we want to allow the process to occur in a gradual and orderly way. allowing them to mature, they rolloff. isn't that orderly? chair yellen: it is. that is why we intend to do it that way. sen. corker: you have not started yet. it doesn't seem to make -- chair yellen: it is orderly. that is desired. to allow we intend those assets to run off as principal matures. occurng that process to result in some tightening of financial conditions. before we turn that process on and start it, we want to make sure we have adequate ability through our normal interest rate overnight interest rate moves to meet the needs of the economy. particularly if it were to longnd some, it would be a process if it is running off. we haveto make sure enough scope and the economy is runoff would that not create a problem for the economy. sen. corker: when you were coming in and interviewing for this post and being affirmed, , wind times called for work, you would allow interest rates to rise. you are known as being a of, i want to a lot -- thank you for allowing that to continue to happen. hopefully the balance sheet will rolloff and i hope you continue to criticize us. thank you so much. chair yellen: thank you. allowing that process to take place, it will show the economy is doing well and the increases have been a reflection of the strength we have seen in the economy. thank you for your leadership at the federal reserve. our economy is not perfect, but has made tremendous strides since the financial crisis. it cost my million americans their jobs. these last six years have shown us how important and positive consumer protection has been to our economy. i want to ask you, health accounts for nearly 20% of u.s. , also feeling innovations in patient care, diagnostics, preventative health, research and development, cures and diseases. budgetonse to the resolution passed last month, the former director of the office of management and budget sent a letter saying the resolution would at nine five $5 trillion -- saying the resolution would add $9.5 , including a reduction in job growth in 2019. my home state is estimated to be on the top of the list as a result of a spike of the number of uninsured. stripping nearly 30 million people of their health insurance would have a significant impact on the productivity of the workforce. are you concerned how this increase in debt, coupled with a downturn in the labor market and deke priest productivity -- and decreased productivity would have an impact on the economy? care doesen: health account for a significant share accessding and a loss of to health insurance could have a significant impact on spending with households for other goods beyond healthnd cure itself, have impacts on the economy. 4cess to health care, some individuals, likely increase their mobility. people will be afraid to leave jobs. that could have implications for the jobs market. sen. menendez: we should tread lightly before we create major changes that could create major disruptions. financial institutions exploited the uncoordinated enforcement of consumer protection laws and this led consumers into risky subprime mortgages, even if they qualified for prime rates. we were finally able to empower a cop on the beat to protect hard-working americans from deceptive and abusive financial practices. who enforces consumer protection laws, they have returned almost $12 billion in relief. helped level the ensuringield, consumers are protected when they purchase a home, take out loans and use prepaid cards. believe had it existed to --ice mortgage markets prior in addition to protecting -- having had an aunt -- enhanced financial stability. chair yellen: consumer abuse is n those areas played a key role. in retrospect, i wish the fed had acted aggressively and abuses.to address those we have learned from the financial crisis it is radical area -- it iss critical to monitor this area for the potential of deceptive practices in consumer lending to financial crisis or financial stability issues. cpb has done: the that since the great recession, has played a critical role and ensuring that. men more active, it would have been great. in the absence of that, a bureau ake that is playing significant role in ensuring consumers have a level playing field. chair yellen: they have been focusing on these issues. of. menendez: in the history the federal reserve, and has had 134 different presidents of regional banks. not one of those presidents have or latino.n-american that is outrageous. it is my hope that we begin to change that reality. these are two communities that have an enormous part of contributing to the nation's gdp . for them to not have representation in the process of these banks is not acceptable. to changecan begin the reality. chair yellen: increasing diversity is a critical priority and i share your hope. toomey: i want to ask you a question of velti forecast for growth at the december meeting. about the forecast for growth at the december meeting. a central part of the message of the president and congress included a commitment to tax reform, a different regulatory approach, a lighter touch and rollback of existing regulation and discussion about fiscal stimulus in the form of an infrastructure bill. i