michelle w bowman : brief remarks on the economy and bank regulation brief remarks by ms michelle w bowman, member of the board of governors of the federal reserve system, at the ceo / executive management conference, sponsored by the mississippi bankers association and the tennessee bankers association, banff, canada, 2 october 2023. * * * thank you for the invitation to join you today. it is a privilege to speak to so many bank leaders from mississippi and tennessee together at the same time, and i appreciate the opportunity to be here with you. 1 as a former community banker, one of the most informative, enjoyable, and productive aspects of my role is the time i spend with community bankers, listening to issues that are important to you and that affect you and your customers, including, of course, the impact of the fed's regulation and supervision. community banks play a key role in supporting economic growth and lending to serve their customers and communities, which is an indispensable role in the u. s. economy. before we turn to our conversation, i'd like to offer a few thoughts on the economy and monetary policy, following our federal open market committee ( fomc ) meeting last month. as you know, at that meeting, my colleagues and i voted to maintain the target range for the federal funds rate at 5 - 1 / 4 to 5 - 1 / 2 percent, after raising rates sharply over the past year and a half to reduce inflation. since then, there has been considerable progress on lowering inflation and the fomc has responded this year with a more gradual pace of increases. in keeping with this approach, we held the policy rate steady in june, raised it by 25 basis points in july, and then held steady again last month. inflation continues to be too high, and i expect it will likely be appropriate for the committee to raise rates further and hold them at a restrictive level for some time to return inflation to our 2 percent goal in a timely way. most recently, the latest inflation reading based on the personal consumption expenditure ( pce ) index showed that overall inflation rose, responding in part to higher oil prices. i see a continued risk that high energy prices could reverse some of the progress we have seen on inflation in recent months. at the same time, the economy has remained strong as the fomc has tightened monetary policy. real gross domestic product ( gdp has been growing at a solid pace. consumer spending has remained robust, and the housing sector

speech delivered to the committee for the republic, washington, d. c., january 16, which sets forth a proposal to limit banks to traditional commercial banking activities, restrict access to the federal safety net to banks, and require affiliates of a bank to disclose to their customers that they are outside the federal safety net. see joseph noss and rhiannon sowerbutts ( 2012 ), “ the implicit subsidy of banks ( pdf ), ” bank of england financial stability paper no. 15. bis central bankers ’ speeches conclusion today, few ideas can be less controversial than ending too big to fail. the question is “ how? ”, and there are differing opinions on that. in titles i and ii of dodd - frank, congress has given the regulators a game plan for ending too big to fail. the regulators, including the federal reserve, are forcefully implementing the plan we have been given. my own view is that the framework of current reforms is promising, and should be given time to work. in any case, too big to fail must end, even if more intrusive measures prove necessary in the end. thank you very much. bis central bankers ’ speeches