Josh Younger on the Origin Story of the Shadow Banking System

Odd Lots

Bloomberg

News, Investing, Business, News Commentary, Business News

4.4 • 1.6K Ratings

🗓️ 7 November 2022

⏱️ 50 minutes

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Summary

There are a bunch of historical analogies that people like to reach for in order to describe some of the economic trends we're seeing today. There's obviously the period of high inflation in the 1970s and early 1980s, or the disruptions caused by the Spanish Flu pandemic around 1918. But there's also a single year -- 1953 -- which not only contains some eerie similarities to today's economic environment, but also ended up having far-reaching consequences that reverberate all the way to 2022. On this episode, Josh Younger, JPMorgan's global head of asset and liability management research and strategy, tells the origin story of the decisions made in 1953 that helped create the vast repurchase or repo market. At a time when there are plenty of concerns over the stability of the market for US bonds, we go back in time to explore the reasons why repo exist at all.

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0:00.0	Do you know what your interest rate is on your savings account?
0:02.7	I bet it's lower than you think.
0:04.4	Go ahead and look.
0:05.2	And in the meantime, I'll tell you about US Treasury bills on public.
0:09.2	As of 9-1-2023, you could earn an annualized 5.5% yield with T-bills when held to maturity.
0:16.2	That's the highest rate on six-month Treasury bills since the year 2000.
0:20.0	Go to public.com slash T-Bill podcast to get started.
0:23.8	This is a paid endorsement by public.com,
0:26.0	fees and conditions apply.
0:27.3	Treasury accounts at public.com or through GICO Securities Inc.
0:30.4	Member Finra and SIPC.
0:31.8	Not FDIC insured?
0:33.1	No bank guarantee.
0:34.0	May lose value.
0:34.8	Full disclosures can be found at www.public.com slash T-Bill podcast.
0:40.4	The world needs solutions.
0:41.9	On October 24th at the London edition of the Bloomberg Technology Summit,
0:45.6	join leaders, innovators and entrepreneurs to discuss technologies that are poised to solve
0:50.5	our most pressing global challenges.
0:53.1	From reducing CO2 emissions and making cities more livable
0:56.4	to affordable healthcare and combating food insecurity.
1:00.0	Executives from Deliveroo, Siemens, Graphcore and more will examine where tech innovation can take us.
	...

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