Receiving Wide Coverage ...
Housing Rebound?: The Wall Street Journal and Washington Post both have articles noting the significance of the Federal Housing Administration returning to the black for the first time since 2011. The FHA served as a backstop for the housing market during the financial crisis, when other lending sources dried up. But that resulted in a sharp increase in the FHA's default rate. Now the agency has recovered, at least in one sense. Technically speaking, the FHA's insurance fund had an economic value of $4.8 billion at Sept. 30, up from a negative balance of $1.1 billion a year earlier. But, the FHA's capital reserve ratio, while rising, is still below where it should be. And, the economy's slow recovery is making it difficult for the FHA to lower insurance premiums and thus stimulate a housing recovery. Fannie Mae and Freddie Mac could make things worse for the FHA next year when they begin offering guaranteed mortgages with downpayments as low as 3%, undercutting the FHA. Mortgage Bankers Association CEO David Stevens points out the FHA is already losing market share to Fannie and Freddie because the FHA's current fees are so high.
Wall Street Journal
Small towns are fighting the Federal Reserve's proposal to ban banks from owning physical commodities assets like oil pipelines. The municipalities are worried that the Fed's proposal would prevent the delivery of oil, natural gas, aluminum and other commodities to customers by the likes of municipal gas districts. The Fed, of course, is worried about whether banks' ownership of such assets poses a threat the financial system, as well as the possibility that banks are holding the commodities for longer than necessary as a way to artificially boost the price.
Is the job of bank teller disappearing? The paper examines the issue, following in the footsteps of American Banker's Sarah Todd, who wrote about tellers earlier this year. The Journal interviewed U.S. Bancorp CEO Richard Davis, who started his banking career as a teller, and who says the role of teller is changing to become that of a banker who is able to offer more services than just routine transactions.
Sens. Elizabeth Warren and Joe Manchin co-author a piece for the Journal's op-ed page advocating for the appointment of persons other than "Wall Street insiders" to vacancies on the Federal Reserve's Board of Governors. Warren and Manchin, unsurprisingly, cite the secretly recorded conversations from inside the New York Fed as one example of the too-cozy relationship between the Fed's supervisors of large banks and institutions like Goldman Sachs.
The FT's U.S. banking correspondent discusses transparency issues as they pertain to the Federal Reserve, ahead of this week's Senate hearing into the New York Fed's secretly taped conversations.
New York Times
Angelo Mozilo may be named in a civil lawsuit, according to the Times. The Justice Department is mulling a case against the former head of Countrywide Financial, widely considered one of the worst actors leading up to the financial crisis. The U.S. Attorney's office in Los Angeles had been close this summer to filing a civil fraud suit against Mozilo, but backed off after Mozilo's lawyers argued such a case would duplicate the Securities and Exchange Commission's efforts.
Maybe this mobile banking thing is going to work after all. A Forrester report projects mobile payments will reach volume of $142 billion by 2019.
A Senate committee will question executives from JPMorgan Chase, Goldman Sachs and Morgan Stanley on Thursday about whether they manipulated the commodities market.