Joyce Chang joins CFS Distinguished Advisory Board

FOR IMMEDIATE RELEASE

THE CENTER FOR FINANCIAL STABILITY
APPOINTS JOYCE CHANG TO DISTINGUISHED ADVISORY BOARD

(New York, NY – November 24, 2020) The Center for Financial Stability (“CFS”), today, announces the appointment of Joyce Chang to its distinguished Advisory Board.

Ms. Chang is the Chair of Global Research for J.P. Morgan’s Corporate and Investment Bank. J.P. Morgan’s Global Research team of over 900 professionals study all sectors in which the firm does business, including equities, fixed income, currency and commodities, emerging markets, derivatives and structured finance. She has been named as one of Top 25 Most Powerful Women in Finance by American Banker since 2012 and was included in Barron’s inaugural 2020 list of the 100 Most Influential Women in Finance. In 2014, she was inducted into the Fixed Income Analyst Society Hall of Fame.

“CFS is at the forefront of analyzing the paradigm shifts underway in global financial markets,” Joyce Chang said. “The organization has been a leader in research, providing insightful and innovative coverage of evolving financial markets dynamics, unconventional monetary policies, and a better understanding of sources of financial instability.”

William R. Rhodes, the Chairman of the Advisory Board stated, “Joyce is extremely well known internationally and is highly regarded in official and financial circles throughout the world. Her engagement will be especially meaningful for the future of our Advisory Board.”

“Joyce’s intellectual bandwidth and energy are legendary,” said Lawrence Goodman, President and Founder of the Center for Financial Stability. He added that “at a time when global risks and forces impacting markets are increasingly multipronged, we are especially delighted that she joins us now.”

Ms. Chang began her career as an Emerging Markets Strategist, where from 1997 through 2012, she held top rankings in Institutional Investor surveys for Emerging Markets research, earning 25 #1 individual rankings. She was a Managing Director at Merrill Lynch and Salomon Brothers prior to joining JPMorgan Chase & Co. in 1999.

Ms. Chang serves on the Board of Directors of Trickle Up and Girls Inc. She is the Senior Sponsor for J.P. Morgan’s Corporate and Investment Bank Women on the Move Network, the network for employees of Asian heritage (AsPIRE) and Nonprofit Board Service. She holds an M.P.A. from Princeton and serves on its External Advisory Council for the Center for Public Policy, and has a B.A. from Columbia from where she was awarded the John Jay award for professional achievement and serves on its Board of Visitors

CFS is an independent, nonpartisan think tank focused on financial markets – with business lines presently segmented into the future of finance, data and analytics, policy, and technology. The Center for Financial Stability was created before financial stability became widely recognized in the private sector as an essential factor in central banking and policy. CFS has successfully and consistently anticipated future financial market trends over the years with an ahead-of-their-time approach to the early identification of financial risks. CFS has developed data and analysis to improve the study of financial markets. CFS maintains a global reach with participants from over 187 of the 195 countries in the world. CFS prides itself on integrity, long-term relationships, and independence.

View the press release at http://www.centerforfinancialstability.org/news/Chang_press_release_112420.pdf.

Holzmann on “The Great Demographic Reversal”

Robert Holzmann (ECB Governing Council Member and Governor of the Austrian National Bank – OeNB) adds to the insightful comments received in response to Charles Goodhart and Manoj Pradhan’s “The Great Demographic Reversal” CFS presentation recently distributed.

Robert notes that “there is a lot to be done, but a lot can be done.”  Two referenced papers from his days as an academic are offered:

1 – His ‘three-tiered life-cycle model’ by income groups suggests that the traditional model applies only to the middle-income subset of the population (see http://centerforfinancialstability.org/research/Holzmann_3_Tiered_Life_Cycle.pdf ).

2 – A new perspective on ageing and dynamic adjustment in the dependence ratio softens the economic impact of fears from the aging bubble ahead (see http://centerforfinancialstability.org/research/Holzmann_Optimistic_Dependency.pdf).

The original message and link to previous comments as well as Charles and Manoj’s slides are below.

