40 Burst results for "Federal Reserve"
Fresh update on "federal reserve" discussed on WTOP 24 Hour News
"4% leave the lights up all year long. Mostly in New York and Indiana, that's where they had the highest percentage of people who said they never take them down. Stacy Lynn, CBS News. Money news at 25 and 55 here's Jeff clay ball. It was a holiday shortened week, but the market all gained ground for the week, the dollop 1.8%, the S&P 500 Index gained one and a half percent. Next week's November jobs report is expected to show job growth continued to slow with the unemployment rate unchanged at 3.7%, other reports next week include pending home sales, job openings, income and spending, and the Federal Reserve's regional report card, the beige book. Jeff Klebold, WTO news. Still ahead, how did this Black Friday stack up the previous ones? It's 8 56. This week at Staples, save 60% on, thanks
You Have An Environment That's Allowing Interest Rates to Go Higher
"An environment that's allowing interest rates to go higher. The Federal Reserve doesn't love it, right? Because they see they see already that there's some signs of a pullback. It's pretty obvious. I mean, just look at all the companies one after another after another that tell us they are planning more layoffs or they have hiring freezes. I've said before, kind of interesting that it all came out literally the day after midterms. Hey, Republicans still won the House. But there's a lot at stake as we move forward into the future. And look, I haven't even gotten to Thanksgiving yet. Which, by the way, is much more expensive this year. Much more expensive. We talked about that the other day. I mean, upwards of over 20% for a meal. But I will say this, I will say this. There is still, I think, a lot that we can be very grateful for. I am very much glass half full. I look at opportunities every single day as an investor, I like the idea that you know what for a change, you can actually get a little yield. I've been going on about the I bomb the savings bond for a long time. It was upwards of 9% last year. It's still a decent rate this year. You can find these opportunities.
Fresh update on "federal reserve" discussed on WTOP 24 Hour News
"Ground for the week, the dollop 1.8%, the S&P 500 Index gained one and a half percent. Next week's November jobs report is expected to show job growth continued to slow with the unemployment rate unchanged at 3.7%, other reports next week include pending home sales, job openings, income and spending, and the Federal Reserve's regional report card, the beige book. Jeff Klebold, WTO news. Up ahead after traffic and weather, they're not fun purchases, but you appear to be more into deals on them this holiday season. I'm Mike Murillo. It's 7 26. We've been together for 30 years. 35. 35 years together. And never an argument. Oh, we fight a lot. Is that we couldn't settle. But we finally agreed on cannabis of all things. Our Friends had had a good experience with it. So we decided to give it a shot. And we both agreed we didn't want to go sit in some doctor's office with a bunch of masked strangers waiting for a medical cannabis card. We did. Oh, thank God. So we went to very hill dot com and qualified online for our medical cannabis cards in just a few minutes. The simple payment plan made it very manageable. Yeah, women get what she wants. I'm a force of nature. Join
It Seems Unlikely That Inflation Will Be Curbed Anytime Soon
"Announcing that it is going to switch to smaller interest rate hikes. Soon, apparently, like possibly as soon as December. Great, because that'll really do wonders to curb this inflation that is still near 8%. I mean, it's been just massive. Look, the reality is this, they pumped what nearly $7 trillion into the economy when it was all said and done. And I'm talking the combination between the Federal Reserve and Joe Biden's big plans and the Democrats big plans. And by the way, it's not like the Republicans are blameless in any of this anyway, because they went through with one two COVID stimulus checks, followed by more stimulus, because that's all politicians know how to do. So it should give us some concern about the future. I don't know how. I don't know how the fed curbs inflation when they're actually looking at just hiking by .5 as opposed to .75 as they had originally intended to in the month of December. I mean, don't forget. The last time we saw inflation like this was back in the early 80s. And when I say inflation like this, it's because this inflation today is very similar to what we saw back in the 80s. In fact, if you look on an apples to apples basis with the same exact criteria that they used back in the early 80s, guess what? You find that we are looking at more like 16 17% inflation as opposed to this 7, 8% that they're telling
Fresh update on "federal reserve" discussed on Bloomberg Best
"Friday sales are expected to break records According to Adobe sales are projected to top $9 billion, which would be a new record, one expert explains why there's plenty of discounts out there to begin the holiday shopping season. We are seeing a lot of overstock still and retailers have been spending the last couple of months trying to sell through that merchandise. Arizona Republican candidate for governor Kerry Lake is filing a lawsuit against Maricopa County officials. She accused them earlier this week of breaking election laws and demanding they provide information about voters whose ballots were impacted by election day printer issues. Maricopa County has declined to comment the U.S. men's soccer team has another point and a path to the knockout stages following a draw with England by a score of zero zero on Friday. The U.S. now has two points in the World Cup after drawing whales earlier in the week. The team will play its final match of group play on Tuesday against Iran. I'm Brian schuch. And I'm Tracy jonke from Bloomberg, world headquarters. Wall Street did not get very far on its half day work day, but the week was a winner with a big assist from the fed. For the day, the Dow's up half a percent, 153 points, the NASDAQ down a half percent, 59 points lower. The S&P staked out the middle ground. It's down a point. For the week, gains a between three quarters and one and three quarters percent for all three with a push from the release Wednesday of the minutes of the fed meeting early this month in that investor saw a reason to hope the Federal Reserve will be less aggressive with rate hikes soon. Consumers were paying record prices for the turkey on their Thanksgiving tables and the main reason is the avian influenza outbreak that is now officially the worst on record. Bloomberg's Charlie pellet reports on the outbreak that pushed the total number of birds killed this year over 50 and a half million. Tracy the highly pathogenic virus was found at a commercial turkey farm in South Dakota this week, resulting in tens of thousands of birds being killed to avoid further spread. USDA data shows that push the 2022 total depopulation numbers above 2015, the virus has mostly impacted turkey and egg operations sending prices to records and contributing to soaring food inflation, Tracy. Vegan foie GRAS is now on the menu in Switzerland and Spain. Bloomberg's genus survey explains. Nestlé has introduced the new product to ease the conscience of foodies worried about animal welfare. Traditionally, the pate is made by force feeding ducks or geese through a tube to make their livers fatty. The new vegan version is called voix GRAS, which combines soy with miso truffle oil and sea salt. Global news, 24 hours a day on air and on Bloomberg quicktake, powered by more than 2700 journalists and analysts in more than a 120 countries. I'm Tracy John key. This is Bloomberg. It's the big take from Bloomberg news and iHeartRadio. I'm Wes kosova. Today, green bonds. They're selling billions of dollars worth of them, but just how green are they, really? It sounds like a noble enough idea, a company or maybe a government. Needs money to pay for a big solar power project or to replace dirty diesel school buses with electric ones. So they issue what's called a green Bond. Green bonds work like any other bun, investors buy them to finance a project. The investors are paid back with interest, and they get to feel good about themselves for putting their money into a cleaner future. The increasing demand for this kind of ethical investing has led to an explosion in the number of green bonds of every description. The thing is, it's not always easy to tell if projects described as green really are, or if it's just clever marketing. That's what we're digging into today. Rebecca Chun Wickham's joins me now. She is a government reporter for Bloomberg based in Hong Kong. Rebecca, you and our colleagues, Caroline Khan, Shirley and Adrian Leung have written this big story taking a look at China's green bonds and where that money is really going. That's not always an easy thing to find out, is it? Kind of has built one of the world's biggest screen bond markets. It's raised more than 300 billion since 2050. And it's really sort of focused on trying to reign in some of the environmental problems in China. But like many parts of the world that have tried to develop these sort of green financing markets that have been real concerned about disclosure and gaps and issues with transparency. So they built a $300 billion green bond market in really just 7 years and its central because president Xi Jinping has made this a very important part of China's sort of green energy transition. Is that right? Absolutely. So China sort of green ambitions have been a central part of Xi Jinping's policy. He's placed at the heart of a lot of what the central government has sought to do over the past decade. And he's really done more than any other leader. He said to be a true believer in the environmental cause and a lot of that initially focused on trying to curb really excessive pollution in many of China's megacities. Xi Jinping's ambitions for China's environmental policy continue to be dominated by phrases that he has, including this one that mountain and river green are mountains of silver and gold. And that's not going to be cheap. And the reason why they're issuing these bonds in part is because by their own estimates, it's going to cost just like an astronomical amount of money. Absolutely, so by their own projections, it could cost upwards of 18 trillion U.S. dollars to fund this green transition. So it is an immense amount of money. And in that context, China's green bond market so far is just a small sliver of that. So you looked at a bunch of different big ambitious projects that some of these green bonds are going to fund and your question was, how green are they? What are some of these projects? So one of the interesting projects that we looked at was this herbe iron and steel company. And it was initially intended to sort of help with pollution prevention and control, but it was actually in part used to fund the relocation of the factory that had already happened. So the factory was moved from her base provincial capital and residents there were of course pleased and said it had helped with pollution. But the issue, I think, is that the plant's new neighbors are skeptical about the green credentials or the environmental friendliness of that project. So we spoke to one man who runs a private bus line in the area where the new factory has been built and he suspects that the pollution prevention system is actually turned off when nobody's watching and he noted that the smoke you can see smoke from the factory better at night
Unemployment claims rise to 240,000, highest since August
"Unemployment benefits claims rose last week to the highest level since August. The Labor Department says jobless aid claims hit 240,000 up 17,000 from a week earlier, while the total is the highest in several months, it remains low by historical standards. The job market is still strong despite high inflation, but the extraordinary job security American workers now enjoy may not last, as the Federal Reserve keeps boosting interest rates, many economists expect the U.S. to slip into a recession next year as higher borrowing costs slow the economy.
