Good-bye, Ms. Turner….

What is the US dollar?

There has been a lot of chatter over the last year about the dollar losing its dominance as a world reserve currency. I believe that the dollar will not lose that dominance overnight. The bulk of its trading partners are in the Euro Zone and North America. I have no doubt that nations like France and Germany will try to maintain close ties with the United States and any China-Russia currency bloc that may ensue from the attempts of emerging markets to develop their own currency.

Interbank market news scan: Incentivizing the market for a CBDC.

Why not amend the Federal Reserve Act so that depositors can create and enter their own overnight market where they authorize the exchange of funds at some rate agreed to by depositors? Rather than risk less than optimal participation in the digital currency system including the risk that black markets for US currency are created, the government and the Federal Reserve could consider such an incentive system.

Interbank market news scan: The jobs report wraps up the Holy Week.

Mr Biden may have missed an opportunity to craft a narrative that emphasizes the importance of getting ahead of the inflationary impact of blocks of emerging economies threatening to transition from the US dollar to resource-backed currencies. These threats have yet to materialize into something definitive and until then the inflationary impact of dumping the US dollar or at least complementing it with other currencies is a way off.

Georgia Power still looks like a proxy for bonds.

Ratepayer advocates in particular should keep in mind that ratemaking occurs in an environment outside of a public utility hearing room; that the rates used by a utility to attract investors and determine the rate of return on the assets used to generate energy are impacted by what happens in the banking environment. How you structure your strategy on rates should take this environment into consideration.

There is no such thing as “moral hazard” surrounding this bank bailout.

What the “moral hazard” critics overlook is the economic impact on those of us who rely primarily on wages to get by. Hiccups in the current monetary and financial system in the immediate term that change the wage earners standard of living have a greater detrimental impact versus those individuals buttressed by the ownership of claims on income. While it behooves the wage earner to reduce his or her exposure to the current monetary and financial system, the short-term bandage on this injury should be applied. The wage earner should bear in mind that this fix is short-term and that it is up to us to seek out a longer-term solution.