And here we go. So Jerome Pow is going to be testifying in front of Congress today and we are going to be live streaming that here directly. So let's go ahead and pull that up. So we got Drone Pals live.

Let's go ahead and watch this straight from the Uh Financial Services or Federal Reserve website. Let's go ahead and pull it up. It's about to start shortly. So all right, give it some time.

Um, once he starts speaking, we should be able to hear him. Um, you guys can let me know in the comments section. If you guys want me to just have it directly, have all the video directly in the Um so you guys can see who is speaking. Or if you guys would rather see the chart and then hear who is speaking, then I'd rather do that.

But yeah, Market is dropping right now. Very similar to yesterday's Um Market reaction. There it goes. Uh, we just recapped one.

Uh, our live trading session with the Lpp team. We're just wrapped up, not recapped. Uh, we just wrapped up our live session with the Lpp team. Uh, but again, Friendly reminder: I Do appreciate you guys taking time and joining this live.

So again, we are waiting for Jerome Powell to speak all I Literally ask you to do is if it's not too much to ask if you could drop a thumbs up and subscribe to the channel I Host these free live streams anytime any significant Federal Reserve live speech is happening or any economic report is being released like next week on March 14th. Did you know that the CPI data report is being released one hour before the Market opens? I Would love to be able to host that live stream for you guys all. I Ask you to drop all I Ask you to do is to drop a thumbs up, Show some love to the channel and of course subscribe to the channel if you haven't done so already. So we are testing our support range on NASDAQ So again, Lpp team, you guys know exactly what I'm what I'm talking about Please Be aware of that.

We talked about it earlier today. Um, you guys know what my plan is. You guys know what specific price point we're looking for to break below or break above. so let's make sure that we are aware of that.

So yeah, we are waiting for Jerome Powell to speak and testify in front of Congress so we are all waiting for that. He is running a little fashionably late. Um, so not surprised there. There it goes.

NASDAQ with a really nice push. See what we got here here? All right. smash that like button I Like it. Thank you guys again.

thank you for live streaming it of course I Appreciate you guys taking time and joining me. Uh, joining me here as well I do want to remind you all even before Jerome Powell speaks One of the things let's see all right. So one of the things that I do want to remind you is before Jerome Powell speaks Uh, we are running our biggest giveaway ever and one of the ways that you could enter is if you've been waiting to join our Lpp team uh, you can watch me trade live every day. So we do it right at Market open.

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So again, a big incentive for people that have been waiting to sign up for LBP 2.0 So just want to make sure that you guys are aware of that. And here it goes: Ask: Kiki Cube Pulling on back testing Old resistance levels new support levels We are all waiting for Jerome Powell to begin to speak. So that's your dream car. That's that's my original dream car.

The GTR is what started it all for me. Gee, As if you guys think back to 2016 when I bought my first I call it a Supercar Uh, but yeah it was the Nissan GTR bought a 2012 Nissan GTR Fell in love with it when I watched The Fast and the Furious movies I Know I'm not the only one right? Objection All members. While I'm fine materials the chair for inclusion in the record and I'll note that the outset of this hearing has a hard stop of 1pm. We are starting for the Fed chair um and Uh, which we intend to strictly observe.

Um I don't recognize myself for four minutes given an opening statement uh, thank you Chairman Powell uh for your testimony today. Um, this week you stated that the FED will quote stay the course until the job is done. uh and that is to restore price stability. This is positive, but you know as well as I do you're facing a very strong headwind from the political left Democrats are pressuring the FED to stray from its narrow mandate without uh, it's a page out of their same old Progressive Playbook When they don't have the votes to achieve something here in Congress they turn to regulators and now chair Powell they're looking at you in the Federal Reserve President Biden's countdown to the far left is what got us into this inflationary mess.

I Urge you to reject the ideologues who put their social agenda ahead of economic prosperity. High prices continue to eat away at workers, wages and retirees incomes. Since President Biden took office, we've experienced inflation at rates not seen since the late 70s and early 80s. Inflation rapidly decelerated, accelerated after Democrats passed their so-called American Rescue plan which poured nearly two trillion dollars of inflationary fuel into the economy.

By June of last year, the Consumer Price Index showed inflation skyrocketed From Below two percent to nearly nine percent and personal Uh consumption expenditures the Fed's preferred measure of consumer prices balloons to seven percent Instead of being rescued by democrats Americans were punished with pain at the grocery store and sticker shock at the pump. While inflation is now believed uh, it is now below its mid-2022 peak, it is persisting and race well above the Fed's target. It remains broad-based and continues to hammer Americans pocketbooks. In fact, a recent Gallup poll shows half of the respondents say they are worse off financially than a year ago.

It's clear that there's still a long way to go in the effort to bring down costs. I Look forward to hearing you reaffirm your commitment to that work today. Republicans Also want to hear from you regarding some concerning developments at the Federal Reserve on the regulatory front. Recently, the Federal Reserves Vice Chair for Supervision announced a quote-unquote holistic review of Bank Capital and the FEDS regulatory regime.

However, it seems that only a small group within the FED knows what this means. uh, what are in sales? How much review is is being vetted by the full board and the the type of quantitative analysis the FED is performing, the FED shouldn't operate in the shadows, especially when the regulation in question can have Broad and significant economic effects. It's also unclear the motivation for the Fed's holistic review, particularly when so many board members have stated that the banking system is very well capitalized and any review of Um of of Capital Standards should be targeting. It also appears the Federal Reserve board is laying the groundwork for climate policy to be implemented through the FED Regulation with an opening: Salvo to quote unquote of quote unquote Scenario Analysis: Addressing an issue like climate change is important, but a policy that should originate here in Congress by the elected representatives of the people, not the central Bank.

As you said, the FED needs to stick to its knitting I Agree There is concern for many that the FED is picking up new needles and knitting partisan sweaters. It's such a precarious time for our County here at home in the global economy. that would be a mistake. Thank you for being here today.

