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☆ Senior Treasury officials reiterate dire warnings if debt ceiling isn’t lifted, pour cold water on invoking the 14th Amendment
▼ + stars: | 2023-05-07 | by ( Sam Fossum | ) edition.cnn.com time to read: +3 min

2, Deputy Treasury Secretary Wally Adeyemo, both painted a stark picture of “economic chaos” if the debt ceiling isn’t lifted and confirmed that the latest Treasury data still indicates the US could default as soon as June 1st. Her comments come as some have speculated about the possibility of President Biden invoking the 14th Amendment, or taking other extreme action, if the debt ceiling is not raised in time. “I haven’t gotten there yet,” President Biden said in an interview Friday night when asked about such a move. “There is no way to protect our financial system and our economy other than Congress doing its job and raising the debt ceiling,” Yellen said. Adeyemo also tamped down the feasibility of using the 14th Amendment when asked about it Sunday, saying the “the only way” to “guarantee” that the US can pay its bills is to raise the debt ceiling.

☆ Ajay Banga: Indian American businessman is the new president of the World Bank
▼ + stars: | 2023-05-03 | by ( ) edition.cnn.com time to read: +4 min

The election came after World Bank board members interviewed Banga for four hours on Monday. Biden congratulated Banga on his “resounding approval” to run the World Bank, which he described as “one of humanity’s most critical institutions to reduce poverty and expand prosperity around the globe.”“Ajay Banga will be a transformative leader, bringing expertise, experience, and innovation to the position of World Bank President,” Biden said. “It is a challenging moment, but it’s a moment where the World Bank remains more vital than ever, and where getting the evolution of the World Bank is absolutely critical,” the official said. “The Board looks forward to working with Mr. Banga on the World Bank Group Evolution process … on all the World Bank Group’s ambitions and efforts aimed at tackling the toughest development challenges facing developing countries,” the bank said. The World Bank has been led by an American since its founding at the end of World War Two, while the International Monetary Fund has been led by a European.

☆ Government watchdogs propose tougher scrutiny of nonbank financial companies
▼ + stars: | 2023-04-21 | by ( Bryan Mena | ) edition.cnn.com time to read: +2 min

Washington, DC CNN —In response to last month’s turbulence in the banking industry, financial regulators on Friday proposed a more comprehensive approach in identifying and addressing threats to financial stability, including closer scrutiny of nonbank financial companies. US Treasury Secretary Janet Yellen announced a new framework proposed by the Financial Stability Oversight Council that outlines the vulnerabilities in the financial system and the tools regulators can use to address those risks. The proposal also reverses guidance issued in 2019 that made it more difficult for nonbank financial companies, such as hedge funds and insurers, to be designated as systemically important institutions. “It is an important preventative tool to address systemic risks that may arise from a nonbank financial firm whose activities or distress could threaten the financial system.”FSOC has the power to designate nonbank financial firms as systemically important institutions if their failures pose a threat to financial stability, which would place those firms under the supervision of the Federal Reserve. Firms would be able to request a hearing if FSOC makes a proposed designation.

☆ Jobs are strong, inflation is cooling — yet recession worries remain
▼ + stars: | 2023-04-18 | by ( Christine Romans | ) edition.cnn.com time to read: +4 min

In the optimist camp is Treasury Secretary Janet Yellen, who told CNN’s Fareed Zakaria last week a damaging recession can be averted. “I do think there is a path to bring down inflation while maintaining what I think all of us would regard as a strong labor market.”After months of inflation at close to 40-year highs, prices are cooling. By most measures, the job market is stronger today than it was in February 2020, before the Covid pandemic crashed the global economy. “I think the strong labor market and bringing down inflation are compatible goals,” Yellen said. Another read is that a recession, if there is one, will be mild and brief, without a big spike in the jobless rate.

