Afleveringen
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Kathryn Judge is a professor at Columbia Law School and Aaron Klein is a Senior Fellow at the Brookings Institution. They discuss the origins of the Federal Home Loan Banks, the role they played in propping up failing banks in the 2023 regional banking crisis, and their ideas for how the FHLBs can be reformed to better fulfill their public mission to promote housing and community development.
Kate Judge’s X: @ProfKateJudge
Aaron Klein’s X: @Aarondklein
Lee’s X: @leereiners
Related Links:
Comment Letter on FHLB Mission Statemen, Kathryn Judge and Aaron Klein: https://www.brookings.edu/wp-content/uploads/2024/07/Klein-Judge-FHLB-mission-statement-comment-FINALpdf.pdf
Forum on the future of the Federal Home Loan Bank system: Highlights from the Brookings and BU Law event, Aaron Klein, Cornelius Hurley, and Harrison Fregeau: https://www.brookings.edu/articles/forum-on-the-future-of-the-federal-home-loan-bank-system-highlights-from-the-brookings-and-bu-law-event/
How to fix the Federal Home Loan Banks, Kathryn Judge and Aaron Klein: https://www.brookings.edu/articles/how-to-fix-federal-home-loan-banks/
FHLBank System at 100: Focusing on the Future, Federal Housing Finance Agency: https://www.fhfa.gov/sites/default/files/2024-01/FHLBank-System-at-100-Report.pdf
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John Coates is the John F. Cogan, Jr. Professor of Law and Economics at Harvard Law School and author of “The Problem of Twelve: When a Few Financial Institutions Control Everything.” According to John, a problem of twelve arises when a small number of institutions acquire the means to exert outsized influence over the politics and economy of a nation. In this episode, John discusses insights from his book and how the concentration of corporate power in the hands of a small group of institutional investors, specifically index funds and private equity funds, undermines our democracy.
Lee’s X: @leereiners
Lee’s Website: www.leereiners.com
Related Links:
The Problem of Twelve: When a Few Financial Institutions Control Everything: https://www.amazon.com/Problem-Twelve-Financial-Institutions-Everything/dp/B0BW67PX7B
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Zijn er afleveringen die ontbreken?
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Art Wilmarth, Professor Emeritus of Law at the George Washington University Law School, reflects on the regional banking crisis of spring 2023 and how decisions made by regulators to resolve Silicon Valley Bank, Signature Bank, First Republic Bank, and Credit Suisse reveal that we have still not solved the Too Big to Fail problem.
Lee’s X: @leereiners
Lee’s Website: www.leereiners.com
Related Links:
The FDIC’s resolution plan for failed megabanks is an empty promise: https://www.americanbanker.com/opinion/the-fdics-resolution-plan-for-failed-megabanks-is-an-empty-promise
Regulators should reject big-bank arguments against stronger capital requirements: https://thehill.com/opinion/4715182-regulators-should-reject-big-bank-arguments-against-stronger-capital-requirements/
We Need a New Glass-Steagall Act to End the Toxic Symbiosis Between Universal Banks and Shadow Banks, Which Professor Corrigan Has More Fully Revealed: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4794680
Statement by Martin J. Gruenberg, Chairman, Federal Deposit Insurance Corporation on Title 1 Resolution Plan Feedback Letters for 8 U.S. GSIBs: https://www.fdic.gov/news/speeches/statement-martin-j-gruenberg-chairman-federal-deposit-insurance-corporation-title-1
Martin J. Gruenberg, Chairman, FDIC Lessons Learned from the U.S. Regional Bank Failures of 2023 Florence School of Banking and Finance: https://www.fdic.gov/news/speeches/martin-j-gruenberg-chairman-fdic-lessons-learned-us-regional-bank-failures-2023
US regulator criticises Swiss handling of Credit Suisse as ‘unhelpful’: https://www.ft.com/content/9fb79310-b8e4-47d8-99cf-a7630eae59e7
FDIC Board of Directors Approves Final Revised Rule to Strengthen Resolution Planning for Large Banks: https://www.fdic.gov/news/press-releases/fdic-board-directors-approves-final-revised-rule-strengthen-resolution-planning
Overview of Resolution Under Title II of the Dodd-Frank Act: https://www.fdic.gov/sites/default/files/2024-04/spapr1024b_0.pdf
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Eric Spitler, former Director of the Office of Legislative Affairs at the FDIC, discusses his paper on the history of bank runs and how he would reform deposit insurance to address the weaknesses revealed by last spring’s regional banking crisis.
