All posts by Zhloeco

US Senate Panel Targets Chinese Banks with North Korea Sanctions

The U.S. Senate Banking Committee unanimously backed new sanctions targeting Chinese banks that do business with North Korea on Tuesday, just before President Donald Trump visits Beijing for the first time since taking office.

As well as strengthening existing sanctions and congressional oversight, the measure will target foreign financial institutions — in China and elsewhere — that provide services to those subject to North Korea-related sanctions by the U.S. Congress, a presidential order or U.N. Security Council resolution.

All 12 Republicans and 11 Democrats on the panel voted for the “Otto Warmbier Banking Restrictions Involving North Korea (BRINK) Act,” clearing the way for its consideration by the full Senate.

The bill was named after a U.S. student who died earlier this year after he was imprisoned in North Korea, further chilling already poor relations between Washington and Pyongyang.

“For too long, we’ve been complacent about the growing and gathering threat from the North Korean regime,” Republican Pat Toomey, one of the bill’s authors, said after the committee voted.

Democratic Senator Chris Van Hollen, another author, said that in addition to Chinese banks, Malaysian financial institutions might end up in its sights.

Trump is due to wrap up a visit to Seoul on Wednesday with a major speech on North Korea, and then shift focus to China, where he is expected to press a reluctant President Xi Jinping to tighten the screws further on Pyongyang.

Some of Trump’s fellow Republicans, as well as many Democrats, have been critical of Trump’s bellicose rhetoric about North Korea, and have called for the use of economic tools like sanctions or more negotiations before talking of war.

Washington so far has largely held off on imposing new sanctions against Chinese banks and companies doing business with North Korea, given fears of retaliation by Beijing and possibly far-reaching effects on the world economy.

Van Hollen told reporters on Monday ahead of the committee vote that he wished Trump would follow the model of President Theodore Roosevelt and “speak softly and carry a big stick,” adding: “We’re trying to give him a little bigger stick with the sanctions.”

Republican and Democratic lawmakers said last week they had reached a bipartisan agreement on the sanctions bill. A companion bill has been introduced in the House of Representatives.

The leaders of the Republican-led Senate have not said when the chamber might vote on the legislation.

 

 

National Assembly: Venezuela’s January-October Inflation 826 Percent

Inflation in Venezuela’s crisis-hit economy was 826 percent in the 10 months to October and may end 2017 above 1,400 percent, the opposition-controlled National Assembly said Friday.

The government stopped releasing price data more than a year ago but congress has published its own figures since January and they have been close to private economists’ estimates.

As well as the alarming Jan-Oct cumulative rise, the legislative body, which has been sidelined by President Nicolas Maduro’s government, put monthly inflation at 45.5 percent for October, compared with 36.3 percent in September.

Opponents say Maduro and his predecessor, Hugo Chavez, have wrecked a once-prosperous economy with 18 years of state-led socialist policies from nationalizations to currency controls.

The government says it is victim of an “economic war” including speculation and hoarding by pro-opposition businessmen, combined with U.S. sanctions and the fall in global oil prices from mid-2014. OPEC member Venezuela relies on crude oil for more than 95 percent of its export revenues.

Prices in Venezuela, which has long had one of the highest inflation rates in the world, rose 180.9 percent in 2015 and 274 percent in 2016, according to official figures, although many economists believe the real data was worse.

Announcing the October calculations, opposition lawmaker Angel Alvarado told the National Assembly that inflation next year could reach 12,000 percent.

“This is dramatic, this is Venezuelans’ big problem, it’s what keeps workers awake at night, it’s what’s killing the people with hunger,” Alvarado said.

In a research note this week, New York-based Torino Capital estimated Venezuela’s 2017 inflation would be 1,032 percent.

A central bank spokeswoman could not provide official data.

Island Nations Fear ‘Apocalyptic’ Storms Will Overwhelm Them

Unless emissions can be drastically and quickly curbed, efforts by small island nations to adapt to climate change may be in vain, a leader of a group of small island nations said Tuesday.

Hurricanes that hit the Caribbean this year were like nothing seen before, with Hurricane Irma so strong it was picked up by seismic machines that detect earthquake tremors, officials said.

National plans to curb planet-warming emissions, drawn up ahead of the Paris Agreement, currently add up to a projected temperature rise of 3 degrees Celsius above pre-industrial levels by 2100 — well above the 1 degree Celsius rise already seen.

