Monetary policy and bank regulation are two sides of the same coin. Since private banks create money through lending, any regulatory action (like changing capital requirements) directly influences the money supply. Giving the executive branch control over regulation would undermine an independent monetary policy.

The removal of leverage lending guidelines will not cause a simple shift from private credit back to banks. Instead, it will accelerate the convergence of public and private credit markets. Banks will now compete across the entire financing continuum, further blurring the distinctions in terms and cost between the two.

The post-Powell Fed is likely to reverse the QE playbook. The strategy will involve aggressive rate cuts to lower the cost of capital, combined with deregulation (like SLR exemptions) to incentivize commercial banks to take over money creation. This marks a fundamental shift from central bank-led liquidity to private sector-led credit expansion.

A surge in IPOs and M&A isn't driven by pro-business policies, but by a reduction in policy uncertainty. With a clearer, albeit more interventionist, landscape, companies have the confidence to execute major strategic plans they had previously postponed.

Recent increases in funding market spreads suggest banking reserves may be too restrictive. This puts pressure on the Federal Reserve to end its balance sheet runoff (QT) sooner than its official timeline, creating a potential for market disappointment if the Fed delays its decision.

The common narrative of the Federal Reserve implementing Quantitative Tightening (QT) is misleading. The US has actually been injecting liquidity through less obvious channels. The real tightening may only be starting now as these methods are exhausted, signaling a significant, under-the-radar policy shift.

For the past decade, the Fed was the primary driver of liquidity. Now, the focus shifts to commercial banks' willingness and ability to create credit to fund major initiatives like AI and onshoring. Investors fixated on Fed policy are missing this crucial transition.

Pending EU securitization reform could significantly reduce punitive capital charges for insurers holding asset-backed securities (ABS). This single change would unlock a market estimated at nearly a trillion dollars, as European insurers currently have minimal exposure (under 1%) compared to their US counterparts (17%).

The early end to the Fed's Quantitative Tightening (QT) is largely irrelevant for year-end funding pressures. The monthly $20 billion runoff is insignificant compared to daily swings in Treasury balances or money market funds. The primary drivers remain bank balance sheet constraints and regulatory hurdles.