LSU is the flagship institution of Louisiana and is one of only 30 universities nationwide holding land-grant, sea-grant and space-grant status.

Since 1860, LSU has served its region, the nation, and the world through extensive, multipurpose programs encompassing instruction, research, and public service. The university brings in more than $150 million annually in outside research grants and contracts, a significant factor for the Louisiana economy.

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Expert Spotlights from Louisiana State University

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ai-in-action-symposium

AI In Action Symposium

Professor

   The AI In Action Symposium, hosted by the LSU E. J. Ourso College of Business, brings together expert voices at the heart of the AI revolution to explore how they have successfully navigated this evolving landscape.

 
		The 2026 symposium focuses on the practical implications of AI in business, including hiring AI-ready talent, ensuring responsible and ethical use, and exploring the challenges of implementing AI across both large enterprises and small startups.

Speakers  Attendees will hear from Louisiana leaders and national AI experts, including… 
Secretary Bruce Greenstein of the Louisiana Department of Health  April Wiley, Senior Vice President at Community Coffee  Robert Veit and Julian Tandler from Scale Team Six, a San Francisco-based business accelerator  Dr. Tonya Jagneaux, who leads medical analytics at the Franciscan Missionaries of Our Lady Health System (FMOLHS)  Hunter Thevis, president and co-founder of Lafayette-based S1 Technology  …and many more!  Details   March 20, 2026, 8:00 a.m. – 1:00 p.m.  Registration deadline is March 15.  Held on the LSU A&M Campus, in the LSU Student Union  Register at lsu.edu/business/ai-symposium  Discount available for LSU System employees     

war-in-iran-impact-on-oil-prices

War in Iran: Impact on Oil Prices

Executive Director of the LSU Center for Energy Studies available for interviews

Interim Executive Director & Associate Research Professor

 As global markets respond to escalating tensions in Iran, energy prices are once again at the center of international concern. For insight into what this conflict could mean for oil markets, consumers and the broader economy, media can turn to Greg Upton, executive director and associate research professor at the LSU Center for Energy Studies.

An expert at the intersection of energy and environmental economics, Upton studies how geopolitical disruptions, supply constraints and policy decisions influence oil prices and downstream economic impacts. As instability in the Middle East threatens global supply chains, he can provide context on potential price volatility, implications for Louisiana’s energy sector and what higher crude prices may mean for gasoline costs and inflation in the United States.

Upton has contributed to more than 40 academic publications and has presented his research to over 200 industry, government and academic audiences. He has testified before committees in both chambers of the Louisiana Legislature and a subcommittee of the U.S. House of Representatives. A frequent voice in national and local media, Upton has been quoted or cited more than 250 times, including by the The Wall Street Journal, The New York Times, USA Today and NPR.

In addition to his research, Upton teaches in LSU’s MBA program and in the Department of Economics and Environmental Sciences, helping prepare the next generation of leaders to navigate complex energy and environmental challenges.

For timely, data-driven analysis on the impact of oil price fluctuations amid the ongoing conflict in Iran, Dr. Greg Upton is available for interviews and expert commentary.


avian-flu-lsu-expert-available

Avian Flu: LSU Expert Available

The first avian flu outbreaks of the season are popping up across the country

Associate Professor

  LSU expert Dr. Rebecca Christofferson is available to speak with media about the first avian flu outbreaks of the season, including what’s driving the spread, potential risks to the public and what people should know as cases emerge across the country.


lsu-astrophysicist-weighs-in-on-potential-release-of-ufo-records

LSU astrophysicist weighs in on potential release of UFO records

  Dr. Eric Burns is a leading researcher in high-energy astrophysics, he studies neutron star mergers and gamma-ray bursts and helped lead the first multimessenger discovery of a binary neutron star merger.

"Given the vast size of the universe, most scientists think life beyond Earth likely exists, and we are actively searching for it. However, there is no credible evidence that extraterrestrials have visited Earth or made contact with humanity. Previous government reviews of UFO reports have not produced convincing proof of alien technology. Astronomers are terrible at keeping secrets — if even one of us had solid evidence of aliens, the entire world would know by lunchtime. I strongly support transparency and look forward to the release of additional information, but extraordinary claims require extraordinary evidence."


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Op-Ed: Crypto innovation needs stability, not shortcuts

By: Rajesh P. Narayanan

Lousiana Bankers Association Professor of Finance

After months of bipartisan negotiations, Congress continues to debate crypto market structure legislation, though questions remain whether common sense investor protections will be included in a new federal framework for digital assets.

These proposals address fundamental questions aimed at providing needed clarity for digital asset markets, including around agency jurisdiction, and trust and confidence for mainstream adoption of modern markets. At times, the negotiations fractured over stablecoin yields, while provisions addressing decentralized finance and developer liability and the importance of investor safeguards have proven similarly divisive.

