Receiving Wide Coverage ...
Democrats Rally for Yellen: Roughly a third of Senate Democrats reportedly have signed a letter urging President Obama to appoint Federal Reserve Vice Chairman Janet Yellen as successor to Fed chairman Ben Bernanke. The Journal and the FT were not able to say exactly who or how many senators have signed the letter, which is being circulated by Sen. Sherrod Brown of Ohio. Sens. Dianne Feinstein and Tom Harkin say they've signed. Meanwhile, the Times and Barron's explore the gender politics between frontrunners Yellen and Lawrence Summers, Treasury Secretary during the Clinton administration. Both discuss the Obama administration's lack of women in top economic positions, while Barron's Greg Valliere calls Summers "famously prickly."
SAC Charged: Federal prosecutors announced criminal charges against hedge fund SAC Capital Advisors on Thursday. The firm is accused of operating as a criminal enterprise that fostered an environment that built its profits through illegal tips and insider information. Prosecutors called SAC "a veritable magnet of market cheaters." The Journal points out that although the charges were expected, observers were surprised by the "scope of the action and the language used by prosecutors." Before charging the company as a whole, U.S. prosecutors decided they didn't have enough evidence to bring criminal charges against Steve Cohen, the hedge fund's defiant founder who has denied any wrongdoing. The FT says that with these charges, "the time for bravado could well be over" for Cohen.
Email Inquisition: Fabrice Tourre, the former Goldman Sachs trader on trial for misleading investors, spent Thursday defending the infamous emails that led to lawsuit. The Frenchman testified that the email where he described how the "Fabulous Fab" would be the only survivor was his way of being "silly, romantic" with his girlfriend. He also said he regretted a joke in an email about selling subprime mortgage-backed securities "to widows and orphans." His legal team tried on Thursday to soften Tourre's image by having him describe his life story, including coming to the United States in 1999 for an internship as a production worker on an assembly line in Ohio that produced heater cores and air-conditioning units.
Wall Street Journal
Federal banking regulators are urging private student lenders to be flexible with borrowers who are unemployed or otherwise unable to repay their student loans as planned. Regulators on Thursday told institutions in a joint statement to consider workout arrangements, such as postponing payments, reducing interest rates and stretching out the life of the loan. Lenders had been seeking additional guidance on how modified loans would be classified on their books. While the Journal reports that the regulatory guidance released Thursday could ease concerns, our sources told us the guidance came up short.
The Federal Housing Finance Agency is pressing Bank of America (BAC), JPMorgan Chase (JPM), and Royal Bank of Scotland for "multibillion-dollar payments" to settle lawsuits that claim the firms broke federal securities laws in selling $200 billion in mortgage-backed securities. The FT cited people familiar with the negotiations. Those firms are among 17 who the FHFA, the conservator of Fannie Mae and Freddie Mac, sued. Citigroup and General Electric previously settled and on Thursday UBS Americas agreed to settle for $885 million. The settlement amount is important because Citigroup and General Electric did not disclose the amount of their settlements, partially because they were not material. Based on UBS's involvement and settlement amount, the FT reports that proportionate settlements with Bank of America, JPMorgan or RBS could be more than $4 billion each.