00:00 Speaker A
I’m sure you’ve had some time to digest uh this news or of a nomination for Kevin Wash to succeed Jerome Powell’s Fed chair.
00:08 Speaker A
Warsh has made a, has not hidden his fact that he wants to remake how the Federal Reserve operates. How would a, a remake of the Federal Reserve impact a bank like yours?
00:21 Speaker B
Yeah, I mean, I’m going to leave the uh, you know, the prognostication on policy to the experts here. What, what I do think though, uh, is quite encouraging is uh, I think uh, the uh, nominee uh for Fed Chair has been clear that he believes that the Fed has a role, a very significant role to play in monetary policy, but that fiscal policy needs to be the purview of politicians.
00:46 Speaker B
I think one of the greatest threats to uh not just the banking sector but to the US economy in general is the fact that we’ve run these structural deficits for a very long time. And to the extent that we are in an environment where we’re going to get a productivity lift uh from AI and that means we can maybe have lower rates on the front end of the curve, but also some steepness to the curve as the Fed winds down its balance sheet, like that’s a pretty golden environment for banks.
1:13 Speaker B
Rates above absolute, you know, at absolute levels above zero on the front end uh and uh some steepness to the curve would be awesome for our industry.
1:21 Speaker A
You’ve spoken a lot Tim in the past about cryptocurrency and its rise and importance. Uh, how, how much of a threat is crypto to the banking system at this point in its life and you know, I imagine it’s going to get more important should that clarity act finally pass.
1:36 Speaker B
Yeah, I, I mean, I’m quite hopeful that we get the clarity act uh as a complement to the Genius Act earlier. Like you said, I’m a big believer that like you wake up every morning when you have a new technology and you can choose to be excited or afraid. And uh our belief at Fifth Third is that we’re better off when we embrace new technologies. So we have been very bullish in particular on stable coins uh and the role that stable coins uh can play as a payment rail.
2:05 Speaker B
I I think the in terms of the threat to the banking sector, it really comes down to whether uh we recognize that if it looks like a bank and it acts like a like a bank, it needs to be regulated like a bank, right? And the concerns that the sector is expressed over whether it’s special purpose charters, uh or the degree to which some of the crypto companies are openly attempting to circumvent uh the principles that were behind the genius Act in the way that they operate without having to be regulated like banks, that’s where the issue becomes.
2:37 Speaker B
We’re prepared to compete with anybody. Uh, it’s just has to be on a level playing field.
2:42 Speaker A
Tim, I can’t tell if you’re on team Jamie Diamond or team Brian Armstrong.
2:48 Speaker B
I I am on team Fifth Third. I’ve tried to be very clear about that. Uh, I represent our employees, our customers, the markets we serve.