The GENIUS Act prohibits stablecoin issuers from paying interest, recognizing such payments transform digital tokens into bank deposits requiring regulatory oversight. Platforms opposing restrictions on stablecoin yields prioritize business models generating revenue by offering deposit-like products without deposit-like regulation – an unfair regulatory arbitrage that disadvantages prudentially supervised banks, drains funding from local lending and introduces systemic risk without corresponding accountability.

While these complex issues require careful calibration, there is no substitute for keeping investor-first reforms at the center of market structure legislation and prioritizing clear rules and robust investor safeguards that ensure digital assets benefit everyday investors and that America strengthens its economic competitiveness and leads the next era of financial innovation.

Such impasses reflect a pattern where narrow interests prevail over broader economic considerations. Platforms opposing restrictions on stablecoin yields prioritize business models generating revenue by offering deposit-like products without deposit-like regulation. Banking institutions recognize that unregulated competition operating under lower-cost structures will drain funding from local lending. Both positions are economically rational for the parties involved. Neither serves the public interest in financial stability.

Likewise, opponents argue that regulation stifles innovation, especially in decentralized finance. But this conflates innovation with regulatory arbitrage. Genuine technological progress creates value by improving efficiency or reducing costs. Regulatory arbitrage extracts value by exploiting gaps between economically equivalent activities subject to different rules.

The alternative claim – that existing securities laws suffice – ignores that those frameworks were designed for different market structures. Securities laws assume centralized issuers. Commodity regulations assume physical delivery. Digital assets often fit neither category cleanly, creating uncertainty that inhibits legitimate activity while failing to prevent abuse.

The choice is not between perfect legislation and the status quo but between establishing clear rules now or waiting for the next crisis. Financial regulation written in crisis tends toward overcorrection that stifles markets for years. Regulation developed deliberately better balances stability with innovation. Both House and Senate committee versions share core elements providing needed clarity on agency jurisdiction, registration requirements and disclosure standards.

International considerations reinforce urgency. The European Union's Markets in Crypto-Assets regulation provides comprehensive frameworks for issuers and service providers. Continued U.S. regulatory ambiguity cedes leadership to jurisdictions that may not share American economic interests. More immediately, delay allows risks to accumulate as digital assets become interconnected with traditional finance through retirement plans and institutional portfolios.

Recent market failures demonstrate why regulatory clarity and investor safeguards matter. The 2022 collapse of crypto exchange FTX revealed an $8 billion dollar deficit in customer accounts, spreading losses to pension funds and individual retirement accounts. Investigators identified conflicts of interest and leverage that standard regulation would have prevented. When Silicon Valley Bank failed, one major stablecoin had 8% of reserves tied to that institution. The crisis resolved only because uninsured depositors received public support. These episodes reveal a pattern where institutions operating outside prudential supervision accumulate risks requiring public intervention.

Markets function best when rules are clear, consistently enforced and apply equally to all participants. This principle applies whether the market involves energy commodities, agricultural credit or digital assets. Louisiana's economy depends on community banks that understand local conditions and maintain lending relationships through economic cycles. When regulatory gaps allow deposit flight to lightly supervised alternatives, these institutions lose capacity to serve small businesses and agricultural operations.

Congress has made meaningful progress on consensus-driven legislation. Completing that work would provide clarity allowing legitimate innovation while preventing regulatory arbitrage that creates systemic risk. The alternative is waiting for the next crisis to demonstrate why such frameworks were necessary.


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Wetlands: Nature’s First Line of Defense for Our Coast and Communities

Since the 1930s, Louisiana’s coastline has been reshaped by the relentless advance of the Gulf, with over 2,000 square miles of land disappearing beneath its waters and representing the largest loss of coastal land anywhere in the continental United States.

This dramatic transformation has far-reaching consequences, threatening local economies, delicate ecosystems, and heightening the state’s exposure to hurricanes. In the face of these urgent challenges, LSU’s College of the Coast & Environment (CC&E) stands at the forefront, leading pioneering research and bold initiatives that not only protect Louisiana’s coast, but also build stronger, more resilient communities. Below are just a few examples of how CC&E is driving meaningful solutions for our coastal future.

Wetlands are vital to protecting our coast, and CC&E researchers are actively investigating the role of both constructed and natural wetlands in reducing coastal flooding hazards. Through several projects funded through the US Army Corps of Engineers, Drs. Robert Twilley, Matthew Hiatt, and CC&E Dean Clint Willson, along with collaborators across campus, are conducting research on coastal ecosystem design -  a framework that leverages the benefits of natural and nature-based coastal features, such as wetlands, environmental levees, and flood control gates – and how that could be integrated into engineering design and urban planning.

