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Thank you for the invitation to join you today. As the Federal Reserve's Vice Chair for Supervision, I am responsible for, among other things, leading the Board's Division of Supervision and Regulation in its work to promote the safe and sound operation of the U.S. banking system. While this includes the specific activities of bank supervision and regulation, the financial system reaches far beyond the banking system. Regulators must also monitor the effects of activities that extend outside this perimeter, for example activities that have migrated from banks to non-banks, or when there are broader market implications of regulatory actions and their potential effects on financial stability. Regulations should not be created in a static world of "set it and forget it." Today, my remarks will focus specifically on how the passage of time—with underlying changes in the composition of the economy and the financial system, interest rate shifts, and patterns and preferences of banking and financial activity—can lead to unintended policy application and unexpected consequences. Regulators should consider these broader evolving dynamics as they craft regulations to endure beyond today's circumstances. Typically, these effects are not contemplated in the scope of the usual cost-benefit analysis, as shifts occur over time after a new rule or regulation is implemented or enacted. But shifts can, in effect, become new policy choices with consequences that can pose significant issues. One shift in particular is that of the supplementary leverage ratio increasingly becoming the binding capital constraint for the largest banks in the Uni FED'S BOWMAN: IT IS TIME TO CONSIDER ADJUSTING THE POLICY RATE OPEN TO CUTTING RATES AS SOON AS JULY FOMC MEETING IF INFLATION PRESSURES STAY CONTAINED Fed governor Miki Bowman signals she could support a July rate cut. “Should inflation pressures remain contained, I would support lowering the policy rate as soon as our next meeting in order to bring it closer to its neutral setting and to sustain a healthy labor market.”…