Best regards,
Larry


———- Forwarded message ———
From: Lawrence Goodman <lgoodman@the-cfs.org>
Date: Fri, Oct 16, 2020 at 11:53 AM
Subject: Comments on The Great Demographic Reversal…

Two comments received regarding Charles Goodhart and Manoj Pradhan’s “The Great Demographic Reversal” follow questions that surfaced during the CFS roundtable discussion.  They include 1) the role of technology and productivity as well as 2) the internationalization of the big demographic shift.

First, Hal Varian (Chief Economist, Google and Emeritus Professor, UC Berkeley) offers a paper on advancing technology and automation vis-a-vis the impact of demographic forces on the supply of labor – https://voxeu.org/article/automation-versus-procreation-aka-bots-versus-tots.

Second, David Dodge (Senior Advisor, Bennett Jones and Former President, Bank of Canada) noted…
“I have been making the same point about the aging of the baby boom generation in Canada. This big cohort were big savers in the first two decades of this century. They will become big dis-savers from 2025 to 2045.”

The original message and link to slides are below.

Best regards,
Larry


—–Original Message—–
From: Lawrence Goodman <lgoodman@the-cfs.org>
Sent: Wednesday, October 14, 2020 12:31 PM
Subject: The Great Demographic Reversal (Goodhart and Pradhan)…

Last week, we hosted a roundtable discussion with CFS Advisory Board Member Charles Goodhart and his co-author Manoj Pradhan.

The Great Demographic Reversal is superb.  It addresses head-on demographic forces that will only gain in importance over time.  The book proposes that the underlying forces of demography and globalization will shortly reverse three multi-decade global trends – it will raise inflation and interest rates, but lead to a pullback in inequality.  Charles and Manoj broadened the country-by-country demographic analysis by connecting many global threads and interactions among nations.

Please find their slides at
http://www.centerforfinancialstability.org/speeches/The_Great_Demographic_Reversal_CFS.pdf

Best regards,
Larry

Comments on The Great Demographic Reversal (Varian and Dodge)

Two comments received regarding Charles Goodhart and Manoj Pradhan’s “The Great Demographic Reversal” follow questions that surfaced during the CFS roundtable discussion. They include 1) the role of technology and productivity as well as 2) the internationalization of the big demographic shift.

First, Hal Varian (Chief Economist, Google and Emeritus Professor, UC Berkeley) offers a paper on advancing technology and automation vis-a-vis the impact of demographic forces on the supply of labor – https://voxeu.org/article/automation-versus-procreation-aka-bots-versus-tots.

Second, David Dodge (Senior Advisor, Bennett Jones and Former President, Bank of Canada) noted…
“I have been making the same point about the aging of the baby boom generation in Canada. This big cohort were big savers in the first two decades of this century. They will become big dis-savers from 2025 to 2045.”

The original message and link to slides are below.

—–Original Message—–
From: Lawrence Goodman lgoodman@the-cfs.org
Sent: Wednesday, October 14, 2020 12:31 PM
Subject: The Great Demographic Reversal (Goodhart and Pradhan)…

Last week, we hosted a roundtable discussion with CFS Advisory Board Member Charles Goodhart and his co-author Manoj Pradhan.

The Great Demographic Reversal is superb. It addresses head-on demographic forces that will only gain in importance over time. The book proposes that the underlying forces of demography and globalization will shortly reverse three multi-decade global trends – it will raise inflation and interest rates, but lead to a pullback in inequality. Charles and Manoj broadened the country-by-country demographic analysis by connecting many global threads and interactions among nations.

Please find their slides at
http://www.centerforfinancialstability.org/speeches/The_Great_Demographic_Reversal_CFS.pdf

The Great Demographic Reversal (Goodhart and Pradhan)

Last week, we hosted a roundtable discussion with CFS Advisory Board Member Charles Goodhart and his co-author Manoj Pradhan.

The Great Demographic Reversal is superb.  It addresses head-on demographic forces that will only gain in importance over time.  The book proposes that the underlying forces of demography and globalization will shortly reverse three multi-decade global trends – it will raise inflation and interest rates, but lead to a pullback in inequality.  Charles and Manoj broadened the country-by-country demographic analysis by connecting many global threads and interactions among nations.