Fresh update on "federal reserve" discussed on Balance of Power
"The ad council. The balance of power. It's always shifting. What is a sensible economic policy with this split Congress? What are the chances we actually are in a recession, just don't know it. Track each transformation with Bloomberg's David west to should we increase the military support to Ukraine from politics and government to markets in the economy. The tug of war between inflation and rate hikes Bloomberg balance of power with David Weston. The debt ceiling is a lot of talk about that. On Bloomberg radio, the Bloomberg business app and Bloomberg radio dot com. Two omicron BQ coronavirus sub variants are now dominant in the U.S.. The Centers for Disease Control and Prevention say BQ one and BQ one one are causing 57% of new infections in the U.S.. The sub variants are believed to be resistant to antibody medications used by people with compromised immune systems. The capital murder trial of a former border patrol agent will begin on Monday, Julie Ryan reports. Juan David Ortiz is accused of killing four women near Laredo, Texas in 2018. The victims were found near interstate 35 with gunshot wounds over a span of two weeks, the trial will take place in the county that's home to San Antonio after a judge granted a change of venue. I'm Julie Ryan. The body of president John F. Kennedy was laid to rest at Arlington national cemetery 59 years ago today. The burial came just days after he was assassinated in Dallas, Texas, Kennedy was shot while riding in a motorcade. I'm Brian shook. And I'm Tracy jockey from Bloomberg, world headquarters. Wall Street did not get very far on its half day work day, but the week was a winner with a big assist from the fed. For the day, the Dow is up half a percent, 153 points, the NASDAQ down a half percent, 59 points lower. The S&P staked out the middle ground. It's down a point for the week gains of between three quarters and one and three quarters percent for all three with a push from the release Wednesday of the minutes of the fed meeting early this month in that investor saw a reason to hope the Federal Reserve will be less aggressive with rate hikes soon. Consumers were paying record prices for the turkey on their Thanksgiving tables and the main reason is the avian influenza outbreak that is now officially the worst on record. Bloomberg's Charlie pellet reports on the outbreak that pushed the total number of birds killed this year over 50 and a half million. Tracy the highly pathogenic virus was found at a commercial turkey farm in South Dakota this week, resulting in tens of thousands of birds being killed to avoid further spread. USDA data shows that push the 2022 total depopulation numbers above 2015, the virus has mostly impacted turkey and egg operations sending prices to records and contributing to soaring food inflation. Tracy vegan foie GRAS is now on the menu in Switzerland and Spain. Bloomberg's genus survey explains. Nestlé has introduced the new product to ease the conscience of foodies worried about animal welfare, traditionally the pate is made by force feeding ducks or geese through a tube to make their livers fatty. The new vegan version is called voila, which combines soy with miso truffle oil and sea salt. Global news, 24 hours a day on air and on Bloomberg quicktake, powered by more than 2700 journalists and analysts in more than a 120 countries. I'm Tracy John key. This is Bloomberg. Your listening to balance and power with David Westin on Bloomberg radio. I'm Joe Matthew in for David
Fed official suggests substantial rate hikes may be needed
"Stock started the day in a sour note after indications the Federal Reserve may need to raise interest rates much higher than had been expected The fed has been raising rates aggressively trying to tame inflation by applying the brakes to the economy and now James bullard who leads the Federal Reserve bank of St. Louis is suggesting its short term rate may have to go as high as 5 6 or 7% to really put a dent in these stubborn inflationary conditions The fed has already raised the rate to around 4% economic reports are showing inflation starting to ease somewhat but consumer spending and a very strong jobs market are keeping it hot The fed is likely to get more aggressive making borrowing more costly and further heightening the risk of recession I'm Jackie Quinn
Fresh update on "federal reserve" discussed on Marketplace with Kai Ryssdal
"So yes, the big economic story of the day is indeed a Black Friday. We shop, we shop, and before we stop, we pull out our wallet to pay. And these days, many of us are doing that with the credit card of one kind or another. During the pandemic, with stimulus payments and fewer ways to spend our money, many consumers just paid down debt, but now we're spending more on stuff again, all while prices are going up. What all this means is that consumer debt levels are rising again, and as marketplace is Mitchell Hartman reports, that could cause some problems for this year's holiday spending and the wider economy going forward. Americans credit card balances are up 15% from a year ago, according to the Federal Reserve bank of New York. It's the biggest increase in more than 20 years. Consumer debts now back up to pre-pandemic levels and loan delinquencies around the rise. Consumers are getting a bit over their skis at this point from a consumer credit perspective. Sam stoval is chief investment strategist at CFR a research. He says a key economic warning sign is when debt rises to more than 20% of personal income. We are now above 25%, such an elevated debt to income ratio in the face of high inflation and a softening economy. I think we'll make it hard for consumers to maintain, let alone raise this level of spending. As inflation bites, consumers are shifting what they're spending on, says Cheryl kingstone at S&P Global market intelligence. A lot of it is necessities spending is now going to what we call non discretionary. Meaning more on groceries, utilities and rent, less on presence and going out during the holidays. And some consumers who are strapped for cash are running down their savings and racking up debt even to afford the basics, says Robert Frick at navy federal credit union. Unfortunately, most lower income people have paid their savings down completely. And there's still 1.5 trillion in excess savings, but that's kind of sequestered among higher income people. As consumer debt rises, so does the cost of paying it back because interest rates are rising too. So far though, consumers are still in okay shape for one key reason, says former fed economist Claudius Somme. The job market is really good. She says, if unemployment rises and consumers are caught with high debt and no income, that could spell more economic trouble to come. I'm Mitchell
The World Is on Edge As Former President Trump Prepares to Run Again
"Street Journal actually put this quite well in a piece that they wrote today and editorial piece. They said, quote, before COVID, he being Donald Trump was headed for reelection, but the damage from his shutdown of the economy combined with his erratic behavior in that crisis gave Joe Biden the opening to campaign for normalcy. Mister Trump lost a winnable election. I think that's a fair assessment. It was a mistake to shut things down and to keep things shut down for so long. And the inflation that we now have, frankly, is a result of all that. Poor decisions that were made at the time, and that resulted in multiple stimulus checks I mean, hey, the first, the first one, what are you going to do? We had no choice, but then there was the second and then there was Joe Biden's third, and then there was the Federal Reserve all along printing printing printing, printing in now, we have record inflation, and I suspect we're going to have real economic trouble in the near future, as the fed tries to reign this thing in. It can't be done, not the way they want. I'm sorry. I mean, hey, they can pull a rabbit out of their hat. I'll take it. But I don't believe we are going to be able to get through the next 12 months without having a pretty serious recession. You saw the news on Amazon today they're laying off people all the tech companies are laying off people, by the way. Interesting how they waited. Until after Tuesday's election to announce all that, I believe many of the announcements came on Wednesday. Um, anyway, we are in a treacherous time. I think it's really important that somebody really capable wins the nomination, another four years of Democrats, possibly with them then gaining control of the house of the Senate. I'll tell you, that's a bad thing for America. I'm
This Rally Could Be the Calm Before the Storm
"The nutrients, our economy. So needs and deserves, we're not getting that right now because our Federal Reserve basically was putting us on some kind of sugar high. I mean, they were doing the antithesis of the rough greens diet, right? They gave us this massive sugar high via so much quantitative easing, so much money printing, and now we're left with this hangover in which things have gotten so out of control and they've got to reign in inflation, but how can you do that without collapsing the economy? I mean, this is sort of the Jamie Dimon point that he's making. And consequently, this is why I just don't buy into this rally right now. I think you're going to see a return to volatility. I think you're going to see a return of apprehension in the market. I mean, heck, look at how much more money people have to pay just to go to work, right? In terms of what they're paying at the gas pumps, we know how severe that has been and in terms of what they're paying for their lunch when they go to work. You know what's up according to the latest read this week up 95% how much people are paying for food while at work or at school, interestingly, groceries are also up over 12%. The cost of butter has skyrocketed somewhere around 30% in change. These are meaningful adjustments to the things that people really need. And now we're going into the winter season where you're going to need things like heating oil, well how's that going to work out?
Wall Street surges, Dow up 1,200 points on cooling inflation
"With the latest A government report showing inflation slowed in October cheered Wall Street Now search 3.7% on the news more than 1200 points close at 33,715 while the S&P 500 and the NASDAQ composite registered even bigger games The S&P up 5.5% or 207 points the NASDAQ adding 761 a whopping 7.4% Consumer prices rose at a better than expected 7.7% annual rate last month the fourth straight month of ease that's fueling hope The worst of inflation may have passed and the Federal Reserve won't have to be so aggressive about raising interest
Inflation eased in October as prices rose 7.7% from a year ago
"There's another sign inflation may be easy with consumer pricing increases moderating last month The Labor Department reports consumer inflation reached 7.7% in October from 12 months ago the smallest year over year gain since January leaving out volatile food and energy prices so called core inflation rose 6.3% The numbers were all lower than economists expectations but even with inflation's tentative easing the Federal Reserve is expected to keep boosting interest rates in a bid to stem price hikes That raises the risk high borrowing rates may tip the economy into a recession For now we are not anywhere near a recession And President Biden says he's convinced prices can be lowered without falling into one Sagar Meghani Washington
Little sign of relief expected in October US inflation data
"Experts say the price is Americans paid for goods and services continued to increase in October When the Labor Department gives its report on October inflation this morning economists surveyed by the data from fact set believe it will say that consumer prices jumped 8% from 12 months earlier and increased a sharp .6% from September to October The United States has been struggling to control inflation which was accelerated by shortages of supplies and labor during the pandemic a burst of consumer spending fueled by federal aid and cut off some food and energy after Russia's invasion of Ukraine and such punishing inflation is giving the Federal Reserve little reason to ease up on its steadily raising of interest rates Donna water Washington
Can This 75 Basis Point Hike Do the Trick?
"Let's get back to business here because we do have a Federal Reserve that is coming out with its, what is this? I mean, we're on like 6 rate hikes now. I don't think it's going to work. I mean, this is why I am worried about inflation still. I think it's going to continue inflation. It is to be problematic for our economy. And so yeah, sure. You can try these rate hikes, but until you take all that money really and truly out of the system by doing the reverse of quantitative easing and they're not willing to do that, I think you're going to be left with the problem.
Charlie Dombeck Shares His Take on the Fed's Next Move
"Here we are waiting, wondering, I think we know what's going to happen. The question becomes, will it actually work? For that, I'm bringing back on the program today. My good friend Charlie dombeck of key city capital. Charlie has a lot of views on what this is going to mean for our future, our economy, real estate, et cetera. Charlie, good to see you again. Great to be here, Trish. Thanks for having me. So they've telegraphed this one pretty well, but I'll ask you, what do you think we're going to get from the Federal Reserve today? I think it's pretty clear the market has priced in a three quarter point increase and that's what I expect coming out later today. But again, I don't think the Federal Reserve work is done. I think we're going to see further rate increases to fate. The Federal Reserve has no choice, but to continue their aggressive interest rate hikes. Maybe they come off a quarter point in the future, but we're not done. We're not out of this inflationary environment, and we have further pressure in our markets from inflation and rising interest rates.