Through the State of Louisiana’s ambitious Coastal Master Plan, administered by the Louisiana Coastal Protection and Restoration Authority, wetland construction and restoration play a huge role in managing the Louisiana coastal region. Such innovative techniques leveraging natural and nature-based features require evaluation to determine the success of such projects, and CC&E researchers are using cutting-edge science to advance this endeavor. Dr. Tracy Quirk and her students are investigating the success of marsh restoration by comparing structural and functional characteristics (e.g., vegetation, elevation, hydrology, accretion, and denitrification) between two created marshes and an adjacent natural reference marsh along the north shore of Lake Pontchartrain, Louisiana.

Wetlands not only serve as a buffer from storms and sea level rise but also play a major role in regulating greenhouse gas emissions and contribute to productive vibrant ecosystems. In large collaborative project funded by the National Science Foundation, Dr. Giulio Mariotti is using computer models to forecast how coastal marshes may change in size, shape, and salinity in the future, and how these changes could affect methane emissions.

As part of the same project, Drs. Haosheng Huang and Dubravko Justic are creating high-resolution hydrodynamic and biogeochemical models to predict changes in methane emissions in coastal Louisiana.

In another project, with funding from Louisiana Center of Excellence, National Science Foundation, Louisiana Sea Grant, and the National Oceanic and Atmospheric Administration, Drs. Matthew Hiatt and John White have established a network of sensors to measure water levels and salinity throughout the wetlands in Barataria Bay, Louisiana, a region that has experienced significant land loss and storm impacts. The goal is to establish an understanding of the drivers of saline intrusion in marsh soils, and to ultimately determine what this means for the ecological resiliency of wetlands experiencing rapid change.

CC&E’s leadership in wetlands science is recognized nationwide. It is the only college in the United States to have six faculty members—Drs. John White, John W. Day, Jr., Robert Twilley, William Patrick, James Gosselink, and R. Eugene Turner—honored with the prestigious National Wetlands Award. No other institution has had more than one recipient. Presented annually by the Environmental Law Institute, this award celebrates individuals whose work demonstrates exceptional innovation, dedication, and impact in wetlands conservation and education. CC&E’s unmatched record reflects decades of pioneering research and a deep commitment to safeguarding the nation’s most vulnerable coastal landscapes.

Every day, CC&E channels this expertise into action—protecting Louisiana’s coast and, in turn, the communities, wildlife, and ecosystems that depend on it. Through bold research, collaborative partnerships, and a vision grounded in science, the college is shaping a more resilient future for coastal regions everywhere. CC&E is building teams that win in Louisiana, for the world.

Article originally published here.  

lsu-experts-break-down-artificial-intelligence-boom-behind-holiday-shopping-trends

LSU Experts Break Down Artificial Intelligence Boom Behind Holiday Shopping Trends

Consumers are increasingly turning to artificial intelligence tools for holiday shopping—especially Gen Z shoppers, who are using platforms like ChatGPT and social media not only for gift inspiration but also to find the best prices. 

Andrew Schwarz, professor in the LSU Stephenson Department of Entrepreneurship & Information Systems, and Dan Rice, associate professor and Director of the E. J. Ourso College of Business Behavioral Research Lab, share their insights on this emerging trend.

AI is the new front door for search:   Schwarz: We’re seeing a fundamental change in how consumers find information. Instead of browsing multiple pages of results, users—especially Gen Z—are skipping to conversational AI for curated answers. That dramatically shortens the shopping journey. 

 For years, companies optimized for SEO to appear on the first page of Google; now they’ll have to think about how their products surface in AI-generated recommendations. This may lead to a new form of “AIO”—AI Information Optimization—where retailers tailor product descriptions, metadata, and partnerships specifically for AI visibility. The companies that adapt early will have a distinct advantage in capturing consumer attention. 

 Rice: This issue of people being satisfied with the AI results (like a summary at the top of the Google results) and then not clicking on any of the paid or organic links leads to a huge increase in what we call “zero click search” (for obvious reasons).  

 For some providers, this is leading to significant drops in web traffic from search results, which can be disconcerting due to the potential loss of leads. However, to Andrew’s point of shortening the journey, it means that the consumers who do come through are much more likely to buy (quickly) because they are “better” leads.  

This translates to seemingly paradoxical situations for providers: they see drops in click-through rates and visitors/leads, yet revenue increases because the visitors are “better.”  

There is a rise in personalized shopping journeys:   Schwarz: AI essentially acts as a personal shopper—one that can instantly analyze preferences, budget, personality traits, or past behavior to produce tailored gift lists. This shifts power toward “delegated decision-making,” in which consumers allow AI to narrow their choices.   

