Cato Center for Monetary and Financial Alternatives

In a new speech, the IMF said, “If anything… we need to pick up speed [with CBDC development].”

Pick Up Speed on CBDCs, Says IMF The IMF said officials need to have the “courage and determination” to push forward on CBDCs.

People should stop looking solely to the Fed to actively manage the economy. At best, such active management will be ineffective, at worst it will be ineffective and crash labor or credit markets.

New Cato Study Confirms Fed Cannot Control Inflation Despite its mandate to stabilize prices, the Fed has historically exerted very little control over inflation.

Trade and Investment Are Not a Balancing Act

Trade and Investment Are Not a Balancing Act The trade deficit is a commonly misunderstood concept that inspires harmful policy ideas.

Americans’ opposition to a central bank digital currency skyrockets when they are informed about the potential risks.

Cato Survey Shows Few Americans Support Central Bank Digital Currencies A CBDC is ultimately a complete government takeover of something the private sector can, should, and does provide.

Join us tomorrow for a virtual event to discuss policy implications for financial artificial intelligence. https://buff.ly/3Mvmabm

In 2023 alone, more than half a dozen US financial regulators have addressed artificial intelligence (AI) through commentary or rulemaking, and the Biden administration’s October Executive Order on AI likely will have far‐reaching implications for financial use cases.

Join us on Thursday for an online panel exploring the policy implications of the financial AI developments on the horizon.

https://buff.ly/3Mvmabm

The arrival of generative artificial intelligence (AI) has captured the imagination of the public and policymakers. While often hailed as the newest new thing in many sectors, AI has been a core financial technology for decades. From market makers to consumer‐facing fintechs, our financial markets both deploy and innovate cutting‐edge AI.

In 2023 alone, more than half a dozen US financial regulators have addressed AI through commentary or rulemaking, and the Biden administration’s October Executive Order on AI likely will have far‐reaching implications for financial use cases. How regulators treat general‐purpose AI will affect the future of finance, and how they treat financial AI will affect the future of technology broadly. Join us for an online panel exploring the policy implications of the financial AI developments on the horizon.

Being Predictive: Financial AI and the Regulatory Future The arrival of generative artificial intelligence (AI) has captured the imagination of the public and policymakers.

Introducing a CBDC risks destabilizing the banking system and worsening panics. https://buff.ly/3ONr3yc

Policymakers generally should be wary of counterproductive interventions that hamstring the very innovations that could help to improve predictions, expand access to financial services and manage longstanding risks.

Regulators Must Avert Overreach When Targeting AI Policymakers generally should be wary of counterproductive interventions that hamstring the very innovations that could help to improve predictions, expand access to financial services and manage…

Hong Kong’s turn from the principles that made it a great society—namely, the rule of law, nonintervention, and a free market for ideas—has made successful entrepreneurs and advocates of freedom like Jimmy Lai enemies of the state. By silencing critics—under the guise of national security—both Hong Kong and China have sacrificed liberty in the name of “stability.” Reversing that trend is the biggest challenge they face in achieving social and economic harmony.

Jimmy Lai: Prisoner of the State Jimmy Lai, like other prisoners of the state, understands the key role a free market in ideas plays for both economic and personal freedom.

A CBDC would likely worsen bank runs, lead people to leave the banking system, and increase the cost of loans. https://buff.ly/3ONr3yc

The Right to Financial Privacy Act is meant to protect citizens from the government, but it provides immunity for private institutions sharing financial information with the government under certain circumstances. https://buff.ly/3L0Kfq3

Rather than launching a new government intervention that is unlikely to address the problems faced by the unbanked, removing legislative barriers to a more competitive financial sector has the power to open doors for those outside the financial system. https://buff.ly/3RagAOW

Regardless of the politics, price controls are harmful policies that tend to hurt the people they’re supposedly designed to help. Credit markets are not an exception to this rule. https://buff.ly/3LDUgJU

The FDIC’s systemic risk exception ultimately only politicizes the federal regulatory framework.

Gruenberg Speech Exposes Flaws in Financial Stability Mandate The premise that government regulation can ensure stable financial markets is wrong.

The approach to policymaking promoted by “new conservatives" is driven by bad economics.

