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OptionsPlay Director of Education and Product Jessica Inskip gives her take on how Fed Chair Powell should respond to high inflation on ‘Making Money.’

The Federal Reserve launched its war against inflation exactly one year ago to the day, kicking off the most aggressive interest rate hike campaign since the 1980s as it rushed to cool the economy. 

In the time since March, 16, 2022, the U.S. central bank has lifted the federal funds rate eight times, underscoring just how serious policymakers are about tackling the inflation crisis. The increases put the key benchmark federal funds rate at a range of 4.75% to 5%, the highest since before the 2008 financial crisis.

The ninth increase is just around the corner, with Chairman Jerome Powell suggesting last week the Fed may need to raise rates higher than previously anticipated and pick up the pace of increases amid signs of broadening inflationary pressures within the economy. 

INFLATION ROSE 0.4% IN FEBRUARY AS PRICES REMAIN STUBBORNLY HIGH

Federal Reserve Chairman Jerome Powell testifies during a Senate Banking, Housing, and Urban Affairs Committee hearing in the Hart Building March 7, 2023. (Tom Williams/CQ-Roll Call, Inc via Getty Images / Getty Images)

The hawkish commentary prompted investors to reevaluate their expectations for the meeting, with many ramping up the odds that the Fed approves a half percentage point hike during its March 21-22 meeting.

But Wall Street no longer sees that as a possibility after the stunning implosion of Silicon Valley Bank on Friday roiled global markets and triggered fears of a broader financial meltdown. 

Silicon Valley Bank collapsed after a liquidity crunch, forcing a government takeover and raising questions over the fate of nearly $175 billion in customer deposits. 

It marked the largest U.S. bank failure since the global financial crisis in 2008, and rising interest rates played a pivotal role in SVB's collapse, according to Treasury Secretary Janet Yellen.

"The problems with the tech sector aren’t at the heart of the problems at this bank," Yellen said Sunday in an interview with CBS’ "Face the Nation."

SVB COLLAPSE THROWS FED RATE-HIKE DECISION NEXT WEEK INTO UNCERTAINTY

That's because SVB, which largely catered to tech companies, venture capital firms and high net worth individuals, saw a huge boom in deposits during the pandemic, with its assets surging from $56 billion in June 2018 to $212 billion in March 2023. The bank responded by investing a large chunk of that cash into long-term U.S. Treasury bonds and other mortgage-backed securities. 

That strategy backfired when the Fed started rapidly raising interest rates and the value of those securities tumbled.  

A sign of a branch of the Silicon Valley Bank in Frankfurt, Germany, Monday, March 13, 2023. (AP Photo/Michael Probst / AP Newsroom)

That coincided with a decline in available funding for startups, which started drawing down more of their money to cover their expenses, forcing the lender to sell part of its bond holds at a steep $1.8 billion loss. When depositors realized that SVB was in a precarious financial situation, a bank run ensued. 

The bank's collapse, coupled with another failure at Signature Bank and turmoil at Swiss lender Credit Suisse, drastically altered rate hike bets on Wall Street.

MORTGAGE RATES POST BIG DECLINE AMID SVB FALLOUT

While problems at the European lender appear to be unrelated to SVB, the back-to-back issues sparked fresh fears over the vulnerability of the banking sector in the era of high interest rates. Swiss regulators stepped in on Wednesday afternoon to announce they would provide liquidity to Credit Suisse if necessary.

Investors remain evenly divided over whether the Fed will pause its rate hike cycle next week or approve a 25 basis point increase, according to data from the CME Group's FedWatch tool, which tracks trading. But they are in wide agreement that policymakers will cut rates later this year amid the bank sector fiasco.

Pricing in futures markets suggests the central bank will trim rates throughout the year, shaving a full percentage point from a peak of 4.75% to 5% by the end of 2023. 

The logo of Swiss bank Credit Suisse at its headquarters in Zurich, Switzerland, March 24, 2021. (Reuters/Arnd Wiegmann / Reuters Photos)

"The easing of recent inflationary pressures, combined with concerns about the banking industry, finally give the Fed reason to discuss a possible end to their tightening cycle at next week’s meeting," said John Lynch, chief investment officer for Comerica Wealth Management. 