I Look forward to your testimony and the questions by our members. The chair now recognizes the ranking member of the committee Miss Waters for four minutes for an opening stable. Uh, thank you very much Mr Chairman Good morning Chair Paul Since your last visit, our country underneath the leadership of President Biden has made major progress to improve economic conditions, including adding a record 12 million jobs, reducing unemployment to its lowest rate in 54 years, while also reducing the deficit by 1.7 trillion dollars. Unfortunately, many families are still struggling to afford basic necessities because of inflation.

What's more, interest rate hikes are making borrowing, especially for mortgages, outrageously expensive. Since I raised this concern for you in a November letter, the rate hikes continued to have an outsized impact on housing costs, which are, as you know, a primary driver of Court inflation. But Mr Chair I think that you will agree that Congress also has a role Nasdaq's moving up. I'm somewhat disappointed that after two months Republicans have taken no serious action to address inflation.

By this time, last Congress House Democrats have passed the American Rescue plan to provide relief from the ongoing pandemic which included our committee's efforts to provide 70 billion dollars for homeowners, renters, businesses and First Responders If Republicans are looking for ideas, Committee Democrats have put forth additional bills like the bill back better act to bring down costs for Americans especially housing costs even more concerning, We just must. We're just months away from an economic catastrophe the young what we have ever seen including spiking interest rates, massive job losses, and Global instability. I'm talking about the threats by Republican leadership to force a default on our nation's debt. If we don't agree to their demands to cut Social Security Medicare or other critical programs, you have urged Congress to take immediate action to raise the debt seller.

But rather than focusing on this very real issue, the first bill that Committee Republicans brought to the floor instead suggested that Social Security and Medicare or socialist threats to America. Since then, we have considered legislation related to deregulating Securities and banking laws and encountering threats from China. But Republicans have completely ignored the biggest economic threat to businesses, consumers, and our economy defaulting on our debt last month I Wrote a letter to chair McHenry urging him to take this matter seriously and hold the hearing. but I'm still waiting for a response I Hope Republicans will listen today to the real consequences that even the mere threat of a default would have for everyone in this country.

And finally, I'm so pleased that we're finally making progress on diversity and inclusion for key positions at the bed, including last year's historic confirmation of Dr Lisa Cook to serve as the very first black woman on the Federal Reserve board with the board's Vice chair and Kansas City fed President positions Bacon I think President Biden and Kansas City Fair Board should build on this progress by by seriously considering diverse candidates for these positions. With that are, yield back the balance of my time. the writing member yields back the balance of my time, asking him as consent to submit for the record. Uh, my letter to Secretary of the Treasury Janet Yellen from February 28th asking for an update on the X date for the debt ceiling I Also, ask Adam is consent to Smith for the record the latest CBO long-term budget outlook on the unsustainability of our debt most recently released and without objection, so ordered.

I'll now recognize the chair of the Financial Institution subcoding chair Mr Barr for one minute thank you Mr Chairman and Chairman Powell Thank you for being here today to discuss the Federal Reserve's monetary policy actions. In a time of economic uncertainty, mixed economic data, historic inflation that continues to plague families and businesses around the country, it is Paramount that the Federal Reserve remained Vigilant on reducing inflation, anchoring inflation expectations, and restoring price stability at the Fed's two percent Target I Also look forward to discussing the Fed's Regulatory and supervisory activities as the FED reviews the bank Capital framework. it needs to consider the impact to the real economy and our Global competitiveness when raising Capital requirements and sidelining capital would work at Cross purposes with monetary tightening, constraining the supply side when we need more not less investment to fix Supply chains and reduce inflation. Tailored regulations are required by the by of the Fed by law and in one size fits-all approach would be the wrong path to take.

Finally, I urge the FED in your words to stick to its knitting and not attempt to be a climate regulator. I Yield back how many times expired. Will now recognize the right humor of the Financial Institutions subcommittee. Um.

Mr Foster For one minute thank you and thank you chair. Powell for being here today. Today is the 15th anniversary of when I was first elected to Congress and placed on the financial services Committee just as the economy was about to collapse and so that was my trail by fire, the emergency response to rescue the economy, and the legislative response that Dodd-Frank Act that successfully stabilized our financial system. So 15 years later as I take my place as the ranking member on the committee of Oversight over U.S Banking This guy has a crazy good voice and we call the solemn hope that I swear to myself back then to make sure that this kind of Calamity never happens again.

The monetary policy report that we're receiving today is largely A Narrative of a return to normal. The lead times to manufacturers are back to pre-covered levels. the job market retains Supernatural strength and inflation is responding more or less as predicted to the usual measures. and by far the largest threat on the horizon is a repeat of the 2011 default crisis.

Congress has the power to avoid that and we owe it to the American people to do so and I yield back. Today we walk in the testimony of Jerome Powell chested support at 297 Reserve System Chair Powell was appointed, reappointed and sworn in for a second for your term as chair on May 23, 2022.. Chair Powell also serves as chairman of the Federal Open Markets Committee and the Systems Principal Monetary Policy Making which is the system's principal monetary policy making. Bonnie Um, Chair Powell We thank you for taking time to be here.

We will recognize you for five minutes, give an oral presentation or testimony without objection. Your written statement will be made part of the record. found your recordness Cameron McHenry Ranking Member Waters and other members of the committee good morning and I appreciate the opportunity to present the Federal Reserve's semi-annual Monetary Policy report. My colleagues and I are acutely aware that high inflation is causing significant hardships every time, Turning inflation to our two percent goal.

Over the past year, we've taken forceful actions to tighten the stance of monetary policy. We've covered a lot of ground in. The full effects of our tightening so far are yet to be felt. Even so, we have more work to do.

Our policy actions are: Guided. By our dual mandate to promote maximum employment and stable prices without price stability, the economy does not work for anyone in particular. Without price stability, we will not achieve a sustained period of labor market conditions that benefit all. I Will review the current economic situation before turning to monetary policy.

