40 Burst results for "Central Bank"
An inflation gauge tracked by the Fed slows to still-high 6%
"A government report shows one measure of inflation eased last month, but is still at a high level. It's called the personal consumption expenditures index and it shows consumer prices rose 6% in October from a year earlier, down from 6.3% a month earlier, but still elevated. The Federal Reserve closely monitors the index, and the number likely reinforces its intent to keep boosting interest rates as it tries to cool the economy and ease the worst inflation in decades. We need to raise interest rates to a level that is sufficiently restrictive to return inflation to 2%. But fed chair Jerome Powell told the brookings institution yesterday the Central Bank could slow the hikes when it meets in two weeks. Sagar Meghani, Washington.
Fresh update on "central bank" discussed on Thinking Crypto News & Interviews
"Clearly, I think there's certainly a push we just wrapped up midterm elections. You have new members entering both the House and the Senate. There's likely going to be some shifts in committees and who may or may not share different committees. So I think until all that kind of settles, it's hard to kind of maybe see light at the end of the tunnel for something to actually get through. But post all that, you know, is it possible that we see something in 2023? Sure. Do I think the events with FTX maybe apply some speed or some pressure to try to do that? Sure, I don't know if it will impact the ability for that to happen. You know, clearly there's bipartisan bills. On both floors to your point that you mentioned the lemma show brand and some of the other ones. But still, I think where we sit today versus where we'll be called in February or March or even beyond that in 2023, I don't think we see any sort of immediate action. But sometime in 2023, sure, I think it's probably fair. So from our perspective, we engage with all the parties, whether it's regulators, whether it's folks on the hill. To make sure that the platforms are sensibly insufficiently regulated. And that's really, I think, the guardrails we want, all the nitty Gritty in between, I think we can we can solve once we get there. If you think about how markets have evolved over the years, the market structure and the rule sets that everyone operates in today wasn't in ten years ago, 20 years ago, 30 years ago, 40 years ago. It's been an evolution. So let's get something out there that allows participants to operate and then let's iterate on it. And let's make it better. For sure. Final question here before we hit some fun wrap up questions. Every Central Bank around the world is working on a CBDC essential bank digital currency years talks about the digital dollar here in the U.S.. You know, what are your thoughts on that? And how that may change markets given money's tokenized on the blockchain, more transparency, maybe I don't know if the right word is velocity of money, but what are your thoughts on those upcoming CBDCs? Yeah, like I like the way you framed it, the velocity of money. I mean, clearly there's a lot of advantages that cryptocurrencies bring to the ability to move funds around in a more instantaneous if you want to call it that manner, then you can if you want to move USD or Euro or whatever it is around. So clearly there's the bridging of a gap of that and allowing folks to have access and ease of access and movement of whatever currency, that Central Bank is responsible for via digital dollar. From my perspective, I'm a wait and see approach. There's a lot of folks that are heavy pros on it. There are a lot of folks that are maybe against it. I'm probably in the middle and more of just the camp of a love reading about it. I love seeing different sides of the fence place their arguments and I love to see how the government's in the central banks are thinking about it. You know, ultimately, I see financial markets digitizing themselves over time. Which markets are first, who knows?
Sorelle Amore: A Central Digital Credit System Favors the Government
"I want to play one more cut for you This is sarella Moore explaining digital currency She's pretty popular on these video platforms Talking again about the danger of this stuff Folks it is nothing more than a mechanism to make your phone not only a homing Beacon and a location device but to make it a device to be able to shut off your money at a moment's notice So you can't escape you can't get out of a country you can't get out of a location and you can't buy anything if the government deems you unworthy deplorable or one of the Here listen to this The government is already able to program what its citizens can and can not spend their money on Over the last few years they've limited millions of people's ability to buy things like train tickets passports and luxury goods They're able to do this because of China's intense social credit system that links each person's identity and actions to their bank account Allowing the government to see and to control everything a citizen does with their money And it seems like the west is paying attention The nations like Sweden South Africa and Canada trials of programmable Central Bank currencies are already underway In fact almost half of the world's nations are at some stage of implementing this kind of programmable money meaning no matter where in the world you live this technology is likely only a few years away Ah there you go Wow that's not coming here Really Really it's not there I'm telling you there are some Republicans who support this Two No it is coming here We still got time to stop it She said something very interesting there too Did you guys catch it Did you mention train tickets And tickets and plane tickets The great way to keep dissidents air quotes from traveling out of your country if you're the Chinese Communist Party right Shut down their money so they can't buy a plane ticket out Then they can say oh is this a prison state No no it's not a they can leave any time
Fresh update on "central bank" discussed on Bloomberg Daybreak Europe
"1% at a 136, one of its best months in fact for a long time for the Japanese currency. Across your Bond space, the rainbow dollar index currently the ten year benchmark I should say currently at 360 two. That's just move hard by two basis points after yields came off sharply yesterday. Brent is trading at 86 $87 a barrel. That's a gain of two tenths of a percent and WTI back above $80 a brow. Again if two tenths OPEC plus is meeting over the weekend, Bitcoin at 17,100. That's the check of your markets more for the top stories around the world. Stephen Carroll. Good morning Tom, thank you, fair cherry Jerome Powell, says the Central Bank may slow its rate hike pace as soon as it's December meeting at a speech at the brookings institution pal said the timing is less significant than how high rates need to go and how long policy needs to stay at a restrictive level. The comments will likely cement expectations for a 50 basis point hike at the December meeting. Research from the London school of economics suggests that UK food prices have risen an additional 6% because of Brexit over the two years to the end of 2021, the study said customs checks, rule of origins requirements and sanitary measures for trade and animals and plants all added to friction for importers and exporters. And Elon Musk wants to get into your brain. He says his Neuralink company aims to start putting its coin sized computing brain implant into human patients within 6 months. The device will allow a person dealing with a debilitating condition such as ALS or the after effects of a stroke to communicate via their thoughts, global needs 24 hours a day on air and on Bloomberg quicktake powered by more than 2700 journalists and analysts and more than a 120 countries. I'm Stephen Carroll. This is Bloomberg. Wow, it's another quite amazing objective, I suppose from Elon Musk to try to help people with these awful diseases to be able to improve their lives, having said that big mask to try to help people with these awful diseases to be able to improve their lives, having said that big ambitions is it realistic. Elon Musk, ambitions and family, surely not. But this 6 month deadline has been announced because of ongoing discussions that the company is having with the Food and Drug Administration in the U.S., so it is on the back basis of actually discussions with regulators about how this would work. But as you say, we are used to Elon Musk backed companies making very ambitious targets. There is apparently quite a lot of composition actually. And one thing that sets them apart, the Neuralink, and the Musk companies, that they actually have a robot that then cuts out a piece of your skull before they implant this chip. They say it makes the whole story, but some of their competitors don't have to have that kind of intrusive intrusive surgery. So they have labs where they're testing this out on monkeys. Yeah, I think itself is controversial. They try to improve the conditions. Fascinating in terms of if it comes to fruition, of course, huge implications. Well, I mean as in which it could be used, but question marks as to whether or not actually it's achieved and he's been criticized in the past for suggesting that this is going to come in and be used and be produced and be a viable earlier than maybe it will. Yeah, because it's a huge field of research and I mean, I remember someone I think at Cambridge University who did an implant, but it was on the skin rather than in the brain. It was sort of it is a big field of research. I think very, very interesting story on Elon Musk. Okay, thank you so much. Stephen Cowell for that story and the rest of our top news this morning. Should we swiftly go over to the U.S. and check in with Amy Morris, who's getting ready for Bloomberg daybreak. Amy, I wonder if that's one of the stories you're looking at, what else is on your show? There is a lot coming up today, Caroline we continue to monitor reaction to fed chair Powell speech yesterday when he signaled that the Federal Reserve would slow the pace of interest rate increases, so we'll talk about what that means for equity markets with Michael Houston with CMC markets, will also get insight from senior economist Jennifer Lee at BMO capital markets, and we'll get some guidance from global market strategist Brian levitt with invesco, not just about Powell's speech, but about some of the market dynamics that we've been watching. And finally, I know you know about this, the state dinner plan for tonight at The White House quite posh the first in more than three years will go behind the scenes with Bloomberg government reporter Jack Fitzpatrick, all of that much more coming up this Thursday morning on Bloomberg daybreak. The menu lobster Maine lobster and what is an award winning Oregon cheese? Yes. And yeah, there's also going to be a Grammy Award winning artist to serenade them as well. So yeah, it's going to be pretty fancy. But listen, I think that French glasses apparently French crystal being used for the wide, even though it's American white. The issues, though, are quite fundamental in terms of the relationship between France and the U.S.. Amy, thank you so much for being with us. Have a great show. Pretty big daybreak up next. If you're listening along to DAB digital, you're here Bloomberg. Surveillance. But yeah, quite interesting. The tensions between Europe and the U.S. right now. Yeah, we'll watch to see whether of course Macron wants to see if he can if he can move the dial at all in terms of that inflation reduction act and what the European sea is the constraints on European businesses in all important U.S. market, of course. If anything moves on that, let's get back to these markets then. European and U.S. stock futures rose, all those U.S. stock futures now points in lower between two tenths and three tenths of a percent. Asian equities are very strong rally there. Today, of course, after China appeared to soften its COVID stance and of course the fed chair, drone power signal to slow down in the pace of interest rate hikes, even though he did say that the terminal rates likely to be higher and higher for longer. Let's bring in the Geraldine sunstroke, whose portfolio manager for asset allocation strategies at pinco, what a fantastic guest to get on today. Geraldine, good morning. Thank you for joining us. What is your assessment of the market's reaction? To J pal, essentially sticking, sticking with the script, but not pushing back on this loosening of financial conditions. Yes, I think the market clearly was a little bit surprised given the rally that we've had. But I would say at this stage, everything and all the good news of probably priced in when we look at the cost that the curve has priced in the U.S. for 2023 in the second half. But more importantly, in terms of equity markets, they have all, but embrace the fact that there will be no recession when we look at earnings consensus and PE multiple okay. In that case, what's your view on the terminal rate? Has that shifted at all? I mean, surely the next question is if rates remain higher for longer how long is longer? We haven't really changed our view on this particular call speech. We've had fundamental data in between. So we think that the peak of interest rate is going to be a number around 5% so that doesn't change. Where we are a little bit different is our view that inflation is going to stay sticky, bringing inflation down from say 10% to 4% is usually easy. However, there's a lot of inertia between your 4% and your 2%. And this is really where we think that the market might be a little bit ahead of itself in pricing such cut so early into 2023 or we would have to face a deeper recession than our forecast. So there seems to be something that is not quite consistent around. And now, of course, we have to face the reopening of China, which could create a new wave of increase in commodity price
Bo Li Calls on the Left to Support a Central Bank Digital Currency
"Listen to boli former deputy governor of people's bank of China Talk about welfare food stamps contracts purchases and a digital bank did your Central Bank digital currency and I want you to listen very closely at the end How he throws in the social justice buzz term to make sure all you left these will buy into this Check this out The third way we think about improved energy inclusion is through what we call programmability That is CDC can allow government agencies and private sector players to program to create smart contract To allow targeted policy functions for example welfare payment For example consumption coupon for example food stamp By programming CBDC those money can be precisely targeted for one kind of people can own and one of the kind of use this money can be utilized for example for food So this potential programmability can help government agencies to precisely target their support to those people who need support So that way it can also improve financial inclusion Folks these people are not stupid
Fresh update on "central bank" discussed on The Charlie Kirk Show
"Yes, they're safe for getting it. What we do not know is the long-term effects after getting it. But my guess and you know, I can only guess because nobody's done that science yet. Is that even these vaccines long-term won't cause a problem because they're just the RNA? We've also learned this evening that doctor ovida fuller has died. She's the internationally renowned virologist from Ann Arbor, who was instrumental in securing the emergency use to authorizations for the three COVID vaccines. Tragic she passed away, but there's a lot of, I mean, seemingly healthy people dropping dead for otherwise inexplicable reasons. So have you been able to isolate that statistic Edward and forgive me if I haven't seen it in your work or your publishing of hyper healthy marathon runners, athletes, have we seen a statistic and inarguable objective statistical increase in either their blood clots or them dropping dead? That's data that we don't have access to and in the humanity humanity project. We're just doing metadata the bodies and the disabilities without identifying what they are. We're looking for help from medical professionals and statisticians to then drill deeper down into the data. And we call that part of our project, the vaccine damage report. Right now we have an excess mortality reported disability report. And the vaccine damage is to come. So we don't have those numbers yet. Because a lot of the data is quite frankly hidden from us. I do know there are some in the insurance industry that are suspicious that the vaccines either believe it is or suspicious who are potentially forming quietly coalitions to sue the government for data that they need to properly price their products. And the insurance industry has been warning about sigma increases for quite some time, especially for younger Americans. So let's conclude with all of this. I believe this all ties to the great reset and that this points to that couple minutes remaining your thoughts at. There's certainly, look, I have objectively I can say what's going on is true. The vaccine in my humble opinion is causing access to death and that's the excess disability. The who and the why, I purposely left out of the book because this book is for the marginal mind to convince people. And I don't want to assault their worldview. But I have a thesis as to what's going on. And I believe it all revolves around death. Global debt in the end of the monetary system that started in 1913 with the Federal Reserve. It's a multi generational Ponzi scheme that needs constant growth. And we've exported Steve Bannon and I have talked before and I'm sure you've heard. We've been exporting dollars in the form of debt since 2000 and then that really accelerated since 2008. So the Federal Reserve debt based monetary systems in the four corners of the globe. It needs constant growth. But if it's everywhere in populations are declining, the chickens have come home to roost. So it's the end of the system, which if you're a banker, Central Bank, or you know this, so you wouldn't be nice to have a system of control in place called the great reset, blame climate change, blame pandemic, explain anything but yourself and your policies and your idiocy. And then so minute remaining, what can be done from this point forward other than just general awareness? Don't live in fear. We're going to go through a very hard transition period globally. The U.S. will suffer less in the rest of the globe, but we're going to suffer, and don't live in fear. And if you believe what I believe, get the message out, because this is about the marginal mind, the mainstream media is captured, our regulatory agencies are captured. So once we convert enough people to our system of belief, which is something's happened, you've been poisoned this win. So we need to convince the marginal mind I'm a capital markets guy. So on the margin markets change on the margin. So this is a marginal mine kind of fight. It's an infowar, as you know. And my book is hopefully going to be helpful in converting a marginal line to waking up to what's just happened..
Brad Mills Saw Red Flags With FTX Ages Ago
"We know FTX is a big what the FTX just went on. We've talked about it. We saw that it happened. I don't know how deep we want to go in that right now, Joel. Is that what we want to do? We want to go into and talk about FTX. You know, I think we could talk a little bit about it, but you warned about this as well, right? When were you talking about FTX and the red flag? Back? Back in January, when I started first paying attention to the large growth in DeFi Ponzi schemes like ohm protocol, Wonderland protocol, Tara Luna. I started to realize that this massive bubble was going to blow up the same as other bubbles and Ponzi's in the traditional markets have before because they've basically just rebuilt everything that was toxic and over leveraged nonsense from the traditional markets. In crypto. And they called it innovation and they put it on a blockchain and called it DeFi. Well, it doesn't take a lot of digging to start to realize it's unsustainable. To be able to get that kind of yield, ten, 20% yield when we're at historically low interest rates and traditional markets, something risky, extremely risky is going on there. And every time that there was a huge hack, like the wormhole bridge got hacked or there was a problem with the Luna, the exit door, the protocol only had a certain amount of liquidity for you to get out to burn the USD tokens and turn it back into Luna and then sell the Luna. There's only so much liquidity. And as these things grow so big, they just become unsustainable. And FTX, like Alameda, three hours capital, jump, which is another one that still hasn't gone down yet. That's at risk of it. And a bunch of other big, huge VC firms like paradigm and a 16 Z and all these bellwether VC brands. I mean, they're all kind of doing all this degenerate stuff and bailing out all these hacks that always happen in DeFi. And trying to provide liquidity into the system, like a Central Bank does.
Fresh update on "central bank" discussed on The Charlie Kirk Show
"Okay. Yes. But it does. But let's take the vaccine out of it for a second. COVID was a convenient excuse for global governments in central bankers because coming into 2019, there was a financial crisis brewing global growth was starting to synchronize and slow together all the countries. And there was in finance, we saw a repo crisis overnight lending rates shot up in September of 2019 and credit markets were becoming unglued. And then luckily, COVID hit in 2020 and the central banks, especially the fed, were able to print 65, the fed printed 65% more money supply in one year. The largest single year increase we've ever seen. And they were able to kick the can down the road. Well, right now, we're definitely heading into a recession in Q one and Q two of next year. My partners at finance technologies and I have talked about that on Steve Bannon and we just don't do vaccine work. We do finance work. I think it's all tied together. I think you're right. So I've had a thesis that if you're going to have a global sovereign debt collapse because since the great financial crisis, all we did was kick the can down the road for 12 years. We did unprecedented global government spending and we did unprecedented money printing. And then we've had for the last 12 years zombie corporations and the rich, those who own paper assets and real estate assets, gut richer, and the rest of the global peoples of the world, the workers. And the rest of us just kind of muddled the law. You were not part of the party. And if you're going to have a global debt collapse, it wouldn't be convenient to have an excuse to point to and blame. And wouldn't it be convenient to have a control system perhaps to stop travel, gatherings and protests. Let's look at China right now. China is having massive protests. A lot of people think it's due to the COVID measures. I say the zero COVID policy is a way to prevent bank runs, which we've been hearing about in China. And also to put down protests because China is imploding economically, they hit a demographic wall in 2020 right when COVID hit mysteriously. So China's population is in decline and much like Japan that saw the same demographic decline and they had two lost decades. Demographics is destiny and China after the great financial crisis built infrastructure and real estate that's not being filled by people. That debt is now bloated. So a lot of what you see going on in the world, the geopolitical COVID. That's why the COVID measures are so synchronized. So was the vaccine made to be the safe and unaffective. I don't know. I wasn't in the room. I think the vaccine was a mechanism mechanism of control to get compliance and make people used to vaccine passports, which would then be rolled into Central Bank digital currencies and universal digital IDs. Let's give them the benefit of the doubt. They screwed up the vaccine so badly that they're not to be able to implement what they wanted to do. So that's why it was so synchronized and so global. And now that the data is in, the global governments are doing a rut row Homer Simpson hedgerow fade..
UK PM Rishi Sunak Is Pushing Heavily for CBDCs
"News that you can use. We did mention that the UK prime minister Rishi sunak is pushing heavily for CBDCs. I watched the video. I don't think it's in this article here, but there is a video of him and it just, it makes me want to retch because they are selling CBDCs as though they are going to be such a blessing for the people and it's going to just lead to all kinds of ways that we can use our funds and make everything more secure and the bottom line is. It's a trap folks. It's all a trap. Central Bank digital currencies will be used in the hands of nefarious people which many of our leaders already are to track everything you do. And if you want to question if this reality is something that could be a reality here, look up the Chinese social credit score system. They implemented this a few years ago where they are tracking everything people buy and sell. They're tracking what they post on social media. Who they are in contact with. And if they decide that you said something, they don't like or you are somehow in relationship with people that might be undesirables, they lower your social credit score just like that Black Mirror episode nosedive. If you haven't seen it, go watch it.
Fresh update on "central bank" discussed on Bankless
"Why wouldn't we want to have the most technologically sophisticated currency in the world? By the way, that doesn't mean that Central Bank digital dollar, I think stablecoins issued by private issuers can play that role. But I want the dollar to it's a huge advantage to Americans for the dollar to be the leading reserve currency and having stablecoins proliferating with enhanced data. Senator, to me, I know you're a big proponent of some stablecoin regulation. I definitely want to get there later in this conversation, especially after we talk about some of the role that the SEC has to play and how crypto is regulated. But of course, we would be remiss to talk about or not talk about. They fall out of FTX and I'd just like to take a peek into what the current state of Capitol Hill is now that we are hearing this news about FTX. What is the gossip? What is the conversation that's happening with regulators on Capitol Hill about this news? Well, actually, you know, we had a hearing this morning where we were evaluating nominees, mostly for the governance of the FDIC. And this came up. And you could actually get a real sort of condensed version of this discussion. I had some colleagues who have used the collapse of FTX as a way to paint the whole sector with this broad damn everything. Crypto is all a big scam and thank God you're doing everything you can to keep it out of the real economy and so on. I've tried to make the argument that it's a profound and fundamental mistake. To confuse bad action by a bad actor with the asset with which the bad action occurred, right? So what do we know about FDX? We know that they took customers assets and lent it to a related hedge fund, apparently, or family office, whatever you want to call Alameda. That's like wildly inappropriate to do that, right?
Bank of England Raises Key Interest Rate by 0.75 Point
"The Bank of England has made its biggest interest rate increase in three decades in an attempt to beat stubbornly high inflation the Central Bank has boosted its key rate by three quarters of a percentage point to 3% The aggressive move comes even as the bank predicted a two year economic contraction through to June 2024 Bank of England governor Andrew Bailey said the move was necessary to keep inflation down The rate increases the Bank of England's 8th in a row and the biggest since 1992 it comes after the U.S. Federal Reserve announced a fourth consecutive three quarter point jump as the fight against inflation takes
"central bank" Discussed on Markets Daily Crypto Roundup
"Bitcoin ether and other risk assets popped up, then dropped in the aftermath of the latest policy pronouncements from the U.S. Central Bank. The headline news was that the Federal Reserve raised its core interest rate by a hefty three quarters of 1% for the fourth consecutive time. But there's a bit more to the story that we'll cover in the headlines today. The largest cryptocurrency by market value remains steady and relatively more resilient compared with traditional stocks even after the shock, as coindesk analyst Glenn Williams wrote earlier in the day, the crypto winter is given bullish investors the opportunity to accumulate more at favorable costs. Quote, whether asset managers are picking the right price point to go long, will play out over the next 12 months, but they appear to be ahead of the curve. Back to Ethereum for the moment this morning's first mover newsletter from coin desk noticed something interesting about the number two token. Adoption of layer two blockchains, which are additional protocols built as mass adoption, low cost solutions on top of platforms like Ethereum, have recently soared with the number of transactions processed by these platforms, reaching a record high of 5.78 million. The data from orbiter finance measures the number of transactions processed by layer two solutions over the past 12 months. Ethereum based solutions are, of course, in the lead. Elsewhere, Dogecoin is the biggest gainer among altcoins over the past week, but it plunged nearly 10% as other risk assets also sold off. In what were pretty brutal post Federal Reserve markets, the native token for exchange crypto dot com was among the few exceptions, recently rising more than 6.7%. Another token bucking the bear market trend was AR the native token of blockchain based data storage solution are weave, which surged as Facebook and Instagram apparent company meta said it will utilize the web three platform to archive their creators digital collectibles. The token jumped more than 60 percent from $10 and 50 cents to $16 and 60 cents over the past 24 hours, according to data source masari. The abrupt rally has boosted the cryptocurrency's market cap to $838 million, making it the third largest web three token worldwide. We'll have more on this story in the headlines too. Today's crypto coverage comes courtesy of coin desk, markets analysts, it's a little desma and am cargo blade. Bitcoin is currently turning a $20,165. That's down a little bit more than one out of 10% over the last 24 hours. While ether is trading at 1533 bucks per token. That's down one and a quarter percent over the same time period. According to the coin desk market index. And taking a quick look at the coin desk market index across top traded tokens, we're looking at an absolute rating of 1011.22, which is down just over half a percent since our show yesterday. All right, now before we get to today's traditional markets update, let's take a quick look at some top headlines. We'll start today with a little bit more color on yesterday's Central Bank announcement, where chairman Jerome Powell pulled a fast one on markets, giving first good news, and then immediately pouring cold water on it. Turning things abruptly negative. To understand what happened, you have to understand how these meetings actually work. There are basically two parts of a Federal Reserve policy announcement day. First is the statement, a carefully worded, closely watched written document, which traders compare against past statements, and sometimes literally parse on a word by word basis. The other part is the press conference, which follows the statement, and where the Federal Reserve chief takes softball questions from seemingly allied or at least extremely credulous members of the financial media. Yesterday's statement surprise traders with its recognition that, as we told you before the statement, monetary policy takes quite a long time to actually work its way from the Central Bank doing a thing to the economy and behavior responding to it. That recognition strongly suggested that the fed's historically aggressive pace of interest rate increases necessary because they kept levels far too low for far too long and created a number of problems including but not limited to out of control inflation was close to over. But as we've told you on the show many times before, markets are forward looking price mechanisms. They peer into the future to see what they think prices will be, and then they bid up or down prices today in anticipation of that believed future. So, as we've discussed before, the fed doesn't actually need to stop what it's doing for markets to rev up their engine and resume bull mode. Markets just need to believe that the worst may in fact be over in the future is predictable again. And that's what happened. Risk assets from Bitcoin to traditional equities rocketed up on the release of the policy statement, only to have the U.S. Central Bank chief basically say the opposite during the interview, which sent markets shooting back down. This was honestly an impressive bit of illusionist bull. The Federal Reserve knows that markets are completely dependent on what they do. And with major parts of regional non U.S. economies around the world repeatedly breaking due to the incredible pace of U.S. rate increases, they needed to provide themselves with at least some cover they could point to that says that they understand that monetary policy takes time to work. At the same time, if they had left it there, then we'd be back in the same situation after the July meeting, where Marcus rocketed up and recovered much of what the U.S. Central Bank had worked very hard to push down. So it was the old one two punch. They suckered in the rooms with an inviting faint, a show of weakness, and then walloped them with a haymaker that said markets down for the day, leaving many traders with a sense of whiplash. As zero hedge aptly put it, markets got rug pulled, you'll find their commentary in the show notes if you'd like more. In other news, it's a bit shocking to see how far collectible tokens have come since exploding out of the shadows with the popularization, at least slightly of NBA top shot less than two years ago. Today we find the Facebook parent company meta's latest bid to expand into the crypto ecosystem via Instagram, which announced that they'll host a marketplace for NFTs starting with support for polygon, but with expectations it'll expand soon to Solana, the company announced. According to the release, the features are live for a small group of creators in the United States already, and will be expanded to other countries soon. Mehta suddenly a crypto native says that information for their collections can now be viewed on the open sea platform. According to a blog post, meta's commerce and web three lead said, quote, a creator economy potentially worth $100 billion can not be realized without a digital economy with greater portability than today's web services. The social media behemoth recently took a huge hit related to losses to their expansive but much mocked metaverse effort, and whether related or not they seem to be adopting more and more of web three's narrative, saying the company's ongoing strategy is to help creators earn a living. Also worth noting is that the company says they won't charge fees in their digital collectibles market until at least 2024 and will cover any blockchain related gas costs. In other words, they'd really like some adoption. This story comes to us from the block crypto and a meta blog post, which has more details. And finally, Andy is crypto industry has formed a new advocacy body almost four months after the previous one was disbanded under cloudy circumstances, according to a release out this morning. The new organization will be called the barat web three association or BWA. A shift in branding towards web three from the earlier blockchain and crypto asset focus council known as the BAC C and by the way, the word Barack represents the nation of India. Coindesk sabotage Singh as the scoop. All right folks, let's move on here, but as a quick aside, I've decided that I'm going to return to Twitter and see how things play out in the now Elon Musk own social network as it goes through what looked to be significant changes that I hope will be positive over the coming months. You can follow me at Adam B Levine. And traditional market stock features dropped and the dollar rose following the U.S. Central Bank's one two punch, futures for the S&P 500 declined by a sharp two and a half percent while the Dow Jones Industrial Average slid by just over one and a half percent. Contracts for the tech focused NASDAQ saw the deepest declines, dropping more than three and a quarter points in early morning trading. In Europe, the regional stocks 600 fell 1.7% while London's FTSE 100 fell 1.3% in the moments before the British Central Bank increased interest rates by the most since the early 1990s, following the fed's lead in increasing rates by a whopping three quarters and one percentage point. Germany's Dax index saw similar to clients with a drop of 1.75%. In Asia results were more mixed Hong Kong's hang sang index fell 3% while Mainland China Shanghai composite fell just two tenths of 1%. In Japan, the nikkei two two 5 traded exactly flat, like zero change actually from our show yesterday. In commodities markets, brand crew, the global benchmark for oil climb just under two thirds of 1%, now trading at $95 per barrel, while gold declined a steeper 2.4% trading at $1618 per Troy ounce. Today's traditional markets covered draws from The Wall Street Journal, the FT and market watch. Stay tuned for after the break, we'll take a look at some possible learnings we can glean from Big Bang Credit Suisse's biggest mistakes, at least it's recent ones. Back in a minute.
Powell likely to be pressed on whether Fed will slow hikes
"Just how high will the Federal Reserve raise interest rates as it wraps up its meeting today The fed is expected to announce a hefty three quarters of a point hike in its key short term rate that would be its fourth straight increase but what many fed watchers are hoping is that cheer Jerome Powell will hint that the Central Bank may ease the pace of its hikes that officials have stressed that they need to sharply raise rates to tame inflation which reached 8.2% in September so far this year the fed has raised its key rate 5 times and an aggressive pace that is sent borrowing rates surging and has heightened the risk of a recession dot of water Washington
Ahead of harsh winter, tourism roars back in Mediterranean
"Travelers are returning to the Mediterranean countries and tourism is booming thanks to a strong U.S. dollar and public demand after years of travel restrictions Among countries to beat annual record revenue halls from tourism are Greece and Portugal Stelios who left his job at Greece's Central Bank to offer boat trips around lesser known Greek islands describes the current situation as much welcomed People after COVID after two years of frustration and probably putting some money aside they decided no they should have occasion And I think the income of the budget willing to spend rose The stronger than expected comeback is a blessing for Mediterranean countries facing high levels of debt But the rebound may also ease the continent's tilt toward recession I'm Mimi Montgomery
ECB Raises Interest Rates by 0.75 Point
"The European Central Bank has made another large interest rate hike The ECB has piled on another outsized interest rate hike aimed at squelching out of control inflation increasing rates at the fastest base in the Euro class history and raising questions about how far the band intends to go with a threat of recession looming over the economy The 25 member governing council rate is interest rate benchmarks by three quarters of a percentage point at a meeting in Frankfurt matching its record increase from last month and joining the U.S. Federal Reserve in
Trish Looks Back at the Stock Market Crash of 1929
"Well, interestingly enough. As you went through the years prior to the crash of 1929, you know, those really happy giddy days, 1920s, think The Great Gatsby and all that. Well, that was all about a lot of money in the system. Times were good and the fed was printing. And then, in 1929, is the bottom sort of fell out from under, and everybody came up with this realization that the party just couldn't continue indefinitely. You had a course that really, really bad market day. The great crash, October 24th, 1929, what do you know? We just passed that anniversary known as black Thursday. It was the day the largest sell off of shares in U.S. history on a percentage basis. So what did the Federal Reserve bankers think was worthwhile to do at that time? Take money out of circulation. Like that made sense, right? The market's plunging. You're going into a major economic challenge. Really, that was the beginning of The Great Depression, and these brilliant academics over at the Central Bank, they decide to take money out of circulation, something that Milton Friedman was very famous for criticizing. In fact, some have also argued, and I'm of this belief that the Federal Reserve actually contributed to having that big market sell off back on October, October 24th, 1929. Because they were the ones that were printing all the money, making everything. So easy, right? Easy, money's not easy. Earning money is not easy. Money doesn't grow on trees. And yet, when you create an environment where you print so much money, putting that much Cass into the system, things may seem good for a little while, but eventually going to pay the price. And that's exactly what happened in 1929. So these brilliant, you know, academics decided, well, we're going to take all the money out, right? Because all that money supply that, that created the problem. So now we're just going to take it out. And so they decreased the M two, the money supply. Significantly massively, and by taking all that money out of circulation, they ensured an even greater crisis. So
Is It the End of The Fed?
"Okay, we got guy high inflation, major market volatility, and the threat of a real problem, like I mean systemic crisis, all of what we saw in 2008. The difference is we don't have any firepower. How are we going to fix this given that we've already spent trillions and trillions of dollars? I mean, estimates somewhere between 6 and $7 trillion that was printed since March 2020. It really makes you stop and think about whether or not now's the time to reconsider that computer and replace. So the Federal Reserve bankers that, my gosh, they just keep getting it wrong. Let's start first here with a little history lesson. Why this all came into being? It came about in 1914 after a bunch of investment banks kind of demanded it. You see, we had a big problem in 1907. The banking system was really facing a crisis. And so all the banks got together, lead actually by JPMorgan. Don't forget JPMorgan's CEO Jamie Dimon is the one who keeps warning of something that's even worse than a recession. What does that mean while we can talk about that too? But anyway, back in 1907, they had this big panic in the banking system. So all the big bankers they got together, and they came up with a band aid, right? A way to fix what was going on. They basically suspended deposits from turning into currency, and that was their way of fixing things. But they weren't too happy about it. It was pretty scary stuff. And so they went to government and they said, you know what? We got to find a better system. So in 1914, the Federal Reserve, the first Central Bank of the United States was created and the idea was they were going to prevent any kind of major, major banking crisis. And then along the way, they said, okay, we're going to try and stabilize employment, and we're going to try and make sure there's not too much inflation. And that was sort of their charter. But somewhere along the way, a funny thing happened on the way to the forum. Some were along the way, they became, I don't know, shall we say a little engrossed in themselves in their own ability?
Nigel Farage on Why Liz Truss Was the Victim of a 'Globalist Coup'
"Nigel Farage joins us right now. Nigel, welcome back to the program for our American listeners. Can you offer some clarity about what the heck is going on in your beautiful sister country across the pond? An astonishing four months, Boris Johnson, the elected prime minister goes because, frankly, he wasn't truthful with the British public about many things. And elected as a conservative, he rather governed as a liberal, and people got upset. Then the queen dies. You know, she'd been there for 70 years. That was very destabilizing. We then got a new prime minister who attempted to introduce conservative philosophy. She wanted to reduce the size of a state and cut taxation. And the world went to war against her. The International Monetary Fund spoke about our mini budget in a way they'd never spoken about any country ever before. The American administration piled in. The German Chancellor piled in, and in the end, you might argue that some of their tax cuts weren't very well thought through, but we have been through in the course of the last two weeks. Nothing less than a globalist coup, we get a mangled Jeremy hum, out of left field, becomes Chancellor of the exchequer, and now we have a new prime minister. He's taken over today, our third and 7 weeks, but the name of Richie sunac, I can pronounce it, even if Joe Biden can't. And he of course is our first former Goldman Sachs prime minister. He's a globalist. He's a supporter of Central Bank, digital currencies. He's barely conservative at all. And it all goes to show that the British Conservative Party isn't conservative at all. And we have a real problem on our hands.
U.K.'s Disaster Is a Warning For the U.S.
"Right? I mean, and I think that we need to have this discussion about whether or not what happened in the UK could actually happen here at home. The one thing we've got going for us, of course, is that we are the world's reserve currency, which enables us to do things that other countries like the UK can't really do. I mean, she had good intentions and I'm a big believer in lowering taxes in order to stimulate the economy. The question is, can you afford it at that point in time? I tend to be of the belief that typically during challenging economic periods sometimes that lower tax environment is what helps to give a little back to the people. I would point out, then that when the previous administration, Donald Trump lowered taxes, we actually had the highest tax revenues on record in the history of this country. What do you know? Now most people who don't like lower taxes, of course, would dispute that. As for Liz trust, she did it at a time when the Bank of England really didn't have the proper support or the ability to properly support her either. It's one of the reasons why these central banks can't get out over their skis like ours has by printing so much money because then what do you do when the chips are down, right? If you don't leave any powder dry. So I think we need to think about the ramifications of this already. You're seeing some fear in the markets that certainly been reflected in our markets and you have only to look at the yields on treasuries, which keep going up. There was one of the fed governors out making the rounds on TV on a financial network recently. And he basically indicated that they haven't been able to curb this enough. It's what I've been telling you all along. No, they haven't been able to curb it enough. They haven't been able to get a hold of inflation. That's in part due to the fact that they printed so much money, increasing the money supply for so darn long. I mean, you're talking somewhere around $7 trillion got pumped into the economy since March of 2020. What do you think
UK leader Liz Truss goes from triumph to trouble in 6 weeks
"British prime minister Charles has seen a turbulent start to her premiership with many saying her leadership is now hanging by a thread at just 6 weeks in power trusses time at the top has been bumpy to say the least Her libertarian economic policies have triggered emergency Central Bank intervention multiple U turns and the firing of her treasury chief conservative member of parliament Robert hauptmann described the last few weeks as a series of horror stories The government has looked like libertarian jihadists and treated the whole country as a kind of laboratory mice in which to carry out ultra ultra free market experiments The financial secretary to the treasury Andrew Griffith defended the prime minister This is a time when we need stability Nevertheless with new Chancellor Jeremy hunting power many say truss is still prime minister in name but powering government has shifted to hunt hunt has signaled he plans to rip up much of her remaining economic plan when he makes a medium term budget statement at the end of October Karen Chammas London
"central bank" Discussed on CRYPTO 101
"Did. It was pretty sad to see, but as fracs ever been targeted, I know you guys said you never lost your peg, but have you guys ever kind of fought off an attack? the thing we just realized we just assume that everything is always adversarial. For example, one of the things that we basically always make sure that our designs and everything can withstand is like if every single unlocked frac stablecoin that's owned by users, like people that actually want to come and redeem and get a dollar of value from the protocol smart contracts, can they do that? And the answer is yes. So right now you can actually don't take my word for it. You could go look at the smart contracts on chain. If every single fracs stablecoin that's owned by users or being staked or something was withdrawn, and then they were either sold into the protocol's own liquidity, like the collateral that the protocol has, or redeemed, could all of them get back a dollar value. The answer is yes. And you don't have to trust me, right? The good thing is we don't say, oh, you know, the collateral is like with a market maker or it's with like, there's no Celsius or Voyager or BlockFi type of risk where there's very hypothecation. Exactly. You don't have to take our word for it, right? Just check the cost, but then verify, right? You could go and take a look. In fact, people did this. In fact, that's why fracs never broke its peg in May, June, and July during those crazy weeks and stuff because people could see it. People could say, okay, everything is going to shit everywhere, right? Do we get out of this thing or is everything messed up here? And a lot of people ask that in our community and things like that. And the reason things didn't go bad is one, a, they couldn't go bad mathematically, but then enough people understood that. And they could confirm it on chain, then there doesn't have to be this crazy panic, right? Yeah, there can't be a run on the bank, or there doesn't need to be a run on a bank because you can see the assets, their publicly verified and attested to by all the different nodes. And so you're not going to have a Lehman Brothers or a bear Stearns crisis, or even more so, kind of as a Central Bank, you're not going to have a Bank of England sort of run on the bank or anything because, you know, people could actually see what's collateralizing the debt. Yeah, it almost feels like it's like it almost feels like in order to not have a run, you need to be able to prove that a run can't happen, right? And in fact, my own view is like the second that and this is just general banking in terms of everything. I think the second that it's verifiably clear that there can and there can be a run, like there's not enough assets to back like liabilities of either stablecoin issue or something else. There will be one. Like the probability as the market like that information goes into the market, the probability of a run goes to a hundred, right? It has some totally reaches. Like a 100%. And so I think that's why it's really important to be able to actually have these kinds of on chain proofs. And honestly, I'm actually pretty big proponent of the regulation that says that stablecoins need to. Publish their reserves because we will automatically by definition complies with every possible regulation of publish, even though there's not an entity. It's like it's decentralized and everything like that. Someone can just publish it in a structure that's like pings the smart contracts and actually just looks in it and structures it like a balance sheet or something or whatever the exact requirements are. But like every single second or every block every ten seconds fracs is actually auditable, right? Like the balance sheet is entirely audible. So I'm actually a pretty big proponent of whenever people ask, oh, what about stablecoin regulations or are you scared of this or that? Obviously, I'm not a proponent of restricting things or like banning certain kinds of stablecoins, but I'm a very, very big proponent of the reserve disclosure requirements. I think that that's required. I think the Fiat coins are too, right? Even though it mainly targets them because they can't attest to off chain stuff. But I think they also want greater transparency. And so do we, because we automatically actually comply with it to facto. Love it. So cool to know the guy who actually built finance the right way, just cruising along, no matter what the world throws at you. So with fracs already being a robust economy, is your vision of being a decentralized Central Bank complete or do you still have more work ahead of you? Well, I mean, it's never, there's never going to be a time where it's complete. So the main thing is that the way that I look at it is in DeFi and in a digital economy, there's usually three fundamental pillars and everything sounds like a triangle, but it's actually because there's a lot of things that are coming in threes. And so I call it the Trinity stack, which in my opinion it's like stablecoins lending and liquidity. And fracs right now is the only economy or basically project that has all three of these things in-house, right? If you think about different stablecoins or different AMMs or lending Mars, they usually have one or maybe two, right? Like for example, maker has the stablecoin die, right? And then they have their over collateralized lending system for minting it. So that's two. They don't have any kind of AMM or swap facility, right? Curve, if you notice recently, they announced their CR-V USD stablecoin. So they have a swap facility and an AMM. And now they finally are releasing their second one, right? The CR-V USD stablecoin. And same thing with aave, aave started out as a lending protocol, one of the largest and DeFi and recently they announced go, which is their stablecoin that will work inside of their lending system. So now they have two as well. Frac says frac stablecoins, fracs lend and frac swap. So we have all three in my personal view is that it's going to be very clear that these three things are part of the same stack and part of the same scope. So the larger these blue chip protocols get, the closer they will be in kind of completing this Trinity, so to speak. And like lending and stable coins. And stablecoins and on chain swaps, they're all the same thing, and they're not as separate as the early kind of crypto DeFi space would like you to think.
IMF to Lower Global Growth Forecast
"The International Monetary Fund is again lowering its projections for global economic growth I'm Ben Thomas with their latest assessment IMF managing director crystalline Georgia that describes the outlook as darker than we would have loved it to be IMF now projects global growth will come in at 3.2% for this year and 2.9% for next Speaking at Georgetown university in Washington Georgia says countries making up one third of the world economy could see at least two consecutive quarters of economic contraction this year or next And by 2026 that could lead to global output shrinking by $4 trillion This is the size of the German economy Gone Says the world economy is experiencing multiple shocks including Russia's invasion of Ukraine and the view is more likely to get worse than to get better As for what to do the IMF chief starts with central banks staying the course on inflation though she cautions if we tighten too much too fast and do so in synchronized manner
"central bank" Discussed on Marketplace with Kai Ryssdal
"This final note on the way out today in which I am sorry to have to tell you the whole will Elon Musk or won't Elon Musk buy Twitter saga. Is not quite settled. I mentioned this yesterday that in a letter Musk said he would pay the $54 in 20 cents a share he signed a contract to pay, provided Twitter's lawsuit trying to force Musk to pay the $54 20 cents a share he signed a contract to pay was dismissed. Well, the judge in the case wrote in a filing today, quote, the parties have not filed a stipulation to stay this action or has any party moved for a stay, I therefore the judge wrote continue to press on toward our trial set to begin on October 17th, 2022, our long national nightmare continues. All right, we got to go and I'm just going to say in lieu of the actual thing that the whole show today was a moment of economic context. That's my story I'm sticking to it. Our media production team includes Brian Allison Jake cherry drew Charles daddy who keeps Jeff Peters Jonathan Thorpe one college Toronto and Becca wineman. I'm Kai risdale. We will see you tomorrow, everybody. This is 8 p.m.. Humanity has been shaped by moments in which one person approached a crowd with something important to say. I'm John meacham, and this is it was said season two, a creation and production of C 13 originals, a cadence 13 studio in association with the history channel. It was said season two, listen and subscribe for free on the Odyssey app or wherever you get your podcasts.
"central bank" Discussed on Marketplace with Kai Ryssdal
Investor Neil Grossman Reacts to Larry Summers' Latest Comments
"Interestingly enough, speaking of economists that tend to have political views, you've got Larry summers out there, and now I'm going to play for you some sound he's at it, Aspen, just a few days ago at the festival there. Basically saying, what the heck happened? We had it going well. And then this. Here he is. We basically had inflation under control for 40 years, despite the fact that the price of oil fluctuated despite the fact that there were all kinds of supply shocks. We lost the thread along with many other countries about a year and a half ago with massively expansionary policies. Okay, so there you go. It's what you're saying, right? They just spent too much money. They lost the friend in my view a lot longer ago than 18 months. This is interesting, explain, explain. Look, the Central Bank of the United States is not a Central Bank, or it wasn't, and it's coming back to maybe to home. But it became a central asset manager. The basic premise became making sure asset markets were supported and bailed out more than anything else. This fed and will even misses Yellen. If you went through a normal risk return analysis, you cut off half of the probability distribution that's wrong. You're always going to be right. You think. They didn't want to consider the consequences. And when you overlay reality in the probability distribution and have to acknowledge that there's a risk, you take policy action earlier to address those potential risks. You've got, you know what? I call it ostrich economics. They stuck their head in the ground. Prayed it would go away. And all it did was get worse and they kept, you know, they came up with acronym or added J after our transitory was just a bad answer. I know, but it was a big word, though. It sounded good.
Why the U.K.'s "trickle down" tax cut plan terrifies investors
"The Bank of England has taken emergency action to stabilize British financial markets after the government spooked investors with a program of unfunded tax cuts I'm Ben Thomas with the latest With the British pound tumbling in the cost of government debt soaring the Central Bank warned crumbling confidence in the economy posed a material risk to UK financial stability in a less Susan streeter of hargreeves lansdowne in London What the Bank of England is doing is stepping in to try and calm down the market But it does smack of a bit of panic and frustration that the government isn't doing more to retreat away from these promises The Bank of England's plan to buy government debt helped stabilize the bond market after ten year yield spiked more than a full percentage point to just over four and a half percent after the tax cuts were announced but analyst Muhammad el Arian with Allianz says it's all having a global impact This is a UK fueling
Dow hits 2022 low as markets sell off on recession fears - POLITICO
"I Mike Gracia reporting the Dow hits its 2022 low as financial markets sell off on recession fears Stocks took a sharp decline worldwide Friday on worries the already slowing global economy could fall into recession The Dow Jones Industrial Average fell 1.6% and closed at its lowest level since 2020 The S&P 500 fell 1.7% closing at its 2022 low set in mid June The NASDAQ slid 1.8% It left the major indexes with their 5th weekly loss in the last 6 weeks This week the Federal Reserve and other central banks around the world aggressively hiked interest rates again trying to puncture inflationary pressures but also raising concerns too much too soon could
"central bank" Discussed on Marketplace with Kai Ryssdal
"Ashley <Speech_Female> <Advertisement> mill <SpeakerChange> tight <Speech_Music_Female> <Advertisement> for marketplace. <Music> <Advertisement> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Speech_Music_Male> <SpeakerChange> <Speech_Music_Male> <Speech_Male> <Speech_Male> As far along <Speech_Male> on the way out today, one of <Speech_Male> the less thought about <Speech_Male> effects of <Speech_Male> the inflation we are dealing <Speech_Male> with saw this <Speech_Male> on CNBC is <Speech_Male> study from New York life <Speech_Male> that shows <Speech_Male> about one out of <Speech_Male> three adults are putting <Speech_Male> less aside <Speech_Male> for emergencies <Speech_Male> now so that they <Speech_Male> can cover daily <Speech_Male> expenses. <Speech_Male> Average amount does <Speech_Male> not going to <Speech_Male> everybody's rainy day funds, <Speech_Male> monthly, <Speech_Male> $243. <Speech_Male> That <Speech_Male> is not nothing. And we <Speech_Male> did a study, <Speech_Male> a poll, actually, with <Speech_Male> our friends at Edison research, <Speech_Male> about two years <Speech_Male> ago, that <Speech_Male> showed 47% <Speech_Male> of people wouldn't be able to <Speech_Male> come up with 250 <Speech_Male> bucks to <Speech_Male> cover unexpected <Speech_Male> expenses. So <Speech_Male> that $243 <Speech_Male> that's not going. <Silence> <SpeakerChange> It's <Speech_Music_Male> a lot. <Music> <Music> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Music> <Advertisement> <Speech_Music_Male> <Advertisement> <SpeakerChange> <Speech_Music_Male> <Advertisement> <Speech_Music_Male> <Advertisement> All right, we're going here <Speech_Music_Male> <Advertisement> is your moment of economic <Speech_Music_Male> <Advertisement> context equipped <Speech_Male> <Advertisement> quick <Speech_Male> rather dip into <Speech_Male> <Advertisement> oil. The U.S. benchmark <Speech_Music_Male> today West Texas <Speech_Music_Male> intermediate, of course. <Speech_Music_Male> $112, <Speech_Music_Male> <Speech_Music_Male> <Advertisement> 70 cents <Speech_Music_Male> <Advertisement> a barrel. Now, <Speech_Music_Male> why I hear <Speech_Music_Male> you asking, <Speech_Music_Male> why can't if oil <Speech_Music_Male> is off its peak, <Speech_Music_Male> as it is, <Speech_Male> why have pump <Speech_Male> prices not gone down? <Speech_Music_Male> And in fact, in many <Speech_Music_Male> cases gone <Speech_Music_Male> up, one <Speech_Male> word <Speech_Music_Male> refining <Speech_Male> capacity <Speech_Male> okay, yes, that's <Speech_Music_Male> two words. <Speech_Music_Male> But we'll have that <Speech_Music_Male> refining <SpeakerChange> story for you <Speech_Music_Male> <Advertisement> next week. <Speech_Male> <Advertisement> Our theme music <Speech_Male> <Advertisement> was composed by <Speech_Music_Male> <Advertisement> BJ leaderman <Speech_Music_Male> <Advertisement> marketplace's executive <Speech_Music_Male> <Advertisement> producer as Nancy <Speech_Music_Male> <Advertisement> Fargo Nancy Cassidy <Speech_Music_Male> <Advertisement> is the managing <Speech_Music_Male> <Advertisement> director of news. <Speech_Music_Male> <Advertisement> Bill Scarborough <Speech_Music_Male> <Advertisement> is the vice president <Speech_Music_Male> <Advertisement> and general manager. <Speech_Music_Male> <Advertisement> I'm Kyra, <Speech_Music_Male> <Advertisement> we will see
"central bank" Discussed on Marketplace with Kai Ryssdal
"Okay, look. Yes, the headlines are scary, I get that, but can we take a minute here? And just step back, please. Thank you. From American public media, this is marketplace. In Los Angeles on car risdale, it is Friday today the 20th of May good as always to have you along. Everybody, you know, I can do a whole setup song and dance here. Take through a couple of things that happened this week and then get to the substance. Or we could just get to the substance, right? To deep ready is it Politico Jordan Holman's at Bloomberg at YouTube? Hey Kai. Hey Kai. All right, so look, I want to do this so there's going to be a little bit of a gut check here, so deep. And here's the deal, right? It seems to me that the general level of economic stress is up. Part of that is market volatility when I talked about that a couple of weeks ago on a Thursday. Part of it obviously is inflation. And here's my question though. Isn't this what's supposed to happen as the fed raises rates and we try to slow this economy? This is exactly what's supposed to happen, but 8% inflation was not supposed to happen. Right. And it was not supposed to happen month after month after month. And so nobody's really prepared for this. It's been 30 years since we've seen anything, even close to this 40 years, 50 years since we've had a similar environment. It's just not going to be pretty. It's not going to be pretty the fed chair J Powell was on this program saying that within the last week, it's just not going to be pretty. And he knows that we know that. We all just have to get to the point of accepting it. And that is the price that we will pay for getting to a better place and just accept it, and then we'll get there, but we have to accept it. And the markets are basically indicating that they're going through that process right now. Huh, a little bit of denial. All right, Jordan Holman, consumer and retail reporter for Bloomberg extraordinary. Here's my question to you. Retail sales we learned this week are up 9 tenths of a percent March to April that I think was the fourth consecutive month of increase. How long does that keep up as the aforementioned adjutant that we're having in this economy takes hold? Yeah, it seems like we are coming to a end of that growth. And the important caveat of that group that we saw in April is that it was not adjusted for inflation, the numbers that we saw this week. So we do not know how much it's taking into account if people are just spending more in the same items that they would have paid. A lower price for this time last year. So that's super important. And then also the other thing is how are people paying for that? Is that on credit cards? Because that has another implication for debt. So right now to point people are adjusting expectations for what this economy is going to look like and how consumers should be spending. Yeah, I think people are adjusting. The stock market is adjusting as you deep said and businesses are adjusting. To which Jordan, let me ask you one more thing. The story out of target and Walmart this week about lower margins, inventory challenges, what are you hearing from the people who are in charge of these big retail companies about their prospects, I suppose? Yeah, there's a lot of noise in the retail sector right now. So the main threat that I'm hearing is that consumer behavior has shifted so rapidly that there was an expectation that people were going to start spending more on services and goods or also the type of goods that they were going to buy. We're going to change. So more and the grocery and food and gas because people know that they're going to spend more money so they might pull back on discretionary items like apparel. But when you're a large company like target, you're ordering things out months in advance. So to switch that quickly is very difficult and that's why you saw dramatic shifts in sell off for target. What's the most since 1987? And that goes back to those expectations changing just because these are big ships that have to change their strategies. Yeah, the company was down like shares were down like 25% a day. All right, so sudeep, let me ask you this and I'm intentionally not prejudging the likelihood or not likelihood of recession, right? But it is much more in the air than it was even a couple of weeks ago. And so the question to you is not whether you think it's going to happen, but what are you going to be looking for? What are the indicators to you over the next, you know, 8, 12 months that this economy is slowing sharply. So obviously the most important indicator is the job market is job growth. It's wage growth. How much that gets dented along the way. That's really going to be the driver, the super hot job market is a leading driver of wage growth, which is good until we see 8% inflation, and that's what that's what needs to get addressed. Look, there's a recession and then there's a recession. Right. Right, right. If we have some light rain, very mild recession, that's kind of what that's J pal's dream right now. That is you have a little bit of a pullback in consumer spending. You let us get through this period. You have a small adjustment, and then we can come back out of it. But this lurching of the economy, two years ago, we were in negative oil prices, store shutdowns, nobody on an airplane. Now you can't get a seat on an airplane. It's all the opposite. How do you plan for that if you're a business? How do you plan for that? If you're consumer, how do you plan for that if you've still got your stuff stuck on a boat somewhere on a ship trying to come over? How do you plan for that? We kind of just need to go through a brief cleansing period to get the system back into order. And hope we come out come out of it quickly, but it just needs to be brief because the downside is that it takes a long time and that's just too painful for all of us. Yeah, the cleanse is always so hard. So Jordan, let me ask you this, what are you looking for? To indicate that there's substantial economic slowing coming. So looking at that consumer sentiment because that is futuristic how people are feeling about that. Deloitte just has some data out today actually showing that the level of people being concerned about their savings has jumped up to 52% from 40% of Americans saying they're concerned. So looking at how people feel about the economy is really key and also gives indications about do they feel comfortable by big ticket items? Do they feel comfortable buying discretionary items? And then that is an indication of how retailers need to plan for the future. Jordan Holman, she's a Bloomberg where she does consumers in retail. So do you ready is it Politico where he's one of the people in charge? Thanks you too. I appreciate it. Thanks Kai. Thanks Kai. Have a nice weekend. On Wall Street today, well, honestly, it was a mostly flat finish to a mostly ugly week as we have been detailing all week..
"central bank" Discussed on Bloomberg Radio New York
"Earnings And the last but not least is the provisioning and provisioning has been going down and which is good for the banks Maybe a little bit more right backs to come We're going to get a rate decision out of Egypt We're debating the size of that We've had a couple of guests in and say a hundred 150 basis points What comes to mind is whether what do you think is more important We know we've got a food price inflation global issue specific in Egypt as well Is it about reasserting the carry trade or defending the currency What do you think the priority is I think the priority is more of the carry trade rather than the really priorities of defending the defending the currency The focus has for us is that the focus should be more on how to tame down inflation Increasing increasing interest rates to reduce the pressure on the Individual the Egyptian And I think the Central Bank with the IMF has been very proactive in that And the currently if you look at it in the past Egypt has been benefiting from inflows because of the positive real yield that has been that has been that I was there Currently it's not So and I think defending the currency is the policy that the Central Bank has hasn't been actually falling for a while Just in terms of managing the uncertainty broadly in the region and in the world for that matter what is the cash on location that you recommend in kind of a base case for clients Is there a gold allocation as well Just to kind of give us context on how much risk appetite you're really laying forward to some of your clients We are and our portfolios we have we have been increasing cash because we see a lot of volatility.
"central bank" Discussed on The Breakdown with NLW
"Credit default swaps ensuring $10 million of the country's bond for 5 years were quoted at about 4 million upfront and a 100,000 annually on Monday. Signaling around 56% likelihood of default, according to ice data services, the main clearing house for European credit default swaps. There are also the implications of specific businesses. British petroleum is exiting its 20% stake in the Russian oil giant rosneft. BP's chief executive Bernard Looney is resigning from the board of rosneft immediately. Looney said I have been deeply shocked and saddened by the situation unfolding in Ukraine. Our immediate priority is caring for our people in the region and looking at how BP can support the wider humanitarian effort. The chair of BP said that while the company is operated in Russia for over 30 years and has, quote, brilliant Russian colleagues, the invasion represents a fundamental change. Quote, Russia's attack on Ukraine is an act of aggression, which is having tragic consequences. Norway's sovereign wealth funds also made a huge change in tone from Friday to Sunday. This is a $1.3 trillion fund that has about $2.8 billion in Russian equities. On Friday, they said quote, if we sold out of Russia now, it would be a wrapped gift to the oligarchs who buy our shares, but by Sunday this which is the world's largest sovereign wealth fund sent, we want to give a very clear and unequivocal response that the type of abuse we have seen in recent times can not be accepted. And the point here in both of these cases is that these folks are going to be selling at a loss as there are no buyers, and as we'll get into in a minute, increasing isolation of these markets. BP is saying is that offloading their stake in rosneft could represent a write down of $25 billion. Now, as I just intimated, this is creating action from both sides. Phil Stewart, the military and intelligence correspondent at Reuters writes, breaking the Russian Central Bank has ordered market players to reject foreign clients bids to sell Russian securities from 400 GMT on Monday, according to a Central Bank document.
"central bank" Discussed on The Breakdown with NLW
"Central Bank will lose the ability to offset the impact of our sanctions. The ruble will fall even further inflation will spike and the Central Bank will be left defenseless. Now, as I mentioned, the swift thing is something that has been a part of many discussions, but the Central Bank thing is something new. Part of the reason that Putin has believed that he could weather sanctions, part of the way that he made his country sanction proof in his estimation is the significant focus on growing the Central Bank's reserves. Those reserves had gotten up to $630 billion. Of that a little over 30% is in Euros over 15% is in U.S. dollars, around 7% is in the pound Sterling, 10% is other while around 20% is in gold and 12 to 15% is in the Chinese RMB. The specific designation of those reserves matters, but also where the reserves are held. A big chunk of this is held overseas in the U.S., Germany, France, UK, Austria, and Japan. It seems clear that many of those assets will now not be accessible to the Russians. As much as two thirds or more than 400 billion. What seems more available includes the 2299 tons of gold, the world's 5th largest stockpile that's all contained within the Russian state itself, and the around 14% of Russia's foreign reserves that China holds, which is its single biggest foreign share. That said, I don't think we should jump to the conclusion that China is super eager to help. While China is no fan and is in fact loudly against economic sanctions as a tool of diplomacy and warfare, it remains likely concerned around second order targeting should they decide to actually go out and help Russia. So what all of this means in practice is that the Russian Central Bank will have a much harder time defending the value of the ruble by selling foreign assets and buying the ruble. This could increase the likelihood of a bank run, and we've already seen citizens in Russia start to get nervous. As early as Thursday, people started queuing up to withdraw their money in both rubles and in any international currency that could get their hands on. A Financial Times reporter said that by mid Thursday, some branches of international banks had run out of currency. Over the weekend this got more intense. When the news about disconnection from certain banks to swift came out, Russians who are concerned that they won't be able to pay with their Visa cards or mastercards, we're out looking for any type of cash, lining up at 5 in the morning waiting for new cash.
"central bank" Discussed on What Bitcoin Did
"Right. Yeah. I don't know. They could effectively standardize and form federations and things. It was a variety of ways that that could all work out. And do you think reputation would lead to a discrepancy in the value of those dollars? Yeah, absolutely. Interesting. Well, reputation as well as it would depend on how transparent they would be. What's tricky is that you can be transparent with blockchain technology, for example, you can be transparent about an asset. But you can't necessarily be transparent about the liability. So theoretically, if it's like, we're a bank. We have a website at any given point in time. You could look at our reserves to our loan ratios that we have outstanding. Or whatever it is that's backing our paper. You would have to trust them on the actual paper that they're issuing unless that was also on a permissionless blockchain as well, which I guess I haven't thought through how exactly that would work. So do you think Bitcoin ultimately leads to the end of central banking or could lead to the end of the Central Bank? I think it ultimately could lead to the end of a Central Bank, I want to believe well, okay, here's how I'll say it. I think that Bitcoin will reduce significantly the role and probably the nature of a Central Bank to in any event to be more of an administrative type entity as opposed to a monetary authority, something that would administer the system and allow it to function with oversight from some sort of legal authority. And not making monetary decisions necessarily. But on the whole, I guess, yeah, I think it's going to end central banks. And the end of central banking and move more to this kind of idea of free market for banking. What are the implications there for an economy? Does it change the market for cheap credit? Does it change mala investment? Does it fix all these problems? I don't think it fixes it. But I think it allows a private market to make those decisions. Or reduce the extremes? Yeah, exactly. I mean, it's economy to fluctuate and this is one thing. So people have come at this from the perspective of Bitcoin solves everything and it fixes everything and everything's going to be perfect and it's going to be a utopia and it's like at the end of the day. There's a reason that we valued more stability in a currency as well. And we were able to use that as a selling point. There is going to be volatility volatility will be inherent even when Bitcoin reaches maturity. It will still be more volatile than a currency that's supplies constantly backstop two halves stability. Is that because of these inelastic? Well, yeah, it's inelastic because every time the demand fluctuates Central Bank can change the supply to respond to that. So yeah, exactly. So we say, which is an easy decision for a centralized entity. To say, okay, well, as long as the costs aren't on us, then we can have this stable currency. And there are still benefits to having a stable currency..
"central bank" Discussed on WSJ What's News
"Before a Macron arrived, lots of countries in Europe were reimposing restrictions to try and stem a rise in delta cases. So the economic picture there was just a little bit different, which is why they're just a little bit further behind. The last thing we should say in that is prior to the pandemic, the economic picture in the Eurozone look very different, right? They had a real problem with very low inflation and had really been trying to drive up spending and then drive up inflation prior to the pandemic. So three big central banks we've been talking about all facing a similar threat, at least when it comes to inflation, all taking slightly different approaches here. How are officials weighing these major policy decisions? I think you can see that they are perhaps assigning slightly different weights to the things that are of mutual concern. If you like. So as we've been talking about the fed and the Bank of England, maybe slightly more worried about inflation at this point in time than the European central bankers. They have slightly different pictures for growth and a slightly different picture in the labor market as well. I think what you're saying is just a bit of a different kind of tolerance for the pressures that they're sort of under at the moment. The Bank of England is out in front I and saying we think inflationary pressures are such that we have to act right now, the fed is not far behind saying we think inflationary pressures are such we're going to be acting quite soon and the European Central Bank is a little bit further behind. Clearly wants to get more of a recovery under its belt if you like before it starts thinking about raising interest rates and withdrawing its stimulus. So we talked a little bit about these three central banks are also dealing with some differences in where each of these areas are in terms of the economic recovery, right? Yeah, that's right. The biggest differences between the U.S. and then the UK and Europe, the U.S., for instance, if you look at GDP recovered its pre-pandemic size a while ago a couple of quarters ago now I think the UK is still maybe 1% or so below that level and you have the Eurozone, I think is roughly the same or possibly even a bit closer to regaining its pre-pandemic size. As we talked about a moment ago, the labor markets are a bit different. The UK labor market is looking pretty tight, much less tight and the Eurozone and there's a big difference between strongly performing countries in the Eurozone a slightly weaker performing countries. And then the U.S. as we know it has a labor market that's pushing up inflation as well. So these are the kind of things that the central bankers are thinking about, and it's best that there's such issues on measuring GDP. I think a lot of economists would focus on what's happening in labor markets to really give a sense of where these places are and their recoveries. That's Wall Street Journal economics reporter, Jason Douglas, Jason,.
"central bank" Discussed on WSJ What's News
"Bank of England has become the first major Central Bank to raise interest rates since the start of the pandemic. The move comes just a day after the U.S. Federal Reserve projected three rate hikes next year, a shift amid growing concerns over inflation. The European Central Bank meanwhile is taking another approach, saying it will phase out its emergency bond buying program while boosting other stimulus measures. We'll talk more about how central banks are determining which approach to take later in the show. Decisions from central banks led to losses on Wall Street today, the S&P 500 fell .9%, the Dow dropped about 30 points or a tenth of a percent, and the NASDAQ lost about two and a half percent. Overseas, markets rose, the pan continental stocks, Europe 600 gained 1.2% and the UK's blue chip FTSE 100 closed up around 1.3%. Advisers to the Centers for Disease Control and Prevention are recommending that adults get COVID-19 vaccines from Moderna or Pfizer over the shot from Johnson & Johnson. The recommendation comes after CDC officials said there is a higher rate of a rare but serious blood clotting condition with J&J than previously detected. The recommendation is likely to deal another blow to J&J, its vaccine rollout has been settled by manufacturing issues and earlier reports of the blood clotting condition. The Department of Justice is pulling out of settlement talks to pay damages to families that were separated at the southern border in 2018, according to the ACLU. The separations were due to enforcement of the Trump administration's zero tolerance immigration policy. Instead, the ACLU says the DoJ will separately litigate hundreds of claims filed by families seeking monetary damages for lasting psychological trauma caused by the prolonged separation. A spokesperson for the Justice Department declined to comment. The Wall Street Journal reported in October that the government was in talks with lawyers for the families to pay up to $450,000 in damages to each person affected by the policies. The lawsuits alleged some of the affected children suffered from a range of ailments, including heat exhaustion and malnutrition. To resolve a legal dispute, former McDonald's CEO, Steve easterbrook, has agreed to return company stock and cash now valued at more than $105 million, which was allocated to him after dismissal from the company in November of 2019. Easterbrook was let go after acknowledging a consensual relationship with an unnamed employee. Today's settlement, which included an apology from easterbrook, avoids a trial that was set to begin next spring. TikTok says that it will adjust its recommendation algorithm to avoid showing users excessive videos on specific topics such as extreme dieting, sadness, or breakups. The social media app said that it's testing ways to avoid pushing too much of this content to protect individual users mental well-being and diversify their feed. In two different investigations this year, The Wall Street Journal has shown how TikTok's algorithm can push young users down rabbit holes of increasingly detrimental content. And we report exclusively that Bruce Springsteen has sold his music rights to Sony Music entertainment for between 500 to $600 million. Sources say it's the largest transaction ever for the life's work of a single artist and gives Sony ownership of Springsteen hits including born to run, dancing in the dark and born in the USA. Coming up, how world banks are approaching inflation and economic recovery. Facebook leads the industry and stopping bad actors online. That's because they've invested $13 billion in teams and technology to enhance safety over the last 5 years. It's working. In just the past few months, they've taken down 1.7 billion fake accounts to stop bad actors from doing harm. But working to reduce harmful and illicit content on their platforms is never done. Learn more about how they're helping people connect and share safely at about FB dot com slash safety. The world's major central banks have had to make some tough decisions as they look to steer their economies out of the worst of the pandemic and keep them on the road to recovery. But amid rising inflation, they're taking different paths when it comes to monetary policy. So what should we make of this divergence? Joining me now from London with more is Wall Street Journal economics reporter Jason Douglas. Hi Jason, thanks for being here. Hi, my pleasure. So Jason, here in the U.S. inflation has been a major concern and driver of the fed's policies, inflation is also top of mind in the UK. Tell us more about what prompted this decision by the Bank of England today to raise rates now instead of holding off as the fed is for the time being, was this decision something of a surprise? So certainly the reasons why the Bank of England and the third are in kind of a similar boat is inflation. You're absolutely right about that. The UK does appear to be a little bit further on in terms of how worried the Central Bank is about inflation how quickly it feels has to act. It was a surprise in the sense that everyone knew where it rises coming at some point, but everyone thought that the bank was probably going to hold off at this meeting because of overcome. But they have been signaling for some time now that they feel they're going to have to start gently nudging up interest rates over the coming year to keep control of inflation, which is about 5% here in the UK so that's well above the banks, 2% target. So we know that is spreading faster in the UK than here in the U.S. right now. How much of a factor did that play in this decision today? In a way, surprisingly little, as I mentioned, a lot of investors a lot of economists thought that the uncertainty around Macron would probably persuade the officials at the Bank of England to hold off until their next meeting, which is in February. In the end, it didn't, and there was only one dissenter on the 9 member panel who cited that reason for not voting for the interest rate increase. I think what they decided is there's a lot of uncertainty around the uncertainty works in both directions, right? So it could hurt growth, but it could also push up inflation. And so the net effect of all that is they'd probably been a very similar position in two months than where they are now. And so they decided there's little bit of value perhaps enacting a bit earlier on getting the process started and they can perhaps recalibrate I guess if things turn out vastly different from what they expect. Let's talk about the European Central Bank, which is taking a different approach than the Bank of England and the Federal Reserve, the ECB does not project rate hikes next year and has announced it will phase out its emergency bond buying program. At the same time, it's planning to ramp up other stimulus measures. What can you tell us about this approach? The European Central Bank is really a lot more cautious and moving much more slowly than the fed and the Bank of England. This is the kind of the big divergence we're seeing in the world's major central banks. Behind that really is just a bit of a difference in the inflation picture and the labor market picture if you like. So both the fed and the Bank of England are grappling with high inflation. They're worried that the inflationary pressures that are seeing are going to stick around a bit longer than they had anticipated. Labor markets are doing pretty well in both the U.S. and the UK, the UK especially where they had this furlough program, which seems to have done pretty well and keeping unemployment time and putting people back to work. Yes, it's a bit different. You have these job shortages and supplying mismatches and that kind of stuff. The picture in Europe is a little bit different. You're absolutely had these furlough programs or short work programs to keep people attached to their employers. But the pickup and the labor market has been a bit different in lots of different places in the European Union. So Germany is a bit healthier than Spain, for instance, Italy and France or inside different positions. So it's just more of a mixed picture in the Eurozone growth is a little bit slower maybe..
"central bank" Discussed on The Breakdown with NLW
"What's going on, guys, it is Friday, November 5th, and today we are talking about what central banks are telling us about the economy. You might have read on Bloomberg or the Financial Times or something like that that investors are noticing a flattening of the yield curve. Now, to discuss what that means we should probably start by asking WTF is the yield curve. So glad you asked. The yield curve is a plot of all of the interest rates of sovereign bonds based on their maturation. For example, the US Treasury market is a nearly $15 trillion market. It includes T bills that have one month to one year maturity, two years to ten years, as well as 20 and 30 years. And in general, you would expect the yield curve to slope upwards. In other words, bonds with longer maturity would have a higher yield. This makes sense because investors would expect more compensation for having a longer maturation period, a longer maturation period means more risk, more expectation of inflation. In other words, ten year notes should have a higher yield ceteris paribus than two year notes. So what does it mean when the yield curve flattens or inverts? Well, of course, it means that short term bonds have a similar or even higher yield than longer dated bonds. It means there is more demand for those short term bonds and often this presages recessions or other market turmoil. So what is the explanation for why this is happening now? Well, in the U.S., it has to do with fed policy. The fed announced earlier this week that they are going ahead with their taper of the $120 billion bond buying program that has been in place since the beginning of the COVID crisis. This taper has been super super clearly telegraphed to investors. But many think that inflation will in fact force their hand faster, compelling them to more quickly unwind bond buying and even getting into interest rate hikes earlier than they say they want to. At the same time in the U.S., long-term bond yields have fallen, and effectively, this is explained by people believing that this forthcoming hawkish monetary policy, a policy they believe is inevitable will be successful in bringing down inflation. However, it's not just the U.S., this sort of yield curve flattening and inversion is happening all around the world. Australia, Germany, Canada, basically anywhere investors are expecting central banks to have to move to Titan policy faster than those policy makers would have ideally like to. But here's where everything gets tricky. What do central banks normally do when the yield curve inverts signaling a recession? They lower benchmark interest rates, which has the tendency to lower the front end of the yield curve. In other words, writing that flattening or inversion. However, in today's environment, basically every Central Bank is already at the zero bound of interest rates. And while theoretically they could lower them to nominally negative rates, the experience of the European Central Bank has suggested the dipping into negative rates hasn't done much to spur investment in growth. So this is a real rock and a hard place situation. On the one hand, almost everywhere we're seeing two to 7% annualized inflation, and that would lead central banks to want to raise rates to fight that inflation. But there is risk with raising rates. Those rates might trigger a recession, a recession that the yield curve is already telegraphing. So do they go the other way trying to lower rates and do more QE to write the curve? But what happens if that just exacerbates inflation? What we're seeing is effectively what happens when you have no more road to kick the can down. So with all of this background, let's do a little survey of what some of the central banks around the world are actually doing. In the U.S., as I mentioned, the fed has been prepping markets for a taper for months. At the FOMC meeting this week they confirmed it. They will start to slow bond purchases at a pace that would see them completely out of the game by mid next year. However, they are not currently entertaining interest rate increases and doubling down in fact on needing to see more improvement in labor markets first. Jerome Powell said we have high inflation and we have to balance that with what's going on in the employment market. It's a complicated situation. We don't think it's a good time to raise interest rates because we want to see the labor market heal further. The level of inflation we have right now is not at all consistent with price stability. Basically, Powell is shrugging and saying, we don't know what to do. In fact, he even suggested that this time calls for humility. That was his word. Nighting, the sponsor of this podcast provides banks, corporate treasuries, pensions, and hedge funds, with ironclad Bitcoin custody and white glove service. Learn more at night dot com slash MLW. That's NY DIG dot com slash nlw. Let's pop over to Australia now and one of the things that made their approach different during the COVID crisis was that they went to full yield curve control. This is different than the policies that the U.S. implemented, so to understand what yield curve control is, here's a simple description from sage bells and David wessel at brookings. QE or quantitative easing deals in quantities of bonds. Yield curve control or YC focuses on prices of bonds. Now, this is a super important concept, so I'm actually going to repeat it again and then I'll keep reading this explanation. QE deals in quantities of bonds, YC focuses on prices of bonds. Under QE, a Central Bank might announce that it plans to purchase, for instance, $1 trillion in treasury securities, because bond prices are inversely related to their yields, buying bonds and pushing up their price leads to lower longer term rates. Under YC, the Central Bank commits to buy whatever amount of bonds the market wants to supply at its target price. Once bond markets internalize the Central Bank's commitment, the target price becomes the market price. Who would be willing to sell the bond to a private investor for less than they could get by selling to the fed. So the royal bank of Australia went the Y C road and to describe what happened next, I'm actually just going to quote Scott hill, who is the new overnight researcher for the breakdown, because in his notes for this episode, he just put it so succinctly. He writes, the RBA targeted specifically, the April 2024 issuance of bonds, which at the time was a three year expiry Bond. This was due to the Australian government's stimulus response being partially focused on encouraging housing purchases with several programs aimed at the housing sector. In Australia, the most common fixed rate mortgage term on offer is three years. So by targeting the three year bond, the RBA sought to subsidize mortgage rates for new and refinanced loans. Another leg of this policy was the term funding facility, a three year funding vehicle for authorized deposit taking facilities, IE commercial banks, intended to allow for certainty in the funding rates at the banks could offer three year fixed mortgage loans on. These policies together with significant increases in housing loans being committed to since the beginning of the coronavirus, sets up the Australian economy to have a rate cliff in 2024. Similar to the subprime issues in the U.S. were a significant cohort of the population will have to refinance throughout 2024 from subsidized low rates to whatever the prevailing rate at the time is. So now we are seeing a lot of cracks in this policy in Australia. Here's a sample of headlines. RBA waves white flag on bond yield target. So interest rates may rise sooner than expected. RBA may be forced to raise interest rates despite 2024 promise. ASX and Australian dollar slip after reserve bank hints at faster rate hikes. There is a ton of commentary on this on Twitter. Basically a ton of people calling it an abortive experiment. And while a lot of this is very technical and sort of macro wonky, there are some real implications for human beings that have to live in the world and with the consequences of these actions. Scott again puts it nicely, quote, this wasn't just open market policy. This was an explicit promise to the Australian people that the RBA had their back to go and buy a house at inflated prices with the cover of subsidized interest rates. The promise was the centerpiece of government stimulus policy, the government encouraged people, especially younger, first time homebuyers to go and purchase.
