Receiving Wide Coverage ...
Strike two: Federal Judge Timothy J. Kelly denied for a second time Leandra English’s attempt to become acting director of the Consumer Financial Protection Bureau. English was appointed by former Director Richard Cordray when he resigned the day after Thanksgiving, but the judge nullified that move, siding with President Trump, who named Mick Mulvaney, the White House budget director, as the agency’s interim chief.
“The Court finds that English is not likely to succeed on the merits of her claims, nor is she likely to suffer irreparable harm absent the injunctive relief sought,” the judge said. “Moreover, the balance of the equities and the public interest also weigh against granting the relief.” Wall Street Journal, Washington Post, American Banker
Bitcoin bans: China is moving to close the country’s bitcoin “mining” industry due to concerns about excessive electricity usage and financial risk. The move follows the government’s shutdown of local bitcoin exchanges and a ban on initial coin offerings. Wall Street Journal, Financial Times
In South Korea, the country’s justice minister said the government is planning to ban the trading of cryptocurrencies on exchanges, a few days after it began on-site inspections at the country’s six largest banks. The prices of cryptocurrencies fell in response. Wall Street Journal, Financial Times
Wall Street Journal
Transforming the CRA: The Trump administration is expected to unveil a “major” revision to the Community Reinvestment Act. The changes “could potentially transform the way banks make billions of dollars in loans, investments and donations to poorer customers,” the paper says. “In all, they could make it easier for banks to meet certain lending requirements and lower penalties for compliance problems. Community groups that support the law fear that any rollback could mean poorer people over time would have less access to loans and banking services.”
Who's next?: The promotions to vice president of possible Warren Buffett successors Gregory Abel and Ajit Jain at Berkshire Hathaway is “not just a big deal for shareholders in Berkshire,” the paper states. “Questions of succession are a vital boardroom matter” for some of the biggest banks in the U.S. The company is the largest shareholder in Bank of America, Wells Fargo and U.S. Bancorp and has hefty stakes in Goldman Sachs, BNY Mellon, American Express, Synchrony and Visa.
Big potatoes: A recent string of relatively small problems at Citigroup “calls into question the bank’s ability to get basic control issues right,” Brooke Masters, the paper's companies editor, says in an opinion piece. While each problem alone may have been minor, “that is no small concern,” she says. “If banks like Citi are still getting the little stuff wrong after a decade of investment, what is going to happen if they stop feeling pressure to invest? Maybe this is a time when investors should be sweating the small stuff.”
Beware disruption: Bitcoin and blockchain are likely to be major topics of discussions at Davos later this month. “But there will be a far deeper deliberation about the wider disruptive impact of technology on banks,” according to Huw van Steenis, global head of strategy at Schroders. “Financiers used to think that the post-crisis regulatory burden would make financial services less appealing for new entrants. But now they fear that non-banking rivals may target more profitable areas and skim the cream in areas such as payments or lending.”
New York Times
No respect: The lack of women economists has suddenly “jolted a profession that prides itself on cool rationality,” the paper reports from the American Economic Association’s annual convention in Philadelphia. One panel was “stocked with women, each of whom presented new research that revealed a systemic bias in economics and presaged a move by the field’s leaders to promise to address some of those issues. Paper after paper showed a pattern of gender discrimination, beginning with barriers women face in choosing to study economics and extending through the life cycle of their careers, including securing job opportunities, writing research papers, gaining access to top publications and earning proper credit for published work.”
“In terms of cryptocurrencies, generally, I can say almost with certainty that they will come to a bad ending. Now when it happens or how or anything else, I don’t know, but I know this: if I could buy long term puts, if I could buy a five-year put on every one of the cryptocurrencies, I’d be glad to do it.” — Warren Buffett in an interview on CNBC.