The data from January on employment, consumer spending, manufacturing, production, and inflation have partly reversed the softening trends that we had seen in the data just a month ago. Some of this reversal likely reflects the unseasonably warm weather in January in much of the country. Still, the breadth of the reversal, along with the revisions to the previous quarter, suggests that inflationary pressures are running higher than expected at the time of our previous Fomc meeting. Not good for Nasdaq generated somewhat since the middle of last year, but remains well above our longer run objective of two percent to 12-month change in total, Pce prices has slowed from its peak of seven percent in June to 5.4 percent in January.

As Energy prices have declined and supply chain bottlenecks have eased over the past 12 months. Core Pce inflation, which excludes the volatile food and energy prices was 4.7 as supply chain bottlenecks have eased, and Tighter policy has restrained demand inflation in the cord Goods sector Has Fallen And while Housing Services inflation remains too high, the flattening out in rents evident in recently signed leases points to a deceleration in this component component of inflation over the year ahead. That said, there is a little sign of this inflation thus far in the category of core Services excluding housing, which accounts for more than half of core consumer expenditures. To restore price stability, we will need to see lower inflation in this sector, and it will very likely be some softening in labor market conditions.

Although nominal wage gains have slowed somewhat in recent months, they remain above what is consistent with two percent inflation and current Transit productivity. Strong wage growth is good for workers, but only if it's not eroded by inflation turning to growth. The U.S economy slowed significantly last year, with real GDP rising at a below Trend pace of 0.9 percent. Although consumer spending appears to be expanding at a solid Pace this quarter, other recent indicators point to subdued growth of spending and production activity in the housing sector continues to weaken, largely reflecting higher mortgage rates, higher interest rates, and slower output growth also appear to be weighing on business fixed investment.

Despite the slowdown in growth, the labor market remains extremely tight. The unemployment rate was 3.4 percent in January, its lowest level since 1969. job gains remain very strong in January while the supply of labor has continued to lag as of the end of December, There were 1.9 job openings for each unemployed individual close to the all-time Peak recorded last March While unemployment insurance claims have remained near historic lows turning to monetary policy with inflation well above our longer run goal of two percent and with the labor market remaining extremely tight, the Fomc has continued to tighten the stance of monetary policy raising interest rates by four and a half percentage points over the past year. We continue to anticipate that ongoing increases in the target range for the Federal funds rate will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to bring inflation down to two percent over time.

In addition, We are continuing the process of significantly reducing the size of our balance sheet. We are seeing the effects of our policy actions on demand in the most interest-sensitive sectors of The economy. It will take time, however, for the full effects of monetary restraint to be realized, especially on inflation. In light of the cumulative tightening of monetary policy and the lags with which monetary policy affects economic activity and inflation, the committee slowed the pace of interest rate increases over its past two meetings.

We will continue to make our decisions, meeting by meeting, taking into account the totality of the incoming data and their implications for the outlook for economic activity and inflation. Although inflation has been moderating in recent months, the process of getting inflation back down to two percent as a long way to go and is likely to be bumpy. As I mentioned, the latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated. If and I stressed that no decision has been made on this, but if the totality of the data were to indicate that faster tightening is warranted, we'd be prepared to increase the pace of rate hikes.

Restoring price stability will likely require that we maintain a restrictive stance of monetary policy for some time. Our overarching focus is using our tools to bring inflation back down to our two percent goal and to keep longer term inflation expectations well anchored. Restoring price stability is essential to set the stage for achieving maximum employment and stable prices over the longer run. The historical record cautions strongly against prematurely loosening policy.

We will stay the course until the job is done. To conclude, we understand that our actions affect communities, families, and businesses across the country. Everything we do is in service to our public. Mission We at the Federal Reserve will do everything we can to achieve our maximum employment and price stability goals.

Thank you I Look forward to your questions. This is the same exact speech as yesterday. the Perfect Question uh, chair and Powell There's been a lot of discussion over the last 24 hours about the effect of rate increases on the economy. A lot of debate about what you said yesterday in the Senate Um, how does but no one asks you this directly.

We have a March meeting coming up of mortgage committee meeting coming up in two weeks. Um, how do you think about the March meeting? What's your approach to that? What are we likely to see? Oh, so I I won't repeat what? I What? I just said in my testimony. But but if I turn to the March meeting, um I guess I would say that we have some potentially important data coming up. uh data to be analyzed.

One of them came out at exactly 10 o'clock That would be the Jolts report which of course I haven't seen having been sitting here at 10 o'clock But we're also getting a jobs report on Friday and a CPI and PPI inflation report next week. so those will be important and we'll scrutinize them. When we say that we're going to be looking at the totality of the data which is what I said that does include these these reports, you have to come. They're going to be important in our assessment of the higher readings that we have very recently received and of the overall direction of the economy and of our progress in bringing inflation down, and we'll be carefully analyzing it again.

I We have not made any decision about the March meeting. We're not going to do that until we see the additional data. Larger point though, is that we're not on a preset path and that we will be guided by the incoming data and the evolving Outlook. But you've also said higher longer.

Is that still the case? Yeah. So and as I said in my testimony, uh, we look at the data since January and and and also the revisions to the November and December inflation data and they suggest that uh, the ultimate level of interest rates higher than we'd expected. What are those economic factors? So um, going back to January As I mentioned the the Nice: the softer inflation readings of November December were revised up. We got a very strong Uh inflation report.

for January, we got an extraordinarily strong employment report very strong consumer spending uh, strong manufacturing data right across the board and as I pointed out, some of that may have been affected by the very warm January weather. but nonetheless, all of it pointed in the same direction. Okay, let's move to regulation. Um Uh.

Chair pal in January The Federal Reserve put out a policy statement noting the Digital Asset Custody is permissible activity if done in a safe and sound manner. However, if a bank can demonstrate to the FED that it can conduct that activity and safe and sound manner, the capital Impact of the Sec's Staff Accounting Bulletin effectively precludes Banks from offering Digital Asset Custody service at any scale. Are you aware of this Staff Accounting Bulletin the Securities Exchange Commission and its impact on custodial services I I am aware of it. Of course, it's an SEC accountable.

