25 Apr
2016
FHA Lenders, DoJ, Federal Reserve, and More – TenCount 4.25.16
- The Justice Department has charged multiple FHA lenders with fraud under the False Claims Act recently, leading to an exodus from the FHA program and reduced opportunities for working-class Americans to get home loans. In his recent letter to shareholders, for example, Jamie Dimon, CEO of JP Morgan Chase, said the bank had dramatically reduced its FHA lending because the government charges excessive penalties for even the most modest mistakes. On Thursday afternoon, a House Judiciary subcommittee will examine the Justice Department’s use of the False Claims Act, a Civil War-era law, to target FHA lenders and others with fraud charges.
- A common element of DOJ’s billions of dollars of settlements with FHA lenders has been to require them to contribute funds to liberal activist groups or other nonprofits that support Obama Administration policies. Judiciary Chairman Bob Goodlatte (R-Va.) has opposed the practice, which will get scrutiny from a separate Judiciary subcommittee on Thursday morning.
- Get out your tri-corner hat! Five of the original 13 colonies go to the polls on Tuesday in another round of presidential primary voting. Maryland, Connecticut, Rhode Island and Delaware all hold elections, but most of the attention will be paid to Pennsylvania, the biggest prize and where 54 of the state’s 71 Republican delegates are not bound to any candidate – meaning that they could play spoilers to Donald Trump’s bid to capture a first-ballot nomination at the Republic Convention this summer.
- Rarely has so much attention been paid to so few who have done so little. That’s right – it’s time for another meeting of the Federal Open Market Committee, the policy-making committee of the Federal Reserve, which convenes on Tuesday and will announce its latest decision on interest rates at 2 p.m. Eastern on Wednesday. Smart money expects the Fed to stay the course, leaving short-term interest rates unchanged, again.
- President Obama travels this week to Germany, where Chancellor Angela Merkel hosts a meeting of the G-5 nations, which also include Great Britain, France and Italy. On the agenda are terrorism, the Islamic State and Libya, in what is likely to be Obama’s last trip to the European continent of his presidency.
- Consumers let up on the gas and business investment slowed in the first quarter, leaving the U.S. economy limping along at its slowest rate in at least a year, analysts believe. The Commerce Department on Thursday will release its first-quarter G.D.P. estimate on Thursday, with the consensus expecting a 0.6 percent increase or less, the slowest since a similar reading in the first quarter of last year.
- Under current law, any email sitting on a server more than 180 days is considered “abandoned property” and can be requested by law enforcement armed with only a subpoena. The Email Privacy Act would change that, requiring a search warrant for law enforcement to go digging into email archives. The bill is expected to come up for a vote in the House this week after being approved 28-0 by the Judiciary Committee two weeks ago. Meanwhile, the House Energy and Commerce Committee marks up 22 – count ’em – bills on Tuesday evening, including three to require more disclosure from the F.C.C.
- Earlier this year, the Labor Department finalized the Persuader Rule, under which employers will be forced to disclose outside consultants that they hire to counter workers’ union organizing efforts. Three lawsuits have already taken aim at the rule, which will be the subject of a Wednesday hearing by a subcommittee of the House Committee on Education and the Workforce titled “The Persuader Rule: The Administration’s Latest Attack on Employer Free Speech and Worker Free Choice.”
- The good, the bad and the ugly in the federal bureaucracy will be the subject of two hearings on Wednesday by the House Committee on Oversight and Government Reform. In the morning, the committee examines “Management Practices and Misconduct at TSA,” including allegations of retaliation and intimidation of workers; in the afternoon, it casts and eye on “The Best and Worst Places to Work in the Federal Government.”
- In the largest-ever emerging markets bond sale, Argentina returned to the capital markets last week after 15 years of absence with a $16.5 billion global debt offering that – despite the country’s previous defaults – left money managers scrambling for a piece of the action. For information about investment opportunities in Argentina and Sphere Consulting’s Buenos Aires office, contact [email protected].