Central banking is at a crossroads. From inflation and dollar dominance to executive orders and rapid financial innovation, the Fed faces no shortage of challenges. In this episode, Bill Dudley joins host Emily Slater to discuss how the Fed and other central banks are navigating these pressures, what to expect from the September FOMC, and what central bank independence really means in today’s global economy.
Bill Dudley is the Chair of the Bretton Woods Committee. He previously served as the president and chief executive officer of the Federal Reserve Bank of New York, during which time he was the vice chairman and a permanent member of the Federal Open Market Committee.
Stream Macro Matters on all major podcast streaming platforms
Apple Podcasts | Spotify | Amazon Music / Audible | iHeartRadio | YouTube
Transcript:
Slater: Welcome to Macro Matters, a podcast where global experts offer clear-eyed analysis on global economic policy. I’m your host, Emily Slater, Executive Director of the Bretton Woods Committee. Each episode, I sit down with BWC’s diverse network of members, from global policymakers to private sector leaders, to discuss timely topics in economics, geopolitics, and finance. In a media landscape full of noise, these conversations offer clarity. We go beyond the headlines to explore not just what’s happening in the global economy, but why it’s happening, what it means, and what might come next.
Welcome everyone. Welcome back to the Macro Matters podcast of the Bretton Woods Committee. We’re really looking forward to diving in today on what’s been a pretty hot topic lately, and something that’s really been in focus and we’re going to be discussing today, the future of the Fed. We are kind of coming off the heels of the Jackson Hole summit and we are looking ahead to the September FOMC meeting of the U.S. Federal Reserve. So really the U.S Fed has been kind of dominating global headlines lately. Markets, policy makers, and the general public are all kind of anxiously awaiting and watching as the Fed has been navigating as kind of a host of challenges recently. Obviously lingering inflation, the impacts of tariffs, the evolving role of the US dollar as the global reserve currency, and really some increasing scrutiny over the independence of central banks, particularly the Fed.
At the same time, financial innovation has been accelerating rapidly. We have new legislation on stable coins here in the U.S. that has kind of sparked a lot of global interest as well. And, you know kind of on that same policy front, I think the U.S. is also starting to look forward and think through its regulatory or deregulatory agenda, kind of beyond digital, in terms of traditional banking and financial services. So, we’re all kind of looking at the Fed to see how they will be navigating this and how other central banks around the world are going to be navigating this environment. So, we’re going to be talking about all of this today.
And we have, I think probably one of the most respected voices on monetary policy, financial stability, and central banking, joining us today. He just so happens to also be the chair of the Bretton Woods Committee. So let me please introduce, Bill Dudley, who has, of course, served as the president and CEO of the Federal Reserve Bank of New York, where he was vice chairman and a permanent member on the Federal Open Market Committee. He was also chairman of the Committee on the Global Financial System and the Committee on Payment and Settlement Systems at the BIS. So, no one better to dive into this today with us than Bill. So, Mr. Dudley, why don’t we get into it?
First and foremost, we talked about, you know kind of Chairman Powell has really been under, I think, a lot of pressure from this administration, from the president in particular. It’s no secret that the president’s been, I think, very forthright in some of his comments about what he would like to see the Fed do, and especially in terms of interest rates, we’ve also now recently seen, you know an attempted, possible removal of an additional Fed governor, given some, potential mishandlings of some mortgage applications and what’s going on with Lisa Cook. So, you know kind of against this backdrop, Bill, why is central bank independence important? Why do we have this model and why do we need to maintain it?