don't think anyone disputes that --. responded withld the view that increases the likelihood, no certainty here, increases the likelihood we would have stronger at comic -- stronger economic growth. imf projected stronger economic growth, a poll showed a strong consensus that growth would likely pick up. the world bank suggested it would add to gdp in 2018. at the december fed meeting, fomc members had no change in their opinion as far as i can gather about the prospect for economic growth. the highest estimate decreased. it looks like the fomc members either believed it is unlike any any of those things will happen, or, they think those things are not progrowth. the rest of the world is of a different opinion. thatthe fed have the view notprospect for growth is changed by the prospect of tax reform and regulatory reform? we don't have clarity on what economic policy -- sen. toomey: i understand there is no certainty. most of myn: colleagues decided not to speculate on what economic policy changes would be put into effect and what the consequences would be. most of my colleagues have taken the view that we want greater clarity about the size, timing, and composition of changes to other policies before trying to cool -- incorporate those into our forecast. sen. toomey: comply us it -- compliance is expensive for banks subject to that. there is an over poor suggesting me see car models employed by the fed are not transparent. report suggests the fed does not engage in risk management of the models it uses. it concludes the fed has not assessed whether ccar is pro cyclical. mightoncerned ccar increase risk in one respect by correlating the risks of bank behavior and allocations of capital. -- weighingting is very different from those of the banks. ccar is not required by statute. you mentioned there is a huge increase in the capitalization of american bank post crisis. has other ways of boosting capital requirements, like the gsib surcharge. duplicative? it is costly and not mandated, would you consider bringing into an end at some point? chair yellen: it is a key part of our regulatory process. it is forward-looking assessment of the risks and affirms balance sheets. has been a cornerstone of our supervision,prove especially of the largest , whose institutions stability is critical to overall u.s. financial stability. found the stress test has been useful, or played a useful role. they made a number of which you agree with and are working on. we will continue to review our practices. we recently changed ccar to exempt most of the institutions under 2 billion -- $250 billion under part of the review. has greatlyng strengthened our process. sen. toomey: that does not necessarily imply the end of stress testing. own stresseir testing. as we know, we have a diffractive acting vice chair of supervision, nevertheless exercised the powers of that position. it is my hope the president will nominate individuals to complete the board of governors, including the vice chair for supervision, who will go through the process, who will be vetted by the committee. refrain fromd will issuing new regulations, which ought to benefit from the input of these new people. thank you. >> senator shelby had a question. shelby: the current account theur trade and balance, long-term danger of an imbalance in trade that we run for years we?years, and where are you were an economics professor. good thing.a most of the people know and you have a nationwide audience here this morning. it is theen: difference between the amount we spend on goods and services that , so wert from abroad have a current account deficit. it has increased in size. ultimately, it leads to a buildup of our indebtedness to foreigners. long-term concern if it is not on the sustainable -- lby: what is it roughly now? i believe in 2016, 2 .6% of gdp. shelby: in dollars? $500 billion. sen. shelby: would it be in the trillions? chair yellen: i can forward you that answer. sen. shelby: would you call that a troubling thing? chair yellen: it depends on the trend and what we earn on our foreign investment versus what we pay. historically, we have learned we earnour assets that our broad versus foreigners who hold our assets. when is the last time we had a surplus? chair yellen: i am not sure. sen. shelby: has it been a number of years? chair yellen: it has been. thank you for being here today. you have a difficult position and an important position. i look forward to working with you. i am sure you are aware of the our economy is suffering. soon there will be fewer than 2 million farms in america since the louisiana purchase. beendity prices have sinking. estimatesartment those who still farm will see -- drop. our nations farmers are being left behind. recognizing they need access to money, and borrowing -- of these folks are seeing they work in an industry that is seasonal. is there something, in terms of economic headwinds, and what we as policymakers should be focusing on to help if we are going to make it through the next couple of years. colorado is setting up an .mergency hotline it is gathering momentum. could you talk to us in terms of what use the we can do to take the burden off of our families? chair yellen: i cannot give you recommendations