Younger consumers are already comfortable outsourcing this cognitive load. However, as ads enter the picture, these personalized journeys could be shaped by incentives that aren’t always transparent. That creates a new responsibility for platforms to disclose when suggestions are sponsored and for users to develop a more critical lens when interacting with AI-driven recommendations. 

Rice: This is also a great point. The “tools” marketers use to attract customers are constantly evolving, but this seems in many ways to be the next iteration of the Amazon.com suggestions that you find at the bottom of the product page for something you click on when searching Amazon (“buy all x for $” or “consumers also looked at…,” etc.), based on past histories of search and purchase, etc.  

One of the main differences is that you can now create virtually limitless ways to compare products, making comparisons less taxing (reducing cognitive load and stress), which may, in some cases, increase the likelihood of purchase. These idiosyncratic comparisons and prompts lead to the truly unique journeys Andrew is discussing.   

You no longer have to be beholden to a retailer-specified price range. You could choose your own, or instead ask an AI to list the products representing the best “value” based on consumer reviews, perhaps by asking to list the top ten products by cost per star rating, etc.  

Advertising is becoming more subtle and conversational:  Schwarz: With ads woven directly into AI responses, the traditional boundary between content and advertising blurs. Instead of banner ads, pop-ups, or clearly labeled sponsored posts, recommendations in a conversational thread may feel more like advice than marketing. This has enormous implications for consumer trust.  

Retailers will likely see higher engagement through these context-aware ad placements, but regulatory scrutiny may also increase as policymakers evaluate how clearly sponsored content is identified. The risk is that advertising becomes invisible—something both platform designers and regulators will need to monitor carefully. 

Rice: This is definitely true. I was recently exploring an AI-based tool for choosing downhill skis, but the tool was subtly provided by a single ski brand. I’m not sure the distribution of ski brands covered was truly delivering the “best overall fit” for a potential buyer, rather than the best possible ski in that brand. At least in that case, it was somewhat disclosed. 

It does, however, become an issue if consumers feel misled, but they’d have to notice it first. Still, the advantages are big for retailers, and the numbers don't lie. According to some preliminary Black Friday data, shoppers using an AI assistant were 60% more likely to make a purchase.  

Schwarz: This shift is going to reshape multiple layers of the retail ecosystem: 
Retailers will need to rethink how they show up in AI-driven environments. Traditional SEO, ad bids, and social media strategies won’t be enough. Partnerships with AI platforms may become as important as being carried by major retailers today. Because AI tools can instantly compare prices across dozens of retailers, consumers will become more price-sensitive. Retailers may face increasing pressure to offer competitive pricing or unique value propositions, as AI reduces friction in comparison shopping. Retailers who integrate AI into their own websites—chat-based shopping assistants, personalized gift advisors, automated bundling—will gain an edge. Consumers are increasingly expecting conversational interfaces, and companies that delay will quickly feel outdated. As AI tools influence purchasing decisions, consumers and regulators alike will demand clarity around how recommendations are generated. Retailers will need to navigate this carefully to maintain  What I think we are going to see accelerate as we move forward: 
AI-powered concierge shopping will become mainstream. Within a couple of years, using AI to generate shopping lists, compare prices, and find deals will be as common as using Amazon today. Retailers will create AI-specific marketing strategies. Instead of optimizing for keywords, they’ll optimize for prompts: how consumers might ask for products and how an AI system interprets those requests. More platforms will introduce advertising into AI models. ChatGPT is simply the first mover. Once the revenue potential becomes clear, others will follow with their own ad integrations. Greater scrutiny from policymakers. As conversational advertising grows, transparency rules and labeling requirements will almost certainly. A new era of “conversational commerce.” Buying directly through AI—“ChatGPT, order this for me”—will become increasingly common, merging search, recommendation, and transaction into a single seamless experience.  I can speak to this on a personal level.  My college-aged son is interested in college football, and I wanted to get him a streaming subscription to watch the games.  However, the football landscape is fragmented across multiple, expensive platforms. 

I asked ChatGPT to generate a series of options. Hulu is $100/month for Live TV, but ChatGPT recommended a combination of ESPN+, Peacock, and Paramount+ for $400/year and identified which conferences would not be covered.  What would have taken me hours only took me a few minutes! 

Rice: On the other hand, AI isn’t infallible, and it can lead to sub-optimal results, hallucinations, and questionable recommendations. From my recent ski shopping experience, I encountered several pitfalls.  

First, for very specific questions about a specific model, I sometimes received answers for a different ski model in the same brand, or for a different ski altogether, which was not particularly helpful, or specs I knew were just plain wrong.  