That may bring climate impacts that are impossible for small island nations to deal with, their leaders warned Tuesday at the U.N. climate talks in Bonn.

If ambition to curb climate remains modest, “have we created a situation for small island developing states where resilience may not necessarily be … achievable?” asked Janine Felson, Belize ambassador to the United Nations and vice chair of the Alliance of Small Island States.

This year, Hurricane Maria destroyed broad swaths of homes and infrastructure on the Caribbean island of Dominica and stripped its trees bare. Barbuda island was left temporarily uninhabitable when Irma whipped through the region.

“In the Caribbean we’re used to hurricanes, but … for the first time we’ve seen storms turbocharge and supersize in a matter of hours,” she said, speaking on the sidelines of the climate talks.

The storms’ impact was “quite apocalyptic,” and magnified the acute vulnerability of small island states, Felson said.

Even so, countries — who are now clear on the risks — can take steps to protect themselves by building structures better able to weather storms, and ensuring policies take into account the rapidly changing climate, she said.

“If we do not know the extent of our vulnerability, then we will not change,” Felson said.

Bouncing back

In Fiji, resilience to the rapidly changing climate is about communities being able to bounce back, rebuild together and become stronger, said Inia Seruiratu, Fiji minister for agriculture, rural and maritime development, and national disaster management.

When Cyclone Winston struck Fiji last year, it caused $100 million in damage to infrastructure alone. Businesses and people’s livelihoods suffered, women and girls became more vulnerable, and school records were lost, Seruiratu said.

“We need to put in place response measures that will allow vulnerable countries to cope with such severities,” he said.

Small island states also need to look at climate risk insurance schemes, and diversify their economies, he said.

“Our dependence on agriculture and tourism makes our economies particularly vulnerable,” he said.

Felson said that international climate funds — including the Green Climate Fund, the Least Developed Countries Fund and the South-South Cooperation Fund on Climate Change — need to better serve the needs of the most vulnerable countries facing climate impacts now.

Countries should also try to tap into the private sector, where much more financing is potentially available, she added.

No fossil fuel

Small island nation campaigners are pushing for countries to immediately phase out existing fossil fuel projects and ban new ones, alongside the overall Paris Agreement commitment to switch to renewable energy by the second half of the century as a way to keep planet-warming to no more than 1.5 degrees Celsius.

“We are fighting for our future. We want our children to be able to live where we live, to learn about our traditions, our culture,” said Billy Cava, Pacific coordinator for 350.org, an activist group, as he described changes in his home territory of New Caledonia.

With new coal mines and coal-fired power plants opening in many parts of the world — including a huge new mine planned in Australia — rapidly phasing out all fossil fuels remains a challenge, experts say.

But the stakes are too high to not push for this change, one campaigner from Fiji said.

“We have to move our plantations inland; we have to build back better after storms,” said Alisi Rabukawaqa-Nacewa, the Fiji program coordinator for the Coral Reef Alliance and a member of Pacific Island Represent campaign group.

“But that is not enough. We cannot keep adapting, moving farther and farther inland. What can we do? Build on the top of the mountain, buildings in the sky? No, we need a phase-out of fossil fuels,” she said.

FIFA Demands Visa, Work Permit and Tax Exemptions for 2026 World Cup

The United States and other countries hoping to host the 2026 World Cup should provide government guarantees on visa-free travel plus work permit and tax exemptions for their bids to be accepted, according to documents published by FIFA on Tuesday.

The U.S wants to host the 2026 tournament in a joint bid with Canada and Mexico, who would also have to commit to the government guarantees for their proposal to be accepted by soccer’s world governing body.

Morocco is currently the only other country to have indicated they will bid for the finals, which will be the first to feature an expanded 48-team field.

FIFA wants a visa-free environment, or at least non-discriminatory visa procedures, while the work permit exemptions apply to anyone involved with the World Cup and tax exemptions relate to the soccer governing body and its subsidiaries.

While FIFA has asked for — and received — similar exemptions in the past, their inclusion in a revamped World Cup bid process will mean the current U.S. administration of President Donald Trump will need to sign off on the exemptions.

Sunil Gulati, chairman of the joint U.S, Mexican and Canadian “United Bid Committee” has previously stated that Trump supports the attempt to bring the World Cup to the United States, which hosted the 1994 finals.