of what congress can do to address the issues. focusing on commodity and food prices. in some cases, we are seeing increases in delinquency rates on loans. weak growth in the global the dollarsled by that began to appreciate substantially around mid 2014 has pressured farmers and is agriculture,ure on as you indicated. farming moves from year-to-year. you could have a drought or excessive moisture. would it be fair to say that with regard to our financial and's touche in's ability to loan or carry debt -- our ab toial institutions' o n or carryility debt -- debt,y to loan or carry would you see some value in that? chair yellen: this is something that is up to congress to consider and a look into. it is not something the federal reserve has the ability to mandate. financials: institutions are the source of the ability to borrow money. it seems illogical to base the ability to borrow money from a financial and touche and on a 12 .- a financial institution make sense to allow this segment of the economy, a different cycle to be considered in without having their loans considered nonperforming assets. -- areally do want to short-term period of time. something we it is can look at. financial institutions are trying to engage in safe and sound lending. they want to protect themselves from losses. thank you.: sen. cotton: i like to discuss lack of wage growth. the federal reserve is a measure -- ways growth has been stagnant. we have seen positive trends in the last few months. i want to look neon the last few years, starting in the 19's 70's. 1970's.ing in the wages for workers with college degrees have increased. for workers without a college degree, it has declined 17%. driving the recent wage growth and what is behind this phenomenon we see on the chart behind me? the general: wagege nationwide trend in growth depends on productivity growth. in recent years, productivity growth has been relatively depressed incan spare -- in comparison to the period from 1949 to 2005. productivity growth was probably higherntage point or so than it was subsequently. for different groups, the chart focuses on changes in wage on structuralends trends in the labor market and in the economy. what we have seen, importantly, change,of technological it raises the return to skill, raises the demand for skilled workers and raised the rewards for people who are able to use technology, coupled with globalization, it has made it easier to offshore or outsource jobs that involve routine work. orcan be done elsewhere subject to technological change. we have seen different trends for higher skilled individuals. the gap between the earnings of college-educated and high school educated or less educated individuals continues to grow. major source of the trends you are describing in your charts. we have seen some improvements in recent months. the labor market is tight and wage growth has picked up somewhat. earnings were up 2.5% in a 12 months ending in january. that would compare with around 2% from 2011 to 2015. there is not a dramatic increase in wage growth in recent years. in part, i think you are seeing a reflection of healthy labor conditions. the fact it remains low is also related to week productivity growth -- weak productivity growth in the economy. sen. cotton: what contributes to a tighter labor market? toir yellen: we are trying do our job. we have put in place conditions to help lower the unemployment rate, improve labor market conditions. has come down.t the pace of job growth is strong and exceeds what is sustainable in the long run. the labor market is continued in a general sense to improve, although, the gains are not distributed among seven -- sa egments of the population. bringing into- our country, would we see continued wage growth for those with a high school degree or less? chair yellen: i am not certain. i expect the labor market to improve somewhat further. we have to make sure we do not allow conditions to get so tight that we push inflation above are 2% objective and we will be attentive but i expect somewhat stronger -- sen. cotton: is that serious risk when workforce participation rate is that an elevated level? chair yellen: it has been trending down. sen. cotton: historically, it is still high. chair yellen: it is relatively high, but it is overtime going to be trading down and immigration has been an important source for kforce growth, so that would be reduced if immigration were to diminish. warren: it is good to see you again. cost008 financial crisis millions of people their jobs, homes and savings. in response, congress passed a bipartisan dodd-frank act, which aimed to prevent banks from blowing up the economy again. president trump has called dodd-frank "a disaster," and he is about to "dismantle." it -- "dismantle it." he started down that road two weeks ago, and he has put steve mnuchin in, who has spent a combined 42 years at goldman sachs, in charge of rewriting the rules to help the banks like goldman. i know you and the fed spent an enormous amount of time looking at data about the economy and financial markets, someone to follow-up on senator brown's questions and get your take on some of the administration's main reasons for calling dodd-frank a disaster . -- a disaster. unveiled