(News Bulletin 247) – Jerome Powell recently estimated that his annual salary of around $190.00 was fair. But, as Bloomberg points out, it barely matches the basic emoluments of associates in investment banks. And, very far from those of the presidents of the ECB, the Bank of England or the National Bank of Switzerland.

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Jerome Powell bears a heavy responsibility. Just one of his words can influence the markets and thus create movements of hundreds or even trillions of dollars. It is therefore normal that his remuneration is, in absolute terms, relatively high.

As Bloomberg reported, the chairman of the US Federal Reserve (Fed) said in a Q&A session last week with Carlyle investment firm co-founder David Rubenstein to hit around 190,000 dollars per year. Remuneration that he considers “fair”, that is to say correct.

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However, the American press agency points out that this remuneration, which is set by the American Congress, is considered too low by observers, “some arguing that it does not reflect its role as leader of the guaranteeing institution of the largest economy in the world,” she wrote.

More than half as much as Christine Lagarde

Citing figures from the specialized site Wall Street Oasis for 2021, the American agency explains that his emoluments are just within the range of the base salary of an associate of an investment bank on Wall Street, which according to Bloomberg, owns generally at least three years of experience, which is still much less than Jerome Powell, who is 70 years old.

In addition, we are only talking about basic gross remuneration. However, bank employees obtain bonuses at the end of the year, which substantially inflate their remuneration. By integrating this element, Powell’s remuneration is closer to that of a financial analyst employed by a bank with a seniority of three years ($194,000 per year).

Powell’s compensation is “shocking for one of the most powerful financial positions in the world,” Patrick Curtis, founder of Wall Street Oasis, told Bloomberg. “People hang on to every single syllable of Jerome Powell. What he says can send the markets off in other directions. If you look at the big picture, he earns just a little bit more than a first-year analyst out of college. That makes the compensation on Wall Street even more impressive,” he continues.

It could be argued that Jerome Powell has a salary similar to that of his colleagues at other central banks. But it is nothing.

According to the annual accounts of the European Central Bank, the gross annual remuneration of Christine Lagarde, her counterpart within the European institution, amounted to 421,308 euros for 2021, against, therefore, 180,000 euros for Jerome Powell (on the basis of a conversion carried out by us).

An important heritage

Andrew Bailey, the Governor of the Bank of England, obtained a total remuneration of 597,592 pounds for the 2021-2022 financial year, ending in March 2022, or just over 671,000 euros. Another example is that of the President of the Swiss National Bank (SNB), Thomas Jordan, whose total remuneration amounted to 945,000 Swiss francs in 2021, or around 956,000 euros, according to the management report of the Swiss institution.

Still, Jerome Powell has built most of his fortune on his previous roles as a lawyer and investment banker. According to several American media, his net worth was estimated between 20 million and 55 million dollars at the time of his appointment, in 2017, Bloomberg arriving for his part at a figure of more than 110 million dollars. The echoes evoke for their part a fortune excluding real estate, on average, at 65 million dollars.