Custodia’s application should have interwoven the currency validation narrative into its sales pitch to the Fed. It would still have had to address the illicit activities/AML issues, but the Board’s ears may have stayed open a little while longer, giving Custodia time to finagle the right language or work out some compromise. Continue reading Custodia failed to wet the Fed’s beak.
Senator Elizabeth Warren, Democrat of Massachusetts, lit in, as usual, to Jerome Powell, chairman of the Board of Governors of the Federal Reserve System. Mrs Warren shared today on “Meet the Press” her dissatisfaction with Mr Powell’s handling of bank regulation in the wake of three bank failures: Silvergate Bank, Silicon Valley Bank, and Signature … Continue reading Unless Elizabeth Warren can persuade Joe Biden to fire Jerome Powell, the Chair is going nowhere …
Michael S. Barr, Vice-chair of the Board of Governors of the Federal Reserve System, warned the U.S. earlier this week that banks should take a careful and cautious approach to engaging in crypto-asset related activities. Banks need to determine whether their crypto-related activities are “legally permissible” before engaging in them. Mr Barr, who is responsible … Continue reading Interbank Market News Scan: Does the State have an interest in sustaining SVB Financial? No.
The media is saying this …. The Chicago Mercantile Exchange’s FedWatch tool has done a 180 degree turn from its 9 February 2023 consensus that the Board of Governors of the Federal Reserve System would only increase its fed funds target range by 25-basis points. The CME forecast a .908 probability of the Fed targeting … Continue reading Interbank Market News Scan: All quiet on the Federal Reserve front …
While I believe that the FOMC will vote to raise rates, how much the rates increase by will be a decision driven by politics as it is by economics. The United States is entering the silly season of campaigning that runs up to the 2024 presidential election. As the expenditures stemming from President Biden’s infrastructure spending and financial support for Ukraine seep through the economy, the last thing the Administration wants to contend with is increased financial stress on American households. Mr Biden would prefer to see the Federal Reserve bring a pause to the inflation fight by the end of this spring, putting the pain into the past as soon as possible while crafting a narrative that places the full blame for inflation on the central bank. Continue reading Interbank Market News Scan: Hours away from Powell’s testimony, the Fed should do a one and done with the fed funds rate.
Morning thoughts … When I listen to the YouTube posse opine about the Federal Reserve’s use of its monetary policy tools, I sense the gurus lack of awareness that they are playing in a sandbox and trying to navigate in the afterburn of an airplane engine. The noise can be deafening. The clutter thicker than … Continue reading The Interbank Market News Scan: An arbitrage moment for U.S. banks
Lawyers Write the Bets. Bankers Sell the Bets. 