his executive order, president trump said he hoped to "cut a lot out of because "friends of mine you have nice businesses can't borrow money." i am aware of the small business server you cited earlier, but i want to look at the bigger range of data. white this data show about business lending -- what does data show about business lending since dodd-frank was enacted in 2010? chair yellen: at this point, it has grown and it exceeds its an inflation adjusted basis, which is true for loans held by commercial 2010.since the end of total senile loans outstanding, if grown over 75% -- total cni cruel overtanding 75 -- grew over 75%, and small cni loans, which are usually sort of small business grew almost 4%, so we have seen healthy growth in actual lending that i mentioned to senator brown. i believe over half of small businesses indicated that they absolutely did not need to lend and had no desire for credit for id. sen. cotton: did not -- sen. warren: did not need to borrow? chair yellen: did not need to borrow. sen. warren: so the data does not back the president up. jonathan: we will break away to the senate banking committee to bring you closing figures from europe's main equity market. to take a look from chair yellen's testimony and the comments she had said would be unwise to a too long to remove accommodation, pushing on treasury yield cushion of the dollar. , barelythe stoxx 600 changed into the testimony. ftse slightly lower, more games on the dax and have a look at the dollar against some of the main competitors in the wake of chair yellen's comments. theling down against dollar, already low given some inflation data in the u.k., which showed growth but not as stronger as some economists projected. euro is up against the pound but down against the dollar, following comments from yellen that it would be unwise to a too long to remove accommodation. we have seen the move up in treasury yields. let's look at the european bond markets. similar story, the u.k., chairman and spanish 10 year all rising in the wake of fed chair yellen's comments. let's get back to the testimony. we should use that to a competitive advantage, but on the flipside, we also have the most highly regulated overboard and banks and -- overburdened banks in the world. that sounds like a contradiction. either banks have competitive advantage because the world knows we carefully regulate banks, or are banks have a competitive disadvantage because of those requirements. chair yellen, which one is it? how have our banks done in comparison to their foreign competitors since we put our new rules in place? allr yellen: i do not have the numbers at my fingertips, but i believe our banks are more profitable. as a mentioned, they have higher market values relative to their markedlues, and they are and european banks capitalize banks that are regarded as safe, sound and confirming a competitive advantage on those in competing for business. sen. warren: taking away clients from other banks. in fact, our banks have thrived since we passed dodd-frank. those big banks and community banks are making the daily record profits. mr. chairman, i would like to submit the most recent quarterly report from the fdic to show that banks of all sizes are more profitable than ever, as well as this "wall street journal" article from november entitled " u.s. banks report record profits in the third quarter." may i do that? mr. chair: with a doubt. sen. warren: thank you. place to stop in another financial crisis, we need to start with facts, real facts, not alternative facts that the administration has become known for. the facts show that donald trump is wrong and his chief economic advisor is wrong about every major reason that they have given to tear up dodd-frank. commercial and consumer lending is robust. bank profits are at record levels, and our banks are blowing away the global competitors. why go after banking regulations? the president and the team of goldman sachs anchors that he has been in charge of the that the usankers put in charge of the economy went to scrap the rules so they can go back to the good old days, when bankers could get huge bonuses if they got lucky and take huge risks, knowing they could get tax payer bailout if they did not pay off. we did this top of regulation before and resulted in the worst financial crisis since the great depression. we cannot afford to go down this road again. thank you, chair yellen and mr. chairman. mr. chairman: senator scott. ott: thank you for being here this morning. a month ago, you had a teacher town hall meeting with post secondary economic educators and you had a question about dodd-frank as it relates to repealing or changing an part of your answer was community banks feel the burden of regulation is very great. i feel strongly that we should be looking for ways to mitigate regulatory burden, and we are looking for ways, particularly for smaller institutions to mitigate that burden. there could be modifications to dodd-frank that could succeed in reducing regulatory burdens for small institutions, to quote you, i would love to hear your thoughts and your recommendations on ways to mitigate that regulatory burden for small banks, specifically small banks, places like