Wall Street Journal
Conflict or no conflict?: Heather Russell, the former general counsel at Fifth Third Bancorp, said she was fired after less than a year at the bank following her disclosure of a romantic relationship with Timothy Mayopoulos, Fannie Mae's chief executive officer. When she was let go last month, the bank said it was based on "a personal matter" that represented "a conflict of interest." Russell, told the Wall Street Journal she "never had any interactions or dealings with Fannie Mae in any regard, and there was never any conflict of interest." Mayopoulos disclosed the relationship to Fannie Mae back in March; his employer took no further action, saying there was no conflict. "The differing views of the relationship by Fifth Third and Fannie Mae raise questions of why it was considered to be a conflict by one firm and not the other," the Journal commented.
Tough times: The Wall Street Journal paints a picture that doesn't bode well for lenders, particularly those in the mortgage business. "The lopsided recovery has shut out millions of aspiring homeowners who have been forced to rent because of damaged credit, swelling student loans, tough credit standards and a dearth of affordable homes," the paper reports. "In all, some 200,000 to 300,000 fewer U.S. households are purchasing a new home each year than would during normal market conditions."
The uneven housing recovery that began in 2012 has "lifted the overall market but left behind a broad swath of the middle class, threatening to create a generation of permanent renters and sowing economic anxiety and frustration for millions of Americans," the Journal says.
New York Times
Look out for Jefferies: Jefferies's $37 billion in assets pales in comparison to its giant Wall Street counterparts, such as Goldman Sachs' $878 billion. Yet its share of Wall Street trading has doubled since 2006, and it never took federal bailout money. Now, as a subsidiary of the conglomerate Leucadia National, "Jefferies has emerged with an appetite for risk and a set of relationships to rival bigger Wall Street firms," the Times reports. "Jefferies is not subject to the trading restrictions and capital requirements imposed on other investment banks that did take bailout funds and became part of bank holding companies. That gives it room to make bolder moves than some of its larger peers."
Washington Post
MasterCard tech unit expands: Applied Predictive Technologies, which sold itself to MasterCard for $600 million last year, is hiring 368 new employees and moving into larger quarters in Ballston, Va., across the street from its existing headquarters. "The partnership that we have with MasterCard has been a phenomenal extension and expansion of how we can support our clients, and we're thrilled to be on the growth path that we've had," APT chief executive Anthony Bruce said.
Crisis? What crisis?: Robert J. Samuelson, the Post's economics columnist, discusses a study by the president's Council of Economic Advisers (CEA) that says the student debt burden "isn't so crushing after all." For one thing, "debt burdens may be exaggerated," he says, noting that "debt owed by the typical student remains modest," according to the report. Moreover, "the good news about this bad news is that the debt levels aren't yet high enough to depress the overall economy." Best of all, "almost all these loans are backed by the federal government. If borrowers default, taxpayers pick up the tab."