Secondly, regarding Andrew’s point about the conversational tone, I asked questions intended to push the limits of what could be considered reliable. For example, I asked the AI to describe the difference in “feel” of the ski for the skier among several models and brands.  

While the AI gave very detailed and plausible comparisons that were very much like an in-store discussion with a salesperson or area expert, I’m not sure I fully trust when an AI tells me that you can really feel the power of a ski push you out of a turn, this ski has great edge hold, etc. It sounds great, but where is the AI sourcing this information? I’m not convinced it’s fully accurate.  

It also seems we’re starting to see Google shift toward a more AI-centric approach (e.g., AI summaries and full AI Mode). At the same time, we’re also starting to see AI migrate closer to Google as people use it for product-related chats, and companies like Amazon and Walmart have developed their own AI that is specifically focused on the consumer experience.  

I can’t imagine it will be long before companies like OpenAI and their competitors start “selling influence” in AI discussions to monetize the influence their engines will have.   


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LSU Expert Available: Lowest Gas Prices in Years

  Greg Upton, an LSU expert in energy economics, is available for media interviews on why gas prices have fallen to their lowest levels in years.


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NASA Missions Discover Record-Setting Blast

LSU astrophysicist Eric Burns is among scientists poring over data from NASA satellites and other facilities as they try to determine what caused an extraordinary cosmic outburst discovered on July 2.

  Black Hole Eats Star: NASA Missions Discover Record-Setting Blast  Dr. Eric Burns, associate professor of Physics & Astronomy in LSU’s College of Science, leads a consortium that studies gamma-ray bursts (GRBs), including the July event that, because of its long duration, stands in a class by itself. Because opportunities to study such events are so rare, and because they may reveal new ways to create GRBs, astronomers are particularly excited about the July burst.

Burns discussed the discovery and the significance of this area of research.

Can you explain your interest in gamma-ray bursts, why they matter, and how they play into these new discoveries? "I run a consortium that studies gamma-ray bursts. These are the most luminous explosions in the universe, other than the Big Bang itself.

The consortium's been operating for almost 50 years. We've seen 15,000 gamma-ray bursts. We've used these sightings to understand the speed of gravity, where gold is created, and fundamental properties in the universe.

In July, we detected a gamma-ray burst that was longer than we've ever seen before. They're normally like 30 seconds long. This one was 8 hours. It was so long that we didn't believe it was a gamma-ray burst for a while."

What was your role in investigating this phenomenon? "The consortium I run helped find it and helped figure out where it was coming from. We put a bunch of telescopes on it to try and figure out what was happening and to understand what caused this event.

Normal gamma-ray bursts come from a massive star near the end of its life. The interior of the star collapses, and it forms a black hole. That black hole eats it from the inside out, and it launches this matter that's moving at basically the speed of light, and that produces your gamma-ray burst.

By chance, a colleague and I had written a paper earlier this year on what is the longest gamma-ray burst you could produce with this scenario. And the answer is 1,000 seconds. So we're pretty sure that what happened here was this: You have that massive star, but instead of its core becoming the black hole, instead you have a black hole that falls into it. Or they sort of fall into each other."

How was this long gamma-ray burst discovered? And what led to your involvement in studying it? "We have what’s called gamma-ray burst monitors. They're a version of a telescope, but they're not like a long tube that you use to see visible light with your eyes. They're actually crystals that detect when they are hit by a gamma ray by fluorescing and sending out light. And so we could detect them that way.

In the consortium I run, there are about a dozen of these gamma ray detectors. They're all on different satellites. Most of them are around Earth, but some of them are much further out in our solar system.

We've automated most of our processes. The spacecraft itself will detect this event and report it to the community. All of that happens in like 30 seconds. In this case, our satellite had four different triggers spread over eight hours, and a member of the community pointed out that these events were coming from the same general area in the sky.

So, even before the last trigger, within a couple hours, we realized, oh, there's something really long happening here that we haven't really seen before."

Full story available here. 

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Op-Ed: Stablecoin 'rewards' are a risk to financial stability

By Dr. Dr. Rajesh P. Narayanan - Dr. Narayanan is the Louisiana Bankers Association Professor of Finance in the Department of Finance at Louisiana State University. 

Congress has long recognized that stablecoins should not function as unregulated bank deposits. The intent of the recently enacted GENIUS Act is clear: to prohibit stablecoin issuers from paying interest or yield to holders, maintaining a distinction between payment instruments and bank deposits which are not only used for payment purposes but also as a store value.

Yet loopholes have already emerged. Some crypto exchanges and affiliated platforms now offer “rewards” to stablecoin holders that work much like interest, potentially undermining the stability of the traditional banking system and constraining credit in local communities.