Monthly U.S. job growth slows to 261,000 from 315,000; unemployment rate 3.7%
"The government says the economy added 261,000 jobs in October and the unemployment rate rose to 3.7% from a 50 year low 3.5% The solid job market has helped workers enjoy steady hiring and higher pay but it's also contributed to rising prices and is making things harder on Jerome Powell's Federal Reserve which has been looking for signs both job growth and wages are easing I don't see the case for real softening just yet The fed's been boosting interest rates at the fastest pace in decades in a bid to tame inflation
US hiring may have slowed to a still-solid pace in October
"The U.S. government releases October's jobs report this morning Economists surveyed by data provider fact set expect today's jobs report to show that employers added 200,000 jobs last month that would be down from an average of 372,000 in the previous three months but the Federal Reserve would likely welcome any indication that employers are slowing their hiring as a sign that high inflation that has been gripping the economy might soon begin to ease and the addition of 200,000 jobs would still represent a healthy gain and would suggest that employers still feel the need to fill many jobs Donna water Washington
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
Jobless Claims Remain Low
"Slightly fewer Americans applied for jobless aid last week I'm Jennifer King with the latest The Labor Department says first time claims for jobless aid fell to 217,000 last week down by a thousand from the previous week and the four week moving average was also down slightly the total number of Americans collecting unemployment aid was 1.49 million the highest in 7 months but still a historically low number Consumer prices remain stubbornly high and yesterday the Federal Reserve raised its benchmark borrowing rate for the fourth time this year by three quarters of a percentage point in an effort to cool the economy and
Fed unleashes another big rate hike but hints at a pullback
"The Federal Reserve is again raising its benchmark interest rate on Ben Thomas with the number The fed is hiking its key short term rate a relatively hefty three quarters of a point It's the fourth straight increase of that magnitude and the 6th this year all aimed at cooling the economy enough to slow inflation which hit an 8.2% annual rate in September The aggressive pace of the fed hikes has triggered a surge in borrowing costs for many businesses and consumers and heightened the risk of a recession The home market has been especially hard hit with the average rate on a 30 year fixed mortgage topping 7% last week according to Freddie Mac More than double the rate a year ago just 3.14% in each of the past 8 months sales of existing homes have dropped Ben Thomas Washington
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
Trish Previews the Federal Reserve's Newest Rate Hike
"Anyway, back to the fed for a second, because they're going to, through this 6th interest rate hike, which we're looking to probably 75 basis points, three quarters of a percentage point. We're going to see an impact. We've already started to see an impact. I mean, we've had, but here's the tricky thing. I mean, you're seeing an impact in that, yes. People are getting more nervous. Yes, the cost of everything is still going up. So therefore, if inflation is still at a 40 year high, what is the fed really doing? And do they run the risk? Of taking money out of circulation at a time when the economy really could be facing something. Truly, horrific. Think about that because I told you the other day about how they've screwed it up over and over again throughout history. I mean, go back, take your pick. All the way back to really those early days of the Federal Reserve. And you even think about what happened in all that went wrong in the 1920s leading up to the crash of 1929, which were, you know, we got an anniversary of here, or we just passed, I should say, at the end of October, and what you see is you had a Federal Reserve, the back then always did the wrong thing at the wrong time in the 20s, when things were good. They just kept printing money, put more money into circulation, and then in 29, when you had that big market crash, they were like, oh, maybe we overdid it. So let's pull back and they took all the money out of circulation and create a whole host of new problems for themselves. Now, none of these are ever the same, right? That's important to recognize. So you can't look at those and say, okay, well, we can do exactly what happened back then and get this result. It doesn't work that way. There's way too many factors.
"federal reserve" Discussed on The Bad Crypto Podcast
"And now I understand blah, blah. But what do you recommend I do to protect myself? My husband, my husband, died, left a small estate, and I don't want to, I didn't want to squander it. What would you recommend I do? Should I buy an apartment? How should I get gold or silver? Should I go into cash? Or what should I do? And I had faced myself in the mirror. I hadn't been foggiest idea of what to say to these people. I was a fraud. Yes, I knew about the Federal Reserve, but the real world of investments. I knew nothing about that. And people wanted that information. So I canceled the series, the speeches, and I decided to go back to school. I really did. I surprised myself. I wanted to learn about the real markets. And so I enrolled in something called the college for financial planning. It's a correspondence course, but it's very highly esteemed course. The issue certificates like a CPA. This was a CFP certified financial planner. And it was a long. This is so you're in your 50s at this point. So you're like, mid 50s or so, you know? I'm going to go back to school, see? That's great. I need dangerfield dead, right? He don't get no respect. Yeah. So anyway, I decided that I'd go back to school. And I got my CFP designation. And I really learned a lot. It's not that I wanted to be a financial planner. I just wanted to learn about the real markets. So then I realized that the story I was sitting on was one of the biggest stories that you could possibly imagine. I decided then to write a book. That was the beginning of it. So it was about a 7 year journey from that point for me together. All this stuff that I knew, but I didn't know all about it. I didn't know enough about it to offer myself as some kind of a half baked expert. To write a book, you'd stick yourself out. And I thought, when I published the book, boy, am I going to get splattered? I was just, I dreaded the day that some college professor would read my book. And expose me as the
"federal reserve" Discussed on Marketplace with Kai Ryssdal
"Say it's become a <Speech_Male> reminder that <Speech_Female> their most important <Speech_Music_Female> investment <Speech_Music_Female> has always been <Speech_Music_Female> in each other. <Speech_Music_Female> <Speech_Music_Female> <SpeakerChange> <Speech_Music_Male> For marketplace. <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Music> <Speech_Music_Male> <SpeakerChange> <Speech_Music_Male> <Speech_Music_Male> This final <Speech_Music_Male> note on the way out today <Speech_Music_Male> about which, <Speech_Male> honestly, <Speech_Male> I can not <Speech_Male> even <Speech_Male> with this. Saw this on <Speech_Male> Catherine pell's Twitter <Speech_Male> feed last night. <Speech_Male> She's going to be with us tomorrow, <Speech_Male> by the way, to discuss <Speech_Male> the week that was. But <Speech_Male> last night, honored <Speech_Male> Twitter <Speech_Male> this item, a poll <Speech_Male> from morning consult <Speech_Male> of registered <Speech_Male> voters on <Speech_Male> this question. <Speech_Male> Who has <Speech_Male> a lot of <Speech_Male> control over <Speech_Male> inflation. That's their word <Speech_Male> a lot. <Speech_Male> The most common answer <Speech_Male> across party lines, <Speech_Male> the <Speech_Male> president, <Speech_Male> and wrong answer. <Speech_Male> Among Republicans, <Speech_Male> 55%, <Speech_Male> <Speech_Male> say, the president, <Speech_Male> which means <Speech_Male> we need more <Speech_Male> GOP listeners to <Speech_Male> this program, I think, among <Speech_Male> Democrats, large <Speech_Male> corporations was <Speech_Male> the most common answer <Speech_Male> for having <Speech_Male> a lot of <Speech_Male> control over inflation. <Speech_Male> Also, <Speech_Male> eh, not right. <Speech_Male> So <Speech_Male> I guess we need more <Speech_Male> democratic listeners <Speech_Male> too, the actual <Speech_Male> right answer, <Speech_Male> which overall about a third <Silence> of registered voters <Speech_Male> got. <Speech_Music_Male>
"federal reserve" Discussed on Marketplace with Kai Ryssdal
"For decades now, the reality has been that overall, Americans don't save enough for retirement. About half of older Americans, the research shows, have less than $50,000 saved or invested to retire on, and for many, especially those with lower incomes, the plan is to just keep working. The catch, of course, is that whether you're allowed to keep working, isn't always up to you. Marketplace is Riemann craze, the host of our podcast, this is uncomfortable. Has this story. About what happens when your family becomes your retirement plan. For years, Rebecca Donna jealous worked as an executive housekeeper in Boston, cleaning hotels. And even though making ends meet was tough, she was content. I love my job. I love my job. I never been absent, never been late in my whole career. Wow. Never took a sick day. Why not? Well, if you don't take your sick days, you get paid three days. You make it however you can. You make it however you can. She was a single mom raising two kids. Her youngest son, Sean Pierre Regis, remembers just how hard she'd work. All of her money basically went to feeding us paying her rent and making sure that we got a pretty solid education at the elementary level. And it was important to her that her son, Sean Pierre, also go to a good college. So when he got into a private liberal arts university in New York, Rebecca insisted on paying for half of the tuition. And to do that, I took out my 401k plan. She liquidated about $20,000 from her retirement plan. At the time, it seemed like a no brainer. She had no plans to ever stop working. But years after Sean Pierre graduated, just as he was climbing the professional ladder, everything changed. He got a voicemail from his mom. My mom just says, I just got fired. I just got fired. Call me. Only bye. End of message. It came as a total shock. She'd worked there for about a decade, and since she lived in the same building as the hotel, she didn't have to pay rent. The hotel gave her two weeks pay and told her she needed to leave her apartment within a year. At 75 years old, Rebecca didn't know what to do, starting over felt impossible. She had just $600 in her bank account. I missed a whole lifetime. I missed lifetimes on the job of things that other people were doing. And I just screwed myself in the end. Her son Sean Pierre was her only real support system. So one day he came to her with an offer. Why not move in with him? She'd live with him and his boyfriend and a small New York City apartment. This was her best option. So that's what they did. Sean Pierre remembers the day she moved in. It was a beautiful day outside. And we were on the terrace, and we were like, welcome home, mate. Rebecca was grateful. But at the same time, it was hard. She'd gone from only depending on herself. It's now depending on someone else. It seems like there was a bit of reversal of roles happening. Oh, he. He became my money. Essentially. There's still working through the transition. Her bedroom, for example, has no windows, and is much smaller than she's used to. The line I remember most often was I moved from my 750 ft² apartment in 81 ft². Remember? To attend by 12 room. Yeah. Without roommates, Sean Pierre is now paying $4000 a month on rent. Rebecca says she's going to start chipping in from her social security checks. But for Jean Pierre, the hardest part has never been about the money. He just wants to feel like his mom is okay. I mean, frankly, the hardest thing is, I think, feeling emotionally tied to your happiness. Right? Well, lay your fears on that. I am happy. Know that these words I have shown here. Don't fret about it. It's not exactly the ideal picture of retirement. But the reality is that one out of every four Americans doesn't have a retirement plan. And so people are increasingly having to figure out different solutions. As far as Sean Pierre and Rebecca can see, their new living arrangement is permanent. They've merged two very different lives at very different stages. They.