Dudley: So let me first start with what we mean by central bank independence because a lot of times, I think that’s misconstrued. Central bank independence does not mean that the central bank gets to do whatever they want. It means that the central bank can implement monetary policy to achieve the objectives set for it by the legislature and the executive branch. So, in the case of the United States, Congress passed the Humphrey Hawkins Act in 1977, and basically said the Fed, your job is to achieve price stability, and full of maximum employment. That’s, those are your two goals, and then the independence part is how you actually achieve those goals. So that’s really what the independence is about, and it doesn’t mean that the Fed can, doesn’t have to explain themselves. They do have to explain themselves, that’s important for their credibility, and they do that through speeches, testimony, the FOMC minutes, transcripts to the minutes are released in a, with a 5 year length, so whole host of ways of communicating, not only here’s what we’re doing, here’s why we’re doing, here’s the motivation for what we’re doing, that helps sustain the Fed’s credibly.
So, the question then is why is this independence important? Well, the reason independence is important is we want central banks to set monetary policy based on what’s best to achieve the objectives set for it by the legislature. So, in the United States’ case, price stability and full employment. And the best way to do that is to take a medium-to-long-term view about what monetary policy should best be set to achieve those objectives, rather than a short-term electoral cycle view. If the administration were to have control of monetary policy, they would have incentives to essentially overstimulate the economy, in a run up to the next election. And then after election, the Fed would be forced to slam on the brakes. And so, you’d have the risk of a sort of stop go kind of monetary policy and a much more volatile economy with up swings and down swings and inflation. Central banks around the world have been moving in this direction of greater central bank independence for the last few decades. And the reason is it’s very obvious that you get better outcomes if the Federal Reserve and other central banks are insulated from short term political pressure. So, this is not just a US situation, this is pretty broad across the world.
Slater: And obviously we, we’ve had this independent model now for several decades. Can you think of another time in history, Bill, when you feel that this model has been tested, particularly here in the U.S.?
Dudley: Well, there have been times where the, when the president of the United States has been unhappy with central bank policy and has put a lot of pressure on that person to pursue a more accommodated policy than probably the most recent example that’s important is Arthur Burns who is serving under at the time of the Nixon administration. And Richard Nixon was not happy with Arthur Burns and wanted him, the Fed to follow a more accommodative, monetary policy. And in that case, essentially what happened is Arthur Burns did, and the consequence of that overly accommodative monetary policy is we have a big inflation problem which Paul Volcker came in to deal with. And I think in some ways, Arthur Burns’ experience cemented the commitment to central bank independence because we sort of recognize the consequence of having a Fed that does the bidding of an administration.
Slater: So, speaking of inflation, I mean, that was certainly the period in US and global history where I think inflation was just such a huge challenge, and took really drastic efforts from Paul Volcker. As you mentioned, and you know, we’re dealing with a really lingering inflation issue now, right? We had the sort of post-covid lingering inflation, we have the impacts of tariffs now that could possibly contribute even further to inflation. So, I mean, this is really what the Fed is grappling with right now as it’s considering its rate moves. And everybody’s kind of looking ahead to the September FOMC meeting to see what the Fed is going to do in this regard and see what the inflation and unemployment numbers look like. I mean, we got a little, we got a few hints in Jackson Hole that there might be some rate changes. And I think, you know, markets are certainly pricing that in and expecting that. So, I guess, Bill, my question to you is, you know, I remember we were in Singapore last year. BWC was in Singapore having a future of finance forum event and you made global headlines then because you were asked what your prediction was for last year’s September FOMC meeting. So, let me ask you again, this year we’re sitting here at the beginning of September looking ahead to 2025 September FOMC, what do you think the Fed is going to do?