Please find their slides at
http://www.centerforfinancialstability.org/speeches/The_Great_Demographic_Reversal_CFS.pdf

Goodhart on “Deflation or Inflation”

CFS Advisory Board Member Charles Goodhart offers thoughts on “After Coronavirus: Deflation or Inflation?”  Charles is a member of the Financial Markets Group at the London School of Economics and a former member of Bank of England’s Monetary Policy Committee.

Topics include:

– Understanding the past.
– Assessing “low for longer” and “inflation is a monetary phenomenon?”
– Offering potential future pathways for prices.

For full remarks:
http://centerforfinancialstability.org/research/Goodhart_Deflation_Inflation_081420.pdf

Sheila C. Bair Joins CFS Distinguished Advisory Board

FOR IMMEDIATE RELEASE

THE CENTER FOR FINANCIAL STABILITY APPOINTS SHEILA C. BAIR TO DISTINGUISHED ADVISORY BOARD

(New York, NY – JULY 29, 2020) The Center for Financial Stability (“CFS”), today, announced the appointment of Sheila C. Bair to its distinguished Advisory Board.  Ms. Bair will also serve as a CFS Senior Fellow, contributing to research and policy offerings.

Ms. Bair has had a long and distinguished career in government, academia, and finance. Twice named by “Forbes” magazine as the second most powerful woman in the world, she is perhaps best known as Chair of the Federal Deposit Insurance Corporation (FDIC) from 2006 to 2011, when she steered the agency through the worst financial crisis since the Great Depression.  For her efforts to protect bank depositors and homeowners during the crisis, she received the Kennedy Library’s Profiles in Courage Award, and was named “the little guy’s protector in chief” by “Time” magazine.

“CFS has long been a thought leader in the area of monetary policy and financial system analytics.  The organization has been an influencer of influencers,” Sheila Bair said. “It is time to broaden the CFS footprint,” added Ms. Bair.

“We are thrilled that Sheila has joined us at CFS.  Her independence, courage, knowledge, and integrity fully reflect and amplify CFS values and principles,” said Lawrence Goodman, President and Founder of the Center for Financial Stability.

A former finance professor and college president, Ms. Bair has been nationally recognized for her innovative initiatives to make college more accessible and affordable. She is a frequent commentator and op-ed contributor on financial regulation and the student debt crisis, as well as author of the NY Times Best Seller, “Bull by the Horns”, her 2012 memoir of the financial crisis.

Ms. Bair currently serves on a number of corporate governing boards, including Host Hotels, Bunge Ltd., and Fannie Mae, and on the International Advisory Board to the Santander Group. She also serves on the board of Paxos, a blockchain technology trust company, and as an advisor to several fintech startups. She is a founding director of the Volcker Alliance, established by Former Federal Reserve Board Chair Paul Volcker to build trust in government and is the founding chair of the Systemic Risk Council, which advocates for financial stability. In addition, she is a Senior Advisor to the Peter G. Peterson Foundation on financial issues confronting young people.

William R. Rhodes, the Chairman of the Advisory Board stated, “CFS’ innovative and practical approach, programs, and research position the organization as one of the world’s leading think tanks and a vital resource for the New York and international financial communities.” He added that “Sheila will play an important role in our future.”

CFS is an independent, nonpartisan think tank focused on financial markets – with business lines presently segmented into the future of finance, data and analytics, policy, and technology.  The Center for Financial Stability was created before financial stability became widely recognized in the private sector as an essential factor in central banking and policy.  CFS has successfully and consistently anticipated future financial market trends over the years with an ahead-of-their-time approach to the early identification of financial risks.  CFS has developed data and analysis to improve the study of financial markets.  CFS maintains a global reach with participants from over 187 of the 195 countries in the world.  CFS prides itself on integrity, long-term relationships, and independence.

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Media Contact:
Brigitte Rudman
212.626.2660
brudman@the-cfs.org

Value Investing and Monetary Policy

Jason Zweig’s “The Bull Market Isn’t As Big as You Think” in The Wall Street Journal  nicely illustrates how the stock market may not be as disconnected from economic reality as many suspect. However, the piece misses the monetary elephant in the room.