☆ Premarket stocks: JPMorgan steals the show as banks lift curtain on earnings
▼ + stars: | 2023-04-17 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +7 min

All beat estimates: PNC (PNC) and Wells Fargo (WFM) by about 9%, Citi by around 13% and JPMorgan (JPM) by nearly 21%. PNC stock also felt the pressure. Before the Bell spoke with Steve Sosnick, chief strategist at Interactive Brokers, to discuss Friday’s big bank earnings and explain that stock discrepancy. I’ve always complained about banks reporting their quarterly earnings first because they’re extraordinarily idiosyncratic. Why did JPMorgan stock outperform its competitors?

☆ Yellen to CNN: The US can bring down inflation while maintaining a strong job market
▼ + stars: | 2023-04-15 | by ( Alicia Wallace | ) edition.cnn.com time to read: +4 min

“I do think there’s a path to bring down inflation while maintaining what I think all of us would regard is a strong labor market,” Yellen said. Yellen said she is seeing some easing of stress in the labor market, including increases in unemployment claims, declines in job openings, and upticks in labor force participation. The labor market gaining more slack will help bring inflation down, but it doesn’t mean there needs to be a significant jump in unemployment, she said. “I think the strong labor market and bringing down inflation are compatible goals,” she said. “Americans should note that America has a safe, strong banking system,” she said.

☆ Yellen to CNN: Despite banking crisis, soft landing still possible
▼ + stars: | 2023-04-14 | by ( Alicia Wallace | ) edition.cnn.com time to read: +3 min

Minneapolis CNN —Last month’s upheaval within the banking sector hasn’t pushed America off course from achieving a soft landing, US Treasury Secretary Janet Yellen told CNN’s Fareed Zakaria in an exclusive interview Friday. “I do think there’s a path to bring down inflation while maintaining what I think all of us would regard is a strong labor market,” Yellen said. “We had big shifts in the way people live and low interest rates, and housing prices rose a lot. In the interview with Zakaria, Yellen said Russia should pay for the damage caused in Ukraine and talks are ongoing as to potential mechanisms to make that happen. “That’s a responsibility that I think the global community expects Russia to bear,” she said.

☆ Yellen: ‘Not anticipating a downturn’ in the US economy
▼ + stars: | 2023-04-11 | by ( Alicia Wallace | ) edition.cnn.com time to read: +4 min

Minneapolis CNN —US Treasury Secretary Janet Yellen said she believes the American economy remains strong and its banking system is resilient despite some recent turmoil among regional financial institutions. “I believe our banking system remains strong and resilient; it has solid capital and liquidity.”She added that the “US economy is obviously performing exceptionally well,” noting solid job creation, moderating inflation and robust consumer spending. “So I’m not anticipating a downturn in the economy, although of course that remains a risk,” she said. The global economy remains in a better place than many have expected, she said. “[During the G20 meeting in February], I said that the global economy was in a better place than many predicted last fall,” Yellen said.

☆ ‘It’s not zero.’ Wall Street is pricing in a small but growing risk of a disastrous US default
▼ + stars: | 2023-03-31 | by ( Matt Egan | ) edition.cnn.com time to read: +6 min

As politicians sleepwalk toward a potential debt ceiling crisis, financial markets have begun pricing in a small — but growing — chance of a disastrous default. “The probability of default has gone up noticeably,” Andy Sparks, head of portfolio management research at MSCI, told CNN in an interview. Yellen has used unusually strong language for a former central banker to warn Congress against messing with the debt ceiling. Asked about MSCI’s estimate of a 2% implied probability of a default, Valliere said that number is low. But this is not a typical debt ceiling debate.”Fallback optionsThere are some early indicators of concern popping up in the bond market.

☆ The US government is seeing ‘an increasing number’ of TikTok-like data security cases
▼ + stars: | 2023-03-24 | by ( Brian Fung | ) edition.cnn.com time to read: +2 min

CNN —The US government is tracking a growing number of foreign-linked business transactions that pose potential data risks to national security similar to those raised by TikTok, Treasury Secretary Janet Yellen told lawmakers Thursday. At a House Appropriations Committee hearing, Yellen said regulators charged with screening foreign investment deals for national security risks have witnessed a rise in such cases, but she declined to discuss specifics. “When it comes to data, we’re seeing an increasing number of cases that do present risks around this issue of the type that have been mentioned in connection with TikTok,” Yellen told Iowa Republican Rep. Ashley Hinson. “We’ve requested increases to be able to do that, especially given the role that the Department plays in imposing sanctions,” Yellen said. “We are a target of a serious number of cyberattacks and we are investing very heavily in cybersecurity to meet very high standards.”

