FED’S INFLATION VIEW IS ALL ABOUT THAT BASE — WSJ’s Jon Hilsenrath: “Federal Reserve officials are talking a lot these days about base effects. That relates to how the economy looks now compared with a year ago. Such year-over-year comparisons provide a sense of how the economy is changing over time. Corporate profits are often deciphered based on year-ago comparisons, too. “The problem is when something screwy happens a year earlier. The base from which a year-over-year comparison is calculated becomes distorted. If a company takes a hit in one year and then gets back to normal the next, it can look like its profits are soaring when in fact they are just getting back on track.” G-7 LEADERS REACH GLOBAL TAX DEAL AIMED AT ENDING PROFIT SHIFTING — NYT’s Alan Rappeport: “The top economic officials from the world’s advanced economies reached a breakthrough on Saturday in their yearslong efforts to overhaul international tax laws, unveiling a broad agreement that aims to stop large multinational companies from seeking out tax havens and force them to pay more of their income to governments. “Finance leaders from the Group of 7 countries agreed to back a new global minimum tax rate of at least 15 percent that companies would have to pay regardless of where they locate their headquarters.” YELLEN SAYS SHE URGED G-7 TO KEEP UP FISCAL SUPPORT FOR RECOVERY, CLIMATE INVESTMENTS — Reuters: “U.S. Treasury Secretary Janet Yellen said on Saturday that she is urging the G7 wealthy democracies and other countries to keep up fiscal support for their economic recoveries and to make investments to fight climate change and inequality. “In prepared remarks for a news conference after G7 finance ministers met in London, Yellen also praised an agreement to pursue a global minimum tax of at least 15% on corporations as helping to stabilize tax systems while preserving national authority to set tax rates and policies.” She also said higher interest rates would be a ‘plus’ for the U.S., Fed — Bloomberg’s Saleha Mohsin: “Treasury Secretary Janet Yellen said President Joe Biden should push forward with his $4 trillion spending plans even if they trigger inflation that persists into next year and higher interest rates. “‘If we ended up with a slightly higher interest rate environment it would actually be a plus for society’s point of view and the Fed’s point of view,’ Yellen said Sunday in an interview with Bloomberg News during her return from the Group of Seven finance ministers’ meeting in London.” ECONOMY SEES PLENTY OF GROWTH, NOT ENOUGH WORKERS OR SUPPLIES — AP’s Paul Wiseman: “The U.S. economy is sparking confusion and whiplash almost as fast as it’s adding jobs. Barely more than a year after the coronavirus caused the steepest economic fall and job losses on record, the speed of the rebound has been so unexpectedly swift that many companies can’t fill jobs or acquire enough supplies to meet a pent-up burst of customer demand. … “In many ways, the news has been cause to cheer: The economy grew from January through March at a red-hot 6.4 percent annual pace. And in the current quarter, that pace is thought to be accelerating to nearly double-digits. Yet the full portrait of the U.S. economy is a rather more nuanced one.” PROPOSED FRAMEWORK AIMS TO GUIDE REGULATORS IN DECISIONS TO CHARGE CHIEF COMPLIANCE OFFICERS — WSJ’s Mengqi Sun: “A proposed framework guiding decisions to bring enforcement actions against financial sector chief compliance officers aims to address growing concern over the individual liability of compliance professionals. “The proposed framework, released Wednesday by the New York City Bar Association, asks regulators to evaluate 12 affirmative factors and three mitigating factors in deciding whether to charge chief compliance officers for conduct relating to their job-related duties under federal securities laws.” ICYMI: SEC OUSTS AUDIT HEAD — Reuters’ Katanga Johnson and Chris Prentice: “The U.S. Securities and Exchange Commission (SEC) on Friday said it had removed the head of the oversight board that sets standards for audits of public companies and planned to replace the rest of the board in due course. “The SEC said in a statement that it had voted to remove William Duhnke III as chair of the Public Company Accounting Oversight Board (PCAOB), a role he has held since January 2018, effective Friday. The other four members of the board will stay on, but the SEC — which oversees the accounting watchdog — is soliciting resumes for those roles.” BOFA CEO: FLUSH WITH STIMULUS CASH, CONSUMERS ARE SPENDING MORE — Bloomberg’s Yueqi Yang: “Bank of America Corp. Chief Executive Officer Brian Moynihan said consumer spending has surged amid the reopening, much of it fueled by leftover stimulus money. ‘Our consumers have lots of money in their checking accounts,’ Moynihan said Sunday on CBS’s ‘Face the Nation.’ ‘They have not spent about 65% to 75% of the last couple rounds of stimulus.’ Spending by consumers at the second-biggest U.S. bank exceeded $1 trillion so far this year, up 20% over 2019, he said.” | 
