as bad events happen. In view of the activities leading to the financial crisis, people could not simply agree to join hands and fight the vice eating up the organization (Clark 75).

Things changed for good to turn around the predicament. At New York Fed, changes were adopted which included increasing the number of bank examiners. Additionally, they established a risk management group to supervise banks on systematic issues (Alessi et al 14). Even so, Beim confesses that the culture has not changed much, if a report by NPR Broadcast is anything to consider. Arguably, most institutions in the Wall Street have become extremely cautious to avoid facing such economic crisis again (Meltzer 10). Internal regulations have also played a big role, because self-discipline goes a long way in ensuring that people follow rules and report anything fishy. The regular exercise of checks and balances is equally playing a role in ensuring financial crises are averted.

Works Cited

Alessi, Lucia., et al. “Central bank macroeconomic forecasting during the global financial crisis: the European Central Bank and Federal Reserve Bank of New York experiences.”    Journal of Business & Economic Statistics (2014) 32#4 pp: 483-500

Clark, Lawrence. E. Central Banking Under the Federal Reserve System: With Special Consideration of the Federal Reserve Bank of New York. New York, NY: Macmillan, 2005. Print

Denison, Daniel. R. Corporate culture and organizational effectiveness. London: Wiley, 2009. Print

Greider, William. Secrets of the temple: How the Federal Reserve runs the country. New York, NY: Simon and Schuster, 2009. Print

Meltzer, Allan. H. A History of the Federal Reserve 2 vol, Chicago: University of Chicago Press, 2010. Print