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Non-banks present huge stability risks
Asked about lofty equity prices at his June Federal Open Market Committee press conference, Federal Reserve Chair Jerome Powell responded that the central bank is focused on its dual mandate. He added that the Fed pursued financial stability, concluding that the banking system is much better capitalised and more liquid and has been ‘a source of strength’ through the pandemic. At end-June, the Financial Stability Board published its report on the evaluation of the effects of too-big-to-fail reforms. The FSB rightly found that these reforms have made banks more resilient and resolvable, and their benefits ... (full story)