Monday Links

What I am reading, plus a review of the Guild Starfire IV.

Some links and commentary on what I am reading and thinking about the week of October 6, 2024.

1. The anti-money-laundering lever that regulators have never used, by Catherine Leffert and Kevin Wack, American Banker. The tool is charter revocation, what bankers called the “death sentence” in the 19th century. “Never” overstates it - this was never common, but bank supervisors revoked charters in the 19th century and during the Great Depression with some frequency. Charter revocation is such a fascinating tool - I think the incredible hesitation to invoke it is a mistake, although I suspect the tool in the case mentioned (TD Bank’s efforts to finally resolve some serious AML compliance problems) isn’t well-suited to the problem. Even so, the optimal number of charter revocations is not zero, which is indeed the number going back many years.

2. ‘Fighting criticism with curiosity’: Evangelical pastor seeks understanding of Latter-day Saints through conversation, by Spencer Mahon, Salt Lake City’s ABC News affiliate. Summarizes a new and highly popular podcast by an evangelical Christian who seeks to understand his new Latter-day Saint neighbors in Utah. I am from Oklahoma, the buckle of the Bible belt and a center for evangelical Christianity. It was not an easy experience for me as a young Mormon. Evangelicals had very little patience for my quirky religion, which they neither recognized as Christian nor particularly religious (I was invited to a surreptitious anti-Mormon revival by my public-school English teacher in 9th grade, where they attempted to rescue me from Satanism; that left a mark). The 2008 and 2012 harassments of Latter-day Saints by evangelical mega-pastor Robert Jeffress was truer to my experience than the podcast referenced above. But the podcaster is not alone: one of my closest friends in the academy and in life is David Skeel, an evangelical Christian, with whom I discuss everything under the sun, including our shared Christianity. I am glad to see an evangelical podcaster in the tradition of David Skeel and not my old English teacher.

3. US Senator Warren asks regulator to impose growth curbs on Citi, by Pete Schroeder, Reuters. Always read Pete Schroeder, and always read Senator Warren’s banking letters. The asset cap that the Yellen Fed imposed on Wells Fargo’s holding company in 2018 (the very night before Janet Yellen stepped down as Fed chair after Trump’s Celebrity Fed Apprentice tour of 2017) is very rare, although not as rare as charter revocations. Citigroup has also had such a long history of quasi-failure and major regulatory challenges. I handicap the odds that the OCC imposes an asset cap unilaterally for the challenges Senator Warren cites at near zero, but as Pete notes, this will change the negotiation space for the OCC (and Citi) as they navigate. A useful form of congressional oversight.

4. Cash transfers and the Phillips curve: The case of Brazil during the pandemic, by Jose Angelo Divino and Adriana Gomes da Silva, academic paper published in Structural Change and Economic Dynamics. As readers will soon know only too well, I read everything I can on Brazilian economic history and policy, and this article is a fascinating one about the pandemic cash transfers and their interaction with inflation. Brazilian inflationary experiences bear profoundly on the psychology of nearly every economic policy - think maybe the midpoint between American and Argentine experiences. American Fed watchers, consider this: in 2023, Brazilian inflation was 4.5% and GDP was 2.9%. Meanwhile, the Banco Central do Brasil’s policy rate was 13.5%. Pretty astonishing and indicative of not only the economics of fighting inflation but the psychology as well. Anyway, Divino and da Silva have a fascinating analysis of the implications of fiscal policy on the shape of the Phillips Curve in Brazil.

5. International Powerlifting Federation Unveils Bench Press Rule Change for 2023, by Jake Dickson, Barbend. This isn’t new but I’m mildly obsessed with this change, which requires powerlifters to keep their backs on the bench. My own bench press form - PR of 335 lbs, aiming at 400, watch this space - isn’t affected by this change, and neither will 95% of bench pressers (as the article notes). But the record holders go to all kinds of wild lengths to make the bar path as short as possible, including more recently creating the most outlandish back bend in their lift. I myself have a small wingspan relative to a very long torso, which makes me a natural bench presser and explains why my squat is weirdly close to my bench (squat PR is 355 lbs, aiming at 500, watch this space). But the bigs were contorting their spines so impossibly in an effort to shorten their bar path that they looked like lunatics and were probably risking serious injury (although there is controversy on this point - something the back bend stabilizes more, not less). Good to see IPF put the kibosh on these antics. If you want to know how to do a perfect bench press, you can never do better than Jeff Nippard, the scientifically-oriented power lifter.

6. The Guild Starfire IV, by Guild. I am probably as committed a Gibson electric guitar player as you get. I adore my Les Paul and (my son’s) 335. But in part because my son has said in no uncertain terms that I am not allowed to buy my own 335 and can only play his with permission - pretty cheeky for a kid whose guitars all originated in his parents’ bank accounts, but what can you do - I have been on a multi-year quest to find a perfect semi-hollow alternative. I love Gretsch, liked okay D’Angelico, and am PRS curious. But the Guild is syrupy sweet, with astonishingly clear tones for blues, amazing sound on an Acoustic Sim (I use a Fender Mustang GTX 100 amp with a downloaded package), and just shreds with minimal distortion. My son thinks I am a bit crazy, but I may have found my permanent non-Gibson semi-hollow home. Good work, Guild!

What are you reading? What do you want to know more about? What do you want to know less about? Comment below.