Dudley: Last time it was actually quite interesting because the market couldn’t decide if it was going to be 25 basis point cuts or 50. And I argued for 50. So that was, that was actually newsworthy. This time, my views are not newsworthy because I think right along with everybody else that the Fed is going to cut interest rates by a quarter of percent at the September meeting. Yeah, Powell basically foreshadowed this in his speech at Jackson Hole. He basically said that I’m more worried about the downside risk to the labor market than I am about the upside risk to inflation. And he basically said, I think policy today is restrictive. So, you put the two things together; policy is restrictive and I’m more worried about the downside risk to the labor market, that’s putting 25 basis points on the table. And then he underscored that by saying explicitly, you know, it may be time to cut interest rates. He didn’t say they would, but to me it is a very, very strong hint. And he didn’t say anything about hinting on the other side. So, everybody, I think markets are pretty much priced at a 25-basis point rate cut at the September meeting, and only if we have an extraordinarily unusual set of data over the next couple weeks will that change. The bar to changing is very high. The Fed has basically moved away from data dependence now having a forecast. Powell has a forecast, the downside risk to the labor market is the predominant risk right now. And he’s going to act on that forecast unless the data basically tell him that he’s got the wrong forecast.
Slater: So, if you were sitting around the FOMC table, your vote would be for a 25-point cut.
Dudley: Well, I would in the sense that if I was the vice chairman of the FOMC, I would not be dissenting from what the chairman wants. But, you know, based on my own personal preferences right now, I would probably wait a little bit longer because I think there’s still a lot of uncertainty about the passing through of tariffs into inflation. Wait a little bit longer, because I think the economy is actually doing okay. If you look at a lot of data, it looks like things have actually picked up a little bit in the third quarter. But at the end of the day, you know, it’s not a big deal if they cut in September or if they wait for another meeting or two. The markets have priced in a lot of easing over the next you know couple years and naturally, what’s important, cause that’s really what derives the bond yields and the equity market. So, in some sense, the price, the easing’s already priced in regardless of what they do in September. But 25 base point cut is almost as a sure thing at this point.
Slater: Alright, so I think moving on with interest rates. Let’s talk a little bit about the regulatory priorities that we’ve seen so far from this administration. I want to start with some of the GENIUS act, which is the recent legislation that’s been passed here in the U.S. that really provides a regulatory blueprint for stablecoins. And this is really a big step forward in terms of putting some regulatory guardrails and definitions around what digital assets are and are not here in the U.S., which was an open question for quite some time, including in the prior administration. Bill you’ve really led a lot, you’ve led all of BWC’s digital assets work, as well as some of our stablecoins work. You know, we’ve really been supportive of the technology here, and we have been calling for there to be some regulatory guardrails in place. So, in my view, this is a great first step forward. So, I want to ask your thoughts on the GENIUS act, what you think it does and maybe what it does not do. Because there seems to be a lot of chatter about, you know, maybe some of the gaps in the framework and some of the risks that it doesn’t address.
Dudley: I think the GENIUS act is a very good first step, and to use your words, it requires 100% backing of stablecoins by high quality liquid assets, predominantly, presumably cash and short-term treasury security. But it allows some other very low risk money market assets. So that’s good 100% backing. Number two basically says you can only do this if you’re a financial services company, so it’s basically restricted, and we’re going to regulate it. You’re going to have oversight. If you’re a small stablecoin issuer, you can have oversight from state entities but even in that case the outcomes have to be consistent with what would happen at the federal level. So, all that is really good. And the last thing is it really to fit defines what a stablecoin is. It’s a stablecoin, which is something to be used for making payments because payment of interest on stable coins is prohibited. So that means it’s not an investment asset. It’s not going to be competing with, you know, bank certificates of deposits. It’s really something to be used as a medium of exchange. So, it really defines what a stablecoin is, I think in a narrow way that doesn’t create a lot of financial stability risk for the broader banking system. I mean, one thing if you had stablecoins that you could pay interest on, there’s always be the risk that you could have disintermediation out of the banking system into stablecoins. But not paying interest, you know, I think people are going to be not that interested in holding a lot of stablecoins unless they want to use them to execute payments.