FIFA produced new bidding criteria after the organization was heavily criticized over the selection process for the 2018 and 2022 World Cup finals, won by Russia and Qatar respectively.

Formal submission of the completed bids has to be made by March 16, 2018 and FIFA will decide whether to select one of the candidate bids at their congress in June next year, or re-open the process if none of the bids are accepted.

Overview document

Regarding immigration and travel guarantees, the FIFA overview document on government guarantees states: “In order to cover the needs of the respective groups of individuals, the Government is requested to generally establish a visa-free environment or facilitate existing visa procedures for them. Regardless, any visa procedures must be applied in a non-discriminatory manner.”

As a presidential candidate, Trump called for a total ban on Muslims entering the U.S. as a counter-terrorism measure.

The courts have blocked his latest executive action barring entry into the United States for people from several Muslim-majority countries.

The FIFA document adds however that: “It is understood that such ease of access to the Host Country/Host Countries must by no means adversely affect the national immigration and security standards in the Host Country/Host Countries.”

The document also says a bidding nation’s government “is requested to guarantee the issuance of valid work permits unconditionally and without any restriction or discrimination of any kind” to people involved in the preparation, organization and hosting of the tournament.

It adds that the government “must grant a general tax exemption for FIFA, the 2026 FWC (FIFA World Cup) Entity, the 2026 FWC Subsidiaries (if applicable) and any other FIFA subsidiary limited to the period of preparation, delivery and wrap-up of the Competition, commencing on the date of appointment of the Host Country/Host Countries and ending on 31 December 2028.”

FIFA’s “enhanced” bidding guidelines are part of a series of reforms enacted after a corruption crisis in 2015 engulfed the organization. They include ethics, human rights and transparency commitments plus demands on stadium size and infrastructure.

 

US Demining Cut Provokes Cambodia

A U.S. decision to cut funding for a demining program in Cambodia threatens to further worsen a feud between Phnom Penh and Washington.

On Tuesday, it emerged through local media reports the U.S. had decided to discontinue annual funding in 2018, worth about $2 million, to clear explosive remnants of war in Cambodia.

Prime Minister Hun Sen reportedly responded to the surprise decision by declaring he will stump to raise the money, according to a senior Cambodian demining official.

No public explanation has been given for the cut, and both the Cambodian Mine Action Center (CMAC), the final recipient of the funding, and Norwegian People’s Aid, which administer the money, say they do not know why the funding has been discontinued.

CMAC Director General Heng Ratana said he had no warning of any cut to the funding before he received notification Monday about the decision. The money covered the salaries of about 300 staffers, many of whom were deminers.

“I don’t know what the real dispute [is]. We just present the facts and we work together; they never indicated any dispute that we have had, but suddenly they cut the aid,” he said.

“But we are very lucky that the government, the head, the prime minister, granted approval that he will maintain our operation as usual so that means it has no impact on our operation,” he said, adding that funds for the rest of this year had not been affected.

The United States had a moral obligation to deal with the legacy of its bombing of Cambodia during the Vietnam war, he added.

Ruling Cambodian People’s Party spokesman Sok Eysan told VOA he was unaware of the cut, which seemed peculiar to him.

“I think that it’s an issue which we see that it’s not normal. So, no matter what we answer, it will still be not normal,” he said.

Norwegian People’s Aid country director Aksel Steen-Nilsen said he, too, had been unaware about the reasons for the cut.

“I mean, of course, there is a lot of rhetoric between Cambodia and the U.S. right now,” he said. “But … I don’t see any specific objective related to this because it’s the end of the grant cycle, and then of course, it’s up to the donor if they have funds and interest to continue or not.”

Steen-Nilsen said cooperation had been good thus far over the three years the grant had been running and there was no indication of any special reason it would stop.

In an email, the deputy spokesman of the U.S. embassy in Phnom Penh, David Josar, said demining remained at the top of the State Department’s assistance priorities, but he did not address the specific reason for the cut.

“We will use 2018 resources to put in place a world-class removal program targeting U.S.-origin UXO [unexploded ordnance] in eastern Cambodia,” he wrote. “UXO experts have proposed that the United States devote more attention to clearing such UXO, in addition to our support for clearing the more lethal Chinese, Vietnamese, and Soviet land mines in western Cambodia.”

Next year’s funding would be opened up to competitive bidding with requests for proposals — prepared in consultation with the Cambodian government — to be released this year, he wrote without providing any further details.