"federal reserve" Discussed on Marketplace with Kai Ryssdal
"I personally am a big fan of quick and efficient meetings, but OPEC plus might have gotten a little carried away today 11 minutes is what it took for the oil cartel to decide to increase global production later this summer increase a little bit. It should be said. So we got Abby rajendra and on the phone for some explanation and analysis, he's the director of oil market research at energy intelligence. I'll be thanks for coming on. Thanks for having me. So what do you make of this? Announcement today from OPEC. Yeah, it was an interesting announcement. It was a little bit of a carrot for everyone, right? I think there were a lot of winners on the face of it coming out of this. I'll get to how much it's really going to matter in terms of affecting world prices in a sec, but I'll tell you what, I'll tell you what. Let's get to the winners in a minute. Let's get to right away what it's going to do to oil prices. The reality is not much. The group was already adding about 430,000 barrels per day. Each month. In incremental supply, so they just accelerated the supply edition slightly, right instead of 430, they're going to do 650,000 barrels a day for July. And for August, effectively bring forward the end of the supply tapering by month. But that incremental supply, again, there's questions around who's going to actually be able to add it. And I think the answer is just a few countries a few members. And the impact on oil markets is going to be fairly minimal. And we're still headed for kind of a hot summer here. Weather wise end price wise. So let me ask you then the winners, right? And let me take off a couple and you can say winner or loser, right? Saudi Arabia. They now have clearance to pump some more oil winner or loser. Winner. Okay. Russia, which is under sanction its supply, the amount that is pumping is decreasing winter or loser. I would say there are winner two. Mainly because, you know, again, you know, there was some chatter about possible exemption for Russia. Not that that would matter much either, but again, Moscow didn't ask for that. That was not really talked about. You know, open plus is generally been supportive of Russia over the last couple of months as their supply has gotten more and more strained. But even with these slightly accelerated production, Russian world remained a core OPEC plus member of that, that is my expectation for even beyond the fall and the end of the year that they will remain a core member. Interesting. That's really interesting. Okay, now I'm going to get to the geopolitics of it. The United States of America and president Joe Biden winner or loser. A winner, but again, I would say a winner because they got a little bit more oil out of OPEC plus, but in terms of actually affecting prices, it's not going to really change the trajectory. So in that sense, I would say loser from a market impact standpoint. Last thing and then I'll let you go. Back to market impact, the American consumer, the oil consumer in the United States, that is, seems to me to be the loser because it's not going to have that much near term impact on prices at the pump. That's right. I think the key driver that driving oil markets is what's going on in the refined product markets, right? The gasolines, the diesels, and then some of the other products. Where there are shortages and during the COVID era, we lost three and a half million barrels a day of global refining capacity, and that's really kind of hitting the hitting the consumer and then hitting the market. And then we expect this to continue over the summer. I was driving season picks up as air conditioning season picks up in the Middle East. That's not talked about much, really around the world. Construction season picking up. Plus China coming out of COVID. There's a lot of factors that will push prices or at least keep them fairly high. The refiners will continue to sort of chase that market. And in doing so, they'll continue to buy as much as they can, which will keep the oil prices elevated at least for the next couple of months. I'll be gender, and he's at Columbia also at energy intelligence..
"federal reserve" Discussed on Bloomberg Radio New York
"Underlying demand I see it in the excess savings which you know is still well over $2 trillion And that doesn't include net worth increases whether that be house or market over the last couple of years Business inventories are low business investment and spending still seems very strong State local governments seem flush with cash And they'll put that to work whether that be spending or tax reductions And so it still feels to me like the dynamics of underlying demand are quite strong And we talk about raising rates but as Mike said at the beginning we're still a long way from neutral And so it's not clear we're going to get to constrain the economy for a while And so I think I put those together and I still see a lot of underlying strength Talking about underlying strength and strong demand about the housing market Tom How concerning is that at this point for the Federal Reserve Are we getting into a scenario that may be akin to 2008 So housing is very hot I like to say there's no way to understand the weakness I'm sorry the weakness of your own house than spending 24 hours a day in it And a lot of Americans have decided to move into a new place to invest in their current place to buy a second place And so all of those are all of us are happening And that's very much propping up demand and price for houses From a financial stability standpoint which is really 2008 The thing to look at is leverage And at least the numbers I've seen still comfort me that we're not dealing with in excess leverage situation In the housing market at least yet in other words loan to values are still at a place where you could take a change in the housing price situation and still not affect the health of balance sheets But that is of course something to watch And we're still pretty early in this price cycle That's something I'm going to be watching going forward The folks on the trading desk want me to make sure I ask you what's going to happen with the balance sheet Do you anticipate an announcement in May What would be the optimal plan for reducing.
"federal reserve" Discussed on Bloomberg Radio New York
"Of this pandemic is fair to say that the Federal Reserve has helped us get through this in a major major way This question has been asked before But I'm going to ask it again in a different way Because could you compare the economy pre-pandemic Pandemic a year ago And today and tell me where we're at in relation to those three different points in time Sure So the pre-pandemic economy that was a very long historically long ten years and 8 months expansion growth was just modestly above potential every year So we were getting growth between two and 3% and we think potential growth is around 2% So that implies a tightening labor market So we have this long relatively uninterrupted period of growth and what happened is unemployment kept coming down and participation kept coming up And that was very beneficial And so you saw people around the edges of the labor market getting more wages we saw we saw companies going to prisons and recruiting people who weren't going to get out for a couple of years I mean it was a very very it was a great labor market So that's pre-pandemic So then the pandemic comes and it upends everything and so the question really is what are things going to how is it going to be different And we're only beginning to see that because we're not out of the pandemic We're a long way from out of potentially But so what are some of the things that we're seeing that are with us now One of them is that the recovery and labor force participation overall has been slower than hoped actually prime age labor force participation has moved up a full percentage point almost last year but overall that was offset significantly by older people retiring for people older people and not older people retiring So we're seeing some differences We're also we're going to see people working remotely There's the wage increases that we're seeing are still very skewed to the lower end Of the income spectrum So there may be something happening there where wages are just going to be higher for people and we don't know whether any of this will persist but some of those are some of the things that we're seeing I know employers who are hiring younger people out of school are finding that they have to have one day to work from home or they'll go to someplace else where they can get that So it's a place it's a market right now where labor is very short as a result workers have a lot of leverage and that may persist So I think there's a lot of different things I've just got a limited.
"federal reserve" Discussed on Ron Paul Liberty Report
"Hello everybody and thank you for tuning into the weekly report. The biggest federal reserve scandal following revelations that federal reserve officials made trades in financial assets while the fed was taking extraordinary efforts to stimulate the economy. Federal reserve chairman. Jerome powell ordered a review of the fence. Ethics rules while these trades appear problematic. They pale in comparison to the biggest fan scandal. The feds impoverishment of ordinary americans in enrichment of the elite and facilitation of government debt and deficits the depression induced by corona virus. Though really caused by so-called public health actions government took in response was the official reason for the feds increased asset purchases last year. However the fed actually started ramping up. Its money creating activities. In september two thousand nineteen when it began pouring billions of dollars a day into the repo markets which banks used to make short-term you loans to each other in order to keep repo market interest rates. Low corona virus was just a convenient excuse for the fed to do more of what it was already doing now. The fed is using the limited reopening as a scapegoat for rising prices. Of course anyone who understands austrian economics and understands that rising prices are a symptom not a cause of inflation. Inflation is the very act of money creation by the fed rising prices that diminish the average american standard of living are not the only resolve of the fed's manipulation of the money supply the manipulation distorts economic signals producing results including booms bubbles and bus inflation has always benefited the well-connected elise hu received the feds newly created money before the new money causes. Widespread price increases the true motivation behind fed. Policies was revealed by former fed. Official andrew hustler in two thousand thirteen house are writing. Neuronal street journal confirm that quantitative easing cap stock prices high instead of helping americans struggling with the after effects of the two thousand eight election. Other beneficiaries of the fair are big spending politicians. The federal reserve purchase a federal debt instruments keeps the federal government debt. Servicing costs manageable. This is why. Despite chairman powell's recent suggestion that the fed will soon begin tapering. Its purchases of treasuries. The fed is unlikely to see -nificant reduce its purchase of treasuries or allow interest rates to significantly increase. Power is also unlikely to upset president baden in biden's congressional allies as long as progressives are urging biden not to reappoint pow progresses. Went to replace powell with someone more committed to fighting climate change and systemic racism with two bogeyman routinely bought out as excuses for vast expansions in government spending and power. Another major scandal involving the fed is congress's refusal to pass the audit the fed bill and let the american people. Know the truth about the fizz operations audit the fed authorizes a government accountability office audit of the fens dealing with foreign governments and central banks. The fans discount win the operations reserves of members banks and security credit interest on deposits and open market transactions audit. The fed would finally reveal the truth about all the feds operations limited audit authorized by dodd. Frank act found that between two thousand seven and two thousand ten. The federal reserve committed over sixteen trillion dollars to foreign central banks and politically influential private companies. Imagine what a fool audit would find. It is time to end the scandal of allowing a secretive central bank to have so much power over the economy and our liberty it's time to audit and and the fed. Thanks for listening..
