April 2021 Remarks by Director Falaschetti to the Financial Research Advisory Committee

Good morning, and welcome Committee members and our public to the Office of Financial Research’s 17th Advisory Committee. I am Dino Falaschetti, and have the privilege of serving as OFR’s Director.

First, I want to acknowledge our Committee members, thank you all for taking time from your demanding schedules to share your advice with us today. We are grateful for your service.

Also, I’m pleased to recognize the Financial Stability Oversight Council’s Director of Policy, Stephen Ledbetter. Thank you for joining us today, Steve.

Today’s meeting will be the second that we have held virtually, and I hope to be able to see you all in person soon. The COVID pandemic has dominated headlines for over a year, with material implications for many financial categories. The outbreak took countless lives and livelihoods. It triggered rapid and periodically unpredictable changes in markets that stressed the financial system, requiring numerous government interventions. Economic indicators on the eve of the pandemic showed little if any concern about a slowdown - let alone a sharp economic contraction. Over the turbulent months since the start of the pandemic, the OFR’s mandate has never been more important – that is, to support the Financial Stability Oversight Council with research insights and data services to help financial regulators respond more effectively to threats to financial stability. I am proud of the good work our Office has accomplished over the past year, and we look forward to further leveraging the expertise and industry knowledge that you bring to this table. Indeed, it is an important resource to further our core mandate.

Now, let me give you a quick overview of today’s agenda. In a minute, I will ask our Committee Chairman Randy Kroszner to make introductory remarks and introduce Tami Longaberger who I invited to join our Committee and serve as vice chair.

We will then hear a presentation led by Mickey Levey, with contributions from Colin Teichholtz, Larry Goodman, and Greg Hopper on the impacts of sustained low interest rates. We welcome input on this important topic from each member of the Committee.

FDIC Chairman Jelena McWilliams will join us at 11:00. After her remarks, she expects to have time to take two or three questions from Committee members.

Following Chairman McWilliams’s remarks, we will turn to our remaining discussions. The first will be led by Marc Summerlin on how policies and programs that were launched to support the COVID economy could give rise to future vulnerabilities.

We will then turn our discussion to the potential impacts of climate change on financial stability. As always, we’ll end today’s meeting with a discussion about ideas for our next meeting, with adjournment expected by 1:15.

If you need anything during the meeting, please use the chat to contact our colleague, Melissa Avstreih.

I want to remind everyone that this meeting is public and on the record. Questions and comments will be limited to Committee members only. I look forward to a productive discussion. And with that, I am pleased to introduce Randy Kroszner, our Chairman.