☆ Premarket stocks: The banking meltdown may have done the Fed's work for it
▼ + stars: | 2023-03-22 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +7 min

But in a strange twist, it’s possible that the banking meltdown actually did some work for the Fed in bringing down prices without raising interest rates. That could have the equivalent effect of the Fed hiking rates by half a point, said Goldman Sachs economists on Tuesday. Bank stocks rebound as Janet Yellen, Jamie Dimon work to restore confidenceThe collapse of Silicon Valley Bank and Signature Bank rippled through markets last week. The Treasury secretary reiterated that the federal government would be willing to rescue uninsured depositors at small banks if lenders suffer bank runs, raising the specter of contagion. The SPDR Regional Banking Equity Traded Fund, which tracks a number of small and mid-sized bank stocks, gained 5.8% for the day.

☆ Janet Yellen: Further rescues of depositors could be needed if smaller lenders suffer bank runs
▼ + stars: | 2023-03-21 | by ( Matt Egan | ) edition.cnn.com time to read: +2 min

New York CNN —The federal government could once again come to the rescue of uninsured bank depositors if smaller lenders suffer bank runs like the one that collapsed Silicon Valley Bank, according to prepared remarks from US Treasury Secretary Janet Yellen. And the US banking system remains sound,” Yellen said in the remarks, to be delivered at the American Bankers Association’s Washington DC Summit on Tuesday. “Our intervention was necessary to protect the broader US banking system. Regional bank stocks have been volatile ever since the bank failures, with some lenders such as First Republic experiencing dramatic declines. The industry-led rescue of First Republic, announced last week by some of the biggest US banks, represents a “vote of confidence in our banking system,” Yellen said.

☆ Fed and other central banks try to head off crisis by boosting flow of dollars
▼ + stars: | 2023-03-19 | by ( Mark Thompson | ) edition.cnn.com time to read: +3 min

Credit Suisse — one of the 30 most important banks in the global financial system — was bleeding money last week after investor and customer confidence collapsed. Swap lines are agreements between two central banks to exchange currencies. They allow a central bank to obtain foreign currency from the central bank that issues it, and distribute it to commercial banks in their country. During the global financial crisis of 2008 following the collapse of Lehman Brothers, funding markets dried up because of an extreme aversion to risk. From Monday through at least the end of April, the Fed and other central banks will make dollars available on a daily basis, rather than weekly.

☆ SVB fallout: Is my money safe?
▼ + stars: | 2023-03-13 | by ( Ramishah Maruf | ) edition.cnn.com time to read: +6 min

New York CNN —The question on so many bank customers’ minds in the aftermath of Silicon Valley Bank’s stunning collapse: Is my money safe? US customers held at least $151.5 billion in uninsured deposits by the end of 2022, SVB’s latest annual report said. But before markets opened this week, the Biden administration took an extraordinary step, guaranteeing that SVB customers will have access to all their money starting Monday, even uninsured deposits. Many SVB customers had much more than $250,000 deposited and now that they can’t get their money, some companies are struggling to make payroll. “I don’t think people should panic, but it’s just prudent to have insured deposits versus uninsured deposits,” Hatfield said.

NEW YORK (Reuters) -U.S. authorities were preparing “material action” on Sunday to shore up deposits in Silicon Valley Bank (SVB) and stem any broader financial fallout from its sudden collapse, sources familiar with the matter told Reuters. Biden administration officials worked through the weekend to assess the impact of startup-focused lender SVB Financial Group’s failure on Friday, with a particular eye on the venture capital sector and regional banks, the sources said. REUTERS/Nathan FrandinoAnd amid increased withdrawals from other regional banks, U.S. officials are also keeping close watch on the wider sector. The S&P 500 regional banks index dropped 4.3% on Friday to end the week down 18%, its worst week since 2009. Signature Bank, First Republic Bank, PacWest Bank and Charles Schwab did not immediately respond to requests for comment.