in south carolina and other states? -- other states. chair yellen: let me reiterate what i said. it is important to look for every way we can to mitigate the regulatory burdens. what we have suggested previously, and i would reiterate with respect to dodd-frank, is that congress might want to consider exempting community banks from the local role and some of the incentive compensation provisions that apply to them and those it be the examples. ableve seen being [indiscernible] we have taken steps to extend the exam cycle per well-capitalized banks. we are reducing the duration of her on-site loan reviews. we have heard from community bankers with big teams of inminers coming in and stay the bank premises for a long time and it can be quite disruptive, so we are doing much more work off-site. we are trying to reduce our documentation requests to areas that we think are high risk that we want to examine. we do a lot to many of the regulations that we put out apply to the largest banking organizations. and not the community banks, so we tried to make clear the ,ommunity banks this new reg this does not apply to you. you don't have to worry about that. doesve to make clear what apply to community banks and what portions of the regulations to not apply to community banks. to reduce the frequency of our consumer compliance exams for banks and a and low risk, so those are some of the things we are doing. to grip ourpting review with the other banking regulators to identify provisions that can reduce , with puth reduced out provisions that reduce the amount of information that we require on the reports and many other things. sen. scott: thank you. i look forward to seeing some of that writing so we can fuse it all together. earlier, you know there was a 1% drop in the increment rate of african-americans, which is a positive sign, so i think there is a correlation between educational achievement and unemployment rates, whether you live in cleveland, detroit michigan, high school diploma is at least twice as high as any other demographic with the same level of education. what do you think drives the prepares the -- drives the prosperity and what effect is your policy have on that specific demographic? chair yellen: so african-americans generally have unemployment rates in labor markets experience that is more cyclical in downturns. they tend to be very badly affected. and in the strong upturn, their ins -- they are basically regaining ground that they lost, so we can see stronger gains. for example, over the last year, the white unemployment rate , thens stable at 4.2% african-american rate dropped from 8.8% to 7.7%, but as you pointed out, that is a much higher rates and the same is true that all educational levels . lower education levels are much higher than those at higher education levels. at leastle, those with college had an unemployment rate of 2.5%. those with less than and school, 7.7% african-americans tend to have worst experience. sen. scott: one of my concerns is if you look at the 60.8 percent of african-americans about the high school degree versus the overall demographics versus the unemployment rate of 2.4% for african-americans versus white folks, who have the highest level of education. my concerns long-term is as we examine the labor force participation rates, 8% or so, the real unemployment is when you have all the numbers together is 9.2%, 9.2%. our entire financial system is still wired around the defined benefits platform, so you lower labor force participation rates means it does for goal to meet the obligations from social security to medicare, so long-term, if the gross cash growth in our economy from people perspective for african-americans and hispanics, who are produced a payday and have the markets in the nation, the reality is if 20% , itployment is persistent foreshadows a difficult future for this nation to meet our obligations. chair yellen: i agree and i think it is appropriate for the trains mitigate that we have discussed [indiscernible] development of product up at other things might be, as well. sen. scott: thank you. mr. chairman: thank you, senator? senator: i want to associate myself with your moke said -- with the remarks of sandra scott but i went to at least some consideration of the underemployment 10 unemployment of native american citizens. i think what you look at those numbers, i will tell you they are worse than indian country because of the isolation of the geography and additional education challenges, so i think -- i want to point out that we cannot leave our native american citizens behind. talk abouted to their marks on small community banks, but i didn't want to spend all of my time talking about it because it gets enough pretty quickly -- it gets eat en at pretty quickly. we know retirement security is a huge future burden in this country, but i want to focus on automation. and what automation would mean for employment, especially employment of the categories that senator scott was talking about. in a 2015 speech, the chief economist for the bank of england referenced a startling u.s.stic that 47% of all jobs are likely to be replaced by technology over the next 10-15 years, and that would be more than 80 million altogether. obviously, we