| Powell testimony, $3.5 trillion stimulus, and bank earnings continue. Spending, inflation Federal Reserve Chair Jerome Powell begins his semi-annual testimony to the House Financial Services Committee this morning, with Democrats on the panel seeking his support for another round of government spending. Republicans are likely to point to yesterday's hotter-than-expected inflation print as evidence of the dangers of further stimulus. Powell will have to have answers for both, while also being aware that a decision on his own future remains in the balance. His testimony moves to the Senate tomorrow before he meets with Treasury Secretary Janet Yellen on Friday to discuss risks from the hot U.S. housing market. $3.5 trillion Senate Democrats on the Budget Committee agreed to a $3.5 trillion spending bill which would carry most of President Joe Biden's economic agenda without needing Republican support. The president will be on Capitol Hill today to discuss the deal. While there are still challenges in getting the support of all 50 Democratic senators, the reduction in the size of the bill from a previously-mooted $6 trillion should help ease some worries. Powell's answers to questions on the package today and tomorrow may also carry some weight. Earnings Wall Street's second-quarter earnings season got off with a bang yesterday as Goldman Sachs Group Inc. and JPMorgan Chase & Co. both saw revenue from deal-making surge. Bank of America Corp., Citigroup Inc. and Wells Fargo & Co. report today with analysts looking for an M&A boost to bottom lines. BlackRock Inc. also reports before the bell. Markets mixed Global equity gauges are fairly directionless this morning as inflation fears continue to haunt markets that remain close to all time highs. Overnight the MSCI Asia Pacific Index slipped 0.3% while Japan's Topix index closed 0.2% lower. In Europe, the Stoxx 600 Index was down 0.2% by 5:50 a.m. Eastern Time with tech companies rising on a report that Apple Inc. is preparing supplies for a production boost. S&P 500 futures pointed to a small move higher at the open, the 10-year Treasury yield was at 1.391%, oil dropped and gold gained. Coming up... Turkey's latest central bank decision is at 7:00 a.m., with Canada's at 10:00 a.m. U.S. PPI for June is at 8:30 a.m. Latest crude oil inventories data is at 10:30 a.m. Powell's appearance before the House panel is scheduled to begin at 12:00 p.m. The latest Fed Beige Book is at 2:00 p.m. Chile's central bank rate decision is at 6:00 p.m. Delta Air Lines Inc.. is among the non-financial companies reporting results. What we've been readingHere's what caught our eye over the last 24 hours And finally, here's what Lorcan's interested in this morningThe European Central Bank will decide today whether to move to the next phase of development of a digital euro. While the discussion about the need for central bank digital currencies remains robust, I want to take a minute to try to figure out what it is they actually are. To use an analogy, "digital currency" is quite like "football." Because, depending on where you are in the world, football means different things. The recent European football championship was won by Italy. Unless you are American, in which case Italy won the soccer championship. In the U.S., football is an entirely different sport which has almost nothing in common with the version played in the rest of the world. I'm Irish, and we have our own sport here called football. Whether you are Italian, or Irish, or American, you know what you mean when you say "football." It's just entirely different from what other people mean. Likewise with digital currencies. Most people think "Bitcoin" when they think digital currency. If, to continue the analogy, Bitcoin is (Italian) football, then something like Dogecoin would be (Irish) football and CBDCs would be (American) football. CBDCs will have few of the features of Bitcoin, they will not be anonymous, they will not be an asset class in themselves, and there may even be controls on how much a person can hold. It's hard to see how digital currency advocates will get excited about them at all.
So, a CBDC is not really a "digital currency" in the traditional sense. Basically, it is a slightly more efficient payment system with good cheerleaders. Follow Bloomberg's Lorcan Roche Kelly @LorcanRK Like Bloomberg's Five Things? Subscribe for unlimited access to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close. | 
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