Terminology matters. Credit card rewards are funded by interchange fees and paid to encourage spending — you earn points for using your card. Stablecoin “rewards” are different. They’re funded by investing the reserves backing stablecoins, typically in Treasury bills or money market funds, and passing that interest income to holders. You earn returns for holding the stablecoin, not for using it. Economically, this is indistinguishable from a bank deposit paying interest.

When a platform advertises “5% rewards” on stablecoin holdings, it’s generally backing those tokens with Treasuries yielding about 4.5%, then passing that yield to users. Whether labeled rewards, yield or dividends, the function is the same: interest on deposits. Banks perform a similar activity — taking deposits, investing in loans and paying depositors a return — but face far higher costs, including FDIC insurance, capital requirements and compliance obligations that stablecoin issuers largely avoid.

This dynamic has a precedent. In the 1970s and early 1980s, Regulation Q capped bank deposit rates at 5.25% while inflation and Treasury yields soared above 15%. Money market funds filled the gap, offering market rates directly to consumers. Deposits fled smaller banks, which lost their funding base, while large money-center institutions gained reserves. The result was widespread disintermediation, the collapse of the savings and loan industry and the farm-credit crisis of the 1980s.

Stablecoin “rewards” risk repeating that history. Just as money market funds exploited the gap between regulated deposit rates and market rates, stablecoin platforms exploit the difference between what banks can profitably pay and what lightly regulated issuers can offer by passing through Treasury yields with minimal overhead.

Some ask why banks can’t just raise deposit rates. The answer lies in structure. Banks operate under a fundamentally different business model and cost framework. They pay FDIC premiums, maintain capital reserves and comply with extensive supervision — costs most stablecoin issuers don’t bear. Banks also use deposits to make loans, which requires holding capital against potential losses. Stablecoin issuers simply hold reserves in ultra-safe assets, allowing them to pass through nearly all the yield they earn.

To match 5% “rewards,” banks would need to earn 6% to 7% on their loan portfolios — an unrealistic target in today’s environment, especially for smaller community banks. The consequence is not fair competition, but a structural disadvantage for regulated depository institutions.

The Consumer Bankers Association warns this loophole could trigger a massive shift of deposits from community banks to global custodians. Citing Treasury Department estimates, the Association notes that as much as $6.6 trillion in deposits could migrate into stablecoins if yield programs remain permissible. Because the GENIUS Act’s prohibition applies narrowly to issuers, exchanges and intermediaries may still offer financial returns under alternate terminology. This opens the door to affiliate arrangements that replicate the essence of interest payments without legal accountability.

Those reserves don’t stay in local economies. The largest stablecoin issuers hold funds at global custodians such as Bank of New York Mellon, in money market funds managed by firms like BlackRock or — if permitted — directly with the Federal Reserve. When a community-bank depositor moves $100,000 into stablecoins, that capital exits the local bank and concentrates at systemically important institutions. The community bank loses lending capacity; the megabank or the Fed gains reserves. The result is disintermediation with a concentrated risk profile reminiscent of the money-market fund crisis.

The Progressive Policy Institute estimates that community banks — responsible for roughly 60% of small-business loans and 80% of agricultural lending nationwide — could be among the most affected. In Louisiana, where local banks finance small businesses and family farms, that risk is especially relevant. If deposits migrate to unregulated digital assets, community-bank lending could tighten, particularly in rural parishes and underserved communities.

Research from the Brookings Institution reinforces the need for regulatory parity. The label “rewards” doesn’t change the fact that these payments are economically interest. Allowing intermediaries to generate yield without deposit insurance or prudential oversight could recreate vulnerabilities similar to those seen during the 2008 money market fund crisis.

To preserve financial stability, policymakers should move to close the stablecoin-interest loophole. Clarifying that the prohibition on interest applies to all entities— not just issuers — would uphold Congress’ intent. Regulators such as the Securities and Exchange Commission, Commodities Futures Trading Commission and federal banking agencies could also treat “reward” programs as equivalent to deposit interest for supervisory purposes.

Stablecoins offer genuine efficiencies in payments, but unchecked yield features risk turning them into unregulated banks. History shows what happens when regulatory arbitrage allows competitors to offer deposit-like products without oversight: deposit flight, institutional instability and capital flowing away from community lenders. Acting now could help sustain stability, protect depositors and preserve the credit channels that support community lending — especially in states like Louisiana, where community banks remain the backbone of Main Street.