So I think it’s quite good as far as it goes. The one big question and this is what people are really debating is the backing of the stablecoins airtight? Is there still a risk of runs? And if there was a risk of runs, what would happen to the value of the stablecoin? Would it just continue to trade at par, you know to one to one. And number two, could there be consequences for financial stability? Because if there were a stablecoin run, the stablecoin holders would have to liquidate their other money market assets to redeem their coins. So, I think that part is not quite as good as it could have been. What I would have favored, frankly, is to basically require the stablecoins to be 100% backed by central bank reserves. In that case, there is no question of, can you turn them into cash. Of course, the Fed can turn them into cash because they’re sitting on the Fed’s accounts. There’s no question about whether you have sufficient backing because the Federal Reserve is going to be auditing that you have sufficient reserves at the Fed. So, I think it’d be good if we could go a little bit farther to make it not 98-99% airtight, but 100% airtight.
You know, having lived through the great financial crisis, you know, I don’t like things that are almost certain. I want things that are certain because the one thing that works so well we have seen in the United States is deposit insurance. Why does deposit insurance work well? Because people know they’re going to get their money back 100% guaranteed in a very timely way. And so, we really want to replicate that same standard for stablecoins. We’re close, but we’re not quite there in my opinion.
Slater: Do you think there is an opportunity for it to go further, or do you think this is what we have for now? We’re going to see if the risk pools and then, you know, address it when there is a crisis, which is generally how we make regulatory policy.
Dudley: Well, I think where the Fed comes out on this is pretty important. I mean, if the Federal Reserve started to say that we really think that this should be backed by central bank reserves, maybe that could lead to another additional step. I don’t think that requiring backing by central bank reserves as long as the Fed is paying interest on those reserves is a big hardship for stablecoin issuers. And I think frankly, if I was a stablecoin issuer I want to make my stablecoin as bulletproof as possible to reduce the risk of runs to essentially zero. So, I think it’s possible, but I think you need the central bank to be an advocate. I think you need to have a little bit more focus on some of these financial stability risks. I think it’s doable, but whether we’re going to do it soon or only after we have a problem that remains to be seen at this point.
Slater: Yeah, and so far, the Fed hasn’t been that forward leaning.
Dudley: I agree with you.
Slater: On digital assets, right? I mean, apart from saying no we’re not doing CBDC’s and they’ve, they haven’t been very forward leaning on, on stablecoins.
Dudley: Yeah, I wish the Federal Reserve would take a more forward leaning position on this. The fact is stablecoins are here. They are going to be used. They actually can be used to facilitate payments on a cross-border basis, probably in a way that’s more efficient than existing forms of payment. So, let’s get on with it, but let’s also make sure that they’re absolutely safe.
There are some other aspects of the bill that I didn’t mention. I think they’re also important to highlight. One of the things that makes this legislation useful is that if a stablecoin issuer were to fail, all the stablecoins would be protected from bankruptcy. So, people who have stablecoins would be able to redeem their money even if the stablecoin issuer went bankrupt. And it’s also subject to BSA Bank Secrecy Act regulation. One of the big concerns about stablecoin usage, that stablecoins are used by illicit actors to do nefarious things. And we want to make sure that stablecoin doesn’t sort of provide a better tool to do bad things. So, the fact that the legislation addresses both those things, I think, is helpful.
Now that said, I think we still have a lot more work to do on anti-money laundering and bank secrecy in the United States and elsewhere. It’s a very inefficient system right now. Every bank has to do its own sort of independent verification of its customers, and you also have the downstream issue. I can see you as my customer, but I don’t see who you’re transacting with downstream. So, I think, the Bank Secrecy Act, the anti-money laundering issue is still something that we can make some further progress in the U.S. and elsewhere in the world for that matter.
Slater: Yeah, I agree. I remember we were in Brazil last year, Bill, having this conversation with some Brazilian firms that operate in the U.S. And they were explaining the scope of this issue to us and the cost of doing business. And it was just really eye opening for me in the first time I had really been exposed to that issue, but just completely inefficient and costly for companies. Kind of sticking with some of the stablecoins. Apart from the kind of financial stability piece and regulatory piece, the other part of this is some of the, I say global reaction is what this is going to do to the US dollar in terms of the global reserve currency status. And I think countries who also have reserve status or aspirations of that are particularly concerned about there being growing demand here for US dollar backed assets. So, tell me what your thoughts are on that. How do you view stablecoins contributing to the dollar strength and global monetary competition?
