US Federal Reserve Chairman Jerome Powell said he was more worried about the risk of a large-scale cyberattack than another financial crisis like that of 2008.
The risks of a 2008-like crisis with a need for government bailouts of banks were “very, very low,” the head of the US central bank said during an interview aired on Sunday on CBS’ 60 Minutes.
“The world changes. The world evolves. And the risks change as well. And I would say that the risk that we keep our eyes on the most now is cyber-risk,” he said, adding that concern was shared by multiple governments and private businesses, particularly in finance.
Additionally, those organizations invest the most against cyberattacks, he noted.
Powell said that the Fed was considering different types of scenarios: “There are scenarios in which a large payment utility, for example, breaks down and the payment system can’t work. Payments can’t be completed. There are scenarios in which a large financial institution would lose the ability to track the payments that it’s making and things like that,” he said.
The Fed was also looking at the possibility that part or even a large part of the financial system could shut down.
“We spend so much time and energy and money guarding against these things,” he said, adding that cyberattacks on major organizations happen “every day.”
Powell was also asked about the possibility of creating a digital US dollar, as China last month became the first global economic power to unveil a cryptocurrency.
He said that for now, the Fed was evaluating the possibility.
“We feel it’s our obligation to understand it. How would it work? What would the features of it be?” Powell said.
He also said the Fed was developing software and even designing the look of a digital US dollar, but the final decision on whether to make it public would only be made once its impact was fully understood.
The US dollar is “the world’s reserve currency. The dollar is so important... We do not need to be the first ones to do this. We want to get it right. And that’s what we’re going to do,” he said.
In October last year, Powell said that the US was thinking about issuing its own cryptocurrency, but added that a full assessment of the benefits and risks would take time.
Regarding the US economy, Powell said on Sunday that it was “at an inflection point.”
Growth and employment would accelerate in the coming months, he said.
However, he once again said that the COVID-19 pandemic continued to present a risk.
“We feel like we’re at a place where the economy is about to start growing much more quickly and job creation coming in much more quickly,” Powell said.
“The outlook has brightened substantially, and that’s the base case. I would say again though, there really are risks out there,” he said.
“The principal risk to our economy right now really is that the disease would spread again. It’s going to be smart if people could continue to socially distance and wear masks,” Powell said.
The rise of the cryptocurrency dogecoin has reached a new level after the token was used to pay for a lunar satellite launch. SpaceX, Elon Musk’s commercial rocket firm, is to embark on a moon voyage next year carrying a so-called cubesat — a mini-satellite used for space research — from Geometric Energy Corp that has been paid for entirely in dogecoin. The development is the latest twist in the saga over the digital token, which started as a joke in 2013, but is now a dominating Internet meme and sitting on a 21,000 percent rally in the past year. Musk has
CAPACITY EXPANSION: Construction of the site, which is to be the firm’s first mRNA production facility outside of Europe, is to begin this year and likely finish in 2023 COVID-19 vaccine maker BioNTech SE yesterday said it would build a Southeast Asia headquarters and manufacturing site in Singapore to produce hundreds of millions of messenger RNA (mRNA)-based vaccines per year. Construction of the site would start this year, and it could become operational by 2023, the German company said in a statement. “With this planned mRNA production facility, we will increase our overall network capacity, and expand our ability to manufacture and deliver our mRNA vaccines and therapies to people around the world,” BioNTech chief executive Ugur Sahin said. The vaccine produced by BioNTech jointly with Pfizer Inc of
OUTBREAK: About 200 of the airline’s 1,200 pilots are not able to work. Most of them have been quarantined to prevent further infection, but 12 have COVID-19 China Airlines Ltd (CAL,中華航空) yesterday confirmed that it would temporarily reduce its cargo flight services to cope with a pilot shortage, as one-sixth of its pilots have been sidelined by a COVID-19 outbreak. “We are working out a new schedule,” the airline said in a statement after local news media reports on Saturday said that it would be reducing its cargo services from Wednesday, primarily affecting US destinations. CAL declined to give details about its new operating plan, but the reports said that it would be suspending its cargo flights to Dallas Fort Worth International Airport, Hartsfield-Jackson Atlanta International Airport and
The Financial Supervisory Commission (FSC) yesterday fined Citibank Taiwan Ltd (花旗台灣) NT$10 million (US$357,194) and DBS Bank Taiwan (星展台灣) NT$6 million for breaches of the nation’s anti-money laundering (AML) regulations. The NT$10 million fine is the highest penalty that it has imposed on a domestic bank, the commission said. Citibank Taiwan failed to set up a sound mechanism for evaluating clients’ risk of money laundering and for detecting suspicious transactions, Banking Bureau Deputy Director-General Huang Kuang-hsi (黃光熙) told a news conference in New Taipei City. The bank based its AML policies on those of its US-based parent company, Citigroup Inc, but the policies