The new top cop at the U.S. Federal Reserve hardly fits the presidential mold. Michelle Bowman, Donald Trump’s pick to be the central bank’s vice chair of supervision, has indicated that she believes in aligning federal rules with Europe and the rest of the world. If so, it would mean largely conforming to Basel 3, the sort of international accord the White House is trashing most everywhere else. Bowman should be a welcome choice to the eight systemically important U.S. banks, which include Bank of America and Goldman Sachs. JPMorgan boss Jamie Dimon led the charge against her predecessor, Michael Barr, who initially proposed

The U.S. economy is still running too hot for comfort. Prices rose in January by 0.5% from the prior month, nudging the annual increase up to the psychologically testing 3% threshold. It’s another roadblock for further rate cuts from the Federal Reserve. More importantly, it leaves even less room for President Donald Trump, whose tariff plans could stoke inflation further. Something must give – raising the specter of recession. Inflationary pressure is the result of a gaggle of disparate causes: egg prices were up 15% over the prior month; car insurance is nearly 12% more expensive than last year. Sure, prices for

The U.S. Constitution gives Congress the power of the purse, but President Donald Trump interprets the foundational document differently. His acting budget chief issued a two-page memo, citing “wokeness” and “Marxist equity” as if they were spending line-items, that freezes what the agency says is $3 trillion in federal grants and loans. Even if only temporary, as the administration claims, the decision will upend financial planning for chipmakers, road builders, medical researchers and more. If no one stops the overreach, the economic consequences may be more dire. There was no advance warning that Trump would blatantly contradict the separation of powers. The vagaries

Death came for Silicon Valley Bank the way it almost always does for doomed banks: by depositors fearful of losing their money rushing for the door. But that mortal moment, which unfolded a year ago this week, was the culmination of a process that started long before. The killer – a disjointed system that is supposed to oversee, save or wind up U.S. banks but in practice struggles to do any of the three – is still at large. With the benefit of hindsight, California-based SVB Financial was a compendium of problems in the making. It had grown extremely quickly by

There’s a spanner in the freshly restarted U.S. manufacturing machine. A factory construction boom sparked by President Joe Biden’s industrial policies has led to unbridled optimism about the sector for the first time in decades. The hardest part of the process hangs in the balance, however: filling all the anticipated job openings. Biden has walked all his predecessor’s talk of a manufacturing revival. The Bipartisan Infrastructure Deal, the Inflation Reduction Act, with its tax credits for renewable energy projects, and the CHIPS and Science Act’s semiconductor subsidies have had the desired effect. Spending to build new plants surged to an

Two U.S. lawmakers have an idea for reining in Big Tech: get someone else to do it. Democratic Senator Elizabeth Warren and her Republican peer Lindsey Graham proposed a new commission for policing technology firms on Thursday. Silicon Valley is indeed posing novel challenges, from privacy to mental health. A tech-focused super-regulator would be a great way to fail to fix these problems. True, the goals that inspired the Digital Consumer Protection Commission Act, which was introduced to the Senate for consideration on Thursday, are noble. They include protecting young users of social media, and countering anticompetitive behavior. Yet there are already

Bank watchdogs are mulling changes to deposit insurance schemes after a string of lenders failed. Yet one of the most promising fixes has little to do with insurance, or even deposits. Forcing more U.S. banks to fund more of their loans and investments by issuing long-term debt, and relatively less with deposits, could offer an extra layer of protection for customers. The only question is who shoulders the cost of the extra safety. Globally systemic U.S. megabanks, like Jamie Dimon’s JPMorgan, already issue oodles of loss-absorbing bonds – a product of post-2008 regulations designed to end government bailouts. Yet unlike

Clawbacks of pay from misbehaving employees aren’t uncommon, but some are sharper than others. JPMorgan is suing to take back eight years of compensation from former executive Jes Staley, who left in 2013 to become chief executive of UK lender Barclays, over his links to deceased sex offender Jeffrey Epstein. Suing former employees – in this case using an archaic-sounding doctrine that brands Staley a “faithless servant” – isn’t a great look, but the bank led by Jamie Dimon has more reasons than most to defend itself. At first glance, Dimon needn’t lose too much sleep over the Epstein affair. His $400 billion

Reinforcements are arriving in the trustbusting fight. The U.S. Department of Justice on Tuesday sued to block JetBlue Airways’ $3.8 billion acquisition of Spirit Airlines, and it may yet be joined by colleagues at the Department of Transportation. It would be the third curious regulatory intervention in recent weeks, each encouraged by Democratic Senator Elizabeth Warren. The cases speak to how President Joe Biden’s administration is pushing its consolidation crackdown to new extremes. DOT merger approval is typically a formality. Since the industry was deregulated in the late 1970s, the agency rarely, if ever, has declined to approve the transfer of certificates to operate

Big banks have little to fear from a recession in 2023. They’re in better shape than a decade ago, with big buffers against delinquent debtors and numerous watchdogs keeping them honest. Nonetheless, the coming year will see large U.S. lenders’ profit relentlessly gnawed by rising expenses that come from many different directions. It’s less a bear attack, and more an ant invasion. JPMorgan, Bank of America, Wells Fargo and Citigroup all report fourth-quarter earnings on Friday. The good news is that for the year ahead, rising interest rates twinned with growing loan books should more than make up for sliding

Investors in U.S. companies have a new way to weigh in on corporate matters. Thursday marks the launch of changes to how they vote for board directors, and it’s likely more companies will be targeted by cage-rattlers, sometimes with absurd demands. Still, chieftains who are doing their jobs have little to worry about. Previously when an activist proposed alternative directors for election at the company’s shareholder meeting, they had to send a separate voting card to investors with only their candidates on it. New rules approved last year by the U.S. Securities and Exchange Commission say companies must include dissident nominees on

Western leaders are giving Vladimir Putin a rational default card. Sanctions give the Russian president more reason to renege on at least some of his $200 billion of sovereign debt. The fallout could leave creditors stuck for years. Judging by its balance sheet, Russia isn’t an obvious default candidate. When the country last reneged in 1998, its borrowings exceeded 130% of annual output. Last year they were less than 20%, only a fifth of which was in foreign currency. That gives Putin a cushion to cope with a collapsing currency and shrinking economy. The spiking crude price will also help