E. Gerald Corrigan, who helped alleviate the ’87 stock slump, has died at age 80

E. Gerald Corrigan, who as the aggressive president of the Federal Reserve Bank of New York helped cushion the Wall Street crash in the late 1980s, died May 17 in a memory care center in Dedham, Massachusetts. Hey what 80

Complications from Alzheimer’s disease were the cause, her daughter Elizabeth Corrigan said.

As chairman of the Federal Reserve Bank in Minneapolis from 1980 to 1984 and then of the New York Fed from 1985 to 1993, Mr. Corrigan used his powers as a regulator to help resolve national and global financial crises and to remedy. to some of the causes of episodic market instability.

“He played a crucial role in providing psychological reassurance for a few critical days after the stock market crash,” Paul A Volckerthe former chairman of the Federal Reserve Board said when Mr. Corrigan has retired by the Fed in 1993, referring to its shares after the fall in the Dow Jones industry average more than 22 percent in a single day in October 1987.

In that upheaval, Mr. Corrigan urged Fed Chairman Alan Greenspan to reassure markets that the Federal Reserve would pump all the money needed into the financial system to reduce volatility. He also played a pivotal role in other crises: he helped the Fed deal with the collapse of the investment bank Drexel Burnham Lambert in 1989 and Salomon Brothers in 1991, and deal with rising inflation, emerging market debt. and the need to regulate global credit risk.

After Corrigan retired from the Fed, he joined Goldman Sachs, where he became CEO in 1996 and later chairman of the firm’s international consultants, co-chair of the corporate standards committee and first non-executive chairman of his bank. commercial. now known as Goldman Sachs Bank. He retired from Goldman in 2016.

Edward Gerald Corrigan, known as Jerry, was born on June 13, 1941 in Waterbury, Connecticut. His father, Edward, was a restaurant manager. His mother, Mary (Hardy) Corrigan, was a librarian.

He received a Bachelor of Social Science in economics from Fairfield University in Connecticut in 1963. At Fordham University in New York, he received a master’s degree in economics in 1965 and a doctorate in the same subject in 1971. (Years later, he donated $ 5 millions to each university to establish chairs.)

After teaching at Fordham for a year, he joined the Federal Reserve Bank of New York as a researcher in 1968 while still working on his doctorate. When Mr. Volcker, the chairman of the New York Fed, became chairman of the Federal Reserve Board in 1979, he recruited Mr. Corrigan as a special assistant.

During his tenure at the Fed, Corrigan was appointed chairman of the Basel Committee on Banking Supervision by the governors of the world’s central banks, a position he held from 1991 to 1993. He was also vice chairman of the Federal Open Market Committee from 1984 to 1993. In 1992 he was appointed co-chair of the Forum of Russian-American bankerswhich helped the former Soviet Union develop a market-oriented banking and financial system.

In addition to his daughter Elizabeth, Mr. Corrigan leaves another daughter, Karen Corrigan Tate, from her marriage to Linda Barlow, which ended in divorce; his wife, Cathy Minehan, who was president of the Federal Reserve Bank of Boston from 1994 to 2007; his stepchildren, Melissa Minehan Walters and Brian Minehan; a sister, Patricia Carlascio; and five grandchildren.

Mr. Corrigan’s romance with Ms. Minehan raised doubts about a possible conflict of interest when she was at the Fed and he was at Goldman Sachs in the mid-1990s, but at the time he said they had consulted attorneys for prevent leaks of sensitive information that could benefit your company.

During his leadership, the Fed was criticized for failing to curb abuses by the scandal-scarred Bank of Credit and Commerce International. But Mr. Corrigan said when he retired that “if it weren’t for the Fed, there is a good chance that BCCI would still be in business.”

In his remarks in 1993, Volcker stated that Corrigan had “a good conceptual understanding of the financial world, but above all he knows how to get things done.”

“This is a rare quality in the bureaucratic world he grew up in”, Mr. Volcker added.

When the market crashed in 1987, for example, Fed officials planned to provide a turgid technical response.

“I said it’s the last damn thing we need,” Corrigan said in Sebastian Mallaby’s “The Man Who Knew: The Life and Times of Alan Greenspan” (2016). “What we need is a statement that contains about 10 words.”

Mr. Greenspan followed Mr. Corrigan’s advice, saying (in 30 words) that the Fed would make all the money available while Mr. Corrigan imported major banks to continue lending to support the markets.

when Mr. Corrigan has retired from the Fed, he said he would take a job in the private sector where “I’ll try to just work six days a week instead of seven.” The aftermath of the 1987 market crash, she said, was his most memorable moment.

“In terms of heart rate,” he said, “that takes the prize.”