Lee’s X: @leereiners
Related Links:
Yelling 'Fire' in the Financial Theater: Bank Runs in the Social Media Age and the Threat to Financial Stability: https://scholarship.law.unc.edu/ncbi/vol28/iss1/5/
The Deposit Insurance Funds as an Early Resolution Tool: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4897571
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Danny Cullenward is a distinguished Senior Fellow with the Kleinman Center for Energy Policy at the University of Pennsylvania. He joined Lee to discuss the current state of voluntary carbon credit markets and efforts in the U.S. and abroad to regulate carbon credits.
Lee’s X: @leereiners
Related Links:
Danny’s website: https://www.ghgpolicy.org/
Webinar: What Role Will Carbon Removal Play Under Article 6 of the Paris Agreement? https://youtu.be/jovH809dhg0?si=e96ktXxTcRcKJvRd
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Sean Vanatta is a lecturer in US Economic and Social History at the University of Glasgow and author of the new book "Plastic Capitalism: Banks, Credit Cards, and the End of Financial Control." Sean sits down with Lee to discuss the history of credit cards in the United States and how this history informs current policy debates, including Capital One’s proposed acquisition of Discover and the Credit Card Competition Act.
Lee’s X: @leereiners
Sean’s X: @SeanVanatta
Related Links
Plastic Capitalism: Banks, Credit Cards, and the End of Financial Control: https://yalebooks.yale.edu/book/9780300247343/plastic-capitalism/
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Jonah Crane, a partner at Klaros Group and former Treasury Department official, breaks down the recent collapse of fintech company Synapse, which has left thousands of customers without access to their funds. Crane also reflects on the regulatory response and the broader impact Synapse’s failure will have on Banking as a Service.
Lee’s X: @leereiners
Jonah’s X: @JonahCrane
Related Links
Klaros Group: https://www.klaros.com/
Does BaaS have a future: https://www.klaros.com/post/does-baas-have-a-future
Nearly $109 million in deposits held for fintech Yotta’s customers vanished in Synapse collapse, bank says: https://www.cnbc.com/2024/06/21/synapse-collapse-nearly-109m-in-yotta-customer-deposits-vanish.html
Abrupt shutdown of financial middleman Synapse has frozen thousands of Americans’ deposits: https://apnews.com/article/synapse-evolve-bank-fintech-accounts-frozen-07ecb45f807a8114cac7438e7a66b512
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Prometheum is the one firm that other crypto firms love to hate. This is because the firm’s founders and co-CEOs, brothers Aaron and Ben Kaplan, have consistently and publicly argued that most cryptocurrencies are investment contracts subject to SEC registration requirements. In this episode, Aaron Kaplan joins Lee to discuss the process Prometheum followed to receive regulatory approve to operate an alternative trading system and special purpose broker dealer, which allows the firm to offer trading, clearing, settlement, and custody of digital asset securities. Aaron also addresses the frequent criticisms leveled at his firm and offers his thoughts on the future of the digital asset industry.
