'Leaving the clean energy transition to Wall street's voluntary actions is failing. The Federal Reserve needs to act swiftly, using its powerful regulatory tools to rein in banks' reckless fossil fuel financing.'
its international counterparts, these announcements indicate that the Fed is finally beginning to take climate risks seriously.
Now we must push for bolder action. Climate scenario analysis can be useful—depending on the kinds of scenarios used—to assess the risks to financial institutions. But it doesn't have any real teeth. It's merely an"exploratory" exercise at a time when we need the Fed to move from exploring to acting. Waiting for more data must not preclude ambitious action. We have enough information about the dangers of climate change to justify regulatory and supervisory action now.
To truly safeguard financial stability, the Fed must introduce policies that reflect the high risk of fossil fuel investment, like requiring banks to hold more capital against high-carbon assets. Higher capital requirements would disincentivize banks from investing in dirty fuels, and act as a buffer in the event that banks sustain unexpected losses, which is extremely likely given climate change. Eventually, the Fed must place outright limits on fossil fuel lending.
The Fed has been in the news a lot lately for raising interest rates in a misguided attempt to tame inflation by increasing the cost of borrowing and therefore dampening demand. Just last week we saw . But this blunt tool will cause more pain and misery, and it won't tackle the root sources of current inflation, which include our overdependence on volatile fossil fuels, corporate profiteering and supply-side turmoil.
México Últimas Noticias, México Titulares
Similar News:También puedes leer noticias similares a ésta que hemos recopilado de otras fuentes de noticias.
Credit card interest rates hit record highThe new high coincides with the Federal Reserve raising its key federal funds rate to a level not seen in more than a decade as it fights persistent inflation.
Leer más »
Binance Proof-of-Reserve pledge gains support following FTX crisisIt's about time! Several crypto enthusiasts support Binance's pledge to implement a Proof-of-Reserve mechanism to provide 'full transparency' through the use of Merkle Trees.
Leer más »
Gun advocacy group challenges NY's gun laws as federal judge suspends certain gun restrictionsA federal judge has suspended parts of NYC's gun restrictions, after he said officials overstepped their authority over individuals applying for gun licenses.
Leer más »
Federal judge tells Beaumont election officials not to harass or discriminate against Black votersClaims of misconduct during early voting were raised in a federal lawsuit filed Monday by the Beaumont chapter of the NAACP, accusing election workers of scrutinizing Black voters’ identities and shadowing them while at voting stations
Leer más »
Florida to DOJ: Federal election monitors not allowed inside polling locationsFlorida officials warned the US Justice Department that federal election monitors are not allowed inside polling places under state law, pushing back against federal plans for monitors in the state.
Leer más »
Late-arriving mail-in ballots for midterms won’t be held up by Republican federal lawsuitFederal judge sets oral arguments for December, too late to affect the Nov. 8 general election’s vote count.
Leer más »