Since the introduction of Quantitative Easing (QE), value investing only outperformed growth strategies during four brief moments – as measured by S&P Value and Growth Indexes (see http://www.centerforfinancialstability.org/oped/Value_Investing_063020.pdf). 

Not surprisingly, the relative outperformance of value versus growth strategies coincided with periods when the Fed curtailed its injections of monetary liquidity: 1) the end of QE1, 2) end of QE2, 3) end of QE3, and 3) the period of quantitative tapering.

Although the monetary policy response to the Coronavirus was needed, unintended distortions should be acknowledged and incorporated into future actions.

The implication for value investors is clear.  Monetary largess is wreaking havoc with the investment strategy.  For the public and officials, the propagation of valuation distortions starve a wide spectrum of deserving companies and industries access to capital.  This will surely minimize private sector driven growth going forward.

View the report
http://www.centerforfinancialstability.org/oped/Value_Investing_063020.pdf

New Chairman: CFS Names William R. Rhodes Chairman of the Advisory Board

PRESS RELEASE

THE CENTER FOR FINANCIAL STABILITY
NAMES WILLIAM R. RHODES CHAIRMAN OF ADVISORY BOARD

FOR IMMEDIATE RELEASE

(New York, New York- June 29, 2020) 

The Center for Financial Stability (“CFS”), today, announced the appointment of William R. Rhodes as the first Chairman of the Organization’s distinguished Advisory Board.

CFS is an independent, nonpartisan think tank focused on financial markets – with business lines presently segmented into the future of finance, data and analytics, policy, and technology.

“CFS’ innovative and practical approach, programs, and research position the organization as one of the world’s leading think tanks and a vital resource for the New York and international financial communities,” William Rhodes said.

Rhodes is an excellent choice to hold the distinct title, as he has been an active CFS participant over many years, leading roundtable discussions and moderating panels of prominent leaders.  He also delivered a seminal “Bretton Woods 2014 – Founders of the Future” keynote dinner address at the Mount Washington Resort in New Hampshire, which was exclusively available for the CFS conference, just as it was in 1944.  An invite-only, guest list which included world leaders from government, business, and academia in a working-group environment to focus on the future of finance and the international monetary system.

“We are thrilled that Bill is our first Chairman of the CFS Advisory Board.  His sustained leadership in finance and public policy is legendary – for his understanding of diverse interests across private institutions and nations as well as his ability to act.  At this time of global risks and crises, Bill’s insights and success will meaningfully magnify CFS’s work in risk management, crisis prevention, and policy,” said Lawrence Goodman, founder and President of the Center for Financial Stability.

William Rhodes is an American banker and philanthropist. He is former Chairman, CEO, and president of Citibank and senior vice chairman of Citigroup. He served in various senior executive positions at Citi from 1957 until his retirement from Citigroup on April 30, 2010. He gained worldwide reputation for international financial diplomacy in the 1980s, 1990s, and 2000’s as a result of his leadership in helping manage the external-debt crises that involved developing nations and their creditors worldwide. During that period and in the 1990s, he headed the advisory committees of international banks that negotiated debt-restructuring agreements for Argentina, Brazil, Jamaica, Mexico, Peru, Uruguay, Nicaragua, and Iraq. In 1998, when the Republic of Korea experienced liquidity problems, he chaired the international bank group that negotiated the extension of short-term debt of the Korean banking system. In early 1999, at the request of the government of Brazil, he acted as worldwide coordinator to help implement the maintenance of trade and interbank lines by foreign commercial banks to Brazil. He has since served as a trusted advisor to governments, financial officials, and corporations worldwide.