Dudley: Well, certainly a very real concern because almost all stablecoins that are outstanding are denominated in the dollar. So, the preferences have been revealed by people that they want to hold stablecoins that are backed by dollars, not by other currencies. Yeah, that could obviously conceivably change over time. So, to the extent that you have a very good solid stablecoin with 100% backing that you’re absolutely sure is bulletproof. That’s going to introduce another good payment medium, especially in cross border payments that will compete with other currencies. But my view is that this is happening already. And so, to say that we shouldn’t have good stablecoins because we already have not so good stablecoins that, that seems like a very bad path to go down. I think the fact that stablecoins are really being designed for payments rather than as an investment asset sort of reduces the consequences of this to other countries and their monetary policies. So, I think there will be a little bit more inroads of the dollar in terms of international payments. But it’s already dominant. So, you know, I think this is more like underscoring the dominance and reinforcing the dominance rather than changing the landscape in a significant way.
Slater: Yeah, and I mean, quite frankly, the U.S., this was always going to be the policy pathway that it pursued. It’s been very clear about that, right. It was just very slow on kind of putting together the guardrails that we said to really to make it usable. But U.S. was never going to do CBDC’s, right? This was always the policy choice. So, I think countries can’t be, I don’t think caught off guard that this has now been a priority for the U.S. and for this administration.
Dudley: Before this legislation, there were stablecoins denominated in dollars that were used for international payments and for other means. So, it already was a reality. This just makes it a better regime than what we had before. So, I’m sure the other countries are going be thinking about, well, how can my economic zone have a stablecoin? I’m sure like the eurozone would be interested in having a euro stablecoin. And obviously, the Chinese are probably going to be looking at is, are their experiments with the E-CNY working or do they need to go a different route, more down a stablecoin path?
So, I think there will be competitors to the US. But look, the dollar is a reserve currency for some pretty good reasons, one we have a rule of law. Two, we have deep in liquid capital markets. Three, you can bring money in and out of the US very easily. And four, the US is just a very, very big economy in the world. And so, until the US does something to sort of damage those attributes, or until another country can sort replicate those attributes, dollars are going to stay the dominant reserve currency. I mean, if the dollar loses its reserve currency status, it’s only going to be because we did it to ourselves. And I would have to say doing it to ourselves will actually turn out to be pretty difficult.
Slater: Going back to sort of regulatory priorities, Trump campaigned on a deregulatory agenda. Tariffs and deregulation were two of the big centerpieces of his campaign. We have seen the tariff and trade agenda clearly be number one priority for him. We are seeing that play out. But we’re starting to hear a little bit that the administration is thinking about what it wants to do in terms of deregulatory priorities, particularly for your traditional financial services and banking sector. So, we’re not quite sure what that looks like yet, but we know that it will be coming at some point. So I guess my question for you is are you expecting to see movement in particular areas? Are there any areas that warrant an actual revisiting? I mean, you’ve led some work here at BWC on liquidity requirements and the resolution framework and looking at parts of the regulatory agenda. So do you think any of those might make its way into the administration’s priorities?
Dudley: I think the administration’s priorities are probably going to be more about reducing regulatory burden. I think that the US regulations for banks, capital liquidity, resolution are probably overly onerous relative to what that last 50% of the regulation they’ve achieved at a relatively small benefit. Living wills is a good example. So, a bank has to file a living will, which basically says how are we going to deal with what happens if we actually were to fail? How do we manage our liquidation or downsizing? And these, these living wills go on to thousands of thousands of pages. No one can hold that in their mind. The CCAR, the Comprehensive Capital Assessment Process is really complicated. And so, I think a lot of it’s going to be about how can we achieve almost the same outcome with a much less heavy hand in terms of the regulatory burn. We’ve already seen movement from the administration on some of the regulations. So, there’s a requirement for banks that they have a minimum leverage ratio against the capital divided by total assets, and they basically reduce that. They’re reducing the supplemental leverage ratio because they basically thought it was too binding. And it was discouraging banks from holding Treasury debt, which is obviously not very risky. So, they’ve already made that change.