"federal reserve" Discussed on Vox's The Weeds
"Apprenticeship programs shows. We need childcare programs. It shows that we need to reduce the criminal justice systems involvement and those are all things that progressives would want to do like regardless of the macroeconomic analysis and. I think the idea that like doing that stuff that like solving the problems that made progressives want to get involved in politics is like also the key to the labor market. It's it's just like it's very appealing like like who doesn't want to kill two birds upon stone. Yeah definitely so the way. I experience it And i think it's definitely a strand inside the press movies that they think that. There's something sketchy for lack of a better word. We'll come up with a better one minute. But there's something sketchy about what the federal reserve is up to. When it does monetary policy they think of low interest rates as causing or exacerbating wealth inequality they think of low rates as a subsidy or sop to the banks ignoring that banks lend spreads. They don't just lend the interest rate but still like they think something about low. Interest rates are a sop to the financial system. They think low interest rates are sustaining or otherwise creating bad corporate behavior in terms of corporate governance. That's really focused. On shareholders or buybacks and dividends and not on investment. Don't mean to be rude to the there's a little bit of a quasi hard. Hard money libertarian. Vagueness to it. It's like you're messing with something. That's shouldn't be messed with. And that's causing all these problems and i think even the people who get it still think. Yeah you might be able to get to full employment. But you're risking a corporate bond bubble or zombie firms or exploding wealth inequality or you are propping up an unfair corporate system of inequality and extraction at the expense of maybe getting full employment and in those people was like points goodall. But think of all this other bad stuff you're doing and there i think those trends existed at higher rates in our economy I don't think necessarily influenced by it. But but that's kind of my read of it before we talk about the strengths and weaknesses of it. Yeah and i think the similar this is i think hard to assess but the but the inequality piece is you know. I think more dollars and cents numbers. And i always know baird rust in a philip randolph. And martin luther king. They very invested in full employment right as a strategy and you know obviously not as the only thing the civil rights movement cared about but it was an important plank of what they were doing and then along came a paper from the new york fed sometime last year. That was like oh no actually submitted. Monetary policy is bad for racial equality. Because it's true that it helps people get jobs but it also makes stock prices go up and why people on most of the stock and so you see we're exacerbating The racial wealth gap here and you run that play with almost any form of inequality right like shares of stock are mostly owned by a relatively small number of people so anytime the stock market goes up. There's some wealth inequality going up and that is definitely a thing that happens right like when when the fed does stimulative monetary policy stock market tends to go up. You know. i think people look at that and they say well. This is not what we're about where we're trying to fight inequality absolutely and it's you get the dope problem with the fed especially in our in our era of collapsing. Trust in government and government competency or at least felt competency. The fed is fact. It does what it does very well like. There's bureaucrats who are really well informed. They carry out. Things they can set up programs very rapidly they. They seem like they know what they're doing. So there's a real incentive to say like well you should also saw these other problems too. So why aren't you also fixing inequality even though we know how to fix inequality it's taxes and p- redistribution and redistribution. There's new when i think of the reason economy's gone so unequal in the last forty or fifty years. I think it's like the top marginal tax rate went from eighty to forty percent. The labor movement was decimated the real value the minimum wage declined etc etc. Down the line. I don't think of like the slow declining value of interest rates which is also an international phenomenon As particularly being the problem if anything new research argues that wealth inequality which we've created throughout these market structures has led to declining interest rate. So i worry a little bit that lake. It is true that monetary policy like the minimum wage. If we wanna raise which we absolutely should it increases wages for low wage workers. And then there's a fight about its effects of employment where you know like leading evidence says there's very minimal impact on employment but that's like a one dimensional impact point. Do you know what i mean like. That's you can argue that trade off pretty straightforward like employers versus workers. And so on we're monetary policy goes in and boost the economy but the economy itself is very unequal so it will have effects that are very and some dimensions but other dimensions like employment. It's really impactful for the people who can get jobs in our economy given that were capitalist system so the trade offs are much were complicated in robust there. But i do worry when you spend too much time there. You just lose your eye on the prize. If we're worried about wealth inequality we have taxes. We can fund the irs. We can tell the irs to do other things in a way. That's way more effective than trying to keep the economy in a perpetual quasi recession to reduce inequality. I guess is what they're saying right. I this is. This is what. I thought right The stock market went down like a lot in two thousand eight and so wealth inequality klein but like it was a huge catastrophe. Right and you could say like really shitty right winger would be like see. You guys got what you wanted right. And it was terrible. But it's not that's not. What the progressives wanted. We're progresses wanders higher taxes. And maybe some other things like the they wanted to address economic inequality in a redistributive way that would raise the floor as well as as lowering the ceiling. And you know we. We talk a lot about the climate stuff on tuesday show. I don't wanna get too deep into it but but this strikes me is actually two manifestations of a similar problem which is that it is challenging to get progressive bills passed in congress legislating. The united states is hard the way that cultural politics has intersected with the way the senate map is drawn has made especially hard to get progressive bills passed through congress so it is extremely appealing to try to find ways to do things that don't involve passing laws through congress. And it's it's important. It's important to look at all the agencies and what they do and what their powers are. But like you can't really imagine a world in which we significantly reduce economic inequality that doesn't involve like a congressional majority that wants to significantly reduce inequality and if you have that like they can just do it right like that's what congress's and if you don't have it it's like well you're just you're not gonna succeed right like right now. It seems like democrats. It's like pulling teeth to get you know. A dozen house moderates to agree to like popular tax increases on the wealthy. And it's that's what happens when you have an eight seat majority it's like it's it's really challenging and like i wish those guys will get their shit together but also like if the polls had been right and democrats had a thirty-seven seat majority whenever you know they would just raise taxes more. Yeah absolutely and you do see this mission creep and it happens in a lot of ways last year. The fed launched a program called municipal any facility which was designed to make sure that thorough liquidity for state cities municipalities. That wanted to to borrow money which they did at record rates and the fed successfully brought down rates though did not do many loans..
"federal reserve" Discussed on Vox's The Weeds
"So when i was a when. I was a young blogger. People talk about the taylor rule which came from a macro economist. John taylor this is i. Don't know it's like a formula. There's some variables in it. It says what the interest rate should be and for a long time. I don't think the fed ever should've of explicitly followed that. The taylor rule but the understanding was that this guy's work was fluential and that it was You know kind of a way to think about Monetary policy that that people took very seriously and during the great recession in it's sort of most acute phases. Even one thing people would say. Look mathematically like the taylor. Rule says we should be in deeply negative interest rates which were not going to do for various reasons. And that's part of the case for obama's fiscal stimulus. So you know it's like you can do things in the economy in this taylor framework. It's not like a hawk all the time view but it says currently that like the fed should raise interest rates to five percent. Basically right way. And that is a view that was kind of predominant way of thinking until really really really recently would say that look. You can't let inflation get above two percent or stay there for any meaningful period of time because people will come to believe that. There's inflation that there's going to be like right now at the price of cars has gone up a lot so you can have a car buying frenzy right in which everyone who is even vaguely thinking about buying a car is like holy shit car. Prices are going up faster than incomes. I better by car like as soon as i possibly can. And then the prices go up and up and up and like we're in a disaster so the fed needs select slammed the brakes right now even if it throws people out of work we need to make it that like you just cannot afford a car and that's the only way we're going to get this back done and it sounds crazy but like i think it's important to understand that like that was how we were doing things like really really recently that like not just it would be undesirable to have three to four percent price growth but that it would be like apocalyptic and at any cost we had to stop. That mapping. yeah. And i think the a critique of the kind of inflation targeting regime which involved the taylor rule that became influential started kind of early in the two thousand tons of his wasn't starting with the economic blogosphere about people like yourselves reinvent many others. Our were very influential in pushing. The argument was that the inflation target becomes like ceiling. Which is another way of saying about you. Know your target metaphor which is to say that if you get that nervous about inflation being over target. You're not actually aiming at a target. You have a ceiling now. Inflation will always be a little bit below and this powerpoint between nineteen. You know if you're always a little bit below target you can actually start to drift down inflation expectations and thus inflation will drop and thus rates have drop lower and you end up in this kind of negative dynamic where you're always on the under heated side. You're always like in the wrong gear on the slow and you're always never quite getting the economy back to speed as quickly and as fast robustly issue cut and so having much warren explicit acknowledgement that. The fed wants to air on both sides understanding that on average it will hit its target gives it opportunity to take periods like right now and instead of just saying like the numbers of the number like the equations you know now through now we gotta we gotta stop everything and slam on the brakes and put the economy into a quasi recession. Slow down you can actually look at it much more holistically and say okay is. This sectoral is transitory. Is this going to decline. You know we still retain the tools to slow down economic activity. But it gives us a framework understand. Like if we actually think this is transitory if this reflecting economy that is coming back to life so rapidly it's causing some bottlenecks in supply chain issues but it will resolve itself. Well you know we have the bandwidth to sit this out and wait a little bit to take action which is important to give the economy time especially for a recession like this so i wanna pivot a little bit and ask you about kind of big picture theory because you know in addition to being a a great monetary policy noar. You're the author of a book freedom from the market which we talked about on this show and you know it's Well it's not about this. But it's about you know the limits of a market society and neoliberalism and i always get the sense that part of the disjuncture between what you and i have been talking about here and the way some progressive activists things is that this doesn't sound freedom from the market marquis enough to them like we're talking about solving problems and making the world a better place but like nothing has been de commodified. Nothing has been redistributed necessarily from anybody. Where like saying some guys on a board need to make somewhat better technocratic decisions and then people can just like get jobs more easily or higher pay and so i wonder i mean because you you really in this space you know. That's like critical of the market society. And how do you how do you think about that. I mean who do you hear from. How do you talk to people. So there's definitely a. I don't think it is reflected in mainstream journalism or progressive activism. But there is a sort of marxist critique of of left cantinas. I would insert myself a left kensington in my political orientation my economic orientation. There's a kind of like marxists left. Critique which says like this ultimately won't work because the battles between employers employees and and you can't massage system that's prone to collapse and i think that's outside this conversation and certainly i think we can do better on keynesian economics and then maybe we'll figure that other stuff out later. Yeah i mean. That's not really what i mean. I mean more. Just the sort of psychic emotional. You know interpretation that. I think people want to. They want to fight the bad guys on one level. And also they want to bolster so we. There was a version not that they were super left wing but like there was a version in in late obama of like a progressive structuralist critique of the economy that was like look participation has fallen in this shows. We need new investments.
