The Central Bank As Crisis Manager | Dr. Patrick Honohan, former Central Bank of Ireland Governor, on Crisis Management, Macroeconomic Shocks, & Tariffs
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It is a privilege to welcome to Monetary Matters Dr. Patrick Honohan. He served as governor of the Central Bank of Ireland and is a member of the governing council of the European Central Bank from 2009 to 2015. He currently is a non-resident senior fellow at the Peter Institute for International Economics and an honorary professor of economics at Trinity College Dublin. He is the author of the most recent book, The Central Bank as Crisis Manager.

Patrick, so great to see you. Thank you so much for doing this.

Thanks for having me, Jack. I'm really glad you're here, Patrick. Your book, Central Bank as Crisis Manager, your central thesis, I think, is that central banks should not solely be focused on what their mandate is, price stability, or as we have in the States, price stability and good labor markets. They should always have in the back of their mind crises and how to handle financial crisis. Do I have that roughly right? And why do you believe that?

Yeah, no, that's exactly it. You know, I've been watching financial crises for many, many years and decades, in fact, and it's increasingly struck me over the years that every time there's one of these big financial crisis breaks out, even if it's in the United States, it's in Europe, it's in a developing economy, the central bank is going to be dragged into it. Obviously, it's going to have to handle the fallout. And every time that happens, it's as if it was a complete surprise.

and people roll up their sleeves and say, "Let's do something." They don't consider preparedness and planning, and they don't seem to realize that there's going to be a financial crisis and probably on the watch of the people who are in charge now. So they ought to be ready. They should be rehearsing. They should be imagining how they will behave in a way that's really substantially different

from how they behave in the normal business as usual, keeping price stability on the road. And what are the different qualities that they need to have for managing crises versus everyday price stability? Well, I mean, if you think about price stability in central banking, you know, you go and see the press conferences organized with Jay Powell, RB Forum, Janet Yellen, and Ben Bernanke, very orderly.

Very orderly affairs, answering questions from the... pitched at them from the journalists to say why they want to maybe raise interest rates by 25 basis points or maybe lower interest rates by 25 basis points. So it's very, very...

orderly and slow and gradual, the actions taken in regard to changing economic circumstances are generally slow. I mean, we had a very big inflation in the last couple of years. People spoke of the dramatic increases in interest rates, but basically they came at a quarter of a percentage point or a half a percentage point at a time. They were still orderly, even though quite quick by historic standards. So that's the first difference.

In a crisis, you've got to move fast. You've got days, if not, maybe it's just hours before you have to take some very decisive steps. So there's a speed difference. There's another type of difference in price stability.

You're dealing with an economy that you sort of understand. It's a fairly straightforward objective. Now, economies are complicated, but essentially the structures are stable over time and deepening understanding and calculations. It's fairly straightforward. But when a financial crisis breaks out,

It's broken out because people didn't understand what was going on, that there's a fundamentally inherent complexity in financial crises that means that you have to work very quickly to amass the information and understand the linkages between different financial institutions, between different financial contracts that are causing this crisis. So there's a difference between straightforward policy and the dramatic complexity of the policy.

A third difference is on messaging. I mean, I already mentioned the press conferences. The press conferences are repetitive. People study the statement coming out from the Federal Reserve, coming out from the ECB. They say, what's the difference between the last meeting? Oh, look, they said maybe instead of will be. They said orderly,

A small analysis of words. The messaging is, we're not going to surprise you because we are going to take the necessary action to keep price stability on track. And so all these subtle changes. Whereas in the case of a crisis...

The communication has to be very, very carefully matched to the circumstances. You have to make very nuanced communication that doesn't frighten people unduly, communicates to the people who probably partly understand what's going on, communicates to them that you as a central bank do understand. And so it's a very complex set of messages and it's very circumstance dependent. So that's the third difference.

And the fourth difference is that maybe you hardliners may be surprised, central banks are supposed to be independent. And indeed, I don't dispute that. In normal circumstances, an approach from the Treasury Secretary to say, why can't you do something to ease our

budgetary problems or financing problems are, will be rebuffed politely by Central Bank saying, "That's not my job. Your job is to boost growth. My job is to maintain stability." So Central Bankers tend to be aloof and distant from governments. That's not going to work in crisis times.

The solution to a major financial crisis is going to require a central bank component, but it's also going to require a government component, maybe with new legislation being proposed and enacted through the parliamentary and congressional procedures. It may require budgets. I mean, central banks can come up with the cash.

But that's always on a loan basis or an investment basis. It's not on a grant basis. And if there are grants needed to offset the effects of the financial crisis, they will ultimately have to come from government. So cooperation with government instead of distance from government. It doesn't mean losing independence, but it means having the connections, the understanding and the ability to communicate backwards and forwards between government and central bank.

Those are four big distinctions that I see between the central bank as it behaves in normal times and as it behaves in a financial crisis.

So the central bank can provide as much money as it wants, but that is going to be short-term liquidity. If there's going to be what you called a grant, a program, basically the government using its own balance sheet to absorb some of the losses from the private sector, that needs to come from the fiscal side, the actual government, not the central bank. So Patrick, when it comes to what a central bank can do in a crisis,

Go through the various tools, balance sheet policy, what you refer to in your book as ELA, emergency liquidity assistance, interest rates. And then there's also collaborating with the government, as you say. Then there's forward guidance. There is using terms, forward guidance would be the name of my old podcast, actually. And also there's a very psychological component to it, isn't there?

You're absolutely right. I could go into detail on each of these points. I think the important thing though, before you use the tools, you've got to understand the situation and decide what action needs to be taken. Some financial crises, even big ones, are inherently contained and containable. Take for example,

A couple of years ago, in 2023, we had several big events. One of the big events was the collapse of Credit Suisse, a big Swiss bank. It's the second largest bank in Switzerland, but that's not all it is. It was one of the global systemically important banks, one of the top, effectively top 20 banks in the world.

Yet there was no real expectation or sense that the collapse of this bank would spill over into a major global financial crisis. And so understanding that meant that did the Federal Reserve have to do anything? No. Did the Bank of England have to do anything? No, they didn't have to do very much because this was not something that spilled over.

over. It would have been a bad mistake, for example, for either of those major central banks to adapt their interest rate policies, to forget about inflation and to concentrate pouring money into the system. That was not needed then. It was needed back in 2008, Lehman

So analyzing the situation is so important to make sure that you do what is necessary, but you don't do more than what is necessary because doing more than what is necessary

usually entails a burden on the taxpayer ultimately, as you bail out too many people. And if it's not necessary, if it's not necessary to ensure that the crisis doesn't spill over into affecting all sorts of other sectors, non-financial sectors and create a recession.