I think another area where we’re probably see going to see some changes a little bit more favorable attitude towards bank mergers and acquisitions. We haven’t seen a lot of bank activity. Some of the capital requirements push against that if I buy another bank and that makes me bigger than my capital requirements go up cause I’m now more complex. So, I think there’ll be things like that. The last thing I’m almost certain that they are going to do, which I think is actually unfortunate, is I think the Financial Stability Oversight Council is going to be very much downgraded. That happened in the first Trump term and was built back up by during the Biden administration. I think it’s unfortunately going to go the other way again.
And I think the problem with that is that the financial stability oversight council is important because it allows you to keep an eye on other things than just banking. There’s a lot of financial service activity that takes place outside the core banking system. In fact, financial services outside the core banking system have grown much faster than the core banking system over the last, you know, 20, 30 years. And it seems to me like we need to have a way of keeping an eye on that and making sure that we understand the risk in that space. So I think that’s one where I hope they don’t do too much because I think having a group that looks at that issue and also having a forum so that regulars can talk to each other about the issues.
I mean the financial stability oversgiht council was actually pretty important in terms of money market mutual fund reform that finally took place. The SEC was pretty reluctant to do it. The financial stability Oversight Council put quite a bit of pressure on the SEC to look at money market fund reform. And the SEC enacted money market reforms that I think make the money market fund industry a lot safer than it was in the past. So, I think there are some, there’s a role to play there, but we’ll see how it plays out. I think my own view is mostly about simplification, less burden. The other area where obviously we’re already seeing change is the capital regulations, Basel III endgame that people talk about, so that’s already been wound back down. The Federal Reserve has already pulled back from their original proposal. And, you know, I think that’s possible that that could be wound down further. There are some aspects of Basel III that are a little hard to understand how you actually, the logic of it. Like setting capital requirements for operational risk. I don’t really know what capital requirement I need against cyber risk because cyber risk is hopefully a fairly rare event but if it happens, it’s going to be devastating and I’m going to need a lot of capital. But do I hold a lot of capital for all the time just in case of the risk of a bad cyber event? So, I think some of the capital requirements need to be thought through a little bit more. Interest rate risk is another area where we probably need a little more work. We saw with Silicon Valley Bank. They got into trouble because they took a lot of interest rate risk and that wasn’t probably treated as well as it could have been from both the regulatory and supervisory perspective. So, I think there are certain things that we probably have to do a little better job, and I think there are certain things where you could certainly reduce regulatory burden and still have a very sound and secure financial system.
Slater: Yeah well, I think, to be seen. I think we’ll all be watching to kind of see now that the trade agenda has clearly been enacted and, I mean continuing to be negotiated, but I think the administration is going to turn its attention to some other priorities. So, I think we will be seeing more but agree with you that reducing sort of how onerous some of the requirements are and the burden is a worthy objective. I think to be seen on, the means to that end, right is a little bit of the MO of this administration right now and all of us watching. You mentioned Basel, so I wanted to conclude with a question on the Bank for International Settlements, which is, of course based in Basel, along with the Financial Stability Board, the Basel Committee on banking supervision, that you mentioned. BWC is actually going to be in Basel next week for the BIS’s Innovation Summit, where central bankers are going to be gathering from around the world to discuss many of the issues that we’ve talked about here today. Then, you spent a lot of time going to Basel during your time as a president of the New York Fed, chairing committees as we said previously. But, you know, I think one thing we’ve seen a little bit from this administration is it’s kind of skepticism towards global coordinating bodies and bodies for international cooperation. You know, I think maybe one anomaly to that has been the IMF and World Bank where we’ve actually seen some constructive engagement, but we’re not quite sure how the administration is going to view its engagement with the BIS and FSB and these global standard-setting bodies going forward. So I guess, question to you is: In your experience coordinating with other central bankers in Basel at these forums, why are they important and what would be your advice for this administration in terms of how it engages with those institutions?
