The Federal Deposit Insurance Corporation and the Board of Governors of the Federal Reserve System (Board of Governors) issued a joint letter (Joint Letter) on July 28, 2022, to Voyager Digital, LLC and its related entities (Voyager), alleging violations of Section 18(a)(4) of the Federal Deposit Insurance Act (FDI Act) by Voyager for making false and misleading statements about its deposit insurance status.1 The FDIC further alleged that Voyager’s conduct resulted in the inability of certa...| www.dechert.com
The Fed's interventions in the repo market are attracting considerable comment. A lot of people seem to think the Fed has embarked on another QE program without Congressional approval. And the usual suspects are complaining that the Fed is pumping up stock prices and debasing the dollar. Stocks are indeed heading for the moon - though so is the dollar, which rather undermines those who think it is being debauched. But the Fed's interventions in the repo markets have nothing to do with stock...| www.coppolacomment.com
Ever since the secured overnight repo rate (SOFR) spiked to 10% in September, there have been dire warnings that these exceptional movements show the financial system is fundamentally broken. The story goes that the post-crisis financial system is so dysfunctional that it is unable to operate without continual injections of money from central banks. The Fed's attempt to reduce the $4.2tn of reserves it added to the financial system in three rounds of QE has dangerously destabilised the financ...| www.coppolacomment.com
No, this isn't a post about derivatives. It's about the relationship between reserves and safe assets. I think it is time I brought the two together and created a unified explanation of the behaviour of safe assets in the presence of excess reserves which earn a positive rate of interest. | www.coppolacomment.com
"USD-backed stablecoin is 10x better than your savings account," runs the headline on an unsolicited press release in my inbox yesterday. And it goes on to explain:| www.coppolacomment.com