"federal reserve" Discussed on Vox's The Weeds
"You know i. i don't want to downplay the significance of this financial regulation issues. That's like why we did a whole segment explaining what they are. And what what the what the topic and what. The significance is but you also wrote a paper recently. That's about sort of the change thinking on macroeconomic policy That sort of also came through the federal reserve as an institution at around this time. And you know. I i want to talk about that like what. What is the kind of transformation that we've seen in terms of thinking about about the labor market and the feds other i think. Sort of fundamentally more significant world there you absolutely so it's interesting to do do one more time machine on you know when people talk about the great recession. I think they often if they're listen economic podcast. Maybe they have a story of the great recession. That's about the bailouts and leman brothers and goldman sachs or they have a story. That's very important but very well rehearsed about whether or not. The obama stimulus was too narrow and small and technocratic and whether or not they did enough on housing or move too quickly on a moving to Pity austerity and whether or not the the fed could do anything or if it was out of ammo story. That's very much about the great recession. The story of two thousand eight to about twenty eleven may twenty thirteen. But there's another story about the great recession. That's twenty fifteen to twenty nine hundred. It's all about how low unemployment can go and where the economy should've leveled out. And i think after the election of trump there is a lot of reason for people to want to believe that unemployment unemployment at that point is a little under five percent. There's a reason they want to believe. Unemployment can't really get below four and a half percent. Maybe it can't get under it certainly can't get under four percent and if it got under four percent and certainly couldn't stay under there very long without causing damages. This is a pretty conventional argument. Twenty sixteen twenty seventeen. Some of it is motivational. That they don't want the trump tax cuts to proceed And so they want to think that raffle employments and thus this will just cause inflation and cause problems. Some of it's very well felt by people who are really bound by the idea that if the fed overshot on got unemployment too low it would have really disastrous consequences and you would really risk the wellbeing of the people you are. Nominally meant to help at that point. I one way to think about this. If you want to situate yourself politically as you go back to the twenty six eighteen campaign and trump is saying like basically like you take the employment to population ratio. And you just like assume everybody not working is unemployed. At like the real unemployment rate under obama's like forty five percent or something in so then people would do debunking. 's and fact check stories about that. Because i think of course. That's crazy right like they're retired people there full-time students. They're they're stay at home parents. There's lots of reasons. People don't work but then you have to decide when you're writing that fact check item. Like how far do you go right. And one thing you could say is like the unemployment rate is actually quite low and like trump is just totally full shit as well as saying something. Factually untrue like the sentiment is false. The economy now here at the end of the obama administration is like firing on all cylinders. Another way you could do. It is be like this thing. Trump is saying is not true. That being said if you zero in on the crime age like twenty five to fifty five year olds. People probably aren't full-time college students. People who aren't retired and you look at their employment population ratio. It is below its historical peaks and it is below its historical peaks despite the fact that the population has gotten better educated at fewer people with small kids at home than than there were in the late ninety. S so you would say look like what trump is saying is not true at the same time the critique that eight nine years after the great recession we are still not back to full employment like that is right and some people like me were saying that and other people which is like not you was in part there was a partisan motive to say. It wasn't true but it was also just like what a lot of people thought. It was genuinely true that the unemployment rate was at a low level. But if you look at these other indicators like wage growth and employment population ratio. There were signs of real weakness there and this was like a big argument right. Two thousand sixteen twenty seventeen. I think a lot of people for a lot of different reasons were on both sides of that debate you absolutely and the participation rate is key because a lot of the reason unemployment came down in the mid twenty tonnes was. He will just slept the labor force. And you know there's harsh kind of reactionary ways of this is about people playing video games or people. Just don't wanna work but there's also like a story that has a morph affirmative role for government. That's not employments like well. We need job training programs. Or we need outreach. Or there's like the way it cuts if you think that that is a actual shift that is independent of the business. Cycle recreates. A very robust partisan debate. But it's sort of orthogonal whether or not russia full employment or not which would over determine and sure enough unemployment continued to go down. There's long sir about a bunch of things that happen we can. We can go into but unemployed gets below four percent at stays below four percent for two years it gets to three and a half percent and bounces around there for six months and there is no pressure on inflation going into vid. There's every sense Notably participation improves dramatically. In a lot of this doomsaying that we're just going to work less. Structurally others is going to be less. People in the labor force and thus unemployment can come down because we're just no longer people being brought into labor force. People who were incarcerated or disabled employers are seeking them out their training. You see robust wage growth in two thousand nineteen the black white unemployment gap gets to its lowest level in fifty years towards the end of twenty nine teen. And there's good reason to think it would have continued to maybe even shrink to zero so in two thousand nineteen and it's weird because it goes in this very partisan mode. There's a pretty robust economic recovery. Predicated on full employment and full employment doesn't do everything but it does a lot of things and and the keeping you mentioned inflation right. Immune a key part of this is that you know. Workers were seeing wage particularly the lower end because they have bargaining power employers will pay a premium. I think to get an experience person. Under those circumstances but it wasn't particularly inflationary because it turned out that the world these people on the margins of the labor mark right you weren't. Some people were getting raises because people value their experience that they had at bargaining power but employers weren't genuinely out of people who could be to work instead. You were seeing opportunities going to people who had been out of the labor force. There was more investment in training people who maybe didn't know how to do the job or just like didn't have a lot of work experience right. I mean there's tons of evidence that if you are out of the workforce for a long time it becomes harder to get a new job. It seems like employers if they can pick. Don't wanna hire someone who has big gaps on their resume. I think for pretty obvious reasons. Your first choice for a job is probably not a convicted criminal right out of prison but it's good for society to have a situation in which like somebody has to roll the dice on the reentering felons. Because like you you. Don't you both understand why people don't wanna hire like recovering drug addicts and things like that but as a country. We don't want those people to be unemployable in part for like squishy humanitarian reasons but also like that's how people get their lives back together right like nobody will give you a chance. You got like a big big big problem and we were seeing in two thousand nineteen. That's what was happening right that. We were able to expand the labor force into these different terrains. and all kinds of gaps. Were going away. Because it's it's just. It's so costly to discriminate..
"federal reserve" Discussed on Vox's The Weeds
"I think the the lack of cost is important to dig into here because obviously there is a cost to participants in the industry who enjoy having very high return on capital. We talk about this and yesterday's show but you know if you can find your investment with a lot of debt then your upside is enormous. The investment pays off. Well so you know people like to do that if they can get away with it normally in life. It's hard to get people to lend you. Money to make speculative investments. That's a heads. I win tails you lose. Sort of situation. But if there's a sense that you might get bailed out you know you can do it. And this is why. We need to regulate banks. The people involved with like you to believe that this is very costly to the economy that by making it less profitable to sort of be in banking. You're going to reduce the availability of credit of capital two people who who rely on banks to get the money but you say that that's not the case. So why is it that you know if i wanna mortgage. I want a small business loan like why doesn't it. Putting tighter capital requirements and banks make that harder for me as a customer sure so from the bank's point of view it is substituting one form of funding for another so instead of funding with dat is funding with equity or retained earnings And so it is. Substituting on the liabilities is basically saying we're going to change our balance sheet so that we're not using this thing that's we like doing more. And certainly at the margins we think that the cost of switching from one to the other has very little cost for that bank itself like if you increase requirements ten percent maybe the cost of capital goes up less than half a percent like. That's the kind of small basis points kind of change and even those might be exaggerated. It's really tough to do these studies. But that's that's the kind of scale talking about also particularly for real economy firms that need money for investments. They themselves have other options to i. You know your tidings regulations on the very biggest banks who we think have real stressors but like there are other things that can lend community banks can lend other your internalizing the cost of the failure of these largest banks over fifty billion dollars in size but there are other financing instruments in the economy as well so between those two things. There's a tendency to think that this has very little low cost and we see this because since two thousand eight to the cova crisis we essentially more than double capital requirements in banking system. And it's across all measures and there's a lot of different ways to to measure this. But in general the banks become significantly more capitalized in the aftermath of the crisis in the years after the crisis and then they keep that rate there because dodd frank forces them to even though they're angry about it and there's no system wide decline in lending or increase in lending causse because those are also largely determined by the federal reserve in aggregate demand Another way to approach is that if an activities profitable someone will lend to it. And they'll find a way to lend to at and that's kind of the flip side of that equation so we did this big experiment where we rapidly increased capital requirements the economy and basically no one says that it had a huge cost. The fight is whether or not the causes even really that measurable and you can just go out. I mean go apply for mortgage tomorrow. Like it's. There's a lot of credit available in the united states of america. But then so okay so. We were going to talk about pout so capital requirements. I went up under obama because of dodd frank and then they went down again somewhat Under under the trump administration. So the reason talk about fifty billion i think is a is a good way to approach a set of things that were deregulated so people ask. Where was the big bipartisan infrastructure. Bill of the trump years and they're actually was one in two eighteen. There was a big and push to deregulate. Parts of dodd frank. It was called something or willion. What is it. The economic growth regulatory relief and consumer protection act Which was basically very few of any of those things and what it did was congress that we're going to take that fifty billion and move it to two hundred and fifty billion and say we're no longer gonna worry about fifty to fifty if there's any worries in between there. The federal reserve is authorized explicitly in this act to step in and do things to make sure baseline projections are in. But we no longer want this enhanced regulation until you get to fifty because we as congress bipartisan group. Wanna really just focus on the biggest place. Now there's a lot of regional mid size banks in that which are very influential and purple states and very influential in terms of their power in congress and they asked for this and they got it. We were very opposed to it. Financial reform community in general is very post to it. I think there's argument. You could have moved. Fifty to one hundred janet yellen when she was at the fed barney frank himself later on so that might have been good but going. The fifty was really far beyond people thought that deregulated several trillion. Dollars on an important way. And these are like you know. Mnt bank santander ameriprise. I mean these. Are you know like have stadium. Sponsorship deals they're large large enterprises. They're not the biggest banks in america. But they you know. I mean i think you have. I think should have at least the question of can you really wind these these firms down in a clear well organized way you know. And that's the kind of basic regulatory concern. And they're being now let off the hook to an extent. Yeah absolutely and so jay-paul becomes ferries of chair and quarrels Randy cross Charge of regulations within the fomc. And they do two things that really upset. The financial reform community one is that they basically zero out regulations. That weren't even in that bill for firms between one hundred and two hundred and fifty billion in size so where we fought against this bill back back when it was passed in a lot of moderate. Dem staffers were like you. Know if there's a real problem between a hundred and two hundred billion size like the federal step in was like no. They're not like this like it felt like almost like oh my god you really do think like view. Believe that i think you you might even just be naive here. And the fed not only didn't stop and they removed living will requirements. They just eliminated them for banks up until two hundred and fifty billion and they eliminated some liquidity capital requirement but basically a certain kind of cap requirement that says you need to be able to make payments for thirty days in case the markets frees up on. They just eliminated that for up to fifty so they took what congress told them to do. Which is to say taylor and right size for up to two fifty and just sweat a lot of stuff away for banks that don't get the headlines. The bad actors in the financial economy away like goldman sachs might get a headline. That's very bad or do things that really stand out in the public but banks that do pose a real financial risks. That could collapse and could have real problems. They do that the next thing they do and they do this over the next several years going into cove. Ed is that they say you know what we're so interested. In only focusing on the largest banks we're going to extend a significant amount of regulatory relief in these areas to banks up to seven hundred billion dollars in size so they are now taking kind of with the directive was that bill but then going way outside the legislation of it and basically saying we are going to make living wills required less offense like every six years for banks up to seven hundred billion in size. And we're going to significantly weakened capital requirements particularly the kind of capital requirements. That are lake the most strict but also the ones the banks hate the most things like liquidity ratios. And things like that. And so now you've taken congress saying like we want to weaken on some of these mid size banks and then the fed goes further in the weakening of those banks and then takes way up the the scale..