Dudley: Well, the first thing to recognize is, when you look what the Bank for International Settlements does, everything is done by consensus. So, if the U.S. doesn’t want it to happen it’s not going to happen. So, it’s not like you’re losing control of what we’re doing in terms of regulation or payments. So, it’s done by consensus. Number two, in terms of regulation, you want to have it harmonized around the world to a degree, because if you don’t, there’s a risk of a race to the bottom and all the activity moves offshore to the lowest common denominator for regulation, and that can be a threat to financial stability. Also, you need global coordination to support the dollar as a reserve currency. One reason why the Federal Reserve has changed swap lines out to foreign central banks is that it helps support the dollar as a reserve currency. And if there is a liquidity problem in the dollar markets abroad, those foreign exchange swaps allow the Fed to come to aid, provide liquidity to foreign central banks at virtually no risk, and that supports the dollar as reserve currency. So, all those things are good. What the Basel Committee, what the BIS does not do is it doesn’t coordinate monetary policy. When you go to the BIS and you talk about your monetary policy, you’re exchanging views with other central banks, but at the end of the day, monetary policies are about what’s best for your country. So, then, the Federal Reserve never skews monetary policy because it might be better or worse for some other country. They set monetary policy with best for the United States, and other countries do the same. So, it’s really more in the regulatory space, the supervision space, bank resolution space, international payment space where you have coordination and cooperation.
But again, it’s an army of the willing so you have to achieve a consensus, and that obviously limits how far you can go. And often what happens is you have a financial shock that sort of creates notion that we need to do something. And then that’s what warrants the action. I think about coming out of the great financial crisis. We had a lot of over-the-counter trading and derivatives. And that over-the-counter trading and derivatives turned out to be very destabilizing when Lehman Brothers failed. So, what happened after the financial crisis? The G20 countries decided that we need to have central clearing of over-the-counter derivatives. We can’t have central clearing over the counter derivatives on a global basis if you don’t have coordination. And so that was left to the BIS to sort out how we can actually do that. So, I think it’s a hugely important body. I think it also helps just going there and meeting your counterpart. I remember in the middle of the Great Financial Crisis after Lehman Brothers failed, we wanted to create more dollar liquidity to support foreign holdings of dollar assets quickly. And the fact that I knew all my counterparts at the leading central banks made it much easier to reach agreement quickly on how to do this. I don’t think I could have done that as if I hadn’t been going to Basel on a regular basis.
Slater: And you mention the G20, which of course was created in the aftermath to kind of get the political will behind the global financial crisis and be able to get countries to get coordinated and move with speed. And of course, the U.S. will be assuming the G20 presidency at the end of this year. So, I think we will be looking at that and looking ahead to see how this administration is going to use its leadership in the G20 to perhaps advance some of these priorities that we’ve discussed today. I would expect potential for deregulatory priority, deregulatory agenda, and also continuing, I think, to push its digital assets priorities forward in that forum. So, to be seen, I think to be seen.
Well, Bill, we’ve covered a lot of ground here today. I think we’ve talked about all things Fed. So, I just want to thank you for joining today and sharing your thoughts on a lot of the challenges facing the global economy, facing the Fed right now as it tries to navigate, and as we look forward to the September FOMC. So, no one better, no one better to share his thoughts on all things Fed. So really appreciate you taking the time, Bill. Thank you.
Dudley: Thanks, Emily. Thank you.
Slater: All right, thanks Bill. We will see you next time on Macro Matters.