00:00One form of regulation that gets a lot of attention in New York and on Wall Street is banking regulation.
00:06Let's talk about the supplemental leverage ratio, which seems like an obscure thing off to the side,
00:10but it has been the subject of much discussion.
00:13And it does, as I understand it, relate to U.S. treasuries and yields on U.S. treasuries,
00:17so that if major banks held more U.S. treasuries, it would bring yields down.
00:23You've said you're going to take more of an active role, as I understand it,
00:26with respect to some of that banking regulation.
00:28Where are we with that?
00:29I think we are very close to moving the supplementary leverage ratio, SLR.
00:36That is moving along very quickly between the three banking regulators, the Fed, the OCC, and the FDIC.
00:45So I would think we could see something on that over the summer.
00:50Over the summer.
00:51And knowing the markets as you do, would you anticipate that might have a significant material effect on treasury yields?
00:58Well, I think it could, because banks are being penalized for holding treasuries.
01:05There's a large supplementary leverage charge.
01:10So I think for holding the risk-free asset, we can reduce that.
01:14And, you know, I've seen estimates that it could bring yields down by tens of basis points.
01:21Certainly during the COVID crisis, it was temporarily taken off, and it had a big effect.
01:30So I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that, and I think it could be a big effect on that.
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