American - Public | February 4, 1953 -
No single housing finance institution should be too big to fail.
Jerome Powell
FinanceSingleHousingFailBigToo
In normal times, at the beginning of each month, the federal government makes a cash advance to the Social Security Trust Fund called the 'normalized tax transfer,' in an amount equal to the estimated payroll taxes for the coming month.
TrustBeginningGovernmentSecurity
The United States has never prioritized or failed to pay any obligation when due during a debt limit impasse. Despite the institutional risks and the lack of clear legal authority, we assume that Treasury will attempt to prioritize payments in a last-ditch effort to avoid default.
RisksEffortLegalAuthorityLimit
If investors avoid the Treasury market, we could be unable to pay off maturing securities, which would mean an immediate default. Market participants generally agree that even a brief default would create potentially catastrophic risks to the financial system, like the meltdown of 2008.
RisksFinancialCreateMeanPayOff
An increase in the debt ceiling should be accompanied by fundamental policy reforms, substantial budget savings, and a strong enforcement mechanism to tie the hands of any future Congress.
FutureStrongBudgetHandsDebtTie
The banking industry has traditionally been characterized by physical branches, privileged access to financial data, and distinct expertise in analyzing such data.
FinancialDataBankingIndustryBeen
There is clear empirical evidence that the response of EME financial markets to different shocks, including changes in U.S. interest rates, depends importantly on the state of economic fundamentals in the EMEs themselves.
FinancialFundamentalsChangesClear
One factor that favors easier adjustment in EMEs is that U.S. monetary policy normalization has been and should continue to be gradual, as long as the U.S. economy evolves roughly as expected.
LongEconomyPolicyFavorsBeen
The expectation of gradual policy normalization should reduce the likelihood of outsized movements in interest rates.
ExpectationPolicyInterestShould
As long as global financial conditions normalize in an orderly fashion, EMEs should have sufficient time to adjust.
TimeFashionFinancialLongAdjust
The TMPG is the place where market participants recognize and address their responsibilities to each other.
PlaceWhereMarketOtherRecognize
The sale of Treasury bonds, notes, and bills finances the U.S. government, and those securities are, in turn, a primary vehicle for savings for a wide range of U.S. households. Treasury securities are also an important source of collateral within the financial system.
GovernmentFinancialImportantTurn
Copyright © 2024 QuotesDict Jerome Powell quotes