Macro Musings with David Beckworth Aaron Klein on the US's Real-Time Payments Problem and the Impact of Covid Era Quantitative Easing
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Jan 12, 2026 Aaron Klein, a senior fellow at the Brookings Institution specializing in financial technology and payments, discusses pressing issues in payments and QE. He highlights the US's lag in real-time payment systems compared to other countries and the inequality fostered by delayed funds. Klein critiques the FedNow rollout and its limited consumer access. He also links post-COVID housing price surges to Fed mortgage purchases, examining the political implications of rising prices for younger generations. His recommendations focus on improving Fed transparency and future crisis management.
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US Payments Lag Behind Real Time
- The U.S. retail payment system still runs like batch laundry while the rest of the world uses streaming-style real-time rails.
- Aaron Klein argues this delay extracts fees from the poor and is a policy choice, not a technical limitation.
Bank Queue Observed On A Saturday
- Klein recalls seeing a woman at his local bank told to wait days for a check, then advised to pay a check-cashing fee for immediate cash.
- He uses this to show 70% of check-casher customers actually have bank accounts but pay for instant access.
Enforce Faster Funds Availability Now
- Regulators should require faster funds availability and expand hours while FedNow develops.
- Klein urged the Fed to enforce the Expedited Funds Availability Act and collect FedNow fee data from banks.