Still, new data released Tuesday morning revealed that inflation remains uncomfortably high. The Labor Department said the consumer price index, a broad measure of the price for everyday goods, including gasoline, groceries and rents, rose 0.4% in February from the previous month. Prices climbed 6% on an annual basis. 

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Although it marked the slowest annual inflation rate since September 2021, the gauge remains about three times higher than the pre-pandemic average, underscoring the persistent financial burden placed on millions of U.S. households by high prices. 

"The Federal Reserve is going to have to pick its poison: tolerate some inflation for a bit to see if its current series of rate hikes takes hold and pause or keep hiking and deal with the financial instability caused by their own policy decisions," said Jamie Cox, a managing partner for Harris Financial Group.

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Horns’ Ewers leads ‘new era’ of college football

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Horns' Ewers leads 'new era' of college football

ARLINGTON, Texas — Texas coach Steve Sarkisian said Thursday that quarterback Quinn Ewers, with the emergence of name, image and likeness and the transfer portal, has become the face of this “new era of college football.”

Ewers initially committed to Texas, but he then opted to skip his senior year of high school and reclassify to the 2021 recruiting class before enrolling a year early and joining Ohio State during preseason practice.

Still the nation’s No. 1 ranked overall prospect, Ewers landed one of the first marquee NIL deals worth $1.4 million.

Ewers, who lasted one season with the Buckeyes before transferring to Texas, will square off against Ohio State on Friday night in the Goodyear Cotton Bowl with a trip to the College Football Playoff national championship on the line.

“It’s not been an easy journey for him,” Sarkisian said Thursday. “There’s been ups, there’s been downs, there’s been injuries, there’s been great moments, there’s been tough moments. … But at the end of the day, he’s always stayed true to who he is. The guy’s been a steady sea for us.”

Ewers has been making college football headlines since Ohio State offered him a scholarship when he was just in middle school. This week, Buckeyes coach Ryan Day recalled meeting Ewers for the first time when he was an eighth-grader visiting a Buckeyes football camp.

“He was a boy at the time really, who just had a tremendous release,” Day recalled. “And I remember grabbing him and grabbing his dad and said, ‘Man, you got a bright future ahead of you. I don’t know if this is good or bad, but we’re going to offer you a scholarship to Ohio State.'”

C.J. Stroud, who has since led the Houston Texans to the NFL playoffs, emerged as a star quarterback for the Buckeyes then, prompting Ewers to transfer to Texas.

“Boy, it was strange how it all shook out,” Day said. “He decided he really wanted to play. And it was disappointing for us, but we certainly understood. From afar I’ve watched him. He’s a really good player. He comes from a great family, and he’s had a great career at Texas and a lot of people here still have good relationships with him and think the world of him.”

At Texas, Ewers has started in 27 wins and led the Longhorns to back-to-back playoff appearances. This season, he has thrown for 3,189 yards and 29 touchdowns with 11 interceptions.

Ewers noted that the “coolest part” of the NIL era is being able to provide for his parents. He has even hired his mom, making her CFO of his finances while giving her a salary.

“Which is nice just because all the effort and work they put into me growing up,” he said. “I mean, when we were living in South Texas, they both quit their jobs and moved up to Southlake [to support Ewers’ budding athletic career].”

Whatever happens in the playoff — whether it be a loss Friday or a national championship victory against the winner of Notre DamePenn State on Jan. 20 — Ewers’ career at Texas figures to be coming to a close.

Though Ewers still has one season of eligibility remaining, blue-chip quarterback prospect Arch Manning appears primed to finally take over in Austin next season.

Manning, the nephew of NFL quarterback greats Peyton and Eli Manning, who could become the No. 1 overall prospect for the 2026 NFL draft, has backed up Ewers for two seasons waiting for his opportunity. Sarkisian even momentarily benched Ewers in favor of Manning during Texas’ 30-15 loss to Georgia on Oct. 19.

Still, Ewers figures to have options.

ESPN football analyst Mel Kiper Jr. ranks him as the No. 6 quarterback prospect eligible for the upcoming draft. Rumors have also emerged recently that Ewers could put off the NFL for another year and transfer to a third school for millions more in NIL money.

