00:00Being regular and predictable does not mean that Treasury's issuance policy cannot or should not evolve as investor demand changes.
00:10If our borrowing outlook changes, so will the amount we issue.
00:14And if structural demand for certain products or tenors evolves over time, we will be responsive and adjust how we allocate issuance accordingly.
00:25For example, we are closely monitoring growth in money market funds and the stablecoin market, which are both large investors and Treasury bills.
00:37Money market funds are now valued at about $7.5 trillion, having grown by nearly $1 trillion in the last year alone.
00:45The stablecoin market, meanwhile, is valued at around $300 billion and could grow tenfold by the end of the decade, thanks to the innovation made possible by the Genius Act.
00:57As money market funds and stablecoins grow, so too will the demand for Treasury bills.
01:05In addition to growing demand for Treasury bills from money market funds and stablecoin providers,
01:10we are witnessing increased demand from banks as they shake off the excessive oversight that has held them back.
01:18Since the start of this year, bank portfolios have expanded their Treasury holdings.
01:22Additional reforms, including the potential ESLR reform I mentioned earlier, could further accelerate this process.
01:31As Treasury watches these trends play out, we will assess whether they are structural or temporary shifts,
01:38and we will adjust our long-term issuance plans accordingly.
01:43For Treasury auctions to be successful, we need to be attentive to market participants, but we will not change our overall protocols.
01:52We will remain analytical in our decision-making, adjusting issuance gradually to avoid market disruptions.
02:00We will provide public forward guidance to the extent practicable, and we will regularly canvass the market for feedback on how our issuance decisions are being received.
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