Transcript: These Are the Signs of a Slow-Moving Credit Crunch
Understanding the fallout from SVB.
Jerome Powell, chairman of the US Federal Reserve, during an International Monetary Fund Committee (IMFC) plenary session at the spring meetings of the International Monetary Fund (IMF) and World Bank in Washington, DC, US, on Friday, April 14, 2023.
Photographer: Samuel Corum/BloombergThe big headlines from March's banking crisis have receded and balances at some of the Federal Reserve's emergency lending facilities, like the discount window, are starting to fall. But if you look closely, there are still signs of strain in the depths of the financial system. And of course, there are still plenty of worries about whether deposit outflows from banks will lead to a broader credit crunch that could tip the US economy into recession. On this episode of the Odd Lots podcast, we speak to Ben Emons, senior portfolio manager at NewEdge Wealth and a longtime portfolio manager at Pimco, about what the banking drama means for everything from US mortgage rates to the vast "repo" market that's often described as the plumbing of the financial system. This transcript has been edited for clarity and length.