United States
Rule-setters need to heed their own advice
The US risks a reputation for failing to meet standards to which it holds others
People: April to June 2023
A round-up of central bankers in the news and on the move during the past three months
Boston Fed paper looks at wider impact of banking stress
High levels of leverage magnify impact of bank crises on output and employment
OCC will target ‘persistent weaknesses’ in US banks
Updated guidance introduces tougher approach to non-compliant banks
US banks need higher equity capital levels, Kashkari says
“Essentially unlimited deposit insurance” poses systemic risk, says Minneapolis Fed president
Bernanke and Blanchard reassess causes of inflation surge
Economists who predicted surge misunderstood underlying causes, study finds
Financial security of US households ‘fell sharply’ in 2022
Inflation comes first in list of financial worries, Fed survey finds
NY Fed and MAS test distributed ledger CBDC payments
System averaged 6.48 payments a second, with peak of 47 payments a second
Robert Lucas, 1937–2023
Nobel Prize-winner became famous for “revolutionary” work on rational expectations
US household debt passes $17 trillion
Mortgage originations fall to lowest level since 2014
Book notes: The Federal Reserve: a new history, by Robert L Hetzel
This book should become the standard reference for scholars
Quantitative tightening and forward guidance need rethink, say economists
Forward guidance removes options to respond to shocks, say academics and experts
Fed’s Bowman defends regulatory ‘tailoring’
Governor calls for independent review of SVB collapse, dismissing Barr report
Florida adopts anti-CBDC law
Governor has denounced US digital currency, though there are no concrete plans for one
Fed communication drives house price expectations – NBER paper
Researchers find people’s expectations vary widely and depend on clear explanations
UK regulator and police raid crypto ATM sites
There are no legally registered crypto ATMs in the UK
Biden nominates Jefferson as Fed vice-chair
President chooses first Latinx candidate for Fed board, and names Cook for full term
Fed walking a financial stability ‘tightrope’
Experts disagree over US regulators’ use of systemic risk exception for deposit insurance
IMF’s Adrian on the systemic threat posed by a ‘weak tail’ of financial institutions
The IMF’s financial counsellor speaks to Christopher Jeffery about bank runs and emergency interventions, market and oversight failings, and the need for action on run rate assumptions, interest rate risk, deposit insurance, crypto regulation and a ‘weak…
Defaults, reduced growth and less lending ahead, Fed says
Recent bank failures were caused by poor risk management, report finds
Another financial crisis hiding in plain sight
Steve Kamin analyses how the risks that sank SVB were plain enough to those who looked for them
World Bank board elects Ajay Banga president
Former Citigroup and Mastercard executive succeeds controversial Malpass
Fed raises rates by 25bp as it chases lower core inflation
Policy-makers still need to “take away the punch bowl”, economist says
Biden may nominate Kugler, promote Jefferson on Fed board – reports
Adriana Kugler would be the first Latinx Fed governor in the central bank’s 109-year history