In Phoenix, President Obama looks to push housing reform (again)…
TOMORROW STARTS TONIGHT: OBAMA BRAGS ABOUT HOUSING RECOVERY. Justin Sink for The Hill: “[Obama] bragged Thursday it was ‘no accident’ that the housing market rebounded under his administration, saying his economic policies helped usher in a construction boom and the lowest foreclosure rate since 2006.
{mosads}— WHAT OBAMA SAID: “We ended up helping millions stay in their homes; we ended up saving millions more thousands of dollars each year by refinancing,” Obama said in an address in Phoenix. “[That’s] what happens when you have policies that put middle-class families first.”
— WHAT OBAMA ANNOUNCED, via Sink: “The president used the speech to announce that he was slashing the fees charged by the government to insure federally backed mortgages — a move the White House says could save 800,000 homeowners an average of $900 per year.” Sink’s story: http://bit.ly/1DDlEN1.
— WHY IT MATTERS: Housing finance reform remains the last piece of the 2008 economic collapse that lawmakers haven’t address. True, Fannie Mae and Freddie Mac are now earning money (and have paid back their government taxpayer bailouts), but hardly anyone thinks that the current government-sponsored conservatorship system that’s set up for them is sustainable. With two years left and a Republican Congress (and progressives who derailed the last Congress’s bipartisan proposal), Obama faces an uphill battle getting housing reform done in his second term.
More on that soon…
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Quick note on the so-called housing “recovery” via The Wall Street Journal…
WSJ: STUDENT LOANS A DRAG ON HOUSING. Pedro Nicolaci da Costa reports: “Americans who take on debt to fund their university studies tend to have less wealth and lower homeownership rates over long periods than those who don’t rely on loans, research from the Federal Reserve Bank of Boston finds.
“U.S. student loans outstanding climbed past the $1 trillion mark in 2013 to become the second-largest type of consumer debt, after mortgages. The Boston Fed paper says its findings aren’t sufficient to argue student debt accumulation causes lower wealth and homeownership.” Full story, via WSJ: http://on.wsj.com/17noCuE.
SENATE PASSES TRIA WITHOUT ELIZABETH WARREN, via me: “The Senate approved legislation Thursday to reauthorize the Terrorism Risk Insurance Act (TRIA) for six years, over the objections of some Democrats who criticized a provision they said would weaken Wall Street regulations. The bill, which cleared the House a day earