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Sen.Elizabeth Warren (D-Mass.) kicks off 2023 with a big focus on crypto in a speech this week where regulators and lawmakers are looking to strengthen protections around the digital asset market.
MM caught up with Warren Wednesday afternoon on her crypto plans, as well as her latest views on Fed rate hikes and President Joe Biden’s position to lead the National Economic Council.
Warren’s next move on crypto Reintroduction of a bill with GOP Sen.
Roger Marshall (Can.) To control counterfeiting of crypto-currencies.
Warren said it is her “main focus” in terms of crypto legislation.This time, she’s not floating the bill to remake consumer protections — an area where she believes regulators can already make a difference.Instead of introducing a comprehensive plan that covers the entire spectrum of crypto issues, she is taking a piecemeal legislative approach.
“There are two very different types of crypto problems..One is consumer fraud.
This is what we saw when FTX and other exchanges failed.It’s part of the pump and dump and carpet pulling and other ways customers get scammed.There are already many control tools to deal with that.We need regulators to use those tools, and Congress must ensure that those regulators have the resources they need to be effective police officers on the beat.
“Money laundering is in a different place..
It’s not as visible to the public.It happens in the darkest shadows of the crypto world, but the impact on our national security and law enforcement is enormous.… The current legal framework bears a huge stamp on crypto that illegal money laundering has taken place here.
Warren’s Voice: Same Risk, Same Rule – “This is not about creating any new anti-money laundering laws.This is about applying the same rules that apply to all other financial industries.”
Binary Background – Marshall called Marshall after she saw Warren question him about the use of crypto by drug traffickers, rogue nations and terrorists at a December Senate Agriculture hearing.“I heard the questions and thought, I need a partner to get a meaningful anti-money laundering bill.
Warren sees ‘soft landing’ if Fed freezes.– She blamed the Fed’s rate hike campaign for the damage it could do to workers and the economy.
She still believes that a severe recession can be avoided.
“I am more focused on what the federation will do next.A soft landing may be possible – without reinstating the massive rate hikes the Fed has imposed on our economy – this is true, but only if the Fed significantly slows down the pace it has taken over the past few months.
“Early indications are that inflation is slowing.So we want the Fed to say yes and stop raising interest rates to historically high levels.
Fed vice chairman Lael Brainard may lead Biden’s NEC.
– “Brian Deese has been an excellent NEC director and has served President Biden well.Lael Brainard is a very thoughtful economist.But most important is the vision and initiative of the President.
For the past two years, the president has fought critical battles on behalf of the American people and been freed.
… As long as he and his economic team continue to do that over the next two years, our country will be in good shape.
Happy birthday, Speaker McCarthy – For the rest of us, it’s just Thursday.Please send tips.[email protected] And [email protected].
The Commerce Department released its first estimate of fourth-quarter domestic product at 8:30 a.m.… The Labor Department released unemployment claims at 8:30 a.m.… President Joe Biden spoke about his economic policy wins and threats from House Republicans at 2 p.m.
…
The NYSE is an early surveillance target for financial services Republicans.– Income Home Financial Services Supervision and Investigations Chairman Bill Huizenga (R-Mich.) plans to press the New York Stock Exchange for information on the crisis that disrupted trading Tuesday, the Michigan Republican told Eleanor Mueller.
“The NYSE is now saying it was a technical error, quote, manual error on their part,” Huizenga said in an interview.“What do you mean? So we are preparing a letter,” he said.
“That’s a really important part … what is the control of this,” he added.“You have a problem; what was that problem? Not that there was any regulatory action or enforcement action against it, but it was very relevant to what was going on.”
“So let’s simply ask the question.
It doesn’t mean we have to have a hearing; Let’s send a letter and get a timely response.
– The NYSE addressed the problem.The disaster recovery systems were linked to a fault, the FT reported.
– Charles Schwab The NYSE pounced on the problem.This big board has exploded for not owning a “clear error” which raises doubts about the SEC’s plan to get more investors’ orders filled on the exchanges.
Watch first: Kim and Green seek Taiwan’s role at IMF in new bill – Representatives Young Kim (Ar-Khalif) and Al Green (D-Texas) The governor of the U.S.IMF — the Treasury — is introducing legislation today that would require Taiwan’s admission as a member of the fund.
Kim and Green will be members of the House Financial Services Committee this Congress.See the text of the bill here.
“As the 21st largest economy in the world and the 10th largest trading partner of the United States, Taiwan deserves a seat at the IMF,” Kim said in a statement.
AOC era ends with House Financial Services– Representative.Alexandria Ocasio-Cortz (DN.Y.) will no longer serve on the House Financial Services Committee, after Democrats lost a seat and she seeks a position on House oversight, Eleanor reports.