"federal reserve" Discussed on Vox's The Weeds
"At my guest today. Returning weeds guest is my council from the roosevelt institute. We are doubling down on the federal reserve here in the waning days of my tenure on the weeds. There's a topic that is near and dear to my heart. I wrote a piece a decade ago. Like urging progresses to pay more attention to this subject. It is getting a little bit more attention now. But it's gonna get more attention on this show dammit. I'm sure there's gonna be some cheap ratings ploys coming after my time. But mike is is is a great guest to talk about this because he is really knowledgeable about the regulatory issues. That have been sort of in. Play the discussion of j. powell's tenure. But i think not actually talked about that much detail. So i mean i guess to start is just like what happened with banking regulation under the trump administration or powell's joint tenure with trump like what is the critique about sure. Can i start one. Step back and talk a little bit about what dot frinta just as a backer yeah. Let's go back dodd-frank so dodd-frank so dodd-frank in response to the financial crisis of two thousand eight. Remember that you buy ministration past the big one. The ministration past the dodd frank financial Reformat did a lot of things but things very relevant for pow and trump is that it took banks that were fifty billion dollars in assets is over and put them under enhanced prudential regulations on these are largely largest fifty six. These are not community banks which tend to be under a billion in size dodd-frank said in the statue wrote down fifty billion dollars. If you are above this size you are subject. To a lot more scrutiny. In two pieces. That are very relevant here. When is enhanced capital requirements. Which is to say that banks like that need to fund themselves more with equity. They need to fund themselves in a such that they can take losses without collapsing or panicking or failing in a catastrophic and quick way and another thing that they did was something called living. Wills which is. The banks had right down a plan for if they failed. How could they fail. Leman brothers went into bankruptcy and caused a huge panic. And the idea was that for financial firms bankruptcies not a really good option and for smaller banks committee bank. You have the fdic which can kind of go in and take over a failing firm. But you couldn't do that with these bigger banks. These megabanks banks are involved in a lot of complicated financial instruments or have multiple international exposures and so forth so the idea was like have the banks fund themselves with more equity in a lot of different ways. There's a lot of different types of capital requirements and also right down and be prepared to fail in such a way that would make it easier for officials at the fdic to take them over and wind them down with small bank to just go even more further field right. I was in in in maine last summer. There's a lot of small banks. There was in texas where there's a lot of very small banks and if like a really small bang goes bankrupt the will usually just like sell it to some other bank that you know wants the branches and the facilities or if nobody wants that they take their little pool of fdic money and just pay out the people who had the deposits there and they go someplace else with business. And it's like it's no biggie. You get up to these. Fifty biggest banks keycorp allies and way up to city groups bank of america and it just it wouldn't work logistically the antitrust implications of trying to sell wells fargo to another giant bank would be enormous. You couldn't just do it over the weekend. Obviously and also the banks are involved in like a million different lines business and that sort of the point about the living wills right is that you need to provide some kind of documentation of like what are you doing with your business so that these different lines of business could be frozen or separated or dealt with in a reasonably swift time period rather than just kind of chaotic bailout or chaotic bank failure. Right i mean the the concern was that in the financial crisis you had this sharp disjuncture you could do the bankruptcy option which has a lot of negative consequences for other people or you could do the bail out option which seems to have like not enough negative consequences for some of the people responsible for the failure of the bank. Yeah absolutely and though dodd-frank did a ton of stuff you know it harmonized consumer regulators into a dedicated consumer the consumer financial protection bureau. It moved derivatives into clearing clearing-houses. Did a ton of things when it came to the big banks banks over fifty billion dollars in size the banks and not just saying bank but like things that act like banks things that maybe our bank but also an investment bank things that our investment bank but act like a commercial bank. The kind of hodgepodge of bank holding company law and i am summarizing quickly in greatly here. So feel free to yell at me. On twitter handles dylan matthews. If you really those mentions with esoteric bank law if you're upset with the summary but when it comes to the biggest banks these are the big things like bank capital. Living wills are these are just core. These are not superfluous. These are not like nice to have. These are foundational for what you want to do. And they're the things where you really wanna go far because we think bancapital rules have very little cost for the economy as a whole you're largely just changing how banks themselves and users affirmed a lot of options. So the cost of those to the whole might even be zero. but they're very negligible in terms of like everyday people who need resources and financing and the benefits are quite big no matter what. The crisis is the crisis in the corporate sector capital requirements. And living wills help if it's in the household sector it helps if it's from climate change if it's from rapid decarbonisation no matter what the problem is these things help and living wills also just good internal risk management at just like says you know you have to make sure you're going to do this because the failure point is where we really hit the road so this is exactly where we want to have strong regulations i. Let's no..
"federal reserve" Discussed on Vox's The Weeds
"It doesn't make sense in the real world as opposed to just as like a take about how well if you did everything to the max. You could do a lot because you know like you couldn't you couldn't write like the system has limits. I think yeah. There's also some slippage about what climate thing. You're trying to do that. You can sort of divided the proposals between ones that try to protect banks from the climate and one's try to protect the climate from the banks and those are quite different and have very different ramifications for the climate so some of the stuff about stress testing for for investing in fossil fuel assets trying to serve recognize climate. A systemic risk. You could make an argument. that vary indirectly. Like maybe if you do that then citibank will decide that it needs to serve put a price on carbon internally to offset its risk but basically what you're talking about is is trying to make banks adapt more to observe a world of rapidly changing climate to diversify their assets and ways to protect them. And it's not at all obvious to me that are trying to protect the banks. Themselves from collapse is going to have large effects on the actual climate. It seems more plausible to me that the bank's just serve restructure in ways that make them more resilient without actually changing what kind of activities or invested in the economy and on the opposite end of that of trying to protect the climate from the banks and trying to raise the cost of investing in specifically fossil fuel stuff. It's sort of funny to me that this conversation is happening at the same time that the three point five trillion dollar reconciliation bills being hammered out in congress which is said to include sort of a carrot as opposed to stick version of carbon tax where they pay utilities for meeting certain targets on renewable energy big subsidies for research and development on unclean energy. Some fees on imports. That are heavy. Users of fossil fuels are fines for utilities. That don't meet certain standards. All of that seems very straightforwardly like it will significantly reduce emissions and i think part of why people are pivoting their vision from that to the fed is they don't really believe joe manchin is going to go for a lot of that stuff and it's in fact really really hard to pass ambitious legislation through congress and it feels easier to like have an independent executive agency doing these things with wave of one but the fed does not do things with a wave of lawn aboard. Only some of the board is appointed by the president. A lot is appointed by local bankers and kansas city. Who do not share the sunrise. Movements views on these things and more importantly like i think there are like both practical and like more idealistic questions of democratic legitimacy like congress has passed a law saying that the fed has to maximize employment and stabilize prices. They have not passed any laws to the fed to do anything whatsoever on climate and it feels like the appropriate way to tackle. Climate change is for like congress to pass laws tackling climate change. What's actually speaking of that. Let's take a break. And then i wanna talk about who is actually in the mix.
"federal reserve" Discussed on Vox's The Weeds
"Matthews. We're gonna do a good episode. We're going to talk about mass when you've done about bangladesh. We're gonna talk about the federal reserve. But i i have a sort of sad news to announce at the beginning. Which is that. I am going to be leaving the weeds After two more weeks of shows It's gonna be great. We're gonna be in great hands which were still and mind who've been doing an amazing job as hosts it's Sorry i feel sad. The weeds is very close to me. but you know i think it is. It is probably the the right time for everybody to Move on with things. Vox has some great ideas for the show and for a sort of final weeds episode one week from friday as recline and sarah cliff to excellent new york times reporters who people may remember as the original co host of the weeds with me are going to be coming back. We're going to be having a roundtable. We are going to really. We're gonna weeds it out. We're going to talk about. I think healthcare pricing reform proposals from the by the administration. Personally i spend a lot of time ranting and raving about monetary policy as. We're gonna talk to day. About drum powell. He is the chair of the federal reserve. Donald trump appointed him to that job Previously he had been put on the federal reserve board of governors by brock obama. But he's a republican. He was sort of. Obama was making a kind of a package of fed. Nominee is and this was someone who the obama administration economic team considered to be reasonable republican. Who they could sort of. Put there as a A sop to senate republicans than trump wanted to put sort of. I guess he put his like his own man in at the fed. It's not like he. And powell or like buddy is powell is a republican and steve mnuchin. It seems like feared trump. Toward powell over some other people who were fed. Outsiders who trump knew better. And i remember when this happened. You know when. I talk to x. Obama people and they all said you know we don't i don't know we. We don't think you should fire. Janet yellen but like powell is fine He'll do a fine job. I feel like he has done a pretty good job on the topics that i mostly care about. But there's a big push from the left to dump him and that has involved. I don't know like a bunch of different complaints but dill. What's what's your understanding of of what's going on short so As you say. There are a bunch of different sort of lines of criticism of jay powell and arguments for a replacement fed chair. I think the the two most significant ones Actually let's do. Three most significant ones the first and most basic is that he's a republican and democrats have a right to appoint their own person to run the fed. So brad delong. Who's in economist at berkeley. Who knows a lot about the fed knows. A lot of these players has been arguing for replacing powell basically on social circle grounds of yes. He's been very pro full employment right now but he's a republican has republican friends. There's no guarantee that he'll maintain those positions if he's under pressure from fellow republicans. Route the rest of biden's term. I'm sort of of that. For various reasons that will will go into the other. Two are financial regulation and climate change so the feds and it has a number of jobs but the two big ones are monetary policy. Making sure we have employment and that inflation is under control and banking regulation that major banks have accounts at the federal reserve. The fed Has a lot of regulatory power along with other agencies and how wall wow very very progressive on employment. I think is is less of a die. Hard true believer on increasing capital ratios for banks. Doing the kinds of reforms that liz warren and ends where the financial regulatory community and the democrat party wants and on climate change. This is not traditionally been something. That's considered part of the fed's purview. But i think there's a there's a movement to consider every part of the federal government as involved in greek effort to fight climate change which totally makes sense given the scale of the challenge and there are some boatswain specific things that i think activists in the space want like rating for bonds from fossil fuel projects as riskier and requiring banks that invest in things like that to hold more safe capital as a insurance against them as a way of sort of indirectly deterring them from investing more in fossil fuel projects. And a lot of other are more symbolic things like jay-paul took a while to join the group of central banks that were committing to do certain things on climate change And i think people. I've i've talked to in rat on. That would say that on. Its own doesn't do a whole lot. But it's just sort of a sign of commitment and him being later than the european central bank or the bank of england or the bank of canada looked bad to them. So that's my attempt to to serve. Charitably relate these critics jay powell i think you have a less charitable take on any of these i mean i have in some ways i give frankly more credence to to long's point that you might just want a democrat in the office. I thought that like donald. Trump's stated reasoning for firing janet. Yellen which was that. She was a democrat. Just like makes perfect sense to me. And i thought he handled it really well. Honestly like trump always often handled things poorly but he he didn't trash yellen. He didn't come up with some whole elaborate. Set of like fake reasons. He didn't blame her for anything. I think he. He praised her in fact as having done a good job but he said he wanted own person in there and he did it and in a weird way if that had been the whole thing right like if this was the whole push from day one was just like you put in a democrat not because republicans are necessarily bad but because people are impacted by subtle psychological biopsies. You want somebody who is friends. With lots of democratic party hill staffers democrat ex democrat lobbyists by administration appointees just somebody who liked at the margins. Biopsies will be to say this is good. I would really sort of buy into like. I just feel like he was a huge problem with ben brunelleschi's tenure at the fed. Not that not that. He was like sabotaging the economy because he's a republican but like he was a republican so he thought that the obama administration's policies were misguide and was inclined to give a lot of you know this decisions under uncertainty right so you're inclined to give a lot of credence to the idea that this president who you don't support whose policies you disagree with is like actually the source of problems and that you were being asked to like bail out this bad regime versus you. Were trying to help you know. Be be helping partner in in something that's good. That'll jimmy can argue whether that applies to the current situation. And and i have some doubts. It it's what i thought. Last winter i would say i find the climate argument very puzzling right like literally believe that we should be pulling every climate lever available. Then you should appoint a fed chair. Who will deliberately plunge the economy into a depression because that would greatly reduce short-term co two emissions now..
"federal reserve" Discussed on The Breakdown with NLW
"Wasting asset gold will always glitter but novelty by definition fades bitcoin. And its ilk will. Accordingly almost certainly remain a risky and speculative investment rather than a revolutionary means of payment and are therefore highly unlikely to affect the role of the us dollar or require a response with the cbc. Still even with all of this. What has really gotten people's attention is quarrels discussion of stable coins. Something like we said. That's an increasing concern for many in positions of power. So let's read what he has to say about this. Some commentators argue that the united states must develop a cbc to compete with us dollar stable coins. Stable coins are an important development that raised difficult questions for example how would widespread adoption of stable coins affect monetary policy or financial stability. How might stable coins affect the commercial. banking system. do stable coins represented fundamental threat to the government's role in money creation. In my judgment. We do not need to fear stable coins. The federal reserve has traditionally supported responsible private sector innovation consistent with this tradition. I believe that we must take strong. Accounting of the potential benefits of stable coins including the possibility that a us dollar stable coin might support the role of the dollar in the global economy for example a global. Us dollars stable coin network could encourage use of the dollar by making cross border payments faster and cheaper and it potentially could be deployed much faster and with fewer downsides than a cdc and the concern that stable coins represent unprecedented creation of private money in this challenge. Our monetary sovereignty is puzzling given that our existing system involves indie depends on private firms. Creating money every day now. This doesn't mean in quarrels estimation that there shouldn't be regulation in fact the legitimate recognition of private stable coins would come with more not less legislation quote. We do have a legitimate and strong regulatory interest in how stable coins are constructed and managed particularly with respect to financial stability concerns the pool of assets that access the anchor for a stable coins value. Could if use of the same coin became widespread enough create stability risk if it is invested in multiple currency denominations if it is a fractional rather than full reserve if the stable coin-holder does not have a clear claim on the underlying asset or if the pool is invested in instruments other than the most liquid possible principally central bank reserves in short short-term sovereign bonds all of these factors create run risk possibility that some triggering event cause a large number.
"federal reserve" Discussed on CoinDesk Podcast Network
"And are therefore highly unlikely to affect the role of the us dollar or require a response with the cbc. Still even with all of this. What has really gotten people's attention is quarrels discussion of stable coins. Something like we said. That's an increasing concern for many in positions of power. So let's read what he has to say about this. Some commentators argue that the united states must develop a cbc to compete with us dollar stable coins. Stable coins are an important development that raised difficult questions for example how would widespread adoption of stable coins affect monetary policy or financial stability. How might stable coins affect the commercial. banking system. do stable coins represented fundamental threat to the government's role in money creation. In my judgment. We do not need to fear stable coins. The federal reserve has traditionally supported responsible private sector innovation consistent with this tradition. I believe that we must take strong. Accounting of the potential benefits of stable coins including the possibility that a us dollar stable coin might support the role of the dollar in the global economy for example a global us dollars stable coin network could encourage use of the dollar by making cross border payments faster and cheaper and it potentially could be deployed much faster and with fewer downsides than a cbc and the concern that stable coins represent unprecedented creation of private money in this challenge. Our monetary sovereignty is puzzling given that our existing system involves indie depends on private firms. Creating money every day now. This doesn't mean in quarrels estimation that there shouldn't be regulation in fact the legitimate recognition of private stable coins would come with more not less legislation quote. We do have a legitimate and strong regulatory interest in how stable coins are constructed and managed particularly with respect to financial stability concerns the pool of assets that access the anchor for a stable coins value. Could if use of the soon became widespread enough create stability risk if it is invested in multiple currency denominations if it is a fractional rather than full reserve if the stable coin-holder does not have a clear claim on the underlying asset or if the pool is invested in instruments other than the most liquid possible principally central bank reserves in short short-term sovereign bonds all of these factors create run risk possibility that some triggering event cause a large number of stable coin holders to exchange their coins all at once for other assets and that the stable coin system would not be able to meet such demands while maintaining a reasonably stable value. But these concerns are imminently addressable indeed. Some stable coins have already been structured to address them when our concerns have been addressed. We should be saying yes to these products rather than straining to find ways to say no indeed the combination of imminent improvements in the existing payment systems. Such as various instant payment initiatives combined with the cross-border efficiency of properly structured stable coins could well make superfluous any effort to develop a cbc. I'd like to just note here if you go back and listen to some of my podcast about cdc's and stable coins. Before that. i have said on at least a couple of occasions that if you look just at a government producing a cbc the us is far behind. If on the other hand you include the use of private us denominated stable coins as an example of this new type of money. The us has an enormous lead. That effectively is what quarles is saying. Here also goes in depth on what he sees is still to unexplored. Risks of cdc. His main points are one that quote a. federal reserve cbc could create considerable challenges for the structure of our banking system. Which currently relies on deposits to support the credit needs of households and businesses to could undermine the value of banks competing for customers three. It could present a huge target for attacks and cyber threats for it would demonstrate the challenge of preventing illicit activities while also respecting writes quote. Maybe challenging to design a cdc that respects individuals privacy while appropriately minimizing the risk of money laundering at one extreme. We could design a cbc. That would require cdc holders to provide the federal reserve detailed information about themselves and their transactions. This approach would minimize money laundering risks but would raise significant privacy concerns at the other extreme. We could design a cbc that would allow parties to transact fully anonymous basis to approach. What address privacy concerns but would raise significant money laundering risks. The fifth and final risk or question that he has is that it could be expensive for the federal reserve to design and maintain this thing so all in all a lot of folks really like this speech to give you just a couple sample reactions. Nick carter tweeted. So why do. I like this talk so much. A number of reasons. First of all he contest the framing of the cbc enthusiasts correctly pointing out the most dollars are digital. He also points out. That most dollars are effectively fed dollars. Go through fdic guarantees on commercial. Bank deposits quarles acknowledges the innovation present in the stable sector while rejecting the notion that they are somehow competitive with central bank dollars. Stabile issuers do not create money stables fiat convertible ones at least are just a wrapper on commercial bank dollars. Quarles is one of the first central bankers. I've seen seriously acknowledge the enormous honeypot risks inherent in cdc and the fact that most likely cbc implementations would massively trade off against user privacy. He doesn't try to force stables into some ill-fitting regulatory mold instead acknowledging their utility while stressing that they can be rendered more credible. Although he doesn't elaborate much in how this would work quarles rejects the framing around the urgency of cdc. I am with him. Foreign countries with a reduced respect for property rights or liberty creating sino. Cdc's cannot and should not motivate us to create something similar at domestic. Cdc must stand on its own merits. One thing i find interesting is that these comments differ significantly from the tone of quarrels colleague. Brainard took a decidedly harsh tones on staples recently encouraging to.
"federal reserve" Discussed on CoinDesk Podcast Network
"Vice chair of the federal reserve for supervision as well as the chair of the financial stability board at the one hundred and thirteenth annual utah bankers association convention in sun valley. Idaho gave a speech at the end of june called parachute pants and central bank money. His speeches at core a question about the logic and urgency of a central bank digital currency for the us. His starting point is that the dollar system is already highly digitized. So what he's really interested in is how is he. Bbc would add new benefits or would solve existing problems. He looks first. At the argument that quote the federal reserve should develop a cd to defend the us dollar against threats that would be posed by foreign cdc's on the one hand and the continued spread of private digital currencies on the other with regard to that first part foreign currencies. He says quote. I think it's inevitable that as the global economy and financial system continues to evolve some foreign currencies including some foreign. cdc's will used more and international transactions than they currently are it seems unlikely however that the dollar's status as a global reserve currency or the dollars role is the dominant currency and international. Financial transactions will be threatened by a foreign. Cdc the dollars role in the global economy rests on a number of foundations including the size and strength of the us economy. Extensive trade links between the united states and the rest of the world deep financial markets including for us treasury securities the stable value of the dollar over time the ease of converting us dollars into foreign currencies. The rule of law strong property rights in the united states and last but not least credible. Us monetary policy. None of these are likely to be threatened by a foreign currency and certainly not because that foreign currency is a cbc now with regard to private digital currencies quarrels divides them into stable coins and not stable coins. He is in his analysis. Pretty dismissive of bitcoin's potential to compete with the dollar. Basically saying that it's a novelty quote. Some commentators assert that the united states must develop a cdc to counter the appeal of crypto currencies. This seems mistaken. The mechanisms used to create such crypto acids value also ensure that this value will be highly volatile similar to the fluctuating value of gold which like bitcoin draws a significant part of.