Generational Dynamics World View News

[DaKardii]

Two notable diplomatic spats in just the last few days.

First, Russia has recalled its ambassador from the US in response to Biden's remarks in which he called Putin a "killer."
https://www.voanews.com/usa/russia-reca ... ing-killer

Second, North Korea has severed diplomatic relations with Malaysia in response to Malaysia extraditing a North Korean citizen to the US.
https://www.reuters.com/article/northko ... SL1N2LG39B

[Tom Mazanec]

A New Cold War with China?
https://www.americanthinker.com/article ... hina_.html

Countering and containing China needs to be the U.S.’s chief overseas objective now and in years ahead. Not for Taiwan. Not for other Asia Pacific nations. But for itself.

[Navigator]

I am reading a lot lately about the Fed removing something called "SLR" protections for banks.

"The federal bank regulatory agencies today announced that the temporary change to the supplementary leverage ratio, or SLR, for depository institutions issued on May 15, 2020, will expire as scheduled on March 31, 2021."

It seems that without the SLR protections,

"banks may have to delever, raise new capital, halt buybacks, sell preferred stock, turn down deposits and generally push back on reserves (not necessarily all of these, and not in that order) just as the Fed is injecting hundreds of billions of reserves into the market as the Treasury depletes its TGA account."

I was fully expecting the Fed to extend the protections, but now it seems there is a lot of political pressure to NOT extend them. It could be that they are trying just to pander to the politician temporarily, but it seems that this could be one of the final straws if this is not extended.

I am curious as to Higgenbotham's take on this.

[John]

** 19-Mar-2021 World View: SLR Protections

> I am reading a lot lately about the Fed removing something called
> "SLR" protections for banks.

> "The federal bank regulatory agencies today announced that the
> temporary change to the supplementary leverage ratio, or SLR, for
> depository institutions issued on May 15, 2020, will expire as
> scheduled on March 31, 2021."

> It seems that without the SLR protections,

> "banks may have to delever, raise new capital, halt buybacks, sell
> preferred stock, turn down deposits and generally push back on
> reserves (not necessarily all of these, and not in that order)
> just as the Fed is injecting hundreds of billions of reserves into
> the market as the Treasury depletes its TGA account."

> I was fully expecting the Fed to extend the protections, but now
> it seems there is a lot of political pressure to NOT extend
> them. It could be that they are trying just to pander to the
> politician temporarily, but it seems that this could be one of the
> final straws if this is not extended.

> I am curious as to Higgenbotham's take on this.

There's been a lot of commentary about this on the financial channels
this morning.

According to the commentary, these protections were put into effect
during the Covid crisis, but now they're being removed. This is going
to increase 10-year bond yields -- and in fact the yields already
spiked on the news -- and that's going to affect tech stocks, since
tech stocks are riskier than 10-year bonds.

On the other hand, bank stocks should benefit, because they'll be able
to make more loans, and so they'll make more money.

**** Federal Reserve to end supplemental leverage ratio capital break
https://realeconomy.rsmus.com/federal-r ... tal-break/

[Cool Breeze]

I am reading a lot lately about the Fed removing something called "SLR" protections for banks.

"The federal bank regulatory agencies today announced that the temporary change to the supplementary leverage ratio, or SLR, for depository institutions issued on May 15, 2020, will expire as scheduled on March 31, 2021."

It seems that without the SLR protections,

"banks may have to delever, raise new capital, halt buybacks, sell preferred stock, turn down deposits and generally push back on reserves (not necessarily all of these, and not in that order) just as the Fed is injecting hundreds of billions of reserves into the market as the Treasury depletes its TGA account."

I was fully expecting the Fed to extend the protections, but now it seems there is a lot of political pressure to NOT extend them. It could be that they are trying just to pander to the politician temporarily, but it seems that this could be one of the final straws if this is not extended.

I am curious as to Higgenbotham's take on this.

The natural progression of this FED and all central banks will be that they are the only game, the last one. The reasons are manifold, but it will be due to particular control and manipulation of the CBDC. Not only do I know more about this than Higgy, I know what Richard Werner has done and has said. And that's it.

