The Banker Next Door

BND: Strategy Room 8-25-2024

This was a Live Stream on Podbean for the podcast audience. This episode provides a weekly update on U.S. banking industry news.

Episode 208: Its official, BLS cooking the jobs numbers!

This episode looks at the stunning revisions this week in reported employment numbers from the Bureau of Labor Statistics (BLS). This was the largest downward revision in 15 years! And one of the largest downward revisions in history at over 800,000 jobs! This report confirms what some have been suspecting for the last 18 months, that BLS has been manipulating the employment data to make the labor force appear stronger than it actual is. Several recent articles are reviewed from Bloomberg, The Wall Street Journal, and CNBC. Links to all three are included below.
Link: Fed Confronts Up to a Million US Jobs Vanishing in Revision - Bloomberg
Link: Jobs Report Revision: U.S. Job Growth Weaker Than Initially Reported, Data Show - WSJ
Link: Nonfarm payroll growth revised down by 818,000, Labor Department says (cnbc.com)

Episode 207: U.S. Treasury is manipulating interest rates!

This episode looks at a recent paper issued by Stephen Miran and Nouriel Roubini titled “ATI: Activist Treasury Issuance and the Tug-of-War over Monetary Policy.” The paper was highlighted in a feature article on CNBC titled “Kelly Evans: Is Treasury manipulating interest rates.” Links to both the paper and article is included below. The subject paper details the process with which the U.S. Treasury is effectively enacting quantitative easing to manipulate long-term interest rates. The authors warn that this manipulation has become political and can have dire consequences.  
Link: Kelly Evans: Is Treasury manipulating interest rates? (cnbc.com)
Link: 635102_Activist_Treasury_Issuance_-_Hudson_Bay_Capital_Research.pdf (hudsonbaycapital.com)

Episode 206: What is The Jackson Hole Economic Symposium?

This episode looks at The Jackson Hole Economic Symposium that takes place every year in August in Jackson Hole, Wyoming by the mountains of Grand Teton National Park. This year’s symposium will take place between Thursday, August 22nd and Saturday, August 24th. For over 50 years, The Jackson Hole Economic Symposium has been a major gathering for Federal Reserve officials, economists, academics, and policy makers from around the world. Market watchers always pay close attention to this conference to see what the Federal Reserve is planning for future meetings and monetary policy. What is expected this year? A link to the featured articles is included below.
Link: The Jackson Hole Economic Symposium Starts This Week—Here's What You Need to Know (investopedia.com)

Episode 205: FHFA's new credit scoring requirements

This episode reviews an article from ICBA titled “Ron Haynie & Tim Roy: Deciphering FHFA’s Credit Score Transition.” The Federal Housing Finance Agency (FHFA) has issued new credit scoring requirements for Fannie Mae and Freddie Mac by transitioning from the classic FICO to the FICO Score 10 T and VantageScore 4.0 credit scoring models. Is this a good or bad change? How will this affect you as a consumer trying to get a residential mortgage? A link to the article is included below.
Link: Ron Haynie & Tim Roy: Deciphering FHFA's Credit Score Transition (independentbanker.org)

Episode 204: Review of Bank Director 2024 Governance Best Practice Survey

This episode reviews Bank Director’s 2024 Governance Best Practices Survey and a related Bank Director article titled “2024 Governance Best Practices Survey: Exercising Independence” by Emily McCormick. This annual survey examines board responsibilities, risk oversight, composition, engagement and governance practices. The question is asked can a dominant CEO or board member have a negative impact on their bank? A link to the article and survey are included below.
Link: 2024 Governance Best Practices Survey: Exercising Independence | Bank Director
Link:  2024GovernanceReport-Open-Version.pdf (bankdirector.com)

Episode 203: What is happening in the U.S. labor market?

This episode reviews four articles to get a better understanding of the current U.S. labor market. Is there a white-collar job squeeze? Are half the U.S. online job postings fake? What is the new normal for pay raises? Are the lowest-paid workers the hardest hit as unemployment rises? These are some of the questions we try to address. Links to the articles are included below.
Link: Salary budgets expected to grow in 2025 and workers are slated to get pay raises - The Business Journals (bizjournals.com)
Link: The White-Collar Job Squeeze | The Epoch Times
Link: Why Nearly Half of US Online Job Postings Are Fake | The Epoch Times

Episode 202: How can small banks level the playing field?

This episode reviews an article from Bank Director titled “Three ways smaller banks are leveling the playing field” by Cetin Duransoy. This article lays out three ways that smaller banks and credit unions can effectively compete against the industry behemoths. The three potential solutions include 1) highlight their impact to build consumer confidence, 2) Solutions to combat high compliance and cybersecurity costs, and 3) agility in pricing.
Link: Three Ways Smaller Banks Are Leveling the Playing Field | Bank Director

Episode 201: Is the FDIC proposal on brokered deposits a problem?

This episode reviews several articles from S&P Global Market Intelligence. The first article titled “FDIC proposal would classify more BaaS deposits as brokered, not core." The second article is titled “US elections have potential to reshape fintech regulatory landscape." Both articles were written by Yizhu Wang. The first article addresses the proposed rule from the FDIC that would end a BaaS practice that allows banks to count deposits originated by fintech partners as core and require them to classify the funds as brokered. The second article points out how the outcome of this year's Presidential election can have massive consequences on the regulatory landscape particularly regarding fintech companies.  

Episode 200: Check fraud is a BIG problem!

This episode reviews an article from the ABA banking journal titled “Is it time to kill the paper check?” by Evan Sparks and an article from The Business Journals titled “Big brands are ditching paper checks. Small-business owners might not be able to do the same” by Andy Medici. These articles detail the current usage of checks in the banking system and why fraud with bank checks is so prevalent. Is it time to replace paper checks? Are the alternatives really that great? Is getting rid of checks even feasible? Links to both articles are included below.
Link: How to know if paper checks are still a good payment option - The Business Journals (bizjournals.com)
Link: Is it time to kill the paper check? | ABA Banking Journal