Why the Fed Matters Now More Than Ever, with Douglas Diamond

About this episode

Douglas Diamond discusses the crucial role of the Federal Reserve in the economy and lessons from past financial crises.

From setting interest rates to keeping inflation in check, the Federal Reserve sits at the center of some of the most important economic decisions shaping our daily lives. As the Fed prepares for new leadership, following the tenure of Jerome Powell, many are wondering: What’s next for the Fed, especially when it comes to their financial decisions and their independence? We spoke with Prof. Douglas Diamond, the Nobel Prize-winning economist of the University of Chicago, in order to explain the Fed’s crucial role in our financial system—and why it matters so much for our future. Renowned as one of the founders of modern banking theory, Diamond has conducted groundbreaking research on banking, particularly during financial crises. He described the lessons we can learn from past bank runs, including the 2023 collapse of Silicon Valley Bank, and warns that we must remain on guard to help prevent the next financial crisis from happening.

People in this episode

Host: University of Chicago Podcast Network

Guest: Douglas Diamond

Topics covered

• Federal Reserve
• economics
• financial decisions
• banking theory
• financial crises

Keywords

• Federal Reserve
• Douglas Diamond
• banking theory
• financial crisis
• interest rates
• inflation
• Silicon Valley Bank

Mentioned in this episode

Organizations: University of Chicago, Federal Reserve, Silicon Valley Bank

More episodes of Big Brains

• How Websites Trick You Using ‘Dark Patterns’ · June 11, 2026 · 37 min
• Quantum Technology, Explained: A Big Brains Live Event · May 28, 2026 · 40 min
• Our Untapped Superpower: Connecting With Others, with Nicholas Epley · May 14, 2026 · 39 min
• Anxious? Avoidant? How to Build More Secure Relationships · April 16, 2026 · 37 min
• Could AI Models Forecast Extreme Weather Events? with Pedram Hassanzadeh · April 2, 2026 · 35 min
• Are Judges Too Powerful? The Rise of Universal Injunctions, with Samuel Bray · March 19, 2026 · 40 min