But how do you know, for example, the Credit Suisse being taken over by UBS? I imagine that is a good thing, that it was taken over. UBS assumed basically all of the liabilities, I believe, of Credit Suisse. Whereas when Lehman Brothers failed, Lehman Brothers went bankrupt. So people who were owed money by Lehman Brothers had to go to a bankruptcy court.

And, you know, they were might have a money market fund that needed money the next day. And, you know, the bankruptcy court takes a year. So that was a disaster. And there's also the fact that, you know, if you did the work, which obviously I haven't, but people have that Lehman Brothers was a huge counterparty on many trades and Credit Suisse was as well, but to a lot, a lot, perhaps fewer counter counterparties.

But how do you know? And then also, do you agree that basically the fact that Credit Suisse's liabilities were absorbed by UBS, that was a enhanced stability and reduced the fallout? Let's take that case, the Credit Suisse case, because I think it's very illustrative of the sort of day-to-day challenges that faced the Swiss, the central bank, and obviously the financial regulator there, which is not

the Swiss National Bank, which is a central bank, is not the financial regulator. So they had to work closely with the financial regulator, which is obviously that task of financial regulation in the United States is distributed between the Federal Reserve and the FDIC and the control of the currencies. And a lot of agencies in the Federal Reserve have- And who's the bank regulator in Switzerland?

FINMA is the name of the bank regulator. What sort of problems did they face in that week? By Tuesday, you will probably have forgotten the details, but there was a huge run, a stock market collapse of the price of Credit Suisse shares on the stock market and a run against Credit Suisse.

The Swiss National Bank decided, having taken their assessment of the situation, that they did not want this bank to be unable to pay its depositors midweek. They wanted to get a solution and they wanted to get it at least to the weekend. So they decided they wanted to give an emergency liquidity loan to Credit Suisse, which is, you know, we talked about ELA. And suddenly they discovered that

that they couldn't because, and it's also true in the United States, a loan, an emergency liquidity loan, requires backing by some kind of collateral. And the Swiss National Bank had blocked themselves into a situation where they had a rule of what would be eligible collateral, and Credit Suisse didn't have enough of those. And so at that point, the Swiss National Bank had to ask the government

to enact a new law that widened the range of collateral, if you put it like that, into details. So here's a situation where midweek there had to be a change in the law of the country, cooperation with the government to ensure that that happened. So it's not just a question of assessing the situation, it's a question of assessing your preparedness to have the tools to deal with the situation.

The other aspect of that particular week was on communications. And a very delicate point because, you know, how do you communicate in a situation where the bank has not failed? Its stock market price is collapsing. Everybody's taking their money out. And so

The authorities, jointly the Swiss National Bank and FINMA, said that "oh no, Credit Suisse meets the capital and liquidity requirements for a systemically important bank" and I'm quoting this, they say "but this allows negative effects of major crises and shocks to be absorbed".

Now, this is not a very well, in my view, considered communication because by the end of the week, it was quite clear that Credit Suisse did not have the adequate liquidity. They had not been able to access emergency liquidity without a new law, and they did not have enough capital to survive. So this is sort of statement, very, very difficult situation. I don't deny that. But they made a statement that doesn't look good in retrospect.

and really tarnishes their ability to make good communications in a future crisis. So they need to have a complete grasp of the situation.

You know, Napoleon once said, you see, you've got to have military analogies. Napoleon would go into, he was, as you know, a pretty good general. He went into military situations, battlefield situations, and he said, what you need is to be able to grasp the entire situation at a glance.

"un coup d'oeil," he said in French, capture the situation at a glance. And that's what the central bank needed to do in the Credit Suisse case. They needed to get all the pieces together and say, yeah, there's a lot of pieces, but we see everything that is needed and every action that we take should be consistent with the goal that we aim at.

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Thanks for listening. Let's get back to the interview.

And you have to, don't you, Patrick, skate to where the puck is going, to use a hockey term or a soccer. You don't pass the ball in football to where your player is. You pass it to where your teammate is going. And if on Monday Credit Suisse has the capital and it has the liquidity, you just look at the outflows hour by hour. And by Thursday, they won't, right? Well, that's absolutely right. And, yeah.

You need to have the plan B as well. You may not be able to foresee everything that's happening. You don't know where the poke is going until your opponent actually strikes it. But there may be a limited number of directions. You need to know what you're going to do, not just in the most likely direction,

scenario over the coming days. But what happens if that's not enough and that's going in the wrong direction? So you've got to have that in your mind, your fallback. The tools that you can use, which may not be the ideal tools, but you know that they work even though they may have some bad side effects. You only use the ones with the side effects if the scalpel doesn't work.

So what did the Swiss National Bank actually do? What tools did it employ in the end? It did provide a very, very substantial emergency liquidity, having got the permission to do it. It made those statements. I think they were they were somewhat ineffectual. What they did not do and decided not to do was to use the new tool of resolution,

which now most of the advanced central banks, the emerging markets don't have it in many cases, but most of them have ensured that there's legislation and powers for the financial regulator, the supervisor banks, to seize control of a failing bank and to separate its structures in such a way that the vital services can be continued

when the failing parts are isolated financially and put into some kind of quasi bankruptcy procedure. So these are kind of complicated legislative tools for dealing with the bankruptcy of a bank.

but which allows the vital parts of the bank to continue. Swiss had these systems, they had practiced them, they had prepared for them, and they had announced even a few months before, they said, all of the major banks, we're ready to deal with any kind of failure situation using our resolution tools. They did not use the resolution tools because they seemed to have caught cold feet. They felt this is not actually going to work.

