Still Weighing PPIP

Skepticism continues to swirl around the Obama administration's public-private investment program, but in earnings calls with investors last week, most industry executives said they were keeping an open mind."We have been viewing, as you would expect, with a lot of interest, the legacy loan program coming from the government," said Richard Anthony, the chairman and chief executive of Synovus Financial Corp. "We believe that some new avenues for disposition will be opened up as a result of this program … , but the information that we want to see is not yet totally available, so we'll continue to follow progress there."

Joe Price, the chief financial officer at Bank of America Corp., echoed that sentiment.

"We have got to first see exactly what it is," he said. "Any program that adds to price discovery and adds to some pricing in the marketplace will be helpful. At this point our inclination would be to think about giving it a small trial run to see what it yields and to see if it offers an additional avenue to manage the businesses and assets and see where we go from there."

James Rohr, the chairman and chief executive at PNC Financial Services Group Inc., said he wants to "get the stress tests, hopefully, out of the way and then, hopefully, we'll hear more about the details."

So far, James Dimon, the chief executive of JPMorgan Chase & Co., seems to be the only major executive rejecting the program outright. In a conference call with reporters this month, he said he would not participate, given the problems that working closely with the government can create.

"We're certainly not going to borrow from the federal government," he said. "We've learned our lesson on that."

Nodding Off

A meeting last week between President Obama and credit card executives was a snooze — at least for Lawrence Summers, director of the National Economic Council.During the meeting, Summers nodded off several times, at one point appearing to fall asleep with his head propped on his fist.

But Ed Yingling, president of the American Bankers Association, insisted that the meeting was useful — at least for the card industry. In an interview, Yingling, who attended the meeting, said it gave the industry a chance to make its case about the dangers of continuing to rein in card practices.

The Federal Reserve Board and other regulators have completed rules that are to take effect next year curbing abuses such as double-cycle billing and universal default.

But Yingling said the uncertainty over how Congress may toughen these rules is creating funding problems for many card issuers who are unable to sell credit card receivables on the secondary market.

"We understand there are consumer issues, but if we want credit available we also have to understand there are funding issues," he said.

As for President Obama, he appeared engaged, Yingling said. His message was similar to one he gave to several bank chief executives when he met with them a few weeks ago: People are angry at you. But the president also emphasized that he did not want to curb access to credit and acknowledged he may be the first president to run a card balance early in his career.

He also — as far as anyone could tell — appeared awake through the whole thing.

New Face at Cato

Mark Calabria, a senior economist for the Senate Banking Committee's top Republican, Richard Shelby, has left Capitol Hill for a job with the Cato Institute as a director of financial services regulation. Calabria joined the committee in 2001 as a senior economist under former Sen. Phil Gramm, R-Texas.Before working in the Senate, Calabria held posts as a deputy assistant secretary at the Department of Housing and Urban Development and as a senior economist at the National Association of Realtors.

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