Treasury Secretary Janet Yellen told CBS News:Last week’s bankruptcy filing shocked the cryptocurrency world.
FTX, one of the world’s largest cryptocurrency exchanges, collapsed in just a week, leaving the company and former CEO Sam Bankman-Fried now under investigation in the United States and other countries with possible securities violations. Though the impact of the FTX collapse is largely limited to the crypto financial market, Yellen rallies a chorus of experts and officials from around the world to suggest the digital currency industry needs to face more regulation. joined the
In a wide-ranging interview in Bali, where the U.S. Treasury Secretary was attending the G20 summit with President Biden, Yellen told CBS News correspondent Nancy Cordes, “This is an indication that investors and consumers are really very cautious. I think it’s a field that has to be done,” she said.
“While we have very strong laws protecting investors and consumers in most financial markets, the crypto space is poorly regulated in several respects.”
Yellen said the Biden administration had highlighted “regulatory holes that must be filled to allow Americans to do business with peace of mind”, pointing to the “lack of proper oversight and regulation” of the FTX collapse. condemned.
Yellen stressed that she was not in a position to offer specific advice on how Americans should or should not invest their money, but said that cryptocurrencies are “very risky assets and In some ways, it’s even dangerous,” and urged people to be “very careful” about their activities in this space. ”
FTX’s creditors are seeking to reorganize the company as part of their Chapter 11 bankruptcy filing, so they will be among the first to receive the assets the bankruptcy judge sees fit. Investors in the Bahamas-based company, which has raised about $2 billion in venture capital, are second in line. This means that FTX account holders who have used the platform to trade Bitcoin, Solana, and other digital currencies will.
A “Strong and Resilient Economy” vs. Inflation
The Treasury secretary said the U.S. economy was strong and resilient overall and said he expected inflation to ease next year as more jobs were being created for Americans, but global conditions remained volatile. It warned it was “uncertain”.
“Many countries are suffering from high energy and food prices, and we bear those burdens ourselves, but the economy is strong and resilient,” Yellen told Cordes, adding that the U.S. labor market is growing. He said the market was “very strong.”
“We continue to create jobs at a very solid pace. Unemployment is at its lowest level in almost 50 years, and there are two job openings for every American looking for a job,” she said. Says the country’s household, bank, and corporate economic conditions are “big solid.”
“We expect inflation to decline over time, and Americans are right to be concerned about that, but I think it will feel better,” she said.
Diesel “shortage/low inventory”
One thing that could run counter to the U.S. inflation recovery this winter is the limited supply of diesel fuel. Diesel fuel is used to heat buildings and to move nearly everything Americans buy domestically. Diesel powers most freight trains and trucks, and due to a global shortage of fuel, prices have risen by more than 40% since last year and are still rising.
Earlier this month, rumors that fuel could even run out were circulated after one major U.S. supplier warned of a “shortage” on the East Coast.
US diesel inventories are lower than they were since 1982, but energy market experts sayand the United States never ran out — at least for the next few weeks, unless the global supply chain completely collapsed.
Yellen is also optimistic, but cautious. Asked by Cordes if the U.S. has enough diesel to survive the winter, she said, “Hopefully I believe we do,” but “some shortages and stock shortages” on the East Coast. admitted that there is
“Hopefully we don’t see any more gains. Prices are going up and we are monitoring the situation very closely,” she told Cordes, adding that the Biden administration “has spoken to the oil companies about it.” ” he added.
Shift to “China-dependent” EV?
While President Biden has said a lot about his ambition to power half the cars on U.S. roads on electricity rather than fossil fuels by 2030, the Pentagon recently announced a move to electric vehicles (EVs). He called China’s dominance in the battery market a major challenge to it. goal.
Most of the raw material for lithium-ion car batteries is made in China, and Yellen acknowledged that the U.S. and the auto industry have historically “relied on China.”
the finance secretary saidApproved by Congress this summer, “this includes incentives and provisions aimed at changing that and diversifying the supply chain for battery components.”
“These are very strong incentives for the United States and other allies to invest in these minerals, so we are focused on that. We expect that over time things will change and we will become less dependent on China, as it is being done in other countries that have trading territories.”
Kristopher J. Brooks and Megan Cerullo of CBS MoneyWatch contributed to this report.