Lee’s Twitter: @leereiners
Related Links
*Prometheum Receives First of Its Kind Approval From FINRA to Clear and Settle Digital Asset Securities: https://www.businesswire.com/news/home/20240110419249/en/Prometheum-Receives-First-of-Its-Kind-Approval-From-FINRA-to-Clear-and-Settle-Digital-Asset-Securities
*Prometheum Announces Custodial Services for Ether (ETH), Opens Account Sign Up For Institutional clients: https://www.businesswire.com/news/home/20240207966185/en/Prometheum-Announces-Custodial-Services-for-Ether-ETH-Opens-Account-Sign-Up-For-Institutional-Clients
*SEC may be forced to declare Ethereum a security after controversial new launch: https://fortune.com/crypto/2024/02/07/sec-prometheum-ethereum-broker-dealer-gary-gensler-coinbase/
*Blockchain Association Calls for Investigation into SEC Approval of Prometheum Ember Capital as Special Purpose Broker-Dealer: https://theblockchainassociation.org/blockchainassociation-calls-for-investigation-into-sec-approval-of-prometheum-ember-capital-as-special-purpose-broker-dealer/
*‘Crypto Communism’? Not in America: https://www.wsj.com/articles/prometheum-digital-asset-crypto-china-wanxiang-tuberville-eab5629b
*U.S. Senator Tuberville Asks DOJ, SEC to Investigate Crypto Broker Prometheum:
https://www.coindesk.com/policy/2023/07/10/us-senator-tuberville-asks-doj-sec-to-investigate-crypto-broker-prometheum/
*Testimony of: Aaron Kaplan Co-CEO and Founder, Prometheum, Inc. Before the U.S. House of Representatives Financial Services Committee: https://docs.house.gov/meetings/BA/BA00/20230613/116085/HHRG-118-BA00-Wstate-KaplanA-20230613.pdf
*Agriculture, Financial Services Republicans Demand Sec Clarify Position Regarding Prometheum’s Custody Of Ethereum’s Ether: https://agriculture.house.gov/news/documentsingle.aspx?DocumentID=7749
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Well Fargo was an iconic and respected American Brand. But then, in September 2016, in a settlement with the City of Los Angeles, the OCC, and CFPB, it was revealed that approximately 5,300 Wells Fargo employees had been terminated between 2011 and 2016, for sales practice violations that included opening over two million unauthorized deposit and credit card accounts. Earlier this year, Kevin Wack published a 5-part series in the American Banker that shed new details on the scandal. Kevin came on the show to talk about how the series came together and what his reporting uncovered. He also provides an update on what has happened to some of the senior executives involved in the scandal and shares his thoughts on the enduring lessons the Wells Fargo scandal provides.
Leave questions and comments at [email protected]
Lee’s Twitter: @leereiners
Related Links
*Alarm bells, arrogance and the crisis at Wells Fargo: https://www.americanbanker.com/news/alarm-bells-arrogance-and-the-crisis-at-wells-fargo
*How Wells Fargo's Aggressive Sales Culture Took Root: https://www.americanbanker.com/news/how-wells-fargos-aggressive-sales-culture-took-root
*Wells Execs Stuck to the Script as Evidence of Sales Abuses Mounted: https://www.americanbanker.com/news/wells-execs-stuck-to-the-script-as-evidence-of-sales-abuses-mounted
*Deal to put ex-Wells Fargo executive behind bars sends tough message: https://www.americanbanker.com/news/deal-to-put-ex-wells-fargo-executive-behind-bars-sends-tough-message
*The Rise and Fall of Wells Fargo with Dick Kovacevich: https://open.spotify.com/episode/7f2D7PL9ZM1zLlnNCneK0L
*Wells Fargo Unauthorized Account Openings: A Case Study for Bank Board Directors: https://sites.duke.edu/thefinregblog/2017/04/26/phony-accounts-scandal-a-case-study-for-bank-board-directors/ -
James Wigginton has thought deeply about economic power and the role cooperatives can play in ensuring Web3 lives up to its stated potential of sharing ownership with users in digital networks. James joins Lee to discuss how cooperatives can be used by Web3 firms to engage with their users, strengthen digital networks, and remain compliant with securities laws. James also talks about the potential for sports fans to own a part of their favorite teams by allowing cooperatives to take minority stakes in teams.