Even though they said they were going to use them and that they were ready to use, they didn't choose them. Instead, they went to the other big bank and said, "Hey, why don't you take over the number two bank?" This is the most old-fashioned form of coping with a failing bank, is to find another apparently strong bank and get them to take it over.

several drawbacks, including making your biggest bank even bigger, market power and so forth. It also left that bank, the UBS, in a strong position to demand a takeover which involved wiping out a block of

of the Credit Suisse's capital, not just the equity capital, but the so-called alternative tier one securities where their value was wiped to zero. UBS took the rest of the liabilities and assets of Credit Suisse. It was a very profitable operation for them because they were not hampered by the reputational damage that had been experienced by the management of Credit Suisse over the years. And they were able to put these

assets to good work. Yes. And a strong bank that takes over the assets of a failing bank, often that can be quite profitable. With UBS and Credit Suisse, when JP Morgan took over the assets of First Republic Bank, they made a lot of money. When First Citizens took over the assets of Silicon Valley Bank, they also made a lot of money. So Patrick, talk about that resolution authority. In America, is that resolution authority strictly within the FDIC? Yes.

And then what is the equivalent in Europe? Is it in the central banks or outside of the central bank? So before I answer that question, I want to say that there are also many cases, especially in the developing countries, but also in Europe around the time of the global financial crisis, where banks, strong banks taking over weak banks weakened the strong bank.

and put it into quite a big difficulty. So the FDIC does that job in the United States. There are several different versions of it for the United States. And in Europe, there is a single resolution board to deal with the largest of the banks in the euro area. And that's part of the ECB or no?

It's not part of the ECB. The ECB is part of the process that the ECB has to... Because the ECB now supervises the banks, and if the ECB has come to a conclusion that the bank is failing or likely to fail, they have to inform the Single Resolution Board, which is a separate entity. It's located in a different city. It's in Brussels rather than Frankfurt, and that separate entity also has to consult the European Commission, but it has the powers then to seize control of this bank and to break it up. And this has happened on...

only a handful of occasions because this mostly applies to very large banks and there haven't been too many large bank failures. The biggest case that they dealt with was the case of Banco Popular in Spain. That was, I think, in 2017.

Bank of England deals with this situation in the British situation because the supervision, resolution, and monetary policy are all within the Bank of England in London. Interesting. So going back to the tools, I guess there's lending against collateral, supplying money. There's, I guess, an American facility that is

a facility where banks can basically borrow as much as they want against collateral. You talked about a loan. Is that more of a term loan? I don't think the Federal Reserve is that's as common with the Federal Reserve. So there's lending as assets, and then there's buying assets.

buying assets in a crisis. Maybe it's different than quantitative easing, which is trying to lower long-term yields. And so talk about buying assets versus lending against assets. Lending against assets, central banks have been doing that for hundreds of years. Badgett wrote about it, right? The Badgett dictum. You can tell us what that is. Buying assets is a little bit different, right?

Yeah, no, the distinction is not between buying, in this context, is not between buying assets and lending. The distinction is between dealing with a particular failing institution or weak institution and dealing with the market as a whole.

So, buying assets such as in the QE programs of the Federal Reserve, Bank of England, the ECB, Bank of Japan, these are system-wide and they're designed to change the overall financial conditions, the overall tightness of liquidity in the system. But dealing with a particular bank which is not able to access

short-term liquidity in the market and is coming to the central bank and saying, I can't access finance in the market. I'm not going to be able to pay my creditors unless you help me. This is the emergency liquidity provision. It also has to be

And one of the most controversial areas at the time of the Lehman's collapse was why didn't the Federal Reserve provide an emergency loan? Some people think that the Federal Reserve made a big mistake and that they could have got good collateral from the Lehman Brothers had. The Federal Reserve took the view that no, that the collateral that was available was not good.

if, as it seemed to prove, Lehmann's was, in terms of capital, completely underwater. By seizing the available collateral, Federal Reserve would not have done any favours to the other creditors of Lehmann's.

But this is all about banks. And really, one of the things that I want to stress is that we know a lot about how to deal with failing banks. What we know less about is dealing with financial sector crises that are not simply to do with banks. And these have become increasingly common, both in the advanced economies and in developing economies.

Then there is another type of crisis, which is a sort of all-embracing macroeconomic crisis, where the whole financial fiscal system is coming under pressure. It's not just down to the weakness of one or a handful of individual banks.

And in the book, I go through quite a few cases to show what has been done and what has not worked very well in a variety of those crises in the years, largely in the years since the global financial crisis, because I don't think we want to rehash everything. The global financial crisis

crisis is fascinating, but there have been many books written on the global financial crisis and we don't want to rehash all of that. But I would stress that the next crisis is much more likely to be a financial sector crisis broader than the banking system in the advanced economies. And as we've seen in many emerging markets over the years,

When their financial systems get into trouble, it's often related to a wider confidence collapse in enveloping the government and the non-financial sector.

Right. So banks take deposits and now are heavily regulated. Non-banks don't take deposits and they're outside the banking system. I know in the United States with a lot of financial regulation, the non-bank financial sector and therefore what people sometimes call the shadow bank sector has grown enormously. And so what you're saying in Europe and rest of the world, that is also a broader trend and that you think perhaps it's a little bit more likely that the next financial crisis, and of course there always will be a next financial crisis,

is more likely to come from the non-financial sector. In, I guess, chapter three of your book, you cover four examples of non-bank financial crises. The UK guilt crisis of 2022, which actually happened on my birthday. The United States bond market meltdown of March 2020, when basically I think of the collapse of the US.

collateralized repo market, a lot of hedge funds that were doing the basis trade, very, very levered non-banks. They got messed up with the volatility there and the Federal Reserve intervened. And then China in 2015, an interesting example there. If people want to learn more about it, they got to buy the book. Let's talk about that fourth example, Patrick, where you have direct experience, the euro area crisis of 2010 to 2012. How was that area? How was that

a crisis outside of the banking system. What was the problem and what was implemented? Do you think it was good or not? Well, it wasn't good to get into that crisis, but the final resolution was quite impressive. I mean, the fundamental problem...

