BCLP Banking Blog

Bank Bryan Cave

White House

Main Content

Financial Services Update – August 26, 2011

Bernanke Signals No New Fed Stimulus

On Friday, Federal Reserve Chairman Ben Bernanke offered an upbeat assessment of the domestic economy that offered little indication of any immediate monetary stimulus by the Fed. However, Bernanke did acknowledge that the nation faces significant challenges, including high unemployment and an unsustainable federal debt. Bernanke also offered an unusual critique of the government’s fiscal policy, criticizing the political battle over raising the debt-ceiling. While Bernanke failed to signal any future Fed action, he did say the issue of potential action would be discussed at the next meeting in late September.

Treasury Department Announces OFAC Settlement with JPMorgan Chase

On Thursday, the Treasury Department announced that JPMorgan Chase has agreed to pay $88.3 million as part of a settlement over a series of transactions involving Cuba, Iran and Sudan. The Treasury Department’s Office of Foreign Assets Control (OFAC) said in a news release that JPMorgan processed wire transfers totaling around $178.5 million for Cuban nationals in late 2005 and early 2006, violating United States embargo laws. The bank was also fined for a 2009 incident in which it made a $2.9 million loan to a bank that had ties to Iran’s government-owned shipping line, a violation of United States sanctions against Iran. The third violation occurred in 2010 and 2011, when the bank failed to give up documents about a wire transfer that referred to Khartoum, the capital of Sudan. According to the release, the agency gave JPMorgan a list of documents believed to be possessed by JPMorgan. In response, JPMorgan, which previously said it had no such documents, produced more than 20 of the items in question.

S&P President Resigns

On Tuesday, McGraw-Hill, parent company of Standard & Poor’s (S&P), announced that S&P President Deven Sharma will step down from his position by the end of the year and be replaced by Douglas Peterson, the chief operating officer at Citigroup. McGraw-Hill said Sharma’s decision was not influenced by the United States’ credit rating downgrade or an investigation by the Justice Department over S&P’s rating of its subprime securities. The company said the decision to replace Sharma took place over six months ago when the Board of Directors decided to split the company into four divisions due to increasing pressure from investors.

Read More

Financial Services Update – January 7, 2011

December Unemployment 9.4%

On Friday, the Labor Department announced that the United States economy ended the year with 9.4% unemployment in December. The agency also revised estimates from October and November saying that 210,000 jobs were created in October instead of 172,000 and 71,000 in November, instead of 39,000.

Obama Appoints Daley, Sperling To Key Posts

On Thursday, President Obama announced that William Daley will serve as his new chief of staff. Daley is the former U.S. Secretary of Commerce in the Clinton Administration and brother of Chicago Mayor Richard Daley. Daley replaces interim chief of staff Pete Rouse, who will become a Counselor to the President. Rouse replaced Rahm Emanuel, who stepped down to make a run for mayor of Chicago. On Friday, President Barack Obama also announced that Gene Sperling will be the new Director of the National Economic Council replacing Larry Summers. Sperling had previously served as Counselor to Treasury Secretary Tim Geithner and Deputy Director of the National Economic Council and National Economic Adviser for President Clinton.

Tax Reform Debate Gains Steam

On Thursday, Senate Majority Leader Harry Reid (D-NV) announced that the Senate Finance Committee would hold hearings on tax reform in the near future. Senate Minority Leader Mitch McConnell (R-KY) followed Reid’s comment by saying that he also welcomed discussions about how to improve the country’s tax code. House Majority Leader Eric Cantor (R-VA) also said that tax reform was one issue that he believes could garner bipartisan support and hopes the President addresses it in the State of the Union at the end of the month. While tax reform was initially thought to be a second or third tier issue, it could now become the next big issue for Congress to tackle this year after the debate on raising the national debt ceiling.

Read More

Financial Services Update

Financial Services Update

September 7, 2010

Authored by: Matt Jessee

White House Considering New Stimulus Measures

Sources indicate that White House officials have begun considering new measures to stimulate the economy, including an extension of the expired research and development tax credit and new infrastructure spending. However, Democratic Congressional leaders have expressed concern to the White House regarding the difficulties they anticipate in passing even a small stimulus bill, particularly given the success of “Tea Party” Republican candidates in primaries over the August recess. The White House denied a story last week indicating that they are strongly considering a payroll tax holiday geared at getting businesses to start hiring new workers. It remains to be seen what, if any, stimulus measures could get passed by Congress in the current political environment. But with the Congressional midterm elections fast approaching, the push is growing for the White House to take action.

Bernanke Defends Fed’s Role in Financial Crisis

On Wednesday, during testimony before the Financial Crisis Inquiry Commission, Federal Reserve Chairman Ben Bernanke defended the Fed’s policies during the financial crisis in 2008, expressing confidence that the bailout averted a much greater crisis for the U.S. economy. Bernanke also defended the Fed’s involvement in the collapse of Lehman Brothers in September 2008, stating that the Fed did everything within its legal authority to avoid the company’s collapse. With regard to how the Fed’s role will change in the aftermath of the newly enacted Dodd-Frank Wall Street Reform bill, Bernanke said the Fed will have a more active role in managing systemic risk in the economy in order to prevent another collapse such as Lehman’s from happening again.

August Jobs Report Shows Rising Unemployment

On Friday, the Department of Labor released its August jobs report showing the economy lost another 54,000 jobs overall last month, mostly because of the loss of temporary Census Bureau jobs. The report also showed that the unemployment rate rose to 9.6 percent from 9.5 percent. Overall, the government lost 121,000 jobs in August. State and local governments, many of them grappling with severe budget deficits, cut 10,000 jobs, and another 114,000 temporary Census positions came to an end. The total number of unemployed people rose to 14.86 million in August from 14.59 million in July.

More Information
If you have any questions regarding any of these issues, please contact:

Matt Jessee, Policy Advisor
matt.jessee@bryancave.com
(314) 259-2463

Kip Wainscott, Associate Attorney
kip.wainscott@bryancave.com
(202) 508-6172

Read More
The attorneys of Bryan Cave Leighton Paisner make this site available to you only for the educational purposes of imparting general information and a general understanding of the law. This site does not offer specific legal advice. Your use of this site does not create an attorney-client relationship between you and Bryan Cave LLP or any of its attorneys. Do not use this site as a substitute for specific legal advice from a licensed attorney. Much of the information on this site is based upon preliminary discussions in the absence of definitive advice or policy statements and therefore may change as soon as more definitive advice is available. Please review our full disclaimer.