This is. this is Sap 121 I Think And that's right. Certainly aware of it, and you know we do follow Um Uh General accepted accounting principles in in our in Our Basketball regulation. Okay, well, without objection, I'll submit to the Um submit for the record uh, my uh, letter to the bank regulars about this.

Uh, so while the FED says it can be done in a safe and sound manner, the Securities Exchange Commission is regulated so that it cannot be done. Uh, Next question is uh, certainly about Bank Capital standards. You got questions about this yesterday. Uh, Chair Bar has announced a holistic review of Capital Requirements.

Uh, As I said my opening statement, there are a lot of questions about this process. Um, and uh. previous statements by members of the Uh: the FED Governors Um, about the adequacy of current current capital standards. Um.

And so while the Vice Chair for Supervision has announced that the Feds will engage in a holistic review of capital Regulation as that Fed staff is that done at the Uh, You know, the Governors, the board level, um, what is the process? Well, there are a lot of questions that people have about his statements. Um, and so we want to understand why it's necessary for the Cat the FED to conduct a holistic review and what that process is. Um, And so you know. My general question is, do you still agree with your previous statements about the adequacy on a generalized basis of of our financial system? Uh, Or are we to read into this that we're not adequately capitalized and there's there's a high level of risk in the system that we're unaware of at this point.

Thank you. So the the Why really? just is that uh, as a new Vice Chair for Supervision, Vice Chair Bar has has launched into he's taking a fresh look at everything including Capital that that actually is typical of the last two people to have this job, so that makes a lot of sense. Um, in terms of Um, the process, it's you know it's certainly conducted under Vice Chair Bar's leadership with with input from the staff and you know, discussions with Governors on that committee. and uh, I'm kept uh, broadly apprised about what's going on.

But the the bottom line is there: Nothing has been. Nothing has been proposed to the board. Nothing has been formalized at this point. It's a lot of work that's going on.

I think discussions are going on, meetings with industry and that kind of thing. When we get to that to the place where that's appropriate. Uh, you know the board will be carefully briefed. Ultimately, we'll vote on a proposal and that proposal will go out for comment.

And we'll We'll solicit comment from any and all commenters and we'll look very carefully at that so it'll be a wide open Uh process in the sunshine. Thank you! Are you all back now? Recognize the general General one from California the ranking member, right? Miss Waters Thank you very much I agree with what you said on February 1st that Congress must raise the debt limit because of what you described as a highly risky consequences of failing to do so. You are perhaps the most important expert on the debt limit, which is why I find it very concerning that your recommendation to raise the debt limit in a timely manner is being ignored by my colleagues on the other side of the eye. I'm also concerned that the consequences of this brinksmanship are imminent.

Fitch Ratings said this week. They may seriously look at downgrading the U.S debt based on the escalating brinksmanship they are observing. Even if Congress ultimately addresses the debt limit at the last minute, this is history repeating itself standard. and Poor's downgraded our debt back in 2011 when Republicans last controlled the house and threatened Depot The bipartisan policy Center later found that the 2011 debt limit debate cost us 18.9 million dollar billion dollars in higher borrowing costs even though we never defaulted.

To put that into perspective, that could have been leveraged to provide up to 20 200 billion in loans to small businesses through the State Small Business Credit Initiative or to provide hundreds of thousands of people down payment assistance to buy their first home. That House Republicans including most of the Republicans on this committee had no qualms about paying our debts. When Trump was in office three times, they addressed the debt ceiling in a timely manner without holding our country hostage. But Republicans are now are ready to tear down the hard work of Americans everywhere to weather the pandemic and build back a strong recovery chair.

Powell Can you describe for us the risk you see if Congress continues to delay actions on the debt limit both for our economy and for individuals and Families Let me start briefly by saying that we have no role and seek no role in what is really at the heart of fiscal policy except I will limit myself to the two things that other Fed chairs have said about this one is just that: Congress raising the debt ceiling is really the only alternative. There are no rabbits in hats to be pulled out on this too. Really is just that no one should assume that the FED can protect the economy from from you know, the non-payment of of the government's bills, let alone a a debt default of some or something of that nature which we don't think will happen here. But no one should be thinking that we have the tools to to to protect the economy from all the potential effects of that.

Well, thank you very much I don't want to miss uh what you said I Uh, somewhat quoted you? uh when you said that Congress must raise the debt limit because of what you described as a highly risky risky consequence of failing to do so is that your language well must in the sense that that's that's really the only way for for the debt limit to be raised is Congress has must act I I Again, these are fiscal discussions and we're not, don't We don't want to be a part of them. and uh, really, they're between. you know, elected officials, but you are an expert on the subject. Well, I spent a lot of time on this.

As you'll recall, as an expert on this subject, you are concerned about the high risky, risky consequence of failing to do so. Is that correct? Did I correctly quote you? That's correct? Thank you. Um, and so again, let me just go a little bit further. Um, the chair mentioned that he had either written a letter or maybe even had some conversation from Janet Yellen about uh, the time limits that she had attempted to describe.

Is it your understanding that she said she could maneuver and kind of manipulate things so that she paid the bills that were coming due, but this could only last until about June Is that your understanding? Honestly, I would really have to not try to interpret the secretary's words for you. She that's really up to her to do well said. Can she keep us afloat until about June I Don't Honestly, that's not for me to say. that's these are these are really questions for the secretary.

I'm sorry. Have you had any conversation with her about the statement that she made about being able uh to manipulate the debt and pay bills that were coming due out of another account Etc Did you have that conversation with her? The conversations is that you and I have privately don't go anywhere I don't talk about them with anybody and the conversations I have with with secretary Yon I don't I don't okay and I don't want to get it expired digital age times expired. Do I did I have equal time with you? You sure did. He went over time, but if I did thank you I yield back and I'll recognize the vice chair of the full committee.

Mr Hill of Arkansas for being with us. You're welcome anytime until we ask if you want to volunteer and come we. we love having your views on many topics. Thanks for talking about your commitment to price stability.

