 talk about an institution that should be privatized. Let's talk about the Federal Reserve. Yesterday, the chairman of the Federal Reserve, the chairman of the Federal Reserve gave a speech, a speech in Sweden. He was attending a conference in Sweden in Jerome Powell. Fed chairman gave a talk about Fed independence and sticking to the Fed mandate. And most of that was standard stuff. Nothing really exciting. It's a pretty short speech he gave in any way. But there was an interesting section there about climate change and about the role of the Fed. And I thought it was worth sharing with you because the Fed is under a lot of pressure, under enormous pressure to start regulating banks with ESG in mind, regulating banks with climate change in mind, regulating banks to not allow banks to lend money to oil and gas and do all kinds of crazy things like that. And to Jerome Powell's credit, he's standing up against that. So he writes, this is him speaking, I'm just gonna read you from his speech. Today, some analysts ask whether incorporating into bank supervision, the Fed is one of the five entities or seven entities that regulates banks. It's probably the most powerful of all the bank regulatory agencies. He says, today some analysts ask whether incorporating into banks of provision that perceived risks associated with climate change is appropriate, wise and consistent with our existing mandates. He says, addressing climate change seems likely to require policies that would have significant distributional and other effects on companies, industries, regions and nations. Decisions about policies that directly address climate change should be made by the elected branches of government and thus reflect the public's will as expressed through elections. At the same time, in my view, the Fed does have narrow but important responsibilities regarding climate related financial risks. I'm dubious about whether any of those exist, but okay. These responsibilities are tightly linked to responsibilities for bank supervision. The public reasonably expects supervisors to require the banks to understand and appropriately manage their material risks, including the financial risk of climate change. But without explicit congressional legislation, it would be inappropriate for us to use our monetary policy or supervisory tools to promote a greener economy or to achieve other climate-based goals. We are not and will not be a climate policymaker. So I like that. We are not and will not be a climate policymaker. The Federal Reserve has a mandate dictated by Congress. For those of you who still think that the Federal Reserve is a private institution, it is not. It has a mandate mandated by Congress, passed by law. That mandate is to do two things, to price stability, keep inflation low, in other words, and keep unemployment low. Now, why it has two mandates, and it really historically only had one and should only have one, which is price stability is a different issue whether it even has much control over price stability and how it controls price stability and whether it knows what it's doing with regard to price stability. All good questions, but that's its job, supposedly. But there is a lot of noise coming out of the Biden administration, particularly out of Congress, that the Federal Reserve should do a lot more about climate change that the Federal Reserve do, it reserve again should get involved in ESG. And I like the fact that Powell is saying, we are not and will not be a climate policymaker. He says we will not promote a greener economy or achieve other climate-based goals. That's not our job, we won't do it. So good for Powell, we will see how long this lasts. Of course, Congress could pass a bill that requires them to do it, but I don't think it will. I think there's enough of a stalemate in Congress that that won't happen. I do worry a little bit about him saying that there is some financial risk of climate change. I mean, I get what he's saying. Let's say you're a bank and you're giving out a lot of loans for people building stuff in flood zones. That's a risk that you should take into account. Given the climate changes, just ask a California right now about climate change. It certainly seems to have changed, but climate always changes, right? But it's good to know that Powell is not gonna just fold, at least he says he's not gonna fold, let's believe him for now, to the crazy leftists who would like the Federal Reserve to now become a climate change policeman. All right, speaking about California, this is not on my list, but we might as well talk about California. I don't know if you've seen what's going on in California, but California's got a once in a, I don't know, 20, 30, 40 year weather event. This is major and it's rare. It's actually rare. They've got one of those rivers of rain after rain after rain after rain. I remember this happened in the 90s when I was living in Northern California, but it's very rare to happen in the quantities. I mean, the ground, everybody speaks to Northern California, saying the ground is completely saturated by now. Any rain that falls is basically accumulates above ground because there's nothing to soak into the ground. It is really bad up there and the quantities of rain, 20 feet of snow in Lake Tahoe. It is not just a season. It is a very unusual season, but that happens. Of course, part of the problems are that California is not invested in mitigation for floods. It is not invested in mitigating against events like this because for a decade and a half now at least, California's been under this constant bombardment of drought, drought, drought. California's a drought, or once in a 100,000 year drought. It's gonna be a drought forever. The climate change has changed. We're now a drought, drought, drought. There's never gonna be water, enough water. And if we don't invest in flood mitigations, floods are no problem anymore. Now we have to invest heavily in mitigating droughts and the only way really to invest in mitigating drought is to kick people out of the state of California or to reduce people's consumption of water. God forbid you should desalinate or do anything like that. There's one major desalination priority in California and San Diego and it's brilliant. San Diego doesn't have a drought. Hasn't had a drought because they have plenty of water from desalination. But the interesting thing, that while California now is being just bombarded with quantities of water that's hard to imagine for California and nobody is arguing about, hey, we didn't invest in the right, and government, why was there no investment in the flood protection and in everything like that? I mean, what is going on right now? What is going on right now is environmentalists panicking that their drought story is over. You're even seeing some environmentalists coming out and say, well, don't think just because we've got a little bit of rain that the drought is over. As the snowpack is accumulating, as reservoirs are slowly filling, it still may be as a drought. You have to feel for the environmentalists. I mean, it's horrible. Like you predict that population is gonna explode and everybody's gonna die and population explodes and nobody dies. You predict mass starvation, it doesn't happen. You predict the ice caps will melt and islands will flood and the islands don't flood and you predict that California is forever gonna be in a drought condition and it gets a lot of rain. I mean, it's very, very difficult to have an ideology and to sustain an ideology, keep going in ideology when everything you predict coming out of that ideology doesn't really happen and maybe it's not that hard. Somehow it doesn't seem that hard for them. Somehow it doesn't matter that they're wrong about almost everything. It's truly amazing that in finance and economics, if you're wrong and wrong and wrong and wrong and wrong, well, even that's not true. In finance, at least, in economics, that's not true. In finance, if you're wrong and wrong and wrong and wrong and wrong, people don't give you money. People stop believing you. People stop listening to you. People stop it. Raise money. But in environmentalism, somehow, being wrong and wrong and wrong and wrong doesn't prevent anything. Anyway, massive flooding, lots of problems in California, particularly in the North, but also in the South. This is ultimately good for the state. It'll get more reservoirs. It'll relieve some of the water constraints. If you're a skier in about a week, it will be amazing to go ski in Lake Tahoe once the snow passes. You'll have amazing ski conditions up there. So fly out to California, go skiing. Yeah, there's a lot of good stuff that's coming out of this. Thank you for listening or watching the Iran Brook show. If you'd like to support the show, we make it as easy as possible for you to trade with me. You get value from listening. You get value from watching. Show your appreciation. You can do that by going to iranbrookshow.com slash support. By going to Patreon, subscribe star, locals, and just making a appropriate contribution on any one of those channels. Also, if you'd like to see the Iran Book Show grow, please consider sharing our content and, of course, subscribe. Press that little bell button right down there on YouTube so that you get an announcement when we go live. And for those of you who are already subscribers and those of you who are already supporters of the show, thank you. I very much appreciate it.