For months, Cambodia has accused the U.S. of fomenting a color revolution — a conspiracy plot it has used as the grounds to jail the country’s opposition leader, Kem Sokha, and justify moves to dissolve his party.

They have seized on the continuing impacts of unexploded ordinance left over from the U.S.’s massive illegal bombing campaign during the Vietnam war — a line of attack only bolstered by news of the cut to CMAC funding.

Carl Thayer, an emeritus professor at the Australian Defense Force Academy, said the embassy reports he had read also did not seem to be specific about the reasoning for the cut.

“So we don’t really know the reason why the funding was cut so far, and it’s sheer speculation on Hun Sen’s part and political opportunism on his part to make that linkage,” he said.

Any retaliatory action by the U.S. in response to the decimation of Cambodia’s opposition party would have been made up front, he said.

“There’s an expression, ‘between conspiracy and cock-up, you always go for conspiracy, and that seems to be what the Cambodians are doing, and until I see a better explanation, I’m saying its just a bureaucratic decision probably made in Washington and passed through without much thinking,” he said.  

Josar said the U.S. had spent more than $131 million on the remediation of explosive remnants of war in Cambodia.

In recent years, the main focus of that funding has been on U.S.-dropped unexploded ordnance left in Cambodia’s east. Some experts have complained this diverts resources away from more harmful explosive remnants in the west.

 

Catalonia Faces 10 Percent Tourism Hit in Fourth Quarter

The restive Spanish region of Catalonia faces a potential $500 million financial hit in the fourth quarter as business-related travel dips following the attack in Barcelona and the uncertainty generated by the disputed independence referendum.

 

In an interview Monday with The Associated Press at the World Travel Market in London, Catalonia’s top tourism official Patrick Torrent said the region will likely see a 10-12 percent fall in tourist numbers during the fourth quarter, which would equate to around 450 million euros. The large bulk of that fall is related to a drop-off in business travel to events such as conventions.

 

Despite the anticipated fourth-quarter decline, the executive director at the Catalan Tourist Board, said Catalonia is set to see revenues this year outstrip those last year and that the expectation is that revenues will rise again next.

 

However, more insight will emerge at the turn of the year when the bulk of pre-reservations are made. His staff, he said, are “on alert” about the impact on the main booking season.

 

The worry among many economists is that deteriorating business environment in Catalonia, which has seen around 1,500 firms move their headquarters out of the region, could worsen further amid all the uncertainty. Credit ratings agency Moody’s has warned that the region’s financial recovery is being jeopardized

 

“Moody’s believes that the political instability will negatively affect the region’s economy, in particular foreign investor sentiment and the tourism sector, and add pressure to the region’s already weak finances,” it said last week.

The Catalan tourism industry, a key income generator in what is Spain’s richest region, has had a difficult few months. After the August attacks in Barcelona and a nearby town that saw 16 people killed, the region has been embroiled in a battle of wills with Spain over the disputed independence referendum in early October which prompted Madrid to impose direct rule and seek the arrest of members of the Catalan government, including its leader, Carles Puigdemont, who has fled to Brussels.

 

The impact of the attack in Barcelona on holiday travelers was short-lived, according to Torrent, and “less important” than other cities in Europe, such as Brussels or Paris.

 

“The perception of Barcelona and Catalonia as a safe destination has not suffered any impact,” he said, noting figures showing tourism numbers higher in September.

 

Torrent said he met up with Alvaro Nadal, the Spanish minister of energy, tourism and digital matters, on Monday for the first time since the triggering of Article 155 of the Spanish Constitution which imposed direct rule on Catalonia.

 

Torrent said the Spanish government has made no requirements upon him or his staff and that it is “business as usual” until an early Catalan regional election on Dec. 21.

 

“It’s not intervention. It’s more a kind of coordination,” he said. “It’s easy, it’s not complicated, with good relations without problems, at this moment.”

 

Before direct rule, Torrent would speak with Spanish tourism officials two or three times a month. Now, it’s that amount of times a week.

Torrent urged all participants in upcoming demonstrations in Catalonia before the election, including one this Saturday, to remain peaceful and law-abiding.

 

“It’s important to say that our streets are normal, our restaurants are working as usual, our destination is exactly the same situation,” Torrent said.

