Bloomberg has a good analysis today of how the Federal Reserve Board’s emergency actions have diminished the authority of regional Federal Reserve Bank presidents. The strongest criticism comes from Bill Poole, who held the regional presidency in St. Louis until he retired earlier this year. Poole, now a senior fellow at the Cato Institute, tells Bloomberg:

The Board has usurped authority. This dramatic change in policy direction has not been announced or even acknowledged.

The story mentions the Fed’s $600 billion intervention in the mortgage market, on which the regional officials didn’t have a vote. It also mentions the fact that the effective federal funds rate has been trading well below the target set by the Federal Open Market Committee, which includes the regional presidents. “That can’t be an accident,” Poole says.

Here’s how Barclays Capital analyst Ethan Harris sums up the new governance model:

If I am a regional Fed bank president, I have had my power diminished a lot. I think of it as war powers for the Board of Governors.