Leave questions and comments at [email protected]
Lee’s Twitter: @leereiners
Related Links
*Cooperatives: An Ownership Model for Digital Networks: https://media.orrick.com/Media%20Library/public/files/insights/2023/cooperatives-path-to-compliance-for-web3.pdf
*Can fan-owned cooperatives change the relationship between fans and owners for the better? https://theathletic.com/4783026/2023/08/17/fan-cooperatives-sports-ownership/?access_token=13946098
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Alicia Seiger is a lecturer at Stanford Law and the managing director of Stanford’s Sustainable Finance Initiative. And Marc Roston is the founder of investment advisory firm MNR Capital and a senior research scholar at Stanford University’s Steyer-Taylor Center for Energy Policy and Finance. In this episode, Alicia and Marc offer their perspective on the problems with the current method of corporate carbon counting, known as the Greenhouse Gas Protocol. They also break down a new carbon accounting methodology they’ve developed called Emissions Liability Management, or ELM.
Leave questions and comments at [email protected]
Lee’s Twitter: @leereiners
Related Links
*Carbon Accounting and Emissions Liability Management:
https://sfi.stanford.edu/carbon-accounting-and-emissions-liability-management
*Settling Climate Accounts: Navigating the Road to Net Zero:
https://link.springer.com/book/10.1007/978-3-030-83650-4
*Accounting for Climate Change: https://hbr.org/2021/11/accounting-for-climate-change -
Tony McLaughlin is Managing Director for Emerging Payments & Business Development at Citi Treasury & Trade Solutions. In this episode, Tony offers his thoughts on the latest developments in payments, including stablecoins, central bank digital currency, and FedNow. He also breaks down an exciting new project he’s been working on, called the Regulated Liability Network (RLN). RLN envisions a regulated Financial Market Infrastructure that could deliver an interoperable network of all facets of the sovereign currency system: central bank money, commercial bank money, and e-money (and in the future, regulated stablecoins).
Leave questions and comments at [email protected]
Lee’s Twitter: @leereiners
Related Links
*The Regulated Liability Network Whitepaper https://regulatedliabilitynetwork.org/wp-content/uploads/2022/11/The-Regulated-Liability-Network-Whitepaper.pdf
*Regulated Liability Network U.S. Proof of Concept Findings https://www.rlnuspoc.org/home#subpage/introduction/section/w3rk7
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Joe Davis is chief economist at Vanguard as well as the global head of Vanguard Investment Strategy Group. In this episode, Joe offers his thoughts on what’s driving inflation, how the Federal Reserve is likely to respond at their upcoming policy meeting and beyond, and how investors can insulate their portfolio from inflations pernicious effects. Joe and Lee also reflect on key lessons learned from the last 15 years of economic policymaking.
Lee’s Twitter: @leereiners
GFMC Twitter: @DukeGFMC
Related Links
*Ukraine and the Changing Market Environment* Vanguard https://advisors.vanguard.com/insights/article/ukraineandthechangingmarketenvironment
*Why Do We Think That Inflation Expectations Matter for Inflation? (And Should We?)* Jeremy B. Rudd
https://doi.org/10.17016/FEDS.2021.062
*Will Inflation Stay High for Decades? One Influential Economist Says Yes* Wall Street Journal https://www.wsj.com/articles/inflation-high-forecast-economist-goodhart-cpi-11646837755
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Ari Redbord is the head of legal and government affairs for the blockchain intelligence firm, TRM Labs. Prior to joining TRM Labs, Ari held public sector roles involving cryptocurrency and national security at the Department of Justice and U.S. Department of the Treasury. In this episode, Ari and Lee break down President Biden’s executive order on cryptocurrency.