He is the director of the Private Export Funding Corporation; chairman emeritus of the U.S.-Korea Business Council; vice-chairman of the National Committee on U.S. – China Relations; a director of the Korea Society;  a member of the Chairman’s advisory council and senior fellow of The Hudson Institute; a member of the Board at the Foreign Policy Association; and a former trustee of the Economic Club of New York.  He is also a member of the Council on Foreign Relations, The Group of Thirty, and the Advisory Council of the Brazilian American Chamber of Commerce. Mr. Rhodes is a member of the Board of Directors of the Volcker Alliance, a member of the European-American Chamber of Commerce New York and a member of the Executive Committee, Bretton Woods Committee Board of Directors.  He is the first vice-chairman emeritus of the Institute of International Finance and Chairman emeritus of the Americas Society and Council of the Americas. He previously served as Chairman of the New York Blood Center, the Bankers Association for Finance and Trade, and the U.S. Hong Kong Business Council.

William Rhodes is a life trustee of The New York-Presbyterian Hospital; a member of the Metropolitan Museum of Art Business Committee and Chairman’s Council, and chairman emeritus of the Board of Trustees of the Northfield Mount Hermon School. He has received decorations and honors from various governments and institutions, including an honorary doctorate in humane letters from his alma mater Brown University, where he established the William R. Rhodes Center for International Economics and Finance; a member of Center on Capitalism and Society at Columbia University; Officer and Chevalier of France’s Legion of Honor; decorations from Poland, Korea, Brazil, Mexico, Argentina, Venezuela, Colombia, Panama and Jamaica; and multiple awards from not-for-profit organizations such as the Africa-America Institute, Arab Bankers Association of North America, the America-Israel Friendship League and Sciences Po Foundation, Pro Mujer, Franklin Delano Roosevelt Boy’s Scouts Award in recognition of his contributions to international banking and finance.

He authored the book BANKER TO THE WORLD:  Leadership Lessons from the Front Lines of Global Finance.  The book is available in English, Spanish, Mandarin, Korean, Japanese, Portuguese, and a separate edition published by Tata in India and the Sub-continent. The book has two editions in English and Spanish.

The Center for Financial Stability was created before financial stability became widely recognized as an essential factor in central banking and policy.  CFS has successfully and consistently anticipated future financial market trends over the years with an ahead-of-their-time approach to the early identification of financial risks.  CFS has developed data and analysis to improve the study of financial markets.  CFS maintains a global reach with participants from over 187 of the 195 countries in the world.  CFS prides itself on integrity, long-term relationships, and independence. 

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Media Contact:

Brigitte Rudman
212.626.2660
brudman@the-cfs.org

New ETF Resource for Investors, Officials, and the Public

Exchange-Traded Funds (ETFs) are at the forefront of the shift from active to passive investment management styles.  Hence, ETFs now represent a large swath of the financial asset landscape. To be sure, ETFs provide outstanding vehicles to express views across a wide range of asset classes. Yet, the Federal Reserve Bank of New York created a special Secondary Market Corporate Credit Facility (SMCCF) to purchase ETFs and some fear underlying systemic risks.

CFS recently conducted a survey of highly knowledgeable participants in academia, investment management and banking.  The results were clear.  More knowledge of ETFs and their impact on the financial system is vital.

The Center for Financial Stability ETF library represents a first step to support and publicize the most thoughtful research and ideas regarding the market structure, risks, and policy.  The Library is divided into two sections 1) Analysis of Risks and Markets and 2) Policy and Regulation.

Access the ETF Library through the main menu on our homepage or www.centerforfinancialstability.org/ETFs.php

We invite you to submit original pieces or material to be considered for posting to Brigitte Rudman at brudman@the-cfs.org

Financial Timeline: 13 years of Official and Market Action

The CFS Financial Timeline, created and managed by senior fellow Yubo Wang, is likely the longest continuous financial timeline freely available. It covers over 1,300 international events from early 2007 to the present. The timeline curates essential inputs from established public sources to seamlessly link financial markets, financial institutions, and public policies.

The CFS Financial Timeline has become an integral part of the work done by scholars, students, government officials, and market analysts, who seek to:

  • Uncover relationships among market reactions, institutional activities, and public policies
  • Accurately analyze developments, in one place, as they happen,
  • Put current events in a historical context, and gain insights on future developments.

View the Timeline at:
http://centerforfinancialstability.org/timeline.php