Week InReview
Friday | Jul 15, 2022
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The highest inflation in a generation continues to buffet both the world economy and financial markets. In the US, President Joe Biden is risking a disconnect with the American public after playing down a 9.1% annual inflation rate as out of date because it fails to reflect a recent drop in fuel prices. In markets, meanwhile, investors are fleeing to the dollar as a safe haven with worries that a global wave of interest-rate hikes to fight price pressures will choke economic growth. That’s taken a gauge of the greenback’s strength to a record high. The prevailing gloomy mood leaves stocks in Asia facing a choppy start on Friday.
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The Federal Reserve said price increases remained “substantial” across the US in recent weeks though some areas saw signs that inflation is cooling, amid indications of a slowdown in demand and rising worries of a recession. While economic activity “expanded at a modest pace, on balance, since mid-May,” several Fed regions “reported growing signs of a slowdown in demand,” and some contacts noted “concerns over an increased risk of a recession,” the Fed said Wednesday in its Beige Book, typically published two weeks before each meeting of the policy-setting Federal Open Market Committee. (Bloomberg Markets - Economics | Jul 13)
Michael Barr was confirmed by the US Senate on Wednesday as the top bank watchdog at the Federal Reserve, allowing President Joe Biden to further put his stamp on Wall Street oversight. Barr, a former senior Treasury Department official who played a key role in shaping the 2010 Dodd-Frank Act, received bipartisan support for the job, with a 66-28 vote. The Fed vice chair for supervision position has been vacant since late last year. (Bloomberg Markets | Jul 13)
The Securities and Exchange Commission on Wednesday advanced a pair of measures intended to make it slightly easier for investors to weigh in on the affairs of public companies. Separately, SEC Chair Gary Gensler expressed doubt Wednesday that negotiators in Washington and Beijing will reach an agreement over audits that is necessary to prevent Chinese companies from being delisted by U.S. stock exchanges. (The Wall Street Journal | Jul 13) see also SEC weighs waiving some rules to regulate crypto, Gensler says (Bloomberg Markets - Crypto | Jul 14)
A closely watched signal of recession risk in Treasury markets on Wednesday hit its most extreme level in more than 20 years, as hotter than expected inflation data fuelled investor bets that the Federal Reserve will aggressively raise interest rates. The yield on the two-year Treasury note, which is particularly sensitive to short-term rate expectations, rose 0.09 percentage points to 3.13 per cent after data showed the annual rate of US consumer price inflation hit 9.1 per cent last month. Yields rise when prices fall. (Financial Times | Jul 13)
Treasury Secretary Janet Yellen embarked on an international lobbying blitz for a proposal she says will stave off a global recession, working to address technical and diplomatic challenges to her plan to cap the price of Russian oil. The goal of the proposed price cap, which Ms. Yellen has been championing for months, is twofold: bring energy prices down by keeping Russian oil flowing to the global market and limit the revenue Russia derives from the sales. (The Wall Street Journal | Jul 11)
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US Treasury gets first response to query on trading transparency |
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(Jul 14) — The US Treasury Department received this week its first response to its request for comments on possible steps to increase transparency for secondary-market transactions in Treasury securities, as well as possible benefits or risks of such a move.
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The Program on International Financial Systems responded to Treasury Secretary Janet Yellen’s inquiry by presenting her with a copy of a June report they published on ways to enhance Treasury market structure
- In the report, the group concluded that “post-trade transparency in cash Treasury markets is lacking” and that “real-time post-trade transparency for other financial markets has consistently increased liquidity, reduced transaction costs and enhanced price efficiency in those markets”
- Therefore “US policymakers should mandate comprehensive real-time post-trade transparency for cash Treasury markets,” they advised
- PIFS hosts events and training on regulation and issues affecting financial markets
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For RFI response landing page, click here
Source: Liz Capo McCormick | Bloomberg Government
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Photo: Mads Perch | Getty Images |
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A new attack can unmask anonymous users on any major browser
Researchers are warning this week about a novel technique attackers could use to de-anonymize website visitors and potentially connect the dots on many components of targets’ digital lives. The findings show how an attacker who tricks someone into loading a malicious website can determine whether that visitor controls a particular public identifier, like an email address or social media account, thus linking the visitor to a piece of potentially personal data.
Log4j to persist as ‘endemic’ risk for years to come, U.S. government board finds
A major cybersecurity bug detected last year in a widely used piece of software is an “endemic vulnerability” that could persist for more than a decade as an avenue for hackers to infiltrate computer networks, a U.S. government review has concluded. The flaw – identified within versions of a common bit of code known as Log4j – has so far been less significant than initially feared, according to a report summarizing the review’s findings released Thursday.
How mercenary hackers sway litigation battles
A trove of thousands of email records uncovered by Reuters reveals Indian cyber mercenaries hacking parties involved in lawsuits around the world — showing how hired spies have become the secret weapon of litigants seeking an edge. The email trove provides a startling look at how lawyers and their clients are targeted by cyber mercenaries, but it leaves some questions unanswered. The list doesn’t show who hired the spies, for example, and it wasn’t always clear whether the hacking was successful or, if so, how the stolen information was used.
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Illustration: Sol Cotti | WSJ |
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Five new financial jobs of the future
NFT appraiser? Financial-bot supervisor? Money and possessions are evolving in an increasingly digital and virtual world. Many jobs, including those in finance, will need to change just to keep up. This week's The Future of Everything looks at some of the new roles that those in the industry see emerging.
Sleep patches are the hotel amenity we've all been waiting for
Guaranteeing good sleep, especially amid the ultrastressful environs of today’s travel climate, is no small feat. Even before factoring jet lag in, recent findings from the Sleep Foundation show that up to 48% of American adults suffer from some form of insomnia. Check into an Eiffel Tower-facing suite at the Peninsula Paris or the old Hollywood digs of the Peninsula Beverly Hills and you’ll find a whole slate of new amenities that range from wellness concierges to in-room fitness gear. But the one that most caught my attention comes with turndown service, placed in an envelope on your pillow.
This simple system will streamline your jumble of apps, tabs, and eMail to boost productivity
The conscious and active pursuit of a productive and healthy life invariably includes reflection, self-examination, and experimentation. From time to time we should look at our systems and tools and evaluate them for just how well they are serving us in our work. And if a hot new life hack lands and takes the town by storm, why not try it? Here's a new method for organizing your entire digital life, and the new philosophy it’s based on.
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