As you know, the euro area is 19, that's now 20 countries come together, use a single currency, have a single central bank. That seemed to be okay for the first 10 years of operation. There was no question mark raised over is a euro in Greece as good as a euro in Germany. Nobody asked that question. They said, that's fine, it's just the one system, and it indeed was just one system. But ultimately,

Ultimately, there were weaknesses in the government accounts in several countries, particularly Greece, Italy. There were problems in the banking system which affected the rest of the government accounts in Ireland, where I was responsible for trying to clean up that situation, and Spain, Portugal also. So when the country's government came under question, it

started to raise in investors' minds the specter of some withdrawal from the euro area. Would the Greek government say, actually, we think we'll introduce our own currency again because we cannot stick with the discipline that's implied by using

a common currency. So that fear that somehow the system would break up with some countries peeling away became quite influential in the markets as particularly the Greek financial system was not being corrected quickly enough. But also wider than that, it affected banks in France. So by the middle of 2012,

Financial market participants were starting to think, how can we operate in a situation where there's the risk of a bank deposit or an asset in Greece no longer being a euro deposit? How can we deal with this? And it was at that point, in the end of July of 2012, that

Europe's top central banker, Mario Draghi, who was the president of the European Central Bank, made his famous speech where he managed, in wonderful communication, he managed to convince the markets that he was serious about that he did have the tools to stabilize the situation and that he would use them. I think most economists knew that the tools were technically available,

But we're not sure that the you know in order to do this Mary Draghi had to get the agreement of the other governors of the other Central banks composing the euro system including conservative areas like Germany particularly Netherlands Baltic states

He had to get the agreement and it was to convince the markets that yes, he had the agreement and that he was going to go ahead with the measures as needed. That turned sentiment around and eliminated that tail risk of a breakup of the currency union. So that's a story that I briefly highlight a few of the central banking points about in the book. It's worth a lengthier treatment. Indeed, I've given it a lengthier treatment elsewhere.

I'm really glad you brought that up, Patrick. You know, actually, the whatever it takes speech, we feature that audio clip from Mario Draghi in the theme music to this podcast. So it is very fitting. And he says the exact quote, within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And then he says, and believe me, it will be enough. And that is that psychological component to give the investment community confidence. What was the threats actually?

at the time. I mean, you said Greek yields were exploding. In the book, you referred to them as credit spreads because unlike in the American bond market or other sovereign bond markets,

There is a risk that you won't be paid back because the Greek central bank could not print euros. As you were running the Central Bank of Ireland, you could print euros, but only as part of the ECB system. And you had to go back to headquarters, right? And so that was the risk.

And particularly when it's government debt that's involved. The Irish government also had to pay very high, increasingly high interest rates in late 2010 when the pressure came on there. It's heavy borrowing because it had decided to bail out the banks and

So, heavy borrowing to cover that, heavy borrowing in the financial markets and interest rates went higher and higher. And then financial markets said, wait a minute, if they're borrowing that much and these interest rates, we're not sure we're going to get paid back. So, there's no way, there's no channel within which the Central Bank of Ireland can say, oh, okay, don't worry, we, Central Bank of Ireland, will provide the Irish government with euros.

What Centrelink could do is to ensure that the banking system is liquid, but it couldn't, the Irish government then, in order to finance itself, had to go to the IMF and the European funds also chipped in, governmental funds, and agree a programme, a credible programme, which was actually designed from the Irish side, but a credible fiscal adjustment programme, which would convince the markets.

So this gave them financing for several years. In fact, by 2012, the government said, actually, we don't need to.

to borrow any more of this money. Everything is okay and we can go back into the markets. But there is that distinction between what the central bank can do in a currency union and what the central bank can do outside. Though the distinction is not as absolute as that because although people say, well, the central bank in Britain could bail out the government.

But it does so at the cost of pushing out so many pounds sterling into the market that the value of the pound sterling fell. So if you look around the time of the Lehman crisis in 2008, you can see a dramatic fall in the value of the pound sterling against the US dollar. So people say, oh, wouldn't it be great to have our own central bank? No, and not necessarily. It's a two-edged sword.

But that could stimulate exports, a weak currency. It is probably inflationary, but inflation is kind of what you need. I mean, Patrick, I'm just looking now. I

I wasn't aware 2011, the Irish 10 year bond yield 11% when inflation was that 2% or a 2.5%. So that is a 9% real rate of interest. I mean, that is something that was kind of seen during the Great Depression. What was it? What was that like? I mean, that was really tough.

You know, those are the secondary market yields. So who was borrowing at those yields? Nobody. Nobody. The Irish government was not borrowing at those yields. Irish government at that stage had said, we're out of this. When the rates went to whatever it was, 6% or around that area, Irish government said, we're not borrowing at these rates anymore. In fact, it was lower than that, that they went out of the market and eventually went into the IMF program to finance them over that period.

difficult period. But these are secondary market yields trading between investors who bought them, investors who are optimistic about Ireland, who sold them, investors who are pessimistic about Ireland, who won, the investors who were optimistic about Ireland because the yields came down very smartly and they were pretty low in a couple of years after that. They were pretty low and anybody who had bought long-term Irish government bonds at that worst point in 2011 made an absolute killing on it. Not at the expense of...

Not at the expense of the Irish government, but at the expense of the investors who have become overly pessimistic. Right. But Patrick,

isn't the entire bond markets of the biggest company in Ireland, Accenture, all the Irish companies, don't they borrow at the government yield plus the spread? So if companies wanted to access the bond market and borrow or anyone wanted to borrow, wouldn't they have to borrow at 11% plus the spread? Or you're saying the government didn't borrow, but that must have paid financial conditions dramatically. In practice, this is where our membership of the euro area helped because in practice,

Okay, to the extent they're foreign owned, they finance themselves on the international market using their own credit rating. There's so many international firms, Microsoft, Google, Intel, they're not financing themselves in the Irish banking system. The local firms who are financing themselves, they are relying largely on the banking system, both locally and internationally.

dealing internationally, but to the extent that they were borrowing from the Irish banking system, the Irish banking system was kept liquid by access to the European Central Bank's facilities. So there was a certain point at which the borrowing of the Irish banking system through the Irish Central Bank, but basically from the Euro system as a whole, was of the order of 100% of GDP because of the crisis, because of the outflow of GDP.

Depositor funds being replaced by the lending facilities of the ECB, including emergency liquidity from the Central Bank of Ireland. So they borrow at basically not much more than what French firms are borrowing through the banking system.

Irish firms' reliance on the debt markets as opposed to the banking markets is small. European firms rely less on debt markets than US firms. The banking system is much more dominant in Europe.

even though it has been shrinking relative to the, as you say, the shadow banks, but it's still much more dominant in Europe than it is in the United States. I'm really glad you brought this up. A lot of these distinctions, I don't know. So they're still borrowing in the Irish banking system, a lot of the small business and Irish companies, and they were borrowing at a spread that was the ECD policy rate plus a spread? Well, it's the bank's ability to lend to their normal commercial customers

which in a collateralized way. Government borrowing is not collateralized. It's the government's signature is what you get. So the government bond yields, even at the short-term rate, were quite high. They were factoring in quite a significant credit risk spread that time. Again, the people who insisted on that credit risk spread and people who sold those bonds lost out because the credit risk wasn't there. The Irish government had no intention

of having its credit reputation been in a situation which it could afford to, as later proved, it could afford to

to service all its debt and still see the economy pull out of that really quite deep recession. And Patrick, the solution was a fund that was created with the IMF. So was that the non-central banks, fiscal authorities, not just the IMF, but also governments that pulled together and create a fund to buy those bonds? Yeah.