☆ US regulators are working to bail out SVB customers
▼ + stars: | 2023-03-12 | by ( David Goldman | ) edition.cnn.com time to read: +4 min

New York CNN —American regulators are working through the weekend on an extraordinary plan to make Silicon Valley Bank customers whole after the financial institutions’ stunning and rapid collapse late last week. Treasury, Federal Reserve and Federal Deposit Insurance Corp. officials over the past two days have worked with the Biden administration to develop facilities that would guarantee all uninsured deposits held by SVB customers. If a sale fails, customers could collect some of their uninsured deposits as the government unwinds and liquidates the bank’s assets to repay them. As of the end of last year, Silicon Valley Bank said it had $151.5 billion in uninsured deposits, $137.6 billion of which was held by American customers. Customers yanked $42 billion from Silicon Valley Bank on Thursday, leaving the bank with $1 billion in negative cash balance, the company said in a regulatory filing.

☆ What’s the next Silicon Valley Bank — and how can the US prevent more chaos?
▼ + stars: | 2023-03-12 | by ( David Goldman | ) edition.cnn.com time to read: +5 min

New York CNN —Silicon Valley Bank failed in rapid, stunning fashion Friday. What took place Friday was an old-fashioned bank run: Customers yanked $42 billion from Silicon Valley Bank on Thursday, leaving the bank with $1 billion in negative cash balance, the company said in a regulatory filing. As of the end of last year, Silicon Valley Bank said it had $151.5 billion in uninsured deposits, $137.6 billion of which was held by American customers. Wall Street is also concerned the tech companies that kept their cash with Silicon Valley Bank could collapse. What a bailout might look likeCalls for a bailout have grown over the weekend from Silicon Valley to Wall Street.

☆ Yellen says World Bank nominee's credentials will overcome selection criticism
▼ + stars: | 2023-02-25 | by ( David Lawder | ) www.reuters.com time to read: +3 min

BENGALURU (Reuters) - U.S. Treasury Secretary Janet Yellen said on Saturday that she believes the strong qualifications of the U.S. nominee to lead the World Bank, ex-Mastercard CEO Ajay Banga, will overcome any criticism of the selection process. FILE PHOTO: Ajay Banga, President and CEO Mastercard attends the World Economic Forum (WEF) annual meeting in Davos, Switzerland January 19, 2017. REUTERS/Ruben Sprich/File PhotoIn an interview, Yellen affirmed her support for the longstanding tradition of the United States choosing the World Bank’s leader and Europe choosing the head of the International Monetary Fund. As the World Bank’s largest shareholder with 16.35% of its voting power, the United States wields strong influence over the bank’s policies, and the lender’s president works closely with the Treasury Department. Yellen is pressing the World Bank to refine a package of sweeping reforms aimed at vastly expanding its lending resource and mission to tackle climate change and other global challenges.

☆ Premarket stocks: State of the Union, recession, crypto woes and more tech layoffs: What investors are watching
▼ + stars: | 2023-02-07 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +5 min

Wall Street will also be watching closely for clues about the ongoing debt ceiling debate, tax policy, foreign relations and more. The unemployment rate ticked down a tenth of a percentage point to 3.4% — the lowest jobless rate since May 1969. European diesel prices fall as Russian ban kicks inEurope’s ban on Russian diesel arrived this week without inflicting more pain on the region’s economy. Russia accounted for 29% of the region’s total diesel imports last year, data from Rystad Energy shows. Countries have prepared for the latest ban by ramping up imports of Moscow’s diesel in recent months.

