Episode 123

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Published on:

14th Mar 2023

Jerome Powell’s Testimony, Silicon Valley Bank and Poor People Tax

Federal Reserve Chairman Jerome Powell has cautioned that interest rates are likely to rise higher than central bank policymakers had expected. Citing data showing that inflation has reversed the deceleration it showed in late 2022, Powell warned of tighter monetary policy ahead to slow a growing economy. His remarks imply that the peak, or terminal, level of the federal funds rate is likely to be higher than the previous indication from the Fed officials, and also that the switch last month to a smaller quarter-percentage point increase could be short-lived if inflation data continues to run hot.

In this episode of The Higher Standard, Chris and Saied examine this news and determine the effect it will have on the economy as a whole.


They discuss an announcement from automaker Rivian indicating a drop in its cash position. Rivian had cash and cash equivalents of $12.1 billion on hand at the end of December, down from $13.8 billion at the end of the third quarter and $15.5 billion as of June 30.


Chris and Saied look at news that investors have dumped shares of SVB Financial Group and a collection of other U.S. banks after the lender said it lost nearly $2 billion selling assets following a larger-than-expected decline in deposits.


They also offer some thoughts on data from ADP, indicating that private payrolls increased by 242,000 in February, versus the estimate for 205,000 and above the 119,000 in January.


Join Chris and Saied for this fascinating and informative conversation.


Enjoy!


What You’ll Learn in this Show:

  • Results of the most recent Job Openings and Labor Turnover Survey (JOLTS) report.
  • The voluntary liquidation of Silvergate Bank.
  • Demystifying concepts such as 'index plus margin' and a 'run on the bank.'
  • Why there is much more at play in banking than just finance.
  • And so much more...


Resources:

"Dow closes 570 points lower, turns negative for 2023 as Powell ignites higher rate fears: Live updates" (article from CNBC)

"Fed's Powell again rejects idea of raising inflation target" (article from Reuters)

"Rivian Stuns Investors With Very Bad News" (article from The Street)

"US unemployment is falling even as the economy slows. What the heck is going on?" (article from MarketWatch)

"Fed Chair Powell says interest rates are ‘likely to be higher’ than previously anticipated" (article from CNBC)

"Job openings declined in January but still far outnumber available workers" (article from CNBC)

"Private payrolls rose by 242,000 in February, better than expected, ADP says" (article from CNBC)

"Banks Lose Billions in Value After Tech Lender SVB Stumbles" (article from The Wall Street Journal)

"System Open Market Account Holdings of Domestic Securities" (article from The New York Fed)

"Slack is introducing AI assistant that can write messages for you" (article from Morning Brew)

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About the Podcast

The Higher Standard
This isn’t a different standard, it’s the higher standard.
Welcome to the Higher Standard Podcast, where we give you ultra-premium, unfiltered truth when it comes to building your wealth and curating the lifestyle of your dreams. Your hosts; Chris Naghibi and Saied Omar here to help you distill the immense amount of information and disinformation out there on the interwebs and give you the opportunity to choose a higher standard for yourself. Sit back, relax your mind and get ready for a different kind of podcast where we elevate your baseline with crispy high-resolution audio. This isn't a different standard. It's the higher standard.

About your host

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Christopher Naghibi

Christopher M. Naghibi is the host and founder of The Higher Standard podcast — a rapidly growing media platform delivering unfiltered financial literacy, real-world entrepreneurship lessons and economic commentary for the modern era.

After nearly two decades in banking, including his most recent role as Executive Vice President and Chief Operating Officer of First Foundation Bank (NYSE: FFWM), Christopher stepped away from corporate life to build a brand rooted in truth, transparency, and modern money insights. While at First Foundation, he had executive oversight of credit, product development, depository services, retail banking, loan servicing, and commercial operations. His leadership helped scale the bank’s presence in multiple national markets from $0 to over $13 billion.

Christopher is a licensed attorney, real estate broker, and general building contractor (Class B), and he brings a rare blend of legal, operational and real estate expertise to everything he does. His early career spanned diverse lending platforms, including multifamily, commercial, private banking, and middle market lending — holding key roles at Impac Commercial Capital Corporation, U.S. Financial Services & Residential Realty, and First Fidelity Funding.

In addition to his media work, Christopher is the CEO of Black Crown Inc. and Black Crown Law APC, which oversee his private holdings and legal affairs.

He holds a Juris Doctorate from Trinity Law School, an MBA from American Heritage University, and two bachelor degrees. He is also a graduate of the Yale School of Management’s Global Executive Leadership Program.

A published author and sought-after speaker (unless it’s his son’s birthday), Christopher continues to advocate for financial empowerment. He’s worked pro bono with families in need, helped craft affordable housing programs through Habitat for Humanity, and was a founding board member of She Built This City — helping spark interest in construction and trades for women of all ages.