Up until then, there had been... You see, IMF is just normal IMF business. It's always lending to countries that are stressed, whether they're

advanced economies or developing economies. The sums involved in the loans to Greece and Ireland and Portugal were significant even for the IMF. And so the arrangement that was made was that the European governments, not the European central banks, the European governments would chip in to a fund which would pay for two-thirds of the lending under these programs of lending to Greece, Ireland and Portugal.

And they did so. And this fund borrowed against the... They didn't actually pitch in the cash. They pitched in guarantees. And the fund borrowed in the markets and passed the money on to, you know, two euros for every one euro borrowed from the IMF. And did... Was it... Like, how did Ireland emerge...

in a relatively strong position? Did Ireland have to cut its budget? Because I know if you have to cut your way into getting out of a financial crisis, that's really tough. I mean, if everyone's cutting at the same time, that's what happened during the Great Depression. And why did Ireland have a slightly more successful time than Greece, for example, which had a really, really tough economy?

Well, I don't want to minimize the degree to which there was downturn and that people lost their jobs and people's wages were cut. Partly the recovery was maintenance of credibility for this small open economy, which deals with the whole world. So demand doesn't just come from internal demand, which is shrinking because of the budgetary constraints. It comes from the rest of the world. We're a big exporting country. And by maintaining credibility of that whole structure,

We maintained all that demand. And so the multinational companies sending out of Iran continue to sell out of Iran and then found out we can do business here.

Also, there had been a rapid increase in government spending and in wage rates in the boom years. And that had happened quite quickly. And the reversing of that, the fact that it was reversing from a relatively sudden increase meant that not everybody was hurt as badly as you would think. Now, some people, yes, they were badly hurt because

They haven't seen a big increase in their salaries. But if you go back just two, three years before the crisis, you can see that wage rates were considerably lower. And so the cutback of wages was not as severe. One thing that you talked about currencies, countries that have their own currency and countries that don't. I often like to look at the comparison between Iceland and Ireland. Iceland had its own currency.

It had quite a steep recession. It's hard to judge which of them was the most more severe recession. In the case of Iceland, however, there was a sharp devaluation. And so compared to Ireland, fewer people lost their job in Iceland.

But the people who kept their jobs lost a substantial part of their income. Inflation was very high. Their real income declined. In Ireland, not so many people, the reduction in real wages was negligible.

Not as severe as in Iceland, but a lot more people, relatively speaking, lost their jobs. So it's a different pattern of where the impact of the crisis is felt in a country with a floating exchange rate and a country which is relying on the common currency. Yeah, and Iceland has its own currency and they suffered inflation, whereas in Ireland it was more...

uh like in terms of unemployment and i guess iceland and ireland they're similar in that like a lot of european countries from tooth after the creation of the euro uh you know from 2000 2007 they just had enormous growth that at the time

I'm sure seemed totally great. But with the benefit of hindsight, it was somewhat dependent on bank credit growth, financing, the real estate sector and the real estate boom. And people in America, they think that there was a huge boom in real estate in the 2000s. But I think in a lot of other countries, particularly Ireland, it was way bigger.

Yeah, that's right. It was in both. Well, it's partly a property price boom in Iceland, more complicated in Iceland, even though it's a much smaller economy. In Ireland, it was largely a property price story.

property price and construction. Not only did the prices go up, but the number of houses being built expanded, expanded, expanded. You might think that would drive the prices down, but it didn't for a long time. Then when the price fall came, it was very, very abrupt. And tell us what you learned during the, uh,

Irish banking crisis in 2007, 2008, 2009. You joined, you became the governor of the Bank of Ireland in 2009. What were you doing beforehand? How were you perceiving what was going on in the banking system before you became the governor of the Bank of Ireland and Central Bank of Ireland? And what did you do when you were there? Well, I mean, the first thing was not to

Not to underestimate the problem. I think anybody who was involved in the situation

officially up until this moment said it can't get any worse. But they hadn't taken an all-embracing view of just how overexposed the Irish economy was to this downturn. And so not underestimating the problem and being ready for it was the first lesson that I tried to apply. Things certainly did get a lot worse than they had been officially expected.

judged to be when I started. The other thing was don't hide what's going on. Communicate clearly.

with all the audiences, there are a lot of different audiences of different interests, communicate to the national audience what the situation is, what the plan is, and why it's going to work. Communicate very explicitly to the government participants so they won't be surprised when you come and say, "Well, there's more bad news," because I told you there might be more bad news.

Communicate to the market that you know, what are the tools that you have? And is the situation manageable even if costly?

So that seemed to me to be pretty important. I mean, there were a lot of technicalities. One of the things in the euro area was to make sure that we didn't miss on any opportunities that were available with what can central banks do? They can do a lot. They can't do everything. They can do a lot. So make sure that

that our particular problems in Ireland, which were more severe than most of the other countries, maybe the second or third most severe of the countries, are taking full advantage of all of the facilities that are available within the structure of the European Central Bank. We did that

That reduced the cost. It reduced the cost to everybody because the quicker Ireland got out of this problem, the less of a problem it was going to create for the other members of the euro area, which is why you have a common European Central Bank. But Patrick, what tools? Because when you talk about Anglo-Irish Bank, it was a...

down after nationalization in 2009, and you write that, I guess, at the bottom, the bank had a negative capital value equal to almost 40% of its peak total assets. So in other words, if it had 40% more

book value, its book value would be zero. So that's a big issue and one that probably can't be solved by, oh, here's a loan, here's liquidity. It's fundamentally insolvent. So did you make the decision? Did the government of Ireland make the decision to just let that bank be wound down because you can't lend to a fundamentally insolvent institution? And by the way, that's maybe a different choice than the US has made with its banks over the past 20 years.

No, no, no, you're, that would create the wrong impression. About a year before I came into the job of being governor of Central Bank, the Irish government decided, and it was in the same month of Lehmann's, the Irish government decided that with uncertainty and people pulling money out of Irish banks, that they would guarantee all of the liabilities of the Irish banks. And they did.