see this from automation and trucks, retail moving telling retail, so i'm studys what is the automation and the impact on the u.s. economy moving forward and i know you always say better training, but obviously, a lot of concern on how we implement that in the forward. automation. know automation and technological change is sad, very important effects on our economy. for many decades. tear to future really know exactly where it is going, horizon on on the the effects of the labor market. sen. heitkamp: do you think we are paying enough attention to this issue? a lot of talked about trade and the displacement globalization has made. --'s talk about optimization automation, which i think has been a larger driver of displacement. how do you get the public attention to this and the educators attention to this, and had we change the labor market and the skill sets we need to change so that eventually we end up with employment in our country? generally,n: automation and technological change more broadly has been the source of growth in income support americans generally, but it has created huge for those with less education and often for those in manufacturing and other the effectsave seen of automation and globalization. i think we need to think about ofs to address the needs those workers because we have seen chronic long-standing downward pressure on your [indiscernible] and they're making it hard for them to cope. sen. heitkamp: one thing that gets lost and this is when we talk about the workers, we are talking about people, 40's and 50's, they are less concerned about their livelihood than the opportunity that their children will have, so i think we need to be having a major discussion of what the job of the future looks like for the job market of the future looks like. one more question. this is about the lack of prosecutions after 2008 and what we can do about it to hold people more accountable. new york fed president bill deadly forwarded an interesting -- bill dudley forwarded interesting idea to adopt the compensationcutive under his proposal and he finds proposals incurred by the firm will be paid by performance bonds, which would incentivize senior leaders to design and implement systemic changes to the firm's culture. what is your view on the current incentive-based pays on wall street? two confirms light too much on equity-based compensation and what is the risk with the deadly model? ey model?dl chair yellen: i think that was an important process in this games and we have worked in her own supervision to insist that firms put in place compensation schemes that do not lead to inappropriate risk taking. they may include longer periods ordeferral or clawback secure provisions of an individual who takes risk on behalf of the firm, it there are losses that are separate, but i think it is important to strengthen incentive compensation practices. sen. heitkamp: one of the concerns that i have, and i'm not a big believer that enforcement is a strong deterrent, but i do believe enforcement is a strong deterrent in white-collar crime and i think there is way too often this sense that if i did not know about it, i'm not hopeful -- i'm not hopeful ball. to respond to people's concerns about wall street and what is happening, we need to have a better system of not only civil enforcement but criminal enforcement, so to be looking at this and this congress and very interested in feedback from the fed and other regulatory agencies because i think we always got ability to prosecute. fine mayon-dollar shock a cleveland worker but not a wall street banker, so weshoct a wall street banker, so we need to do a better job of holding people accountable. mr. chairman: senator tillis? senator tillis: thank you. a couple of questions. one relates back to earlier questions from some of the members about a discussion around dispelling the myth that things are not lending. i do not agree with that. we are comparing probably not the right data sets so that people are absolutely valid in assuming that based on the data they are using, there is a fair amount of academic data that says increased capital requirements have a negative effect on loan underwriting. i will not debate the academics, but i think there is a fair amount of information out there. i think what we see, it occurred andamong household lending small business clients that tend to have a downward trend, you referenced i think the survey that said all but 4% of the people contacted were getting the loans they wanted. i am trying to square that with the research that shows a substantial decrease in the postt of loans precrisis, crisis print element is about household loans or mortgages. we know why there was a lower number, because they should have been under prewritten crisis, but with business loans, i think that is a different consideration and i think that i am seeing a number here that says the average growth rate posed in 2011 and beyond, so after dodd-frank reforms, wearing about 4% for large -- worrying about a 4% for large banks, somewhere around 60% of the crisis for business loans, thes it possible that reason why 4% of the people would say they are getting the loans they wanted is because far few people are asking for loans