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Beyond the Repo Headlines: What the Liquidity Signals are Really Saying

By: Dr. Rajesh Narayanan, Hermann Moyse Jr., Louisiana Bankers Association Professor of Finance

In late October and early November 2025, usage of the Federal Reserve's Standing Repo Facility
(SRF) reached elevated levels exceeding $50 billion at month-end -- the highest utilization since
March 2020. Simultaneously, the Overnight Reverse Repo (ON RRP) facility has collapsed to
approximately $24 billion, down from peak levels exceeding $2 trillion in 2023. This
combination signals structural stress in U.S. money markets extending beyond seasonal factors.
These two facilities serve opposite functions in the Fed's monetary policy framework. The SRF is
an emergency lending facility where banks can borrow reserves overnight by pledging Treasury
or agency securities as collateral, paying the SRF rate (currently 4.50%). It acts as a ceiling on
overnight rates. The ON RRP works in reverse: money market funds and other institutions lend
cash to the Fed overnight, earning the ON RRP rate (currently 4.30%). It provides a floor on
rates.

The depletion of ON RRP removes a critical shock absorber. When the facility held trillions in
2021-2023, it functioned as a deployable liquidity reservoir. During stress events, as repo rates
in private markets rose above the ON RRP rate, money market funds would withdraw their cash
from the Fed and deploy it into higher-yielding private repo markets. This automatic flow of
liquidity would stabilize rates without Fed intervention. With ON RRP now depleted to $24
billion, this reservoir is empty. When liquidity shocks occur, there is no pool of cash to flow into
stressed markets. Instead, all pressure falls directly on bank reserves, currently at
approximately $2.8 trillion. The elevated SRF usage indicates that despite aggregate reserves
appearing adequate, banks are unable to efficiently reallocate liquidity across the system.

The core problem is that banks with surplus reserves face prohibitive costs to intermediating
due to post-2008 regulations, particularly the Supplementary Leverage Ratio (SLR) and G-SIB
capital surcharges. The SLR requires capital against all balance sheet assets, including reserves.
For a large bank to lend $1 billion overnight, it expands its balance sheet by that amount,
increasing SLR denominators and potentially triggering higher surcharge brackets. The capital
costs of holding additional assets on the balance sheet often exceed repo market spreads,
rendering arbitrage unviable. Banks with surplus reserves therefore park them at the Fed rather
than lending to institutions that need them.

Current conditions reveal that while dealer behavior around period-ends follows established
patterns, the magnitude of rate effects has grown substantially. Recent Federal Reserve
research documents that SOFR rose as much as 25 basis points above the ON RRP rate at recent quarter-ends, far exceeding the 5-10 basis point moves typical in 2017. The Fed's analysis
attributes this to "growing tightness in the repo market and a diminishing elasticity of supply
and demand" as reserves decline. Critically, the research shows that dealer quarter-end 
behavior -- reducing triparty borrowing and shifting to central clearing -- has remained
"remarkably stable," yet rate impacts have intensified. This indicates the problem is not
changing behavior but deteriorating underlying conditions. The pattern mirrors 2018-2019,
when similar dynamics preceded the September 2019 crisis. Academic work from that episode
documented that foreign banks reached minimum reserve levels while domestic G-SIBs
maintained surpluses but declined to intermediate due to balance sheet constraints.¹

November 2025 differs critically from September 2019: the ON RRP buffer is now depleted. In
2021-2023, that buffer absorbed surpluses and prevented repo rate collapse. Its near-zero level
means the system lacks this stabilizer precisely when QT has reduced reserves and Treasury
issuance remains elevated. Additional liquidity pressure falls directly on reserves, leaving repo
markets vulnerable to quarter-end dynamics, tax payments, or Treasury settlement volatility.

Chairman Powell announced that QT will slow dramatically, with Treasury runoff ending while
mortgage-backed securities continue maturing. However, this addresses only aggregate levels,
not the structural issues driving period-end stress. The question remains whether current
reserve levels are sufficient given elevated post-pandemic deposits, outstanding credit line
commitments, tighter balance sheet constraints, and the expired Bank Term Funding Program.

What do these signals indicate? Three interpretations emerge. The most likely is that quarterend and month-end rate effects will continue intensifying as reserves decline further, with the
spread between SOFR and ON RRP at period-ends serving as a barometer of underlying
tightness. Federal Reserve research suggests that as Treasury issuance continues and reserves
decline, "the repo market is likely to tighten further and the effects of quarter- or month-ends
on repo rates may grow, providing another potential indicator that reserves are becoming less
abundant." This would manifest as larger SRF usage at period-ends and persistent elevated Fed
facility usage, though system functioning would remain generally stable between these events. A more adverse interpretation sees a triggering event during an already-stressed period-end
causing broader repo market seizure, forcing the Fed to resume asset purchases and confirming
that meaningful balance sheet normalization is impossible under current structures. An
optimistic interpretation requires regulatory reform -- SLR exemptions for reserves or changes
to quarter-end reporting requirements -- to reduce incentives for balance sheet window
dressing, though this appears politically unlikely.