And the most costly part of that was Anglo Irish Bank, as you rightly say. And so when, so the Irish government then put in promissory notes to allow Anglo Irish Bank to continue in operation as a bank and to continue to have access to central bank facilities. So these, so it had lost so much, as you say, 40% of its total balance sheet,

but the promissory notes, valuable promissory notes of the government were put into place. But that was part of the then managing that out through the subsequent years and making sure that those promissory notes did not represent a burden

unnecessarily high because when interest rates started to go up, these became more and more costly, it was promissory notes, but keeping that under control and making sure that the government serviced that debt in a reasonable way

taking advantage of the low interest rate environment that existed in Europe. That was a considerable help, I think, to the recovery of Ireland. That's all being paid back now. So it's not true to say that the Irish government walked away from the liabilities of Anglo-Irish bank. It may have been a better thing to do, but the

They didn't, they hadn't taken that decision in September 2008. Actually, realistically, they probably never could have because just as you see in America, there would have been massive pressure one way or another to not have a massive failing, a large failing, a substantial failing, it's a $100 billion bank at that time. So there were a number of smaller banks in Europe where creditors lost money.

this would have been quite a big one. So it's all very controversial as to whether the guarantee was well designed. It was not well designed, but probably some kind of guarantee was kind of unavoidable.

And that's similar to how the Fed and the Treasury and the government basically guaranteed all depositors of the Silicon Valley Bank. And I guess it was the FDIC guaranteed those liabilities and they had various guarantees. The FDIC and the Fed and the Treasury were working together

In your book, you talk about how Silicon Valley Bank and other bank failures revealed the inadequacy, I'm paraphrasing, the inadequacy of deposit guarantee schemes. Is it your point that the FDIC limit of $250,000, it should be higher, it should be unlimited? What is inadequate and how could it be improved?

Well, I mean, we see this time and time again. People say, well, we have, it's fine. In this country, we have a deposit and guarantee system, so don't worry. And then something bad happens and you discover you do have to worry because governments are not happy to see...

In the case of Silicon Valley Bank, even investors who had very substantial deposits were bailed out by action of the Treasury Department. So in the crunch,

The design of the scheme, which says, you know what it says in the US, it's 250,000 per person in any given bank, that doesn't work politically. The politicians say, "Oh, forget about that. We want to give more." So how to design it in such a way that you give more without saying it's a blanket guarantee to everybody, in which case nobody will, people will just go to the bank

bank that offers the highest interest rate. This is the hard part. Now, there are various ideas in resolution of dealing with a failing bank. You say, well, we'll prioritize small businesses, we'll prioritize households. So designing who to prioritize and what levels

will be robust, will be such that when the crunch comes, the minister or the secretary of the treasury says, oh, what about the small depositories? We've looked after that. What about the small business? We've looked after that. Or give me the details. Yes, it's enough. I'm satisfied with that. That's what we don't have in any country. It seems that the deposit insurance scheme is not seen as satisfactory, even though

And, you know, $250,000 is not a small sum of money. Yes, especially for large businesses. And why not just have it be unlimited? Is it because that is seen as a government liability that the government is bailing out the bank? And why even have private banks at all if the government is going to ultimately be responsible for the credit risk of deposits or bank runs? Yeah.

Even the existing deposit insurance schemes have often been criticized by scholars as encouraging and facilitating unwise, reckless behavior by unscrupulous bankers. Not all bankers, but particularly there's evidence from the developing countries. If you have unlimited deposit insurance, you can be sure that...

certain reckless people will open banks and do reckless things with them because they'll be able to access unlimited amounts of deposits without any depositor taking

paying the slightest attention to the way the bank is run. Yes, but it'll be the depositors taking the risk, not the bank. No, they won't be there. If the guarantee is there, they won't be taking any risk. That's my point, that the government would be taking the risk. So you have to find some middle ground. And there are various schemes that scholars have thought about. My point of this is not to pinpoint a

an exact scheme, but to make every person responsible for designing deposit insurance aware and recognize the fact that the existing schemes are not really what they appear to be because whenever the crunch comes,

they're overridden. Yeah, that's a really good point. And of course, the FDIC is funded through levies on the banking system, not the taxpayer. Oh, yes, but tax too, because they can't avoid it. Yes. Patrick, talk about the central bank in a macro financial crisis. And this is a chapter where you talk about countries like Argentina and Lebanon. What is a macro financial crisis that it

The crisis is economy-wide. It impacts currencies. It impacts interest rates. It's not just a banking crisis. How is that crisis fundamentally different? And how does it demand a different approach from central bankers in order to manage it?

You know, this is where you need to grasp everything that's happening in the whole economy, that investors, depositors are concerned about the viability of the economy as a whole. So it's not confined to money.

the financial sector or certainly not to the banking sector. There's no confidence in the government. There's no confidence in the exchange rate policy. People are fleeing. And at the same time, as this is happening, the ability of the government to cope with the situation is weakening because they too are unable to raise funds. They're unable to even, you know, tax revenue is collapsing.

So this, each of these events are sui generis. There's a tendency for people to say all financial crises are the same. Now they do have, they do rhyme. But the point about financial crises is they are all different.

And it's because they're different that they happen. If they were all the same, we'd have put sticking plaster over the particular problem that is causing all of the same problems. The problems are rather different. So the cases that I have in the book, I take Argentina, which is a changeover from the Peronist government to the center-right government in the 20...

15-16 and the central right government's going to do everything new and different and they're going to solve all the problems of overspending. They're going to bring inflation right down and the central bank is on board with this and they're part of the planning process that has gone into designing the policy program and yet it falls apart. We see 2023

Late 2023 and now into 2025, we have a new government just sort of doing the same thing again, but in a more drastic way. So we'll see how that pans out. That's quite different to the regime in the situation in Lebanon, which I go into in some detail.