Saudi Economy Vulnerable as Corruption Probe Hits Business Old Guard

Two weeks ago the glitzy Ritz Carlton hotel in Riyadh was the site of an international conference promoting Saudi Arabia as an investment destination, with over 3,000 officials and business leaders attending.

Now the hotel is temporarily serving as a luxury prison where some of the kingdom’s political and business elite are being held in a widening crackdown on corruption that may change the way the economy works.

By detaining dozens of officials and tycoons, a new anti-corruption body headed by Crown Prince Mohammed bin Salman is seeking to dismantle systems of patronage and kick-backs that have distorted the economy for decades.

But it is a risky process, because the crackdown is hurting some of the kingdom’s top private businessmen — leaders of family conglomerates who have built much of the non-oil economy over the past few decades.

Many industries could suffer if investment by these families dries up in coming months, at a time when the economy has already fallen into recession because of low oil prices and austerity policies.

New breed of companies

Meanwhile, a new breed of state-backed companies is rising to compete with the old guard; many of the new enterprises are linked to the Public Investment Fund (PIF), the kingdom’s top sovereign wealth fund. But it is not clear how smoothly the transition to these firms will happen.

“The rules of the game are changing. But they’re changing indiscriminately,” said one financial analyst in the region, declining to be named because of political sensitivities. “Even people who thought they were within the rules don’t know if they will still be within those rules tomorrow. There’s just uncertainty.”

Some private businessmen in Saudi Arabia are now trying to move their money out of the country “while they still can,” the analyst said.

For many foreigners, the most shocking aspect of the purge has been the detention of billionaire Prince Alwaleed bin Talal, the flamboyant, internationally known chairman of investment firm Kingdom Holding.

But for Saudis, the names of other detainees have been equally stunning: Nasser bin Aqeel al-Tayyar, founder of the Al Tayyar Travel group; billionaire Saleh Kamel; and Bakr bin Laden, chairman of the huge Saudi Binladin construction conglomerate.

State contracts

The saga of the Binladin group underlines how the business environment is changing. Binladin and another big construction group, Saudi Oger, long enjoyed preferential access to the kingdom’s biggest projects and control over pricing as a result of their close relationships with royal patrons.

But the bottom fell out from under both companies last year, when a cash squeeze resulting from low oil prices caused the government to cancel or suspend projects and delay payments.

The firms faced multi-billion dollar debt restructurings; Binladin has laid off tens of thousands of people while Oger’s bankers say it has essentially stopped operating.

New construction company

At the same time, state oil giant Saudi Aramco is moving to set up a construction company with local and international partners to build non-oil infrastructure in Saudi Arabia — potentially taking billions of dollars of business that would previously have gone to the family conglomerates.

Aramco and PIF, the sovereign fund, have also linked up with U.S. construction firm Jacobs Engineering to form a management company for strategic projects in the kingdom.

Many in the Saudi business world are celebrating the downfall of the old patronage system and the shift toward a “cleaner” business environment.

“It’s great news for the clean ones among us — 99.99 percent are ecstatic,” said one senior executive.

But others express disquiet about the possible economic fallout of the purge. Some are concerned that banks could start calling in loans to families implicated in the probe, using loan clauses that permit this in cases of legal jeopardy; this could collapse companies’ share prices.

Business deals put in limbo?

Many new business deals may be put on hold. A businessman at a foreign technology services firm told Reuters he had been considering a venture with a Saudi partner, but decided against it this week because of the partner’s ties to the detained Bakr bin Laden.

The new anti-corruption commission has broad authority to seize assets at home and abroad. Some businessmen wonder if these powers could be used to pressure firms into participating in Prince Mohammed’s economic development projects.

“It’s the old royal fiefdoms that are not in the Al Salman branch of the royal family that are now being purged,” said a Western analyst. “It’s a further centralising of political and economic power, and a seizing of the private assets that those fiefdoms have accumulated.”

 

Dudley Retirement Reflects Broad Turnover of US Federal Reserve Leadership

A revamping of the Federal Reserve’s leadership is widening with the announcement Monday that William Dudley, president of the New York Fed and the No. 2 official on the Fed’s key interest rate panel, will retire next year.

 

Just last week, President Donald Trump chose Fed board member Jerome Powell to replace Janet Yellen as Fed chair in February. The post of Fed vice chair remains vacant. So do two additional seats on the Fed’s seven-member board. And a fourth seat may open as well next year.