[Higgenbotham]

The natural progression of this FED and all central banks will be that they are the only game, the last one. The reasons are manifold, but it will be due to particular control and manipulation of the CBDC. Not only do I know more about this than Higgy, I know what Richard Werner has done and has said. And that's it.

You know nothing.

You're an obsessive, arrogant creep.

[DaKardii]

A top NATO scientist with security clearance has been caught spying for China.

https://www.yahoo.com/news/top-nato-sci ... 52843.html

[Higgenbotham]

** 19-Mar-2021 World View: SLR Protections

> I am reading a lot lately about the Fed removing something called
> "SLR" protections for banks.

> "The federal bank regulatory agencies today announced that the
> temporary change to the supplementary leverage ratio, or SLR, for
> depository institutions issued on May 15, 2020, will expire as
> scheduled on March 31, 2021."

> It seems that without the SLR protections,

> "banks may have to delever, raise new capital, halt buybacks, sell
> preferred stock, turn down deposits and generally push back on
> reserves (not necessarily all of these, and not in that order)
> just as the Fed is injecting hundreds of billions of reserves into
> the market as the Treasury depletes its TGA account."

> I was fully expecting the Fed to extend the protections, but now
> it seems there is a lot of political pressure to NOT extend
> them. It could be that they are trying just to pander to the
> politician temporarily, but it seems that this could be one of the
> final straws if this is not extended.

> I am curious as to Higgenbotham's take on this.

There's been a lot of commentary about this on the financial channels
this morning.

According to the commentary, these protections were put into effect
during the Covid crisis, but now they're being removed. This is going
to increase 10-year bond yields -- and in fact the yields already
spiked on the news -- and that's going to affect tech stocks, since
tech stocks are riskier than 10-year bonds.

On the other hand, bank stocks should benefit, because they'll be able
to make more loans, and so they'll make more money.

**** Federal Reserve to end supplemental leverage ratio capital break
https://realeconomy.rsmus.com/federal-r ... tal-break/

I don't have any particular take that goes beyond the commentary. During Powell's press conference Wednesday, he was asked about this and said he would not comment at that time, but that there would be an upcoming announcement. Later in the press conference, Steve Liesman asked Powell about the 10-year treasury rate and whether the Fed would consider doing another operation twist. Powell replied that the Fed is OK with things as they are. The back and forth with Liesman starts at 28:40 here:

https://www.rev.com/blog/transcripts/fe ... ket-update

Where the transcript says "Howard Schneider" that was actually Liesman speaking.

Whether Powell is right not to be overly concerned by what is going on in the bond market, I don't know. My feeling, expressed a few days ago, was that there might be some hiccups, but beyond that I'm not guessing.

[Navigator]

I don't have any particular take that goes beyond the commentary. During Powell's press conference Wednesday, he was asked about this and said he would not comment at that time, but that there would be an upcoming announcement. Later in the press conference, Steve Liesman asked Powell about the 10-year treasury rate and whether the Fed would consider doing another operation twist. Powell replied that the Fed is OK with things as they are. The back and forth with Liesman starts at 28:40 here:

https://www.rev.com/blog/transcripts/fe ... ket-update

Where the transcript says "Howard Schneider" that was actually Liesman speaking.

Whether Powell is right not to be overly concerned by what is going on in the bond market, I don't know. My feeling, expressed a few days ago, was that there might be some hiccups, but beyond that I'm not guessing.

Thanks. I am thinking that it is just the latest hiccup.

But then whole industries have been savaged by the last year:
Hotels
Restaurants
Airlines
Cruise Industry
Anyone with Rental Property

Once things get even somewhat "back to normal" and people actually have to pay the bills, I think that bankruptcies will seriously accelerate, which in turn could cause the crisis.

[Guest]

Two questions:

1) Is the US dollar the worst G7 currency to be in or are they all bad? Should I buy gold?

2) When is the Vietnam book going to be published? I read parts online, but I would like to have a paperback copy to support you and keep.

Thank you for the good work, John--and everyone else who contributes.