It's almost too complicated to describe. If we had the whole day, we couldn't get to grips with it. In Lebanon, the central bank tried to manage a scheme which kept the exchange rate constant for 15 years and encouraged inflow of funds from people

people with Lebanese connections and Syrian connections all over the world to deposit their funds into the Lebanese banking system and at the same time it produced a kind of Ponzi scheme which collapsed in 2019. There was a lot of corruption involved there as well, but the whole economy went down. People often talk about, obviously Lebanon has suffered from many vicissitudes including, you know, attacks from neighboring countries and

on the south and in the east. It suffered from the great explosion that everybody remembers in the port three or four years ago. But it suffered from this mismanagement by the central bank and mismanagement, as I say, which involved corruption. So there are lots of interesting stories there. And the interesting stories all reveal, I think, the four problems

the four characteristics that I started with that distinguish the behavior, the necessary behavior in a financial crisis from the normal behavior of a central bank in normal times. Well, Patrick, the book is fantastic, extremely well written, extremely well sourced. I can tell you, you did an exceptionally large amount of homework and I really like your analysis. People should buy it. It is The Central Bank as Crisis Manager.

Patrick, in the few minutes we have left, I want to ask you about tariffs. It's not exactly a secret that the vast majority of economists think tariffs are a bad idea. Tariffs have been implemented on China. They were implemented on Canada and Mexico. Of course, I'm speaking from the U.S. by the new tariffs.

President Trump administration. And then there was a 30-day delay on those tariffs because of troops on the border and various things. How would you describe, I feel like I'm lost, Patrick, because I've covered monetary policy and interest rates and things in the financial sector. When it comes to trade, I'm woefully behind. Can you please catch me up and our audience up

Are tariffs as bad as a lot of the economists say? Why or why not? And if the Trump administration does levy significant tariffs against China, Mexico, Canada, and they're sustained, they're not just negotiating tactics, what might the consequences be? Okay, well, let me say four things. I think it'll be four things about tariffs. The first thing is, it's really quite surprising to see the US economy, which has benefited

from the last 30, 40 years of globalization and its big companies, particularly in the tech field, advancing, it's very surprising to see it now adopting measures such as tariffs, which if implemented and put on a permanent footing, would fragment the way

the world economy and limit the ability of the US and its big companies to make the great advances that it has. Of course, I know that some people in the United States are very dissatisfied with the fact that China has become

moving towards being an advanced economy and it's a powerful economy and rival. That's a different maybe power play. But from an economic point of view, it's hard to see why a fragmented global economy is going to be good for the United States. Second point, this might be understandable if the objective

was to ease the situation for those people and sectors and regions of the United States economy that have not benefited as much as the average of the economy from this whole experience of the declining manufacturing sectors, the middle class, middle income, lower income people who have not done well. That's an income distribution problem. It's also

So are tariffs going to be good for this? Well, take the tariffs that were proposed and are now suspended vis-a-vis Mexico and Canada in that largely free trading area.

Well, I mean, take the auto industry, which is the sort of industry that in the old days provided huge numbers of well-paid skilled jobs and now provides a smaller number of those jobs and basically has been a declining industry. Is this going to help the auto industry? Very far from it.

cars and car components pass across those borders many times. Putting tariffs with Canada and Mexico doesn't make any sense for that kind of old industry activity, manufacturing industry activity. So it's not at all clear that this is going to help that segment of society that have

that have not benefited in the United States from globalization. Some of you say, well, okay, now I remember the second one.

So, she'd say, well, yeah, that's not the point. The point about tariffs, you might say, is the US has a big trade deficit. It has a big current account deficit. Maybe tariffs can fix that. Wrong. Tariffs will not fix that. Okay, tariffs, will they prevent imports? Will they reduce imports? Yeah, sure, they will reduce imports because people are saying, I'm not going to pay all that. It's too expensive. And so there will be a decline in imports. But there will be also a parallel decline in exports. Why?

Because people say, I'm not going to buy those imports from China because they're too expensive, but I need the stuff anyway, so I better buy locally produced. Employment is very high in the United States. We're nearly at full employment. There's not much spare capacity. So in order to deliver those goods, there will be a gradual adjustment of the productive capacity.

process, the exchange rate will go up because exporters, you know, there's not going to be that, exports will shrink. Exports will shrink by the same amount, broadly speaking, as imports are shrinking. So tariffs do not, taking the system as a whole, tariffs are not going to solve the trade deficit or the current account deficit problem. Now, exchange rate movements are not entirely predictable, but that would be the tendency. The final point is that

People are going to say, yeah, whatever about that. Tariffs are going to be a good source of tax revenue, much better than income tax. We can get rid of the other taxes and tariffs will deliver the goods. Now, you've just got to do the sums on that, because even if you raise the tariffs to the maximum rate that generates the maximum revenue from tariffs,

and people who've done the sums show that it's only a fraction. It'll generate only a fraction of the revenue generated by the income tax and the other taxes in the American system. So tariffs are not a solution to major cuts in income tax.

So why are they being done? Presumably, one argument is that this is a sort of bluff or a negotiating tactic. We'll impose tariffs unless you do A, B and C. Well,

you know, that is one way to behave and the A, B and C may get done. So far, we haven't seen much of A, B and C. The agreements that are reached with Mexico and Canada are for actions which don't seem to be all that dramatic. But in doing that kind of, you know, bluff and

behavior of that type, you are in drastically increasing uncertainty in international trading relationships and investors who want to build new plans that provide productivity, technological improvement, higher incomes, they say, wait a minute, but this will involve imports, exports,

but we see trade barriers going up all over. This is very risky. Let's pause on those investment plans. And I think that that uncertainty would be a pervasive negative. So was that sufficiently positive on Trump? That was a great answer, Patrick. I want to hone in. So again, I don't know enough about this, but I wonder if a lot of

traditional economic models about trade assume country a and country b have exactly the same terms of trade and if they have the same terms of trade then oh of course it would be a mistake of company a to impose tariffs but what if it's true that country a uh has much looser tariffs in terms of trade than country b and the rest of the world and basically uh you know to to

quote President Trump, Germany has very large tariffs on cars. We allow German cars. Germany doesn't allow our cars. Again, not that it's illegal to drive a Ford in Munich, but to quote literally what he said, President Trump, that you're not going to see Fords going around. So it's just restoring the tarmac.

This is just, first of all, the factual basis of this, we'll set that aside. Supposing it was true, you've got to consider whether you're still making an advance by imposing a tariff on goods imported, no matter what they're doing in the other country. Now, there are some crafty measures could possibly be devised, which are advantageous to a large

like the United States with substantial market power. It could be a very craftily designed tariff regime. That's not what we're seeing. You have to consider a wider historical design of the global system.