Norbert Miche and Romina Boccia joined the Cato Daily Podcast to discuss high interest rates and the “debt doom loop”.

High Interest Rates and the Debt Doom Loop Featuring Norbert Michel, Romina Boccia, and Caleb O. Brown

LISTEN: Jennifer J. Schulp and Jack Solowey joined CatoPodcast to discuss the SEC’s “predictive data analytics” rule and what it means for the regulation of technology used by investors.

An Overbroad Federal Swipe at 'Gamified' Investing Featuring Jack Solowey, Jennifer J. Schulp, and Caleb O. Brown

The direct liability feature of a CBDC is one of the main reasons that a CBDC represents a radical departure from the existing financial system. Nicholas Anthony explains.

Whose Liability Is It Anyway? CBDC Edition Being a direct liability of the central bank is a defining feature of a CBDC. In practice, that trait means destabilizing the financial system is a defining feature of a CBDC.

The Right to Financial Privacy Act has about 20 different exceptions and therefore fails to truly protect privacy

Right to Financial Privacy Act Fails to Protect People's Privacy, Again This example is, unfortunately, another case in a long history of the Right to Financial Privacy Act failing to protect people’s privacy.

Claims that a CBDC will help bank the unbanked are weak. and Kevin Dowd explain

CBDC: Inclusion of the 'Unbanked' or Illusion? Rather than launching another new government intervention that is unlikely to address the problems faced by the unbanked, removing legislative barriers to a more competitive financial sector has the…

Does the Fed have as much control as everyone seems to think?

Amid Wave of Fed Criticism, Cato Study Finds Fed Has Been Historically Ineffective at Managing Inflation Anti‐inflationary policies require a wholistic approach that tackle demand and supply factors along with relying on the Fed.

While much of the conversation has surrounded the role of the Fed in allowing inflation to spiral, Jai Kedia writes that both fiscal and monetary authorities must act responsibly to keep prices stable.

Fiscal Spending Contributed to Post-COVID-19 Inflation Inserting hand‐to‐mouth consumers into a standard macro model shows that fiscal spending contributed to inflation.

The United States should not launch a CBDC. No government should have the kind of power that a CBDC provides.

Americans Need Stronger Private Sector Alternatives, Not CBDCs It’s true that it might take tons of capital and know‐how to compete with a well‐established company, but that’s precisely why the government should ensure the rules do not make it even more…

The Fourth Amendment is meant to safeguard against government abuse. Yet, the Bank Secrecy Act allows the government access to individuals financial records without a search warrant.

History has shown that a free enterprise system, with limited government, allows people to provide for themselves better than a system heavily controlled by politicians and bureaucrats who set arbitrary prices.

Hawley and Durbin Are Set to Crush Credit Regardless of the politics, price controls are harmful policies that tend to hurt the people they’re supposedly designed to help. Credit markets are not an exception to this rule.

In recent remarks, the FDIC Chairman repeated the conventional story that recent economic crises were primarily a result of inadequate regulation. Norbert Michel explains why this narrative is misguided.

Gruenberg Speech Exposes Flaws in Financial Stability Mandate The premise that government regulation can ensure stable financial markets is wrong.

“New conservatives” promote greater government control over how people produce and purchase goods and services. Yet, that system only works well for the politicians in charge until, of course, someone else is in charge.

The ‘New Conservatism’ Is Driven by Bad Economics They want government officials – presumably themselves – to have more control over how people produce and purchase the goods and services that meet their needs.

Six months after the high‐profile failures of Silicon Valley Bank and Signature Bank, the Cato Institute’s Center for Monetary and Financial Alternatives will host Federal Deposit Insurance Corporation Vice Chairman Travis Hill to discuss the state of banking and economic conditions, recent regulatory actions, and the outlook for banks and bank regulators. Following his remarks, Hill will take questions in a moderated discussion.

Insights on the FDIC's Agenda Join us for a conversation with Vice Chairman Travis Hillon on September 21 at 11:00 AM to discuss the state of banking and economic conditions, recent regulatory actions, and the outlook for banks…

Join us today for "Staying Ahead of the Curve: Crypto Regulation and Competitiveness".

Staying Ahead of the Curve: Crypto Regulation and Competitiveness How should new financial technologies that are designed to be open‐source and decentralized be regulated?