in creating businesses? chair yellen: i think that is true and we have had a slowing economy in many small businesses , save their sales growth does not justify significant that would make it desirable as first not looking to borrow. sen. tillis: to me, isn't it problematic to have people leave this meeting thinking that all the small businesses that have business plans, they think that they should move forward with to create jobs and take risk, to make us think that this is a phenomenon that only affects about 4% of small businesses and that everyone else is getting the loans? i think there is a pent-up demand out there. please, finish your thought. chair yellen: i was going to say that sometimes small business loans are underwritten by banks in a way that is similar to credit or home equity loans and small businesses may borrow against home equity lines of one thing that may be happening to some small businesses is that because it was a substantial reduction, especially in some areas of the country in residential property values, their ability to finance -- sen. tillis: in your professional opinion, do you think the universe of potential small businesses that could be created or businesses that want to expand, that they have unfettered access to capital given the current environment? chair yellen: small businesses that want to start off always need equity capital and that is quite difficult. sen. tillis: do you think that when we are in an environment now -- i heard at community bank that i invested in said second much of the banking committee, but i speak with them and they say that the personal relationship that they had in the past, where they could get a loan underwriting were pivotal to them to get a loan. now they feel they have to go in and if you have probably the same amount of assets, you can secure the loan, but there are a lot stricter requirements that have a chilling effect on small business lending in the nation. do you agree with that? chair yellen: certainly our objective is to encourage banks to lend, safe and sound lending, and not be quite often. craddick obstacle -- sen. tillis: i do want to ask another question and i apologize to senator kennedy. i want to touch on the second subject, but i think we are talking out of both sides of her mouth in washington and i'm not criticizing you, but when it take a look at the movement of capital. on one hand, we say x commence anyone. on any given day, we can have five or six regulators saying you better not land based on these parameters because what i consider to be overreach is an enforcement, said to me, leading to comment stand that banks are lending to an e-commerce is not -- you did not say that, it was a sub provision by members on the committee -- i think it is to put icing the small business committee today and the community banks -- small and communityttee banks, which leads me to my last precrisis -- incidentally, i think there were important reforms that had to be implemented with dodd-frank. you had a bill that was this big that expanded to a regulatory framework that was enabled under dodd-frank, and in particular, a north carolina, we had a very thriving financial services ecosystem precrisis. we had over 100 community banks, a couple of regional banks in north carolina, and relatively big banks in charlotte, where i live. we have seen a substantial decline the community banks in north carolina and i think that is a national trend. you know the numbers, as well as i do. since dodd-frank, we have had [indiscernible] one is on an indian reservation. the other one i think is primarily focused on serving the --est community, so we have to all mesh community comes we have completely destroyed the lower foundations of the economic -- banking ecosystem because it has to be because inflection point was after dodd-frank was implemented and agency starts at i think extending their reach. do you believe that is an area to be concerned with? you did say in response to question the community banks do need [indiscernible] i'm sorry for going over my time. chair yellen: i think community banks -- i agree with some of the trends you just described are you i think they happen under pressure. you had many years of the weaker economy, interest rates, and pressure on net margins and compliance cost. i agree that it is very important for us to look for ways to relieve burden and i'm research to several and committed to everything we can to mitigate the burdens on these institutions that play a you havertant role, as indicated, in the economy and so many communities in supporting lending. mr. chairman: senator schatz? schatz: thank you for your public service and accommodating all about ashton. before we get going on my questions, i want to echo the sentiments of my colleagues in terms of what dodd-frank has done for the stability of our financial system. it has strengthened our economy. undermining dodd-frank is not, in my view, the correct course of action. i wanted to ask you, chairwoman change.about climate it has resulted in prolonged droughts that affect yields, the increased severity of storms, and other aspects on which many of our industries depend. of them'sthese

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