For banks, the implication is that reserve buffers need to be higher than pre-2019 benchmarks,
and the ratio of demandable claims to liquid assets requires closer monitoring. For investors,
continued volatility in short-term interest rates should be expected, particularly around periodends. The Fed's weekly H.4.1 release tracking SRF and ON RRP levels provides leading
indicators. Money market fund flows have outsized impact as their allocation decisions directly
affect system liquidity buffers.

The transformation underway represents a fundamental shift from bank-intermediated to
partially Fed-intermediated money markets. Post-2008 regulations strengthened individual
bank resilience but broke private intermediation chains. The central bank now serves as both 
lender and borrower of last resort, with private markets unable to efficiently connect flows.
September 2019, March 2020, March 2023, and November 2025 episodes demonstrate a
pattern: reserves appear adequate until buffers thin, after which modest events trigger
outsized disruptions.

 1. Bostrom, E., Bowman, D., Rose, A., and Xia, A. (2025), "What Happens on Quarter-Ends
in the Repo Market," FEDS Notes, Board of Governors of the Federal Reserve System;
Copeland, A., Duffie, D., and Yang, Y. (2021), "Reserves Were Not So Ample After All,"
Federal Reserve Bank of New York.
2. Du, W. (2022), "Bank Balance Sheet Constraints at the Center of Liquidity Problems,"
Jackson Hole Economic Symposium.


how-lsu-is-helping-keep-louisiana-at-the-center-of-the-nations-seafood-map

How LSU is Helping Keep Louisiana at the Center of the Nation’s Seafood Map

Callais and Woods Professor and Dean, College of the Coast & Environment | Director, LSU Center for River Studies

1. Strengthening the Seafood Workforce   Through outreach programs like Louisiana Fisheries Forward, a partnership between Louisiana Sea Grant and the Louisiana Department of Wildlife and Fisheries, LSU helps fishers and processors modernize their operations.

These voluntary programs teach best practices in handling, traceability, and sustainability — directly improving product quality and market reputation. LSU’s extension agents also provide hands-on disaster recovery assistance after hurricanes and market disruptions, helping ensure Louisiana’s seafood workforce remains resilient and ready for the next season.

2. Building Seafood Resilience  The total economic value for oysters in 2018 was more than $180 million.

Resilience defines LSU’s seafood science. Researchers at the LSU AgCenter and Louisiana Sea Grant are leading selective breeding programs and developing genetic tools to combat disease, temperature changes, and salinity stress.

With a powerful combination of hatchery capacity, genetics expertise, and industry collaboration, LSU is helping Louisiana’s seafood industry adapt faster and smarter — protecting both the food supply and the economic backbone of coastal communities.

3. Powering Economic Growth   Every part of LSU’s seafood research and outreach ties directly to Louisiana’s economy. AgCenter economists analyze market data and advise state and federal partners on strategies to grow the seafood sector.

Meanwhile, Sea Grant specialists help entrepreneurs develop value-added seafood products, from branded lines to ready-to-eat options, that increase profit margins and create new jobs in coastal towns.

By helping Louisiana seafood businesses stay competitive, LSU keeps more of the industry’s economic benefits right here at home.

4. Supporting Communities  Louisiana’s seafood industry faces constant challenges. LSU’s coastal extension agents and Sea Grant programs provide on-the-ground support to help communities recover and rebuild after disasters.

Whether assisting with dock repairs, connecting fishers to relief programs, or helping restart operations, LSU’s commitment ensures that Louisiana’s coastal workforce can weather any storm.

5. Preparing the Next Generation   LSU’s work extends from the lab to the dock — and into the classroom. New research and education programs are training future scientists, producers, and entrepreneurs to continue Louisiana’s seafood legacy. 
 

For new LSU students interested in the coast, Bayou Adventure, a trip created by the College of the Coast & Environment (CC&E), was designed specifically to educate incoming freshmen about some of the challenges and marvels of the Louisiana coastline.

The trip stops at sites that showcase "not just the significance of these areas to the state and nation, but the important work that is being done to sustain and preserve them," said Clint Willson, dean of CC&E.

Through workforce development, hands-on learning, and applied research, LSU is shaping the next wave of innovators who will protect Louisiana’s coast and ensure its seafood remains world-renowned.
 Looking Ahead  As the seafood industry faces new challenges and opportunities, LSU’s mission remains clear: to protect Louisiana’s coast, empower its seafood workforce, and ensure the state remains synonymous with the best seafood in America.


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