Roundup: Cryptocurrencies, Unemployment Insurance and Banking

Today, we are highlighting some research the St. Louis Fed has recently produced that you may have missed. The articles below were all published in the Review.

The Blockchain Revolution: Decoding Digital Currencies

This article presents an overview of cryptocurrencies, blockchain technology and their applications, explaining the spirit of the enterprise and how it compares with traditional operations. The authors discuss money, digital money and payments; cryptocurrencies, blockchain and the double-spending problem of digital money; decentralized finance; and central bank digital currency.

Increasing Employment by Halting Pandemic Unemployment Benefits

In mid-2021, 26 states halted participation in all or some federal emergency unemployment benefits (EUB) programs before those programs’ federal funding lapsed. The authors found that terminating these programs early increased employment by 29 people for every 100 pre-halt EUB recipients. Expressed in jobs, if all states had halted EUB programs in June 2021, September 2021 employment would have been 3.4 million workers higher relative to a no-halt counterfactual.

Turbulent Years for U.S. Banks: 2000-20

The first 20 years of the 21st century have presented U.S. banks with three recessions, long periods of very low interest rates and increased regulation. The number of commercial banks operating in the U.S. fell 51% during this period. This article examines the performance of U.S. commercial banks from 2000 through 2020.

Subjective Assessment of Managerial Performance and Decision-Making in Banking

This article examines subjective supervisory assessments of managerial performance in the banking industry. The authors found that better assessments are 1) positively associated with decisions made by examiners to upgrade relatively objective bank performance ratings, 2) negatively associated with decisions made by examiners to downgrade relatively objective bank performance ratings, and 3) positively associated with decisions made by bank holding company managers to distribute resources among subsidiary banks.