Receiving Wide Coverage ...
Summers Withdraws: Big news broke over the weekend when Lawrence Summers, one of the two top candidates, took his name out of consideration for the Federal Reserve chairman spot, writing in a letter to President Barack Obama "that any possible confirmation process for me would be acrimonious and would not serve the interest of the Federal Reserve, the Administration or, ultimately, the interests of the nation's ongoing economic recovery." (Full text of Summers' letter can be found here, here and here; President Obama's statement accepting Summers' withdrawal is here.) The development is somewhat surprising, given that, earlier this month, White House insiders were reporting a Summers' nomination was imminent, despite mounting Senate opposition to his chairmanship. The Atlantic attributes Summers' withdrawal to a "small team of Democrats" namely, Jon Tester of Montana, Sherrod Brown of Ohio, Jeff Merkley of Oregon and Elizabeth Warren of Massachusetts who were expected to oppose the nomination, though other news outlets say it was Syria that ultimately did Summers in. "The president's inability to rally Congressional Democrats on Syria persuaded Mr. Summers that his most important audience the Senate, which must confirm a Fed chairman probably could not be won over," notes the Times. Global financial markets were cheering on Monday, reports the Journal, largely based off of the assumption that Fed vice chairman Janet Yellen, who is considered "to be more cautious about winding back the Fed's stimulus program," will now get the job. But Yellen's appointment may not be a lock. The President still has options, points out the Washington Post's Neil Irwin, including Donald Kohn, Roger Ferguson, Stan Fischer and Jeremy Stein. (Former U.S. Treasury Secretary Timothy Geithner's is also being name-dropped by a few news outlets, though reports have already surfaced that he remains uninterested in the position.) "Now we get to see what direction the president wants to go now that his favored candidate is out of the picture," Irwin concludes. More big picture coverage: Wall Street Journal, Washington Post, Financial Times, American Banker
About that Financial Crisis: The "five years later" opuses continue in light of the anniversary of Lehman Brothers' bankruptcy yesterday. The Journal's Simon Nixon argues that following the firm's collapse, financial reform remains fragmented. "Why are financial institutions continuing to scale back their cross-border exposures, impeding the free flow of capital and liquidity to where it is needed?" he writes. "And what can the Financial Stability Board
do to reverse this fragmentation, which is a potential drag on global growth?" The Post's Irwin reflects on how he felt the day the financial world almost died: "I spent the fall of 2008 terrified, stressed, and exhausted. And I didn't even have responsibility for making any policy decisions!" And former Barclays CEO Bob Diamond, in an op-ed for the Financial Times, joins past Wall Street executives who think more must be done to end the persistent "too big to fail." "Political leaders, regulators and banks need to collaborate on the core issues in an internationally-co-ordinated effort to establish a robust resolution regime," he writes. "Without an international plan to wind down an important bank in an orderly fashion, political and regulatory leaders are compelled to create more rules often to protect national and regional markets and economies." Another thing that has (perhaps less arguably) persisted, following the financial crisis, per the Journal: "many of the players who were at its center are using significant parts of their diminished fortunes for charitable causes."
Wall Street Journal
A slowdown in investor purchases and shortages of homes for sale are causing the housing market to cool down, but economists don't believe the sector's recovery will stall.
Banks in Spain and Italy are trying to persuade their governments to change obscure accounting-related rules in order to appear more financially sound.
Financial Times
JPMorgan Asset Management is launching an investment company offering investors access to a portfolio of senior secured bank loans. The move is part of a trend as other investment groups are also "turning to riskier assets that offer higher yields" in expectation that central banks will tighten monetary policy soon.
A group of "rebel bondholders" are stepping up pressure for Co-operative Bank to consider alternative debt restructuring plans in order to avoid taking heavy losses. Scan readers will recall that Co-op announced plans in June to ask subordinated bondholders to swap their debt securities for shares in the bank as part of its efforts to raise an additional $2.4 billion in capital.
Elsewhere ...
An Edward "Snowden-derived report from Germany's Der Spiegel" says the NSA may have found a way to access Visa transactions in Europe, the Middle East and Africa, reports GigaOM, though the financial services firm "denies the tapping of its networks."