"central bank" Discussed on The Breakdown with NLW
"Are a case in point the pandemic has accelerated a longer running move to digital mobile contactless payments are already a part of our daily lives. Qr codes and buy now pay later. Options are gaining popularity gloves. Badges in olympic uniforms with payment functions are being prepared for the beijing winter olympics and the tech savvy generation will soon dream about money and payments for the metaverse alongside these developments. The world's central banks are stepping up efforts to prepare the ground for digital cash central bank digital currency or cbc. They have a job to do delivering price stability and financial stability and they must retain their ability to do it. Let me explain. central bank. Money has unique advantages safety finality liquidity and integrity as our economies go digital. They must continue to benefit from these advantages. Money is at the heart of the system and it has to continue to be issued and controlled by trusted and accountable institutions which have public policy not profit objectives. Central bank money will have to evolve to be fit for the digital future. So what are the priorities. Now know where you're going as dag hammarskjold once said only he who keeps his eyes fixed on the far horizon. We'll find the right road and get going. Let me elaborate. Why do we need to know where we are going because today the financial system is shifting under our feet. Big techs are expanding their footprint in retail payments. Stable coins are knocking at the door seeking regulatory approval decentralized finance or defy platforms or challenging traditional financial intermediation. They all come with different regulatory questions. Which need fast and consistent answers. Banks are worried about. The implications of cdc's for customer deposits. Central banks are mindful of these concerns and are working on answers. They see banks as part of future. Cbc systems but make no mistake global stable coins defy platforms and big tech firms will challenge banks models regardless stable coins may develop as closed ecosystems or walled gardens. Creating fragmentation with defy protocols any concerns about the assets underlying stable coins could see contagion spread through system and the growing footprint of big tex and finance reasons market power and privacy issues and challenges current regulatory approaches will the new players complimentary crowd commercial banks should central banks open accounts to these new players and under which regulatory conditions which kind of financial intermediation doing need to fund investment in the green transformation. How should public private money. Coexist in new ecosystems for example should central bank money be used in defy rather than private stable coins. We urgently need to ask ourselves these kind of questions about the future. This is the far horizon for the financial system but we are approaching it ever faster. Central banks need to know where they want to go as they embark on their cdc journey. Cdc will be part of the answer. A well-designed cdc will be a safe in. Neutral means a payment and settlement asset serving as a common interoperable platform around which the new payment ecosystem can organize. It will enable an open finance architecture that is integrated while welcoming competition and innovation and it will preserve democratic control of the currency. This podcast is sponsored by dick and institutional bitcoin firm that sees bitcoin as a gateway to financial security for people around the world. Find out more at night com slash l. w. n. y. g. forward slash and l. w. This brings me to my second message. The time has passed for central banks to get going. We should roll up our sleeves and accelerate our work on the nitty gritty of cbc design. Cdc's will take years to be rolled out while stable. Coins and crypto assets. Are already here. This makes it even more urgent to start in the design thinking methodologies we use it the innovation hub the ideal product stands any sweet spot of the intersection of desirability by ability and feasability when applied to cdc's these translate into three dimensions consumer use cases public policy objectives and technology. We have to ask ourselves. Why consumers would want to see and what they would want to do. The recent european central bank public consultation shows that they value privacy security and broad usability in order to meet consumers expectations. Cdc's need to be made to work. Most conveniently payment data must be protected digital functions. That are not available with cash can be developed such as program ability or viable micro payments then. Cbs's should meet public policy objectives. Central banks exists to safeguard monetary and financial stability for the public good. Cdc's are a tool to pursue this through enhanced safety and neutrality in digital payments financial inclusion access innovation and openness important questions remain. How can cbs's systems and drop rate and should offshore use be discouraged. Technology opens up design choices. System design will be complex. It involves a hands on operational and oversight role for central banks and public private partnerships to develop the core features of the cdc instrument and its underlying system. These features are ease of use. Low cost convertibility instant settlement continuous availability and a high degree of security resilience flexibility and safety complex. Trade-offs will be addressed by central banks including how to balance scale speed and open access with security and how to balance offline functionality with complexity and security across the world central banks are coming together to focus on their common mission charged with stability. They will not rush. They wanna move fast but not to break things. Consultations with payment systems and providers banks the public and abroad ranger stakeholders have begun in some countries to build the cdc for the public. A central bank needs to understand what they need and work closely with other authorities. The innovation hub is helping central banks. We already have five. Cdc related proof of concepts and prototypes being developed in our centers. And more to come. The european union is uniquely placed to face the future. You can build on a state of the art fast. Payments system on the strong protections provided by the general data protection regulation and on the open philosophy of the second payment services directive. The cbs report on a digital euro sets the stage a cbs's goal is ultimately to preserve the best elements of our current system while still allowing a safe space for tomorrow's innovation to do so central banks have to act while the current system is still in place and to act now. I thank you for your attention. So here's the thing that i really wanted to say about this. And that i think is notable we have a phrase that we say pretty frequently on the breakdown which is watch what they do not what they say. And the point of that phrase. Is that very often. You'll see people who are publicly. Ragging on crypto or saying. They're skeptical of bitcoin. But at the same time allocating to this asset class and money talks and bullshit walks to use another famous american phrase. This is interesting because it's actually listen to what they say and how they're saying it and maybe let it give color to some of the other things that they're saying for as much as these people. In positions of traditional financial power have brought up questions about the importance or viability or necessity or use cases or lack of use cases of crypto currencies and digital assets. What are their. Most vaunted institutions has one of their main representatives out on the conference junket telling central banks to hurry up to move to get in this game. The reality is that if you've used the traditional financial system and the process the weighting of dozens of financial intermediaries for seemingly small transactions things. That should be easy. Based on the technology we have even something as simple as payroll or getting paid for a contract and then you've also used the crypto system. There's no competing now. There are plenty. Who would say there are good reasons why they're intermediaries who create stoppers and problems and friction in the system. Friction in the system exists to protect people. And that's fine. That's an argument to be made to discuss. But it feels pretty clear that there is too much. Friction and that crypto abstracting that friction away enormously quickly and forcing many of these central bankers back's against the wall they simply have to update and evolve. The thing with. Cbd's is the same as it's always been the devil will be in the details how they're implemented to what extent they preserve privacy truly verses become just another tool for the expansion of state power so for me. This wasn't about a shared recommendation of cbd's or anything like that. It's about getting a sense about where the world's central bankers think this is headed and it's very clear if it wasn't clear already. Cdc's are on the menu and they're starting to rush the chefs guys. Hope you're having a great weekend. I appreciate your listening and until tomorrow be safe and take care of each other piece..
"central bank" Discussed on CoinDesk Podcast Network
"Consultations with payment systems and providers banks the public and abroad ranger stakeholders have begun in some countries to build the cdc for the public. A central bank needs to understand what they need and work closely with other authorities. The innovation hub is helping central banks. We already have five. Cdc related proof of concepts and prototypes being developed in our centers. And more to come. The european union is uniquely placed to face the future. You can build on a state of the art fast. Payments system on the strong protections provided by the general data protection regulation and on the open philosophy of the second payment services directive. The cbs report on a digital euro sets the stage a cbs's goal is ultimately to preserve the best elements of our current system while still allowing a safe space for tomorrow's innovation to do so central banks have to act while the current system is still in place and to act now. I thank you for your attention. So here's the thing that i really wanted to say about this. And that i think is notable we have a phrase that we say pretty frequently on the breakdown which is watch what they do not what they say. And the point of that phrase. Is that very often. You'll see people who are publicly. Ragging on crypto or saying. They're skeptical of bitcoin. But at the same time allocating to this asset class and money talks and bullshit walks to use another famous american phrase. This is interesting because it's actually listen to what they say and how they're saying it and maybe let it give color to some of the other things that they're saying for as much as these people. In positions of traditional financial power have brought up questions about the importance or viability or necessity or use cases or lack of use cases of crypto currencies and digital assets. What are their. Most vaunted institutions has one of their main representatives out on the conference junket telling central banks to hurry up to move to get in this game. The reality is that if you've used the traditional financial system and the process the weighting of dozens of financial intermediaries for seemingly small transactions things. That should be easy. Based on the technology we have even something as simple as payroll or getting paid for a contract and then you've also used the crypto system. There's no competing now. There are plenty. Who would say there are good reasons why they're intermediaries who create stoppers and problems and friction in the system. Friction in the system exists to protect people. And that's fine. That's an argument to be made to discuss. But it feels pretty clear that there is too much. Friction and that crypto abstracting that friction away enormously quickly and forcing many of these central bankers back's against the wall they simply have to update and evolve. The thing with. Cbd's is the same as it's always been the devil will be in the details how they're implemented to what extent they preserve privacy truly verses become just another tool for the expansion of state power so for me. This wasn't about a shared recommendation of cbd's or anything like that. It's about getting a sense about where the world's central bankers think this is headed and it's very clear if it wasn't clear already. Cdc's are on the menu and they're starting to rush the chefs guys. Hope you're having a great weekend. I appreciate your listening and until tomorrow be safe and take care of each other piece..
"central bank" Discussed on Marketplace Morning Report with David Brancaccio
"Was significant focus on to reduce it but there were challenges in trying to actually get corruption down to levels that i think would if approved the situation was the only or major contributing factor. I think it was a major factor But i think also the framework that ambassador said negotiated which excluded the afghan government triggered Legitimization and i think it was some part the afghan failures handling corruption and improving their execution of programs. I think you can count issues and problems. On both sides. International institutions have warned corruption. Inside afghanistan's government was one of the biggest obstacles for the economy. But mr madi says there are other factors now that are likely to further destabilize. The already fragile situation he said. Afghanistan has been reliant on shipments of physical. Us dollars every few weeks but on friday he received a call. Such deliveries would stop one had been expected. He said sunday the day. Kabul ended up falling to the taliban a day before banks. You said placed large bids for us currency as consumer withdraws accelerated. So could mr ahmadi and his team have done more to bring stability to the system and what happens now. I think the economic situation would jerry. We were able to maintain macroeconomic stability. Even as provinces were falling. But there's a number of factors that angered lead to a worsening situation. We have a large jump international reserves. But i would expect the the. Us government would freeze those assets for the current time. So that's gonna cause a shortage of foreign currency which can utilize i would expect. Donor flows to significantly decline over the next few months. And that's gonna cause pressure on the currency to depreciate that's internally higher inflation pressure on the banking sector likely increases in poverty rates. Do you think there is anything you could have done to help. Prepare not just the country but the economy for what we've seen happen over the last week or so. I think from central banks. I've tried to do all we can. We were able to maintain the depreciation of the currency had only low single digits. Excellent four five percent even as provinces will follow the banking sector remained healthy there sufficient liquidity in the market and so from the central bank side. We manage the situation quite well and we made sure that As provinces fell that are all sin money that l. provinces were secure so i'm proud of the central bank of staff manage the difficult situation. It was more politics security issue rather than a macroeconomic safety..
"central bank" Discussed on Odd Lots
"And i'm joe weisenthal joe. I feel like it's an interesting time to be central bank. I mean yeah it always is. But i think particularly interesting right now because the the scope of new challenges new economic conditions new forces on sort of like how banking and money and markets work. Lots of new stuff right now. Lots of a new territory. Yes so not. Only are central banks responding to an exceptionally unusual economic crisis in the form of a global pandemic which basically led to the shutdown of the entire economy last year. But they're not now Reacting sort of differently to the recovery. So for instance. We saw the fed coming in more hawkish than expected last week. But it's still on hold for the foreseeable future. You have brazil delivering successive rate hikes to deal with inflation. China's sort of winding down. Some of its easy monetary policies. The ecb hasn't even started tapering or even talking about tapering at this moment. In time so you have all these central banks sort of off and doing their own thing trying to respond to this very new environment. And in the meantime you also have some very interesting ideas floating around on the nature of money so sort of like the very fundamentals of being a central bank. Yeah that's true. I hadn't really thought about it Sort of those kind of crosswinds. You're absolutely right like Sort of like unprecedented. You know. i guess there's a sense in which the cova crisis hit everyone the same way at the same time basically like a kind of had this big shutout effect but the recovery is very different with different conditions. So it's like okay. Everyone turns off everything for a few months in our trying to turn it back on again. And some countries different fiscal policies. Some countries have had different trajectories of the virus itself. Some countries have like different underlying economic conditions that changed the nature of the recovery. So there's that and then you get the splintering of policy outcomes as you talk about plus again you know the the rise over the last year of differed thoughts about money particularly crypto currencies. We have The chinese digital currency which is like people talk about for a long time but does actually out. That's raising all kinds of new questions. So yes just numerous things all hitting at the same time. Yeah it's a lot for central bankers to wrap their heads around but We are going to try to do exactly that today. And we have the perfect person to discuss These broad themes with the for central banks and also how central banks are dealing with new approaches towards money including crypto currencies. We're going to be speaking with hyun song shin. He's the economic adviser and head of research at the bank for international settlements and also a previous thoughts guests. So y- thank you so much for coming on. It's really great to be back. So i guess just to begin with a wanted to zero in on the central bank digital currencies idea because it does feel like over the past year. This is an idea that is gaining a lot of momentum. We've seen a lot of banks Issue papers about it including the. Is one of the things i.