Claim OwnershipSimply Put
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A new podcast from FHN Financial looking at the most important things driving fixed income markets and the macroeconomy. Every episode features experts who give unique insights on topics like the regional banking landscape, commercial real estate, or how to translate Federal Reserve policy into market strategies. Tune in to better understand what’s been moving markets lately, and what to keep an eye on in the weeks and months ahead. Listen and subscribe wherever you get your podcasts
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Recent revisions have cast doubt on the reliability of the
government’s economic statistics. Budget cuts and job vacancies at the Bureau of Labor Statistics (BLS) have exacerbated pre-existing issues from low initial survey response rates and the difficulty of identifying economic inflection points in real-time. Striking the right balance between timeliness and precision is essential for investors and the Fed to make well-informed decisions. In this episode, we talk with Bill Beach, Commissioner of the BLS from 2019-2023, about the process behind BLS data collection, why recent revisions have been so large, and different ways to improve government data.
SEC Chair Paul Atkins said he is committed to fast-tracking President Trump’s proposal to change the frequency of corporate disclosure requirements from quarterly to semi-annually. Proponents argue the reform would significantly lower compliance costs and encourage more long-term thinking, while detractors believe it would decrease vital transparency that allows for price discovery and well-functioning markets. In this bonus episode, we talk with Nell Minow, a corporate governance scholar and Chair of ValueEdge Advisors, about the history of quarterly earnings reports, how regulators determine materiality, and the timeline for any potential regulatory changes.
The average rate for a 30-year fixed-rate mortgage fell 65bp between the beginning of June to the end of September, causing a mini refinancing boom from those who initially borrowed closer to this cycle’s peak rates. Most borrowers still have mortgages with rates well below the current market rate, however, reinforcing the “mortgage lock” that has stifled housing market churn over the last few years. The Fed’s policy path and longer-term interest rates will determine whether the housing market continues to thaw and how much prepayment risk there is for MBS investors. In this episode, we talk with Walt Schmidt, Manager of Mortgage Strategies with FHN Financial, about what’s caused the recent decline in mortgage rates, what to expect for MBS prepayments in the coming months, and whether another refinance boom is on the horizon.
FOMC participants disagree about current economic conditions as well as the current stance of monetary policy. The neutral fed funds rate, often called r*, is where policy is neither restrictive nor accommodative, and helps guide Fed officials’ assessments of optimal policy in the short- and long-run. As the Fed continues to normalize policy, the bond market will contend with the uncertain destination of short-term interest rates in the post-pandemic economy. In this episode, we talk with Chris Low, Chief Economist with FHN Financial, about the difficulty in estimating r*, how neutral policy estimates impact bond market pricing, and whether r* is a useful measure of broader financial conditions.
Countries around the world have started experimenting with central bank digital currencies, or CBDCs, to modernize their payments systems and increase accessibility to the banking system. Unlike money in a commercial bank, a CBDC in the United States would be backed by the Federal Reserve and could be transferred immediately between accounts, changing financial intermediation and how monetary policy channels into the economy. In this episode, we talk with Jim Cunha, former Executive Vice President of the Federal Reserve Bank of Boston, about the mechanics of CBDCs, how they would alter the banking sector, and what they could mean for the future of monetary policy.
The Federal Reserve helps support financial system resilience by acting as the lender of last resort, providing liquidity to institutions in exchange for high quality collateral. The usage of its 13(3) emergency authority during the 2023 regional banking crisis suggests the Fed may use these powers more frequently in today’s financial system. The rising importance of non-bank institutions has also complicated the Fed’s aim to strike an optimal balance between efficacy and the minimization of moral hazard. In this episode, we talk with Kate Judge, Professor of Law at Columbia Law School, about the Fed’s role as lender of last resort, evaluating liquidity needs versus insolvency, and whether existing facilities can mitigate the next financial crisis.
The historically strong relationship between sentiment and consumer spending has decayed over the last few years. Although households have thus far persevered through the frustration of rapid price increases and higher interest rates this cycle, the University of Michigan’s consumer sentiment survey has begun flashing new hints for a future pullback in personal consumption. In this episode, we talk with Joanne Hsu, Director of the Surveys of Consumers at the Institute for Social Research at the University of Michigan, about the mechanics of the U Mich survey, understanding post-pandemic economic resilience amid persistent pessimism, and why deteriorating sentiment this year could presage a downturn.
New policies are redefining the relationship between the federal government and higher education, curbing spending on research and threatening the revenue streams from endowments and international student tuition. Colleges and universities are looking for short-term fixes while developing longer-term plans to cut services or raise tuition fees. In this episode, we talk with David Jesse, Senior Writer at the Chronicle of Higher Education, about the federal government’s role in the financing of higher education, the financial impacts new policies could have on colleges and universities, and how institutions may adapt to the new landscape.
Chair Powell and the FOMC are facing heightened pressure to cut rates and account for cost overruns associated with renovations to the Fed’s headquarters. President Trump’s vocal desire to remove Powell has prompted investor concerns that monetary policy will be influenced by short-run political incentives rather than longer-run economic outcomes. In this special edition of Simply Put, we talk with Carola Binder, Associate Professor of Economics at the University of Texas, about the disinflationary impacts of central bank independence, the difference between de facto and de jure independence, and the Fed’s institutional guardrails against political pressure.
This year’s big fiscal package, officially titled the One Big Beautiful Bill Act (OBBBA), extends the TCJA’s tax cuts, increases spending on defense and immigration enforcement, significantly cuts Medicaid expenditures, and increases the debt ceiling by $5tn. The law’s budgetary impact will depend on the path of interest rates, how the economy responds to its various incentives, and whether temporary provisions are eventually made permanent. In this episode, we talk with Rachel Snyderman, Managing Director of Economic Policy at the Bipartisan Policy Center, about the OBBBA’s most significant provisions, its impact on federal deficits, and the ways it could affect growth and interest rates.
