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?

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.

TD was up about 6% over the past three months, the only name in our test group with a positive three-month market return, of note.

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

The Basel Accord is one of the single biggest examples of a regulatory agency literally creating a new law from whole cloth.

In the 1950s through maybe into the late 1990s, the FOMC could control mortgage interest rates....

Perhaps Chairman Powell will be kind enough to fall on his sword on way out the door to make things easier for a future Chairman Waller...

Treasury Secretary Janet Yellen and Fed Chairman Jerome Powell are another bank failure or two away from returning to the private sector.

The cult of ever falling interest rates goes back 50 years and spans the terms of Fed chairs back to Alan Greenspan and Paul Volcker...

As the scale of Fed open market operations grew since 2008, volatility has increased, rendering the adjustment from QE to QT problematic

The real message to the FOMC is this: hike another 75bp in July and then let the Fed funds target sit for a few meetings...

Benevolence, as Chris and I noted in our book "Financial Stability," always gets you more bang for the buck than being miserable.

If you consider QE “stimulus” inflationary, then Fed policy actually accelerated inflation in the November-January period.

The Fed’s chief concern is keeping the Treasury debt market open and functional. Liquidity includes cash and risk-free collateral...