The Institutional Risk Analyst

The Treasury market/bank industry PR lobbyist angle on the Fed's eSLR proposal is a little fake-out for the financial media. This not about buying more Treasury debt but instead buying back more bank stocks. Sabe?

As of yesterday's close, BK was right behind SoFi Technology (SOFI) leading the bank surveillance group higher. BK closed yesterday at 14x forward earnings and 1.6x book value, roughly the same PE multiple as JPM but at a lower book value multiple.

The common penny stocks of these two appendages of the state, Fannie Mae and Freddie Mac, are up over 600% in the past year, generating huge gains for the likes of Bill Ackman and John Paulson. Bitcoin is up a paltry 50% LTM. Indeed, much like old fintech stocks such as PayPal (PYPL) and Block Inc (XTZ), bitcoin seems to be losing the special novelty that always seems to drive these manic stories. Is bitcoin now just another boring Wall Street ETF?

The Fed's actions in 2008 and again in March 2020 were largely driven by the sole mandate of the central bank -- to keep the Treasury market opening and functioning.

When President Donald Trump says the Fed should cut interest rates, he is probably right – at least speaking from the perspective of the real estate markets.

President Trump will not try to fire Chairman Powell. Why not? First, because Powell cannot be removed save for malfeasance. Second, because firing Powell would seriously piss off Senate Republicans, killing Trump's hopes for tax legislation this year.

The paper money economy created by President Franklin Delano Roosevelt in 1933 trapped Americans and the world into using fiat dollars.

Who are the two most powerful people in the Trump White House?

US history over the past century was largely written by liberal Democrats, who at least rhetorically opposed tariffs and embraced inflation

President Trump is using the threat of tariffs to change the behavior of some of our trading partners, particularly Canada and Mexico.

But what happens if the US simply picks up the proverbial football and goes home?

Fed Chairman Jerome Powell now reports up to National Economic Council head Kevin Hassett.

Banks continue to show a strong preference for late vintage loans over securities, a fact which may cause loan yields to continue falling

Folks in the financial sector are beginning to wonder if certain parts of the government apparatus will continue to function.

The real threat of tariffs announced by Trump is not inflation, but rather a LT decline in the dollar as the global reserve currency

When President Donald Trump says that interest rates are too high, he may not fully understand just how right he is about the cost of credit

With Gov Michael Barr stepping down from bank supervision, perhaps Fed Chairman Jerome Powell is more willing to test liquidity lower bound

Cute reference to "average cost," but total return to date would be of greater interest.

Our bet is that the Bessent "3-3-3" plan likewise will be a failure and that the Fed will be forced to restart QE sooner rather than later

As a practical matter, no Fed chairman or governor can function without the support of the White House and the US Treasury.