Ocasio-Cortez follows the Republic.Katie Porter (D-Calif.), another high-profile progressive elected in 2018, who left the panel last Congress.In 2019, they made a big mess when they joined the Squad members Rashida Telaib (D-Mich.) and Ayana Presley (D-Mass.) sometimes clashed with then-Chairman Maxine Waters.
Other Democrats who won’t return to House Financial Services include Reps.Jake Auchincloss Massachusetts, Chu Garcia Illinois and Alma Adams North Carolina.
– In other committee events, Fox News host Tucker Carlson Chairman of Financial Services Patrick McHenry (RN.C.) to place diversity and inclusion under the jurisdiction of the panel’s subcommittees.
Carlson said McHenry declined to appear on the show.
After McCarthy’s debt ceiling meeting, Manchin was promoted– Sen.Joe Manchin.(DW.Va) Speaker of the House Kevin McCarthy When the two met to discuss debt ceiling negotiations, they agreed to leave Social Security, Medicare and Medicaid untouched, Politico’s Burgess Everett reports.
“He was very receptive and wanted to negotiate and sit down and talk,” Manchin said.My feeling is that Kevin McCarthy wants this place to work.
– Senate conservatives return to the House GOP on the debt limit – From Eleanor: Sens.Ron Johnson (Wis.), Ted Cruz (Texas) and Rand Paul (K.) held a press conference Wednesday to show support for House Republicans pushing for spending cuts to increase the debt limit.
“We want to let our housemates know that we appreciate what they have done.We have a big job ahead of them; “We want to do everything we can to support their efforts, but we also want to encourage them,” Johnson said.
“They have to pass these things with a Republican vote.”
Brainard to NEC?– Federal Reserve Vice Chairman Lael Brainard is a contender to lead Biden’s National Economic Council when director Brian Dies leaves, The Washington Post reports.
Hiring Brainard creates a vacancy in the federation.The WSJ reports that some in the White House believe moving her to the administration is worth the Fed’s confirmation fight because a strong NEC chief is needed in a critical year for the economy.
The demand for housing seems to be high– New data from Redfin showed that pending U.S.home sales rose for the first time in more than a year, while other measures of demand rose, according to Bloomberg.Redfin cautioned that the situation varies from city to city and that the market is still quieter than when the outbreak began.
Treasury targets Russians for investing in US real estate.– The Financial Crimes Enforcement Network issued an alert Wednesday warning financial firms to be on the lookout for Russians trying to evade sanctions by funneling money into commercial real estate in the United States, Bloomberg reported.
Banks, fintechs draw battle lines on data access — MM’s Sam Sutton reports that banks and fintechs are at loggerheads over what types of customer accounts and financial institutions must comply with consumer data sharing rules from the CFPB.Business groups have begun publishing lengthy opinion letters to try to influence the bureau’s work on Dodd-Frank’s proposal to implement Section 1033.
The CFTC’s Johnson warns about the future of FTX derivatives arm – CFTC Commissioner Christine Johnson is raising alarms over plans to sell LedgerX, the FTX’s regulated derivatives platform that survived the crypto exchange collapse.
LedgerX has been registered with the CFTC since 2017 – before FTX acquired the business in 2021.Johnson told Sam that the agency has no say in the sales process, which could provide a back door to access markets controlled by bad actors.
Johnson has called on the CFTC to enact new rules that would give the agency more say in mergers involving companies under its jurisdiction.She is also asking lawmakers to include similar language in any future crypto legislation.
“It is completely unacceptable that we are denied a greater role in this process,” she said.“The impact on the sales of the licensed entity is very small.”
Treasury denies GOP request for Hunter Biden records– Bloomberg: “The U.S.
Treasury Department on Wednesday declined to report to House Republicans on any suspicious activity in foreign banks and other business transactions by Hunter Biden and other members of President Joe Biden’s family.”
The Bank of Canada has paused on rate hikes– Reuters: “The Bank of Canada raised its key interest rate to 4.5% on Wednesday, the highest level in 15 years, and became the first major central bank to say it would hold off on further hikes for now.
Germany expects economic growth.– WSJ: “The German economy will grow this year and may avoid a shallow recession in the short term, the government said on Wednesday, the latest sign of bright growth prospects in Europe despite alarming Russia’s invasion of Ukraine.”
People move – From SAM: Andreessen Horowitz’s crypto arm has signed up Colin McCune as its first lobbyist.McCune, a former senior aide to House Financial Services Chairman Patrick McHenry (RN.C.), joined the venture capital giant last year as head of government affairs..
