Category: economy

House Financial Services Chair Warns Against Quick Regulatory Fixes For Banking Crisis

The House Financial Services Committee Chairman Patrick McHenry (R-N.C.), warned against quick regulatory fixes for the banking crisis. The congressman from North Carolina told the American Bankers Association Washington Summit on March 22, we “cannot legislate confidence” when it comes to the banking sector. He stated that it was too early to see if any new…


Banking Crisis Is How It Starts, Recession Is How It Ends

Commentary As the Fed tightens monetary policy, a banking crisis is historically the first evidence that something is breaking. As noted recently in “Not QE,” Last week, amid a rash of bank insolvencies, government agencies took action to stem a potential banking crisis. The FDIC, the Treasury, and the Fed issued a Bank Term Lending…


Small Banks See Record Drop in Deposits After SVB Collapse

Deposits at America’s small banks fell by a record amount in the week ending March 15 as the collapse of Silicon Valley Bank (SVB) spooked depositors and led many to withdraw their savings. Data from the Federal Reserve shows that deposits at small banks—defined as those smaller than the biggest 25—dropped $119 billion to $5.46 trillion,…


The Fed’s Dilemma: Fight Inflation or Save Failing Banks

The Federal Reserve has painted itself into a corner with its fight against inflation, and some experts say it now has no coherent plan for how to get out of it. Having kept interest rates near zero for more than a decade and expanded its balance sheet to $9 trillion to stimulate the economy, the…


Fed’s Bullard Calls for Higher Rates as Balance Sheet Jumps $100 Billion, Depositors Pull Funds From Banks

The Federal Reserve must keep raising interest rates in its inflation fight as the U.S. banking turmoil will subside, says St. Louis Fed Bank President James Bullard. Speaking to the Greater St. Louis Inc. community organization on Friday, Bullard explained that the central bank must lift the benchmark fed funds rate (FFR) higher than previously…


Biden Says Deposits Are Safe, US Banks in ‘Pretty Good Shape’

OTTAWA, Canada—President Joe Biden on Friday praised his administration’s management of the recent banking crisis, saying that the banks are in good shape but that it will take some time for markets to settle down. “I think we’ve done a pretty … good job. People’s savings are secure,” Biden said during a press conference in…


Biden, Cabinet Will Visit 20 States to Promote Economic, Clean Energy Agenda

President Joe Biden and members of his staff will hit the road for the “Investing in America” tour beginning March 28 to tout the benefits of his economic plans, according to a White House press release. In addition to cabinet officers, first lady Jill Biden and second gentleman Douglas Emhoff will participate. Biden’s first stop…


IRS Extends Tax Deadline in for Millions of People After FEMA Disaster Declarations

The Internal Revenue Service (IRS) said that some New York residents who were impacted by storms that slammed the western and upstate portions of the state qualify for tax relief and don’t have to file their federal taxes for another month. Residents who live in any New York county that was “designated by the Federal…


American Households to Dump $750 Billion in Stocks This Year: Goldman

American households are expected to dump $750 billion worth of stocks this year in favor of less-risky assets. This is the first annual drop in demand since 2018, due to higher bond yields and lower savings, reported Goldman Sachs Group strategists, led by Cormac Conners and David Kostin, on March 22. The strategists said that…


Billionaire Investor Warns Economy Heading for ‘Train Wreck’ After Fed’s Latest Move

Billionaire investor Bill Ackman said that the Federal Reserve’s latest decision to raise interest rates by 25 basis points, combined with Treasury Secretary Janet Yellen’s remarks that there are no plans for unlimited deposit guarantees, was a “big mistake” that puts more pressure on smaller banks and sends the economy toward a “train wreck.” Ackman…