Friday, September 9

Receiving Wide Coverage ...

Obama's Speech: Among other things, the president called for a national infrastructure bank and said he'd take steps to spur mortgage refinancings during his address to a joint session of Congress. Wall Street Journal, New York Times, Washington Post

For those who want to relive the moment, here's the full text of the speech.

B of A Bloodletting: The rank and file at Bank of America got a taste of what's to come Thursday as several hundred employees at the Merrill Lynch unit got pink slips, the New York Times reports. Most of the 7,000 jobs the company plans to cut this year are in other business lines, though; Merrill's been solidly profitable since last year. When B of A chief Brian Moynihan unveils "Project New BAC" next week, the strategy is expected to include a much higher number of layoffs, which the Journal says may total 40,000.

Everybody Hates Ben?: It's not just Rick Perry and Ron Paul who like to bash Ben Bernanke; the Journal reports that several other GOP presidential hopefuls are now on that bandwagon, even Mitt Romney, who said at Wednesday night's debate: "I think Ben Bernanke has...over-inflated the amount of currency that he's created. QE2 did not work. It did not get Americans back to work. It did not get the economy going again." Admittedly, that's a levelheaded and civil critique compared to Perry's remarks a few weeks ago. Meanwhile, the Times zeroes in on Bernanke's remark at a speech Thursday that even in light of bleak state of the job and housing markets and personal debt burdens, "households seem exceptionally cautious" – or as writer Binyamin Appelbaum paraphrased it: "Consumers are depressed beyond reason or expectation."

Dodd-Frank Deluge: The reform law may be choking banks' profits, but it's been a gravy train for law firms, consultants and other vendors of compliance-related services, according to the New York Times. The law firm of Debevoise & Plimpton, for example, got paid $100,000 to write a 17-page comment letter. We wonder how that compares on a per-word basis to what James Patterson rakes in. … Separately, the Times reports that Commodities and Futures Trading Commission chief Gary Gensler further delayed a slew of Dodd-Frank derivatives rules until early 2012, saying: "We are focused on considering these rules thoughtfully – not against a clock." … OK, time for a pop quiz: Dodd-Frank aside, what hyphenated proper noun most scares the bejeezus out of bankers? Yep, you guessed it, it's …

Wal-Mart: The Bentonville behemoth is introducing another financial service, this time one of the decidedly old-fashioned sort: layaway plans. This type of installment financing, in which the consumer doesn't take possession of the goods until they're paid for in full, "has made a comeback since the 2008 recession, as consumers avoided turning to credit cards to make purchases," according to the Journal. Five years ago, Wal-Mart did away with layaway plans for everything but jewelry, but it's bringing the plans back this holiday season, an indicator of how tough the economic times are getting. Wall Street Journal, New York Times, Washington Post

Wall Street Journal

Several Obama nominations for key regulatory posts – including Marty Gruenberg for FDIC chairman and Tom Curry for Comptroller of the Currency – cleared the Senate Banking Committee, but it's not certain the full chamber will approve them, the Journal reports. Democrats are the majority in the Senate, but they don't have the 60 votes needed to prevent a filibuster, and Republicans have "powerful incentives" to obstruct.

The Journal's editorial board weighs in on the FHFA's suits against banks that sold dodgy mortgage bonds to Fannie Mae and Freddie Mac. Unsurprisingly, the writers show little sympathy for the companies they not-so-lovingly dubbed "Fan and Fred" years ago; they second what we call the "big boys" view: that Fannie and Freddie were sophisticated enterprises that specialized in the mortgage markets and thus knew what they were buying. "Fannie Mae and Freddie Mac are now shocked, shocked to discover they were buying low-quality mortgages during the housing mania," the editorialists write incredulously.

New York Times

A proposed settlement with Fannie Mae and Freddie Mac over whether they adequately disclosed their positions in subprime loans would include no financial penalties, according to unnamed sources. But the Times said the deal with the SEC will nevertheless refurbish the agency's reputation as an aggressive enforcer.