Ari Redbord’s Twitter: @ARedbord
TRM Labs Twitter: @TRMLabs
Lee’s Twitter: @leereiners
GFMC Twitter: @DukeGFMC
Related Links
*Executive Order on Ensuring Responsible Development of Digital Assets* https://www.whitehouse.gov/briefing-room/presidential-actions/2022/03/09/executive-order-on-ensuring-responsible-development-of-digital-assets/
*FACT SHEET: President Biden to Sign Executive Order on Ensuring Responsible Development of Digital Assets* https://www.whitehouse.gov/briefing-room/statements-releases/2022/03/09/fact-sheet-president-biden-to-sign-executive-order-on-ensuring-responsible-innovation-in-digital-assets/*Background Press Call by Senior Administration Officials on the President’s New Digital Assets Executive Order* https://www.whitehouse.gov/briefing-room/press-briefings/2022/03/09/background-press-call-by-senior-administration-officials-on-the-presidents-new-digital-assets-executive-order/
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Barbara Haya directs the Berkeley Carbon Trading Project. Barbara joins Lee to explain what carbon offsets are and the considerations that must be addressed to ensure that offset credits entering into commerce reflect real, verifiable reductions in greenhouse gas emissions. Specifically, Barbara details why most offset programs issue more credits than they should, and recent policy efforts to bring greater integrity to the voluntary offset market.
Barbara’s Twitter: @Barbara_Haya
GFMC’s Twitter: @DukeGFMC
Lee’s Twitter: @leereiners
Related Links:
*POLICY BRIEF: The California Air Resources Board’s U.S. Forest offset protocol underestimates leakage* by Barbara Haya https://gspp.berkeley.edu/faculty-and-impact/working-papers/policy-brief-arbas-us-forest-projects-offset-protocol-underestimates-leaka
* Measuring Emissions Against an Alternative Future: Fundamental Flaws in the Structure of the Kyoto Protocol’s Clean Development Mechanism* by Barbara Haya https://gspp.berkeley.edu/faculty-and-impact/working-papers/measuring-emissions-against-an-alternative-future-fundamental-flaws-in-the-
Barbara Haya directs the Berkeley Carbon Trading Project. Barbara joins Lee to explain what carbon offsets are and the considerations that must be addressed to ensure that offset credits entering into commerce reflect real, verifiable reductions in greenhouse gas emissions. Specifically, Barbara details why most offset programs issue more credits than they should, and recent policy efforts to bring greater integrity to the voluntary offset market.
Barbara’s Twitter: @Barbara_Haya
GFMC’s Twitter: @DukeGFMC
Lee’s Twitter: @leereiners
Related Links:
*POLICY BRIEF: The California Air Resources Board’s U.S. Forest offset protocol underestimates leakage* by Barbara Haya https://gspp.berkeley.edu/faculty-and-impact/working-papers/policy-brief-arbas-us-forest-projects-offset-protocol-underestimates-leaka
* Measuring Emissions Against an Alternative Future: Fundamental Flaws in the Structure of the Kyoto Protocol’s Clean Development Mechanism* by Barbara Haya https://gspp.berkeley.edu/faculty-and-impact/working-papers/measuring-emissions-against-an-alternative-future-fundamental-flaws-in-the-
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Jeremy Kress is Assistant Professor of Business Law at Michigan Ross and Co-Faculty Director of the University of Michigan’s Center on Finance, Law & Policy. Jeremy joins Lee to discuss how policymakers’ long-standing approach to bank antitrust—premised on consumer welfare—has reduced the cost and availability of basic financial services and ignores numerous non-price harms stemming from bank consolidation. Jeremy details how the Chicago school of antitrust and its focus on consumer welfare came to dominate bank merger review, the impact of fintech on bank competition, and recent policy actions that foreshadow a more stringent review of bank mergers going forward.
Jeremy’s Twitter: @Jeremy_Kress
GFMC’s Twitter: @DukeGFMC
Lee’s Twitter: @leereiners
Related Links:
* Modernizing Bank Merger Review* by Jeremy Kress https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3440914
* Reviving Bank Antitrust * by Jeremy Kress https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4039197
* Executive Order on Promoting Competition in the American* https://www.whitehouse.gov/briefing-room/presidential-actions/2021/07/09/executive-order-on-promoting-competition-in-the-american-economy/
* Antitrust Division Seeks Additional Public Comments on Bank Merger Competitive Analysis* U.S. Department of Justice https://www.justice.gov/opa/pr/antitrust-division-seeks-additional-public-comments-bank-merger-competitive-analysis
* Request for Public Comment on the Bank Merger Act* Joint Statement of Martin J. Gruenberg and Rohit Chopra, Members, FDIC Board of Directors https://files.consumerfinance.gov/f/documents/cfpb_bank-merger-act-rfi_joint-statement_2021-12.pdf
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Mike Bloomberg is the Public Infrastructure Fellow at the NewCities Foundation and a Visiting Researcher with the Urban Tech Hub at Cornell Tech. In this episode, he examines the dark side of U.S. cities embracing cryptocurrency. Mike and Lee discuss how MiamiCoin and NYC Coin actually work, the nebulous legal relationship between these coins and the cities of Miami and New York, and why anyone would bother purchasing or mining these coins. They also discuss the legal and regulatory risks mayors are taking on by embracing crypto.