☆ Janet Yellen: Strong job growth shows recession probability is low
▼ + stars: | 2023-02-06 | by ( Betsy Klein | ) edition.cnn.com time to read: +2 min

Washington CNN —Treasury Secretary Janet Yellen said Monday that the probability of a US recession this year is low as she touted job growth and low unemployment on the eve of President Joe Biden’s State of the Union address. “You don’t have a recession when you have 500,000 jobs and the lowest unemployment rate in 50 years,” Yellen said during an appearance on ABC’s “Good Morning America. Friday’s jobs report showed that the US economy added an whopping 517,000 jobs in January, according to the Bureau of Labor Statistics. The unemployment rate ticked down a tenth of a percentage point to 3.4% — the lowest jobless rate since May 1969. “What I see is a path in which inflation is declining significantly, and the economy is remaining strong,” Yellen said on GMA.

☆ Premarket stocks: ESG funds had a terrible year but traders kept investing anyway
▼ + stars: | 2023-01-23 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +6 min

New York CNN —ESG funds — investments that evaluate companies using environmental, social and governance factors — just survived a tumultuous 2022. That increased scrutiny also played into political differences around ESG investing and opened the door to vocal critics. Responsible investing funds also came up against mighty economic headwinds. These funds’ outsized investments in tech stocks and lack of energy stocks (which was the only positive sector this past year), led to a noticeable losses for ESG funds in general last year. On a global scale, ESG funds also attracted positive investment flows even as money was pulled from broader funds, according to Refinitiv Lipper data provided exclusively to Before the Bell.

☆ Here’s what will happen to the economy as the debt ceiling drama deepens
▼ + stars: | 2023-01-22 | by ( Alicia Wallace | ) edition.cnn.com time to read: +8 min

Minneapolis CNN —After the United States hit its debt ceiling on Thursday, the Treasury Department is now undertaking “extraordinary measures” to keep paying the government’s bills. And Americans — many people — would lose their jobs and certainly their borrowing costs would rise.”Dire warnings of debt ceiling trouble aren’t new. “2011 was the first time in a long time that we came close to a debt ceiling breach,” he said. “I think you would be hard pressed to say [the debt ceiling debacle] was a positive thing,” he said. Considering the potential consequences in the United States and abroad, Sheiner believes the debt ceiling will be lifted or suspended — eventually.

☆ Women living in states with abortion bans suffer greater economic insecurity
▼ + stars: | 2023-01-18 | by ( Vanessa Yurkevich | ) edition.cnn.com time to read: +5 min

New York CNN —Women living in states that restrict or ban abortion face greater economic insecurity than those living in states where they have access, new research finds. “In many of these states, especially the states which have banned abortion, many of the women who are facing economic challenges already are also women of color,” she said. Raising the minimum wage is a powerful tool that has been known to have significant impact on closing racial income gaps. But nearly two-thirds of abortion restrictive states have a $7.25 minimum wage, the lowest legal hourly wage for most workers in the United States. The average minimum wage across the 26 states is $8.17, lower than the average $11.92 for states with no restrictions.

☆ Why recession fears are back: Americans are losing faith
▼ + stars: | 2022-12-16 | by ( Christine Romans | ) edition.cnn.com time to read: +4 min

The famous British economist John Maynard Keynes coined the phrase “animal spirits” to describe what drives investors, consumers and business leaders. “At the end of the day, a recession is a loss of faith,” said Mark Zandi, chief economist at Moody’s Analytics. Yellen explained this week that recession risks permanently exist. “There are always risks of a recession,” Yellen told CBS’s “60 Minutes” in an interview that aired on Sunday. Hopefully we don’t lose faith and run for the bunker and go into recession.”— CNN’s Elizabeth Yang contributed to this report.

☆ Janet Yellen: Inflation will be ‘much lower’ by the end of 2023 and a recession isn’t required
▼ + stars: | 2022-12-12 | by ( Matt Egan | ) edition.cnn.com time to read: +3 min

New York CNN —Treasury Secretary Janet Yellen is striking a cautiously optimistic tone about 2023, predicting a major inflation cooldown and stressing that a recession isn’t required to get prices back under control. “I hope that it will be short-lived,” Yellen said of the current period of high inflation. “We learned a lot of lessons from the high inflation we experienced in the 1970s. Yellen conceded a recession is possible in the months ahead — though the former Fed chair emphasized that one isn’t required to tame inflation. “There’s a risk of a recession,” Yellen said.

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