It's where countries are using any kind of manipulative behavior. In the end, this is a system that works worse than the system, the orderly, low tariff, open borders system that we've seen for 40 years. It's a huge mistake to think that because China has advanced that the system was poorly designed. The system was well designed

For progress in economic welfare generally, what was not done was an adequate redistribution of part of that welfare for the

for the pockets of loss. And what, of course, is behind a lot of the other worries are security and power. It's likely that a fragmented world, now that China has got to that relatively advanced stage in technology, it is likely that a fragmented world will be even more risky from a security standpoint.

point of view than the open trading globalized system. Anyway, that's just my view.

I appreciate you sharing your view. And Patrick, I'm going to make an analogy and tell me if you think this analogy is out of place and don't be afraid to put me in my place. That the trade, open trade, free trade is very good for nominal GDP growth and having the pie be as big as possible, but not necessarily for sharing that pie evenly. So if, for example, the U.S., we have an open trade, we have a large trade deficit,

in order to not have unemployment, we accordingly run a large fiscal deficit. So we have a twin deficit. And so companies' profit margins go up, the stock markets go up. So people in the big cities working at the corporations and financial institutions get wealthier. People who were making the cars and having relatively high-paying blue-collar jobs, their employment prospects go down because those cars are now being built online.

around the world. I'm going to make that analogy, Patrick, and tell me if it's wrong to a peculiarity of the Irish economy, which, which I believe is a lot of the large multinational corporations keep a lot of money in Ireland because of a favorable tax treatment. And I, I,

But I wonder if that's the case, that it kind of inflates the GDP of Ireland. So it makes the Irish GDP, the pie, look very big, but maybe that has social consequences that are not welcome by at least some people. I mean, first, we can separate this in the Irish story and your description of the US. There are too many holes in what you have described from the US situation.

I can't accept that as a premise. I mean, the United States is well able, well able to raise sufficient levels of tax to provide for...

and retraining and new opportunities for those who over the years have been, this should have been done all the time. And it was done and is being done in European countries. And the United States has fallen badly behind on that and with consequences that you see. And it isn't inevitable that that creates trade deficits. It doesn't inevitably that it creates fiscal deficits.

And if companies are making huge profits, they are subject to corporation tax. Now, the U.S. tax system is such that it has been relatively easy for a number of countries, including Ireland, to...

to offer deals, tax structure, not individual deals, but a tax structure, which has been very attractive for... Ireland is not the only country to have done that. And it has been of considerable benefit, both in providing employment and skills. It has provided tax revenue because the companies do pay taxes. Some of them

over some years didn't. This was more or less in the past. They paid practically no taxes. They now generate a very substantial part of Ireland's tax revenue. GDP is exaggerated, but that doesn't help anybody. That just causes trouble for the statisticians. It's just a measure.

That reflects the companies doing their accounts in such a way that most of their profits are booked in countries like Ireland that have attractive tax situations. Those profits are owned by American companies, so they're not lost to America. They do not pay taxes on the profits that they don't

repatriate to America. That's a decision of the US tax authorities. They could change the tax laws like most countries,

and haven't paced enough paces. So it is an odd situation, but it would be easy to caricature it. Thank you for that, Patrick. I want to make clear, I'm just offering a potential theory and I'm not saying I disagree with you at all. And I really want to say I'm very humble that I have not done the sufficient work on trade to really even have an opinion. Patrick, are there any works of on-trade theory

papers or books about trade and tariffs where I or perhaps our audience could check out and learn more if our audience, like me, is kind of new into trade and doesn't really understand a lot of the things or at least a lot of the theories? Well, I certainly could recommend a number of books

articles and pieces in the Peterson Institute that my colleagues in Peterson Institute, a lot of them are very highly specialized in trade. They've produced in recent days a number of very useful summaries about the impact, for example, of the announced tariffs on Canada, Mexico, China, and historical works. You'll see that on the Peterson Institute website, historical works on

tariff waves in the past, in the days of Smoot-Harley and the earlier period. So I would point people to that, also to the mini-site on globalization that the Peterson Institute has, which is a way into considering some of these issues about international trade and international investment linkages.

We'll link to that in the description, Patrick. But just really quick, so if there are prolonged tariffs, do you think the impacts will be higher inflation or lower growth or maybe both? I think there will be higher prices in the United States. It doesn't mean that inflation would necessarily take off. There'd be higher prices. People don't notice the higher prices. The Federal Reserve have the capacity to bring inflation rates back to their target.

It'll be a damaging effect on growth and it will not be a uniform effect. It'll be an effect which affects some people rather than others. And I think we can assume that some of the largest and most influential companies and business people will manage to arrange their affairs so that they actually benefit from this.

Well, Patrick, thank you so much for coming on Monetary Matters. I can't say enough good things about the book. The Central Bank is Crisis Manager. People should buy it. You were on Twitter at P. Honahan, and we'll include a link to the Pearson Institute and your other work there. Patrick, I know when we first met, you were excited not just about the book that is now published, but did you have a workout previously that you were also excited about? What was that? Oh, yeah. Well, I have reached across to my shelf.

People want to get into the story of Ireland. Does this appear? Oh, it appears backwards. Anyway. No, no. I see it the right way. I see the right way. Oh, you see it right. I see it. It appears backwards. There's a picture of an Irish coin. And it gives a whole story of the Irish crisis and some background on the Irish financial system and the Irish growth over the years. So that might be one for people who are interested in those currency issues.

Wow, Patrick, that is... How far back does it go? And how many periods of years? So this book was published in 2019. It starts... It tells the story in a way from... The first couple of chapters are the first...

If you like, 90 years of Irish independence from 1926 was the Irish pound was introduced and then we adopted the euro from 2000. And then it gets in, it hots up when we get to the euro and the euro area crisis. They go into blow by blow account of that crisis and all the steps are taken. Plan A, Plan B, Plan C and if Plan A doesn't work, you try Plan B and if Plan B doesn't work, you know that Plan C will work even if it's less attractive.

Well, that is fascinating. I'm going to check that out, Patrick. And I love financial history, and I know so many of our audience do as well. I was just reading in Barry Eichengreen's book about how in Sweden, they were on the copper standard. So some of the roads were developed, like huge roads, so that people could roll all the copper down because it was so heavy. So it's just so interesting. And thank you for sharing that book. I mean, I'm going to check it out. Patrick, it's great speaking with you. And thanks, everyone, for listening.

Thank you. Thank you, Jack. Thanks for watching. Remember to check out vanek.com slash NLRJack to learn more about the VanEck Uranium and Nuclear ETF. Thank you. Just close this door.