The US Court of International Trade ruled last month that President Trump does not have the authority to unilaterally implement this year’s tariffs under emergency powers, throwing the president’s newest trade levies into legal limbo. As the case winds its way through the appeals process, the international trade environment hangs in the balance. In this episode, we talk with Ilya Somin, Professor of Law at George Mason University and co-counsel in the recent tariff case at the US Court of International Trade, about the legal pathways for enacting tariffs, last month’s ruling, and his predictions for trade policy once the dust is settled.
Regulations, snarled supply chains, and the scarring effects of the global financial crisis have all contributed to a nationwide housing shortage over the last fifteen years. As housing unaffordability continues to limit prospective homebuyers, homebuilders must now contend with federal policies that will impact housing demand, labor availability, and costs for building materials. In this episode, we talk with Robert Dietz, Chief Economist with the National Association of Home Builders, about why there’s a national housing shortage, how homebuilders view new federal policies, and the best ways to improve residential construction.
The Supplementary Leverage Ratio (SLR) was designed to
increase banking sector resiliency after the Global Financial Crisis. Some have argued the SLR reduces Treasury market liquidity because the ratio is risk insensitive. Fed officials like Jerome Powell and Michelle Bowman have supported SLR reform, and Treasury Secretary Scott Bessent believes changes to the SLR could push Treasury yields down 30-70bp. In this episode, we talk with Joseph Wang, Principal at Monetary Macro and former trader on the Fed’s open markets desk, about the motivation behind the SLR, how it limits banks’ balance sheet flexibility, and whether reforms would help improve liquidity in the Treasury market.
The dollar has been the de facto global currency since World War II, pulling foreign investment into the US and allowing the federal government to borrow cheaply. A strong dollar also makes export-driven domestic industries less competitive, something the Trump administration is trying to offset through tariffs. A rumored “Mar-a-Lago Accord” would attempt to maintain the benefits of cheap borrowing while weakening the dollar. In this episode, we talk with Benn Steil, Senior Fellow and Director of International Economics at the Council on Foreign Relations, about the history behind the dollarization of global finance, the economic tradeoffs of sustained dollar strength, and how new policies could upend the dollar’s role in the post-war financial system.
The typical automobile manufactured in North America crosses national borders at least six times before it’s ready to be sold. Tariffs are expected to increase US auto prices by thousands of dollars as companies establish new supply chains and onshore manufacturing with higher production costs. In this episode, we talk with Jonathan Smoke, Chief Economist with Cox Automotive, about the complexity of auto manufacturing supply chains, tariffs’ impacts on prices and employment in the auto sector, and the outlook for a less globally integrated auto industry.
The Fed has been able to dismiss the economic risks from deteriorating sentiment by emphasizing the steady unemployment rate and decent job growth over the last seven months. The labor market’s surprising resilience over the last few years will now be tested by tariff-induced production changes, federal workforce layoffs, cuts to federal spending, and tighter immigration enforcement. In this episode, we talk with Guy Berger, Director of Economic Research at the Burning Glass Institute, about the risks from a low-churn labor market, how employers are shifting hiring plans amidst new federal policies, and whether the labor market can smoothly adjust to coming policy shocks.
President Trump’s latest tariff announcements have thrown global financial markets into a frenzy and increased the uncertainty for the US economic outlook. In this special edition of Simply Put, we talk with Amit Khandelwal, Professor of Global Affairs and Economics at Yale University, about the arguments for and against tariffs, how the 2018 tariffs affected the economy, and what the impacts could be of this year’s much broader and deeper tariff policies.
This year’s budget reconciliation bill has the potential to dramatically alter the fiscal relationship between states and the federal government. Some policymakers have proposed repealing the municipal tax exemption that has been at the heart of state financing for over a century. Others have suggested cutting federal spending by shifting the burden for certain outlays to state and local governments. In this episode, we talk with Emily Brock, Director of the Federal Liaison Center at the Government Finance Officers Association, about the critical role the muni tax exemption plays in local infrastructure investment, how states are adjusting to possible spending cuts from the federal government, and how the municipal bond market is responding amidst the policy uncertainty.
Government Sponsored Enterprises (GSEs) like Fannie Mae and Freddie Mac have been significant actors in the housing market for nearly a century. Ever since market distress pushed Fannie and Freddie into conservatorship of the Federal Housing Finance Authority in 2008, policymakers have sought to transition the firms back into more privatized roles. Reform discussions have accelerated after the November elections, but any massive changes would have to be judicious and likely require bipartisan support. In this episode, we interview Walt Schmidt, Manager of Mortgage Strategies with FHN Financial, about the history of GSEs in the housing market, potential reforms in the coming years, and what these changes would mean for the MBS market.
The pandemic fiscal response supported a much faster recovery in the US than after the financial crisis, but price levels and the federal deficit surged. Households and businesses, tired of high interest rates and cumulative price increases, must now contend with a tariff regime that aims to improve US competitiveness abroad at the risk of higher consumer prices. The Fed meanwhile is trying to restore price stability and preserve the recovery, unsure how much its rate policy is channeling into the economy. In this episode, we talk with journalist Matt Klein, creator of “The Overshoot” newsletter and co-author of the book Trade Wars are Class Wars, about the political appetite for future fiscal stimulus, tariffs’ effectiveness at improving global trade imbalances, and Fed policy in the post-pandemic economy. This interview was recorded live at the City Club of San Francisco on February 12.
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