Amid those distractions, Ewers has thrived in the playoff bouncing back from oblique and ankle injuries from earlier in the year to complete 69% of his passes with four touchdowns in Texas’ two victories.

In the Chick-fil-A Peach Bowl quarterfinal, Ewers tossed 29- and 25-yard touchdown passes in the overtimes, lifting Texas to the 39-31 win over Arizona State.

“I’ve just been proud of him,” Sarkisian said, “because he’s found a source for him that has been a motivating factor, where he can play free and play loose and play confident.”

Ewers added that, whatever the future holds, even contemplating it now would be “selfish,” with a national title still in reach for him and the Longhorns.

“I owe my teammates the best version of me right now,” he said. “I can’t be looking forward or I’ll trip on the rock that’s sitting right in front of me. I’ve got to be locked in on what’s right here.”

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Texas RT Williams back in lineup for CFP semi

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Texas RT Williams back in lineup for CFP semi

ARLINGTON, Texas — Texas starting right tackle Cameron Williams will return for the College Football Playoff semifinal against Ohio State on Friday, Longhorns coach Steve Sarkisian said Thursday.

Williams suffered a right knee sprain in the playoff opener against Clemson. The injury forced him to miss Texas’ quarterfinal overtime victory over Arizona State.

A junior, Williams has played in 37 games in his career with 16 starts for the Longhorns. Williams is rated as the No. 28 overall prospect and fifth offensive tackle in ESPN’s NFL draft rankings.

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Sources: Georgia QB Beck enters transfer portal

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Sources: Georgia QB Beck enters transfer portal

Georgia quarterback Carson Beck has entered the NCAA transfer portal, sources confirmed to ESPN on Thursday.

Beck had declared for the NFL draft on Dec. 28 but is now reversing course and will explore a transfer.

Sources told ESPN that Miami looms as the favorite for Beck and the timeline for his decision is expected to play out within a week.

While Miami is the favorite for Beck, a source said Beck’s camp intends to listen to all potential suitors for the best situation: “It’s a strategic thing, not an emotional thing,” the source said.

Beck, a two-year starter at Georgia, is currently recovering from surgery to repair the ulnar collateral ligament in his throwing elbow after suffering the injury during the Bulldogs’ SEC championship victory over Texas.

Beck will not be able to throw until March, sources told ESPN, which would have complicated his NFL draft process and will likely force him to miss spring practice at his next school. Sources said the variety of feedback he got from the draft process led to this decision, as he changed his mind in the past 24 hours. He received advice that if he could return and wanted to, he should probably return and play another season in college.

A source said Beck received feedback that he could end up anywhere between the first and third round, with much of that uncertainty due to the fact that he would not be able to throw for a team in predraft workouts.

Despite that injury setback, Beck will immediately become the most coveted quarterback available as a late entry to the transfer market. While Miami looms as the favorite, there are other big brand teams that could jump out as suitors including Texas Tech and Notre Dame.

The 6-foot-4, 220-pound senior went 24-3 as the Bulldogs’ starter and was viewed as a potential No. 1 draft pick entering the 2024 season. He threw for 3,485 yards with 28 touchdowns and 12 interceptions this season and led Georgia back to the SEC title game.

Beck injured his elbow on the final play of the first half against Texas on Dec. 7. Renowned orthopedic surgeon Dr. Neal ElAttrache performed Beck’s surgery on Dec. 23 in Los Angeles.

“He wants to win,” said the source close to Beck. “He didn’t come back to get knocked out at halftime of a conference championship.”

Entering his fifth college season, Beck was viewed as a potential top-10 draft pick. ESPN’s Mel Kiper Jr. currently considers Beck the No. 5 quarterback in his draft rankings.

Miami has not added a transfer quarterback this offseason to succeed Cam Ward, the potential No. 1 pick. They’ve quietly been canvassing the transfer market in recent weeks, per sources, as they have been set on bringing in a front-line starter who can produce immediately, much like Ward did.

Ward made a similar decision last January, initially declaring for the NFL draft but changing his mind and transferring to join the Hurricanes after he was unsatisfied with his draft feedback. Ward finished fourth in Heisman Trophy voting in his lone season in the program after producing 4,313 passing yards and 43 total touchdowns.

On3 first reported Beck’s intentions to enter the portal.

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