The unusual pace of the turnover has given Trump the rare opportunity for a president to put his personal stamp on the makeup of the Fed, which operates as an independent agency. Investors are awaiting signals of how Trump’s upcoming selections might alter the Fed’s approach to interest rates and regulations.

 

Trump has made it known that he favors low interest rates. He has also called for a loosening of financial regulations. The Fed has played a key role in overseeing the tighter regulations that were enacted after the 2008 financial crisis, which nearly toppled the banking system.

 

The uncertainty surrounding the Fed’s top policymakers has been heightened by the slow pace with which the Trump administration has moved to fill openings.

To date, the administration has placed one new person on the Fed board: Randal Quarles, a veteran of the private equity industry who is thought to favor looser regulations, was confirmed as the first vice chairman for supervision. That still left three vacancies on the Fed’s board: Just as Quarles was joining the board last month, Stanley Fischer was stepping down as Fed vice chairman.

 

And Yellen herself could decide to leave the board when her term as chair ends on Feb. 3, even though her separate term on the board runs until 2024.

 

Dudley’s announcement that he plans to retire by mid-2018 also creates an opening on the committee of board members and bank presidents who set interest rate policies. Dudley’s position is particularly crucial: As head of the New York Fed, he is a permanent voting member of the Fed committee that sets interest rates.

 

The committee is composed of the board members and five of the 12 regional bank presidents. Unlike the New York Fed president, the other regional bank presidents vote on a rotating basis. The New York Fed president also serves as vice chairman of the rate-setting panel.

 

Some economists said that while financial markets have so far registered little concern about the number of key open Fed positions, that could change quickly, especially if investors begin to worry that the central bank will accelerate interest rate hikes.

 

“We need to get rid of this uncertainty, and until these seats are filled, there is going to be uncertainty,” said Diane Swonk, chief economist at DS Economics.

 

Analysts are trying to read the two decisions Trump has made — picking Powell for the top job and Quarles for the key post for banking supervision — as signs for where he might be headed. With Powell, the president opted for continuity on rates by selecting someone who for years was the lone Republican on the board but who remained a reliable vote for the gradual approach to rate hikes Yellen favored.

And in the bank supervision post, analysts say Trump might have been signaling that he wants to reverse, or at least weaken, Yellen’s backing of the reforms instituted by the 2010 Dodd-Frank financial overhaul law. During the campaign, Trump argued that Dodd-Frank was harming the economy by constraining back lending.

 

Quarles has been critical of aspects of that law. To a lesser extent, so, too, has Powell, who will be the first Fed chairman in nearly 40 years to lack a degree in economics. Powell, a lawyer by training, amassed a fortune as an investment banker at the Carlyle Group.

 

“With his background, Powell can be expected to work well with Wall Street and the business community in general,” said Sung Won Sohn, an economics professor at California State University, Channel Islands.

 

A senior administration official indicated that one important attribute for the open positions will be a diversity of backgrounds.

 

“We believe the Fed will function best with a wide range of skill sets,” said the official, who spoke on condition of anonymity to discuss personnel decisions. This official would not give a timetable for when the administration’s next nominations for the Fed might occur.

Though Trump will choose officials to fill the openings on the board, the choice of Dudley’s replacement will fall to the board of the New York Fed. The New York Fed said a search committee had been formed to choose a successor to Dudley, who joined the New York Fed in 2007 after more than two decades at Goldman Sachs.

 

The announcement from the New York Fed said Dudley, 64, intended to step down in mid-2018 to ensure that his successor would be in place well before the mandatory end of Dudley’s term in January 2019.

 

After overseeing the New York Fed’s securities operations for two years, Dudley succeeded Timothy Geithner as its president after Geithner was tapped by President Barack Obama to become Treasury secretary in 2009.

 

Dudley won praise for the work he did with Geithner and Fed Chairman Ben Bernanke to contain the fallout from the 2008 financial crisis. Dudley supported Yellen’s cautious approach to raising the Fed’s benchmark rate and the plan the central bank has begun to gradually shrink its $4.5 trillion balance sheet, which is five times its size before the financial crisis.

 

The balance sheet contains $4.2 trillion in Treasurys and mortgage bonds that the Fed bought since 2008 to try to hold down long-term borrowing rates and help the economy recovery from the worst recession since the 1930s.

 

In a statement, Yellen praised Dudley for his “wise counsel and warm friendship throughout the years of the financial crisis and its aftermath.”