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“Mayra Rodriguez Valladares, managing principal at New York-based MRV Associates, which trains bank examiners and finance executives, points to the uncertainty caused by trade wars.”

Mayra Rodriguez Valladares, managing principal at MRV Associates, said, “There is a good chance that the Fed will pause in rate cuts.” “To cut rates would be a mistake,” she said. “This extraordinary decade of such low interest rates has led to a perverse incentive for company executives and private equity firms to have record levels of debt, both in bonds and loans. The rising amount of below investment grade bonds and loans could significantly amplify the effects of a recession.”

A growth in auto loan defaults does signal serious financial duress for borrowers, said Mayra Rodríguez Valladares, managing principal of MRV Associates, told Benzinga. “Auto loans tend to be the last loan that borrowers default, since they need their car to drive to work.”

For some, this sort of attempt at disrupting the $6 trillion-a-day currency market was only a matter of time. Mayra Rodriguez Valladares, managing principal at capital markets consultancy MRV Associates, says she is “surprised that it has taken the buy-side this long” to challenge the FX market’s status quo. “There is no reason that with blockchain and other technological innovations, giant asset managers such as Vanguard, [Charles] Schwab, and Fidelity could not participate in foreign exchange markets more significantly without banks as intermediaries,” according to Valladares. With Vanguard alone trading $2.5 trillion worth of currencies annually, it is an opportunity “that would reduce the buy-side’s costs significantly,” she notes.  

“There’s going to be a tremendous amount of attention on him from the House Financial Services Committee, and certainly on the Senate side from Senators Warren and [Sherrod] Brown,” says Mayra Rodriguez Valladares, managing principal at capital markets consultancy MRV Associates. “They’re going to be looking at everything he does, and analyzing it with a fine-toothed comb… He’s not going to have any honeymoon.”

To increase profits, banks have focused on risky assets with higher returns. “Because banks have not shed some of their riskier assets, they don’t have the liquidity they need,” says banking regulation consultant Mayra Rodriguez Valladares. “Bankers are constantly talking about how they’re private companies and shouldn’t have such regulation. But they’re wayward teenagers and want Daddy Federal Reserve to save them.”