Mike’s Twitter: @BloombergME
GFMC’s Twitter: @DukeGFMC
Lee’s Twitter: @leereiners
Related Links:
CityCoins Website: https://www.citycoins.co/
*Money for nothing: Cities’ crypto push draws fans, critics* Associated Press: https://apnews.com/article/cryptocurrency-business-new-york-miami-coin-f076e0e8b80adf74fdeebaeae9188e70
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Jay Brown and Kathleen Hamm are former board members of the Public Company Accounting Oversight Board, or PCAOB. Jay and Kathleen join Lee to discuss the origins of the PCAOB and the ongoing challenges the agency faces. Specifically, they discuss the role of auditors in overseeing non-financial reporting such as ESG disclosure, the difficulty in getting US-listed Chinese companies to comply with American auditing standards, and whether PCAOB standards adequately reflect the risks of a cyber incident at issuers or at the auditors themselves.
Jay’s Profile: https://www.law.du.edu/about/people/j-robert-brown-jr
Kathleen’s Profile: https://en.wikipedia.org/wiki/Kathleen_Hamm
GFMC’s Twitter: @DukeGFMC
Lee’s Twitter: @leereiners
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On January 20th, the Federal Reserve released a discussion paper that examines the pros and cons of a potential U.S. central bank digital currency, or CBDC. In this episode, Marcelo Prates joins Lee to breakdown the paper’s findings and the future of CBDCs in the U.S. and elsewhere. Marcelo is a lawyer at the Central Bank of Brazil and a columnist at cryptocurrency news site, Coindesk.
Marcelo’s Twitter: @MarceloMPrates
Related Links:
*Money and Payments: The U.S. Dollar in the Age of Digital Transformation*, the Federal Reserve Board. https://www.federalreserve.gov/publications/money-and-payments-discussion-paper.htm*No Reason to Fear Central Bank Digital Currencies* by Marcelo Prates
https://www.coindesk.com/policy/2021/05/17/no-reason-to-fear-central-bank-digital-currencies/
* Legal troubles may delay CBDCs* by Marcelo Prateshttps://www.omfif.org/2021/02/legal-troubles-may-delay-cbdcs/
*CBDC: A Solution in Search of a Problem?* by Federal Reserve Board Governor Christopher Waller https://www.federalreserve.gov/newsevents/speech/waller20210805a.htm -
Art Wilmarth is Professor Emeritus at The George Washington University Law School. In this episode, Art discusses his new paper, “It’s Time to Regulate Stablecoins as Deposits and Require Their Issuers to Be FDIC-Insured Banks.” Specifically, Art explains why he believes that stablecoin issuers and distributors should be required to become FDIC-insured banks and the other steps he would like to see financial regulators take in the interim, including having the SEC use its existing authority to regulate stablecoins as “securities” and having the Department of Justice designate stablecoins as “deposits” and bring enforcement actions to prevent issuers and distributors of stablecoins from unlawfully receiving “deposits” in violation of Section 21(a) of the Glass-Steagall Act.
Related Links:
Art’s profile: Arthur E. Wilmarth, Jr. | GW Law | The George Washington University (gwu.edu)
It’s Time to Regulate Stablecoins as Deposits and Require Their Issuers to Be FDIC-Insured Banks: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4000795
President’s Working Group on Financial Markets Report on Stablecoins: https://home.treasury.gov/news/press-releases/jy0454
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