You know we've had this discussion last June between us of I do think that's the primary mission of the Fed and I think it should be. The only priority of the FED is price stability because it's the Legislative branch and the Executive branch that really are responsible for quote Full Employment and having that policy uh, environment and making sure that that's right. So your commitment to price stability is welcome by this committee. Yesterday in the Senate you uh suggested that you supported a regulatory framework a broadly regulatory framework for digital assets.

Is that is that right? Yes. And is it your view that if we had a regulatory framework here in the United States for digital assets, that there'd be more transparency and rules of the road for both consumers, investors, and developers? Absolutely and wouldn't if we had those rules of the road for business seeking to use and develop blockchain as a potential, new technology in their business and tokenized payments that again, that would be beneficial to business. To know how to go about that yes, and to assure that it's all done in a safe and sound manner. when we're talking about Banks right and then as uh, my next point would be exactly that: to help Banks Investment Brokers Custodians understand, uh, how they could even participate in that market in a safe and sound manner.

You agree that a regulatory framework would help on that. Yes and then and then. Finally, we've grown up in our country and it's Unique In the world that we have a dual banking system. and due to a quirk here in Congress over a hundred years ago, we have insurance is regulated exclusively by the states.

So uh, would you uh, believe that that regulatory framework would also have to preserve some sort of role uh, subject to safety and soundness? You know for State Uh states to play some role in that regulatory framework for digital assets? I Uh, let me just say I Think that the work certainly Works in banking and insurance I Have no problem with those. Um, you think it could you consider it possible that it could also work in digital assets? Certainly possible. Yeah, thank you. Um, turning to a topic that's been a subject here for an early four years: Central Bank Digital Currencies Article One of the Constitution reserves coins and coins Ipswich money issuance to the Congress and we've in turn delegated that to the U.S Treasury, which is since 1912 engaged the Federal Reserve as their Fiscal Agent Uh, you've testified here many times before that to issue a central bank digital currency? That that would be have to be authorized by Statute by Congress Is that still your testimony? So that is absolutely the case.

as it relates to a retail Cbdc, there are you know, potential uh forms of a wholesale Cbdc that would be we need to look at. It's less clear, but we've always been talking about retail Cbec and that's uh, that's something we would certainly need Congressional approval for and what would be a parameter on something that's not a retail Cbdc. Where you think that that could be issued in some form or fashion without Congress's direct statutory authorization it would. so it would be.

For example, it would just be something between Banks So it would look an awful lot like a bank reserve And you you might ask, why would we need it and that's that's a really good question too. Yeah, but it's just something that's literally within a wholesale Market But that speaks that you might have a blockchain between Banks and the Fed using a central bank digital currency token to settle transactions institutionally inside the the Yeah. So that leads me to Fed now of which is supposed to be up and running I think this summer somewhat behind the the scene there. Uh, I would like to ask you to formally have this full committee briefed on that by the Federal Reserve I know the chair of the Kansas City Bank was involved.

she's now left. and I think the committee has a lot of questions about Fed. now, how it, how its interoperability will work, how it's going to roll out, and also just a question that we've been asked that why the FED wire system ending up 24 hours a day seven days a week now to benefit consumers that are using Venmo? Do you have a thought on that? I I'm not sure why we're not 24 7 on that and we of course be delighted to come up and brief the committee on on Fed. That'd be good.

We'll take you up on that and the right person from the Fed and Mr Chairman I Yield back. Chilling yields back. Will now recognize the Uh chair of the I'm sorry the ranking member of the Capital Market subcommittee Mr Sherman of California for five minutes. Thank you Mr Chairman I Want to thank you for bringing to our committee's attention several years ago, the importance of tough Legacy Libor some 16 trillion dollars of instruments where the creditors wouldn't know how much the debtor was supposed to pay.

Um, this committee we passed legislation over a year before the Libor hit the fan. Uh, you issued regulations seven months before the absolute deadline I Hope we do this in other areas and it's my understanding that with those final regulations were done. Uh and uh. we saw the the Libor issue.

Uh, is that correct? That's my understanding as well. Um, people talk about inflation and they somehow say that it's a matter of the personalities and politics in the United States Others argue that the entire world is hit by inflation because Ukraine and Covid I think we've got the answer to this question. Uh, in that inflation is uh, considerably higher in the Eurozone than it is in the United States Uh today. Uh, and it's very hard to say that Joe Biden is responsible for inflation in Germany Uh, I Commend the ranking member for bringing up the debt limit and the harm that's already done to our economy.

If we solve the problem tomorrow, we had less investment than we would have had yesterday. Um, and I would say that I Commend the President. He's going to issue a budget plan tomorrow and perhaps in their time. One of our Republican colleagues can tell us when the Republican budget plan will be released.

we are all eagerly awaiting it. Housing is a huge part of inflation and it's We've left it to local government, but the permitting process there guarantees scarcity which guarantees, uh, a high housing costs. Um. Mr Chairman, Uh.

chair. We've talked back in 2001 and several times. Uh, even before that about wire fraud and having just bought a home I saw the process up front. Everybody's very nervous about one thing and that is, will the buyer of the house be tricked into wiring their down payment to the wrong account? Or will the seller the buyer be tricked Or the escalator be tricked into sending the money uh, to someone other than the seller of the property.

We talked about this back in 2001 where I urged you with your Fed Now system which I'm glad is on track to move forward. um to have what the Brits have When you send the wire, you identify not only the number of the account you're sending it to, but also the name of the person or entity that's supposed to receive that. Uh, at that time back in 2001, you said that pain matching is not the best way to do it. there are other ways to do it, and that you'd be happy to get back to me as to how you're going to make sure that a uh, an email, an email from a Nigerian Prince does not get uh, the wired funds particularly in a housing transaction acquired to an account number that turns out to be in Legos Um, what progress do you have? When can when can home buyers have a system where they're sending it to a named payee as well as to a number? So we I hope we did come back in a timely way to you on that.

Um, but uh, it's a it's a problem you've brought to our attention. You're right over many years and we continue to focus on on well, the bureau. The bureaucrats who are working on this don't want to do what the Brits did. They've proven it can be done.

You said you were going to accomplish the same goal in some other way and it has been a while and it's not solved, nor are you aware of any solution. I Would hope that you would go back and say we don't want to add this anxiety to every real estate transaction. Um, we go back to the drawing boards, follow what the the Brits have done, and have a matching. Uh, finally as to uh, crypto, Um, Cryptocurrency says what it means, hidden money? That's what it means and uh, if we impose, uh, know your customer and uh, anti-money laundering statutes to it, it won't be crypto anymore.

What Crypto wants is to have part of its ecosystem above the water line visible and subject to know your customer and then have the rest of the iceberg below the water line. Um I Will now, uh, go to the gentleman from Texas Mr sessions now recognized for five minutes Chair: McHenry Thank you very much Chairman Powell Thank you for joining us today. We appreciate not only your professionalism but your direction at Us. Chairman: Powell I Know that the FED considers divergences and you talked about it in as you spoke in your opening statement about Consumer Price Index Personal consumer expenditures Inflation GDP and all these things are talked about in your Uh report.

A month to report March 3 2023 Thank you. Uh, a couple days ago I had an opportunity to see that a an economist Art Laugher Arthur Laffer uh produced a report that spoke about literally this country doubling GDP Now I know we're putting CPI Pce inflation all these things into a mix but he said that if we made changes in health care to efficiencies we could double the current GDP rate. My question to you that I hope you can answer is what do you think about that is that something that is in this document that I have missed and it seemingly to a person who follows this as Art Lapper does for 50 years what do you think is an important way to look at efficiencies in healthcare? Thank you So no that that's not in our in our Monetary Policy report. uh I just say one thing and that is we do.

We do spend something like 1.7 sorry 17 or 18 in that range percent of GDP delivering Health Care Other other similarly wealthy countries spend 10 percent. So it's the delivery system. It's not that the benefits are incredibly rich or anything like that, it's just that the delivery system is very expensive. That's a trillion dollars a year that we spend and get nothing for it.

This is fiscal policy. but I'm I'm responding to your So I would think that he may have meant that if we if we had a delivery system that that saved that that a trillion dollars that doesn't really get us anything uh then then that would be great for the economy which I would agree with. So you've spoken of supply chain disruptions because it in fact watch for the break below the EMA or an accelerator as we gain that advantage. You just talked about some seemingly which would offer some validation to Mr Lapper as he spoke about the huge Imports of this is that something you should start paying attention to to Where policy people not only at the FED but your Fed banks around the country would start looking at and start putting pressure on us to get to gain those efficiencies as a result of a global view, So on.

Supply Chains generally they have suddenly been tremendously important. uh in in inflation as you know for the last couple of years and for the first time really have been something that we've had to study carefully in terms of of healthcare delivery. That is strictly a question for you and for you know the the parts of the government that are charged. Whether the FED does not have a role to play and does not seek a role does not see a role and and yet as I look at this, you've got a role in projecting confidence.

You've got a role in education, You've got a role in who's in the workplace, You've got to roll my talk, my Discu interest rates might. and yet my point is it's such a staggering number that impacts us. Uh, just love to have you go back. Perhaps we from this committee need to give you some direction on that, but I think you've you're testimony today.

It recognizes the Staggering impact on that. I Don't think it's political. the answer may be political, but I think the actual numbers are not political. It's an inefficiency that is happening across the country, not a regional matter.

And so I wanted to get your take on that. and I appreciate you being here as always. Thank you for your confidence and your hard work that you give this country. Mr Chairman I Yield back my time.

Someone yields back. Will now recognize the ranking. Remember that Agriculture Committee Mr Scott of Georgia for five minutes. Thank you very much Chairman and uh, welcome.

Oh no back, uh Chair Chairman Powell Now chairman Powell Listen to me very carefully here. Oh because I think we're on the verge of making a terrible mistake. Tell me back in 2008 if you recall, maybe uh, Barney Frank then and Miss Waters asked me to take a look and kind of work with you and the fed. you were a board member in 2008 and we came to the conclusion that we needed a more Equitable playing field between our large Banks uh like Goldman Sachs Citigroup and our regional and smaller Banks like truest and our Community Banks And we and we changed that.

But now I hear that. the Fed and the FDIC plan to drop a new rule which seeks to apply the long-term and higher Capital requirements that were created and you and I did this back in 2008 and you'll remember that role created for the Gold Massage and for them. And now we want to apply these rules to the regional Banks There's a big difference and we've omitted this difference. If you proceed in this manner: I Think it's very misguided.

it works and you and I worked on this. You recall this, you were a board member and we saw that we needed to have a better playing field to protect and if you all go along with this, it could put many of our regional Banks and small Community Banks out of business. So I want you to with how many bright people we have in the United States this is the people that we have in our Congress insane to me put a smaller and Regional Banks under the same heavy or financial load as your large worldwide Banks Tell me no, we're not planning that we um, we believe strongly and always have in tailoring uh to address the the different size and risk characteristics of financial institutions and certainly, uh, nothing like that for the Regionals that they won't have anything like what the what the very large, most systemically important banks have in terms of overall regulation. Yeah, because I Remember clearly you and I were back I think we were on this side then talking about this in this same committee room and you worked with us on that I'm glad to hear that uh, where's that coming from I mean it's is a concern, it's just a rumor.

I've have there been any discussions about removing the Uh playing field and the guard rails we have here, the differentiations and the Uh requirements between the regional Banks Community Banks and your larger Global Banks so there's not nothing to them? Well, I would say this: we were required by the law now and we're doing this. Dodd-Frank actually required us yes, suggested that we should tailor and then the S2155 then required it and anything that we do will reflect appropriate tailoring. All right. So we that's off the board.

we're not going to change and put the smaller and Regional Banks This guy back here definitely is. Closing this long position on the market is like I know Mr Scott Time to go short. All right. Yeah, that's right.

All right, good now let me turn to China I'm really worried about China and right now people may not know it, but China is the world's largest economy in terms of purchasing power Now at our last meeting, I I Talked about this move where we didn't blow the balloon up and this is an example of what I was pointing out. Jonas times expired Jesus when I recognize the chair of the science committee Mr Lucas of Oklahoma for five minutes. Thank you Mr Chairman Chairman: Powell I'd like to follow up on the topic of capital standards one of those things we've discussed many times together. As you know, commodity markets have been has seen significant volatility in the last few years, and during times of tremendous economic uncertainty like we've seen, end users turn to the markets to hedge risk, particularly those in the Agriculture and the energy sectors.

And I know that the FED It's early in the review process of potential changes in capital requirements. Can you? uh, well, I'll ask anyway. Can you commit to ensuring that these changes will not increase the cost for banks providing those commodity derivatives to end users? I That's a really specific can I Can I go look at that? I mean I'm not actually sure that that the work even addresses that. so um, fair point to come back to you on that.

and that particular response makes me feel better because after all, those products are very important to my folks and make a great deal of difference in how they're able to address their issues. So as you discussed earlier, and as you've consistently assured, the Fed's not a climate making policy maker, you and I have talked about this issue again many times in the past. However, I'm concerned that the FED could be heading in that direction and could be laying the groundwork for climate-related stress tests that would reduce access to capital for entire sectors of the economy. This would also open up the Federal Reserve potentially the political pressure Force the FED In fact, to make policy decisions related to climate change we've seen for example, this Administration turned to Regulators to impose climate policy as an alternative to the legislative process Chairman: Powell How careful are you in ensuring that the FED does not Place itself into the climate debate and how can Congress ensure that the Fed's regulatory toolkit is not? We just got warped in the confirmation on Lower highs and going to retest the moving average on NASDAQ I Think we do have a narrow but real role there, which is around Bank supervision, making sure the banks understand and can manage their their risks over time from climate.

I Think my colleagues and I all understand that it's a it's a tightly circumscribed role that we're playing and that we we're not looking to uh, you know, move into an area where we come where we're actually becoming a climate policy maker. I Would completely agree with you though that over time that border needs to be very carefully guarded and I I will tell you that I will I will do that as long as as long as I'm at the Board of Governors I Very much appreciate that because again, it's a very important issue with our district of Oklahoma traditional production, agriculture, oil and gas and The actions that the FED takes have a significant impact back home. So it's vital that we resist the demands to do that sort of thing now or in the future. And I very much appreciate that response.

and with that, I'll give you back the balance of my time Mr Chairman, Tell me, yields back So I am looking at the one minute time frame for the person that asks and again, if it's not too much to ask, if you guys are enjoying this live stream I Hope that you guys can consider dropping a thumbs up and subscribing. As of course, we appreciate it to update us. Uh, last week, the Treasury Department announced that leaders from Treasury would begin to meet regularly with leaders from the Fed and and from the White House to discuss a possible Cbdc Central Bank Digital currency and other payment Innovations In the statement it was mentioned and I'll quote from it, it said that the FED is encouraged to provide periodic public updates as it continues its research and its technical experimentation. On Central Bank Digital currencies I Was wondering uh, first of all, when you might be expecting to share some of these public updates uh, What's the timing on that we did go out for for comment uh in general, uh, on a Cbdc a year or so ago and I do expect we'll go out I don't I can't give you a date, but we'll certainly go out and you know, engage.

We We engage with the public on an ongoing basis. Yeah, we're also doing research on policy and also on technology. That's what we're up to. I'm aware of the the Boston Fed has a partnership there.

Uh, the the Uh Hamilton project over there with the folks from MIT uh Media Lab that doing a great job. But you know it says here that the discussions would include uh, technical experimentation. I Was just wondering at what level are you talking about making decisions on architecture For a Cbdc? A retail? We're not. We're not at the stage of making any real decisions.

What we're doing is experimenting in kind of early stage experimentation. How would this work? Does it work? What's the best technology? What's the most efficient really? At an early stage on, but we're making progress on sort of technological issues. The policy issues were equally important. though.

you know we haven't decided that this is something that the financial system in the country want or need, right? So that's going to be very important, right? Well, I think I speak for the Chairman as well. Uh, would love to have more dialogue with the FED on on that and maybe bring in the folks from MIT as well. and just make sure that Congress and this committee is as up-to-date as uh as others. Uh, let me switch over to Uh Fed.

Now there's some champions of digital currency and stable coins in particular that uh continue to cite the need for faster Payment Systems. However, as Uh was earlier mentioned, the FED Now is a service that the FED is working on to finalize. It will allow for instant payments between bank accounts and the FED has a Target release date of off Fed Now between May and July which is right around the corner. Uh, do you see any reason why cryptocurrencies would provide faster payments than the FED Now system? And with this offer with the transparency of Fed Now, would it offer Uh distinct advantages over some of these stable coins that are touting faster payments? What Fednow will do is it will enable all the banks any Bank in the United States not just the big ones to offer instant, you know, instantly available funds and real-time payments to their customers.

That's that's what it will do. So that's that's a great thing. You know, a Cbdc? you I think you're asking whether whether a Cbdc would serve some of that, but a CD Cbdc I Personally, don't think that question's too important. I Wanted to take the time and quickly ask you guys, um on Friday there's the ADP Uh for just the economic report.

Just while I have you guys here on Friday the series of economic reports one hour before the Market opens. there are non-farm payrolls and unemployment rate. This is probably one of the most important reports that are that is going to be released this week. I Wanted to ask you because the market is going to react either very good or very bad.

There should not be an in-between This is what caused the market to sell off last month. I Wanted to ask you we do not have to I'm thinking of hosting a free live session to give you guys a taste of what it's like to watch me trade live every morning. I'm thinking of hosting it after those reports are released. Market's probably going to be very volatile I'll leave it up to you guys right now.

we're at 1600 likes. It's not going to be right away, but it's something to work towards. If this video gets over 3 500 likes I Would be more than happy to host that free live session. I'll leave it up to you guys subscribe to the channel.

Make sure you drop a thumbs up and if you have any questions I Hope that you know that there's two ways to message me. One is via Discord and one is via Instagram and that's the first or third link in the description down below. And yes, you could reach out to me at any time. If you have any questions about joining my team about the live trading sessions about you know you getting started there.

There's no excuses on why you shouldn't reach out to me if you have specific question and again I'd be more than happy to host that live stream I Just want to make sure enough people show up. So again, potential free live session on Friday right at Market open after the non-farm payrolls and the unemployment rate is released. I'll leave it up to you guys. Get the video to over 50 uh 3 500 likes going from Missouri Mr Luke Meyer is recognized for fun events The chair of the National Security subcommittee thank you Mr Chairman thank you chairman for being here this morning.

the reserve currency status of the dollar uh to U.s's enormous financial and Financial Security benefits. In the wake of Russia's unprovoked invasion of Ukraine, the FED took action to prevent the Kremlin from accessing more than 300 billion dollars in reserves roughly half of Russia's reserves. However, this led to an accelerated effort by countries like China to de-dollarize their official foreign exchange reserves. This last week.

There was an article in the Wall Street Journal titled Russia Terms to Yuan in an effort to ditch the dollar. Not only that, but China's President Xi Jinping published for the Settlement of Energy Trip pushed for the settlement injury trades in the Chinese Yuan at a summit with Arab leaders in December. The question is are you concerned about these actions by Russia and China to push to establish different reserves and conduct transactions in non-us dollars. So the Uh, the US dollar is the the widely accepted and really the only serious candidate for for the world's principal Reserve currency.

And that's uh, that's because of our Democratic institutions, our liquid markets, the rule of law, and all those kinds of things and also the fact that the dollar has held its value over time. So other countries um, who are competing on other other Playing Fields may want to. they want to establish different currencies. but really, the dollar is the one that's going to be used more broadly in international Commerce because we have those aspects and other countries don't.

Well, that's true to them. But my question is, are you concerned about the actions of these countries? Uh, because if they they see themselves being challenged or are concerned for instance, if China would invade Taiwan um, you know as Russia invaded Ukraine there were some sanctions put on and I don't disagree with the sanctions. The last time you were here though, Mr Chairman I asked the question because it's an instructive moment for us. The standpoint that knowing that we put sanctions and on on Russia all their different accounts as well as the oligarchs from that country.

Are we thinking about doing the same thing that China when they invade Taiwan And your answer at that point was no. We passed a bill on this Congress on this committee last week to ask the administration basically to start thinking about that In those terms, what kind of uh situations can you come up with? Are you talking to allies? Begin to talk to them to start putting together a list of how you would go about sanctioning the different individuals. The different accounts, things like that. So have you started thinking about that at all yet? Well, let me say the business of sanctions is entirely in the hands of the elected government in the Treasury.

Department We are. We are an implementer as it relates to. Banks That's it. We're going to take your advice on different different aspects of this particular.

Sorry. We're going to take your advice on the different aspects of this. Well I mean honestly, when the sanctions were being put in place, Treasury was doing it. We weren't doing it.

Okay, yeah, I mean that's the way it works. Um, next question. Uh, there was an article again in one of the political newspapers yesterday. I Guess it was.

Um. and it talked about the uh. the problem that we have here with the Fed's balance sheet. It says it now appears similar to the to a hedge fund whose long-term assets are financed by short-term borrowing.

and the bottom line is that it's going to cost money. The FED now has a negative income as a result of having to do this. And so it says here that the FED will simply borrow the money to pay the bills. Is Is this true that we're having the Feds losing money right now as a result of the way you've got your these deadly borrowings that you've started.

You've purchased, uh, structured the place. I would start is that the FED has. You know we we always turn over all of our earnings in every year, we turn them over on an ongoing basis and we've turned over something like 1.2 trillion dollars in earnings just in the last you know, decade or so. So uh, we always know that when you know when we when we raise interest rates okay, you're going to lose money.

Okay, of course. Would you agree with you agree with the point that we have a negative income right now. So this makes my point to my next question. or my concern is a Cpb gets their money to be able to.

Cfpb gets their money to run their agency from the Fed. That's right. So basically there's no money for the FED to pay the CFE EB's bills if this is the case. unless you continue to borrow.

which is basically what's going to happen now is you have to borrow money to be able to pay the the Cfpb's bills. Is that not correct? No, we don't. We don't borrow money. We we issue.

Basically Yes, we can. We can. We don't shut down the FED when we have negative income. Okay, we can pay our bills and we can see my question the next question.

My follow-up question then is do you have any Do you do any accountability or assessing of of the Cpv's spending of these dollars at all? No, we don't So there's been a blank check. You just told me they just got a blank check. They send you a bill, you send them a check. There's no accountability for them.

I Think there are limits built into the log which I don't have in the in the front of my head I have yet to see a limit Mr Chairman I'd love to see what the limits are because I don't think that they've ever agreed that they have that. but I See, my time is up Mr Chairman I Yield back. It's almost time is expired. We'll now go to Mr Foster the ranking member of the Financial Institutions Monetary Policy Subcommittee.

Um, thank you and just a quick comment. I Think it's a mistake to imagine that you can completely hide from the macroeconomic effects of technology and your scenario planning. You know, if you we just talk briefly about health care costs. you know, obesity, half of our health care costs.

and there are treatments in these Glp-1 receptor Agnes the agonists that look like they're just a home run against obesity and so these will be near-term impacts which on which will have macroeconomic effects. So just just a comment. I Hope you have a certain fraction of futurists in the room when you're talking about your scenario planning, because a lot of that future is like now. Okay, back to economics.

Um, so we have this historically low unemployment rate. you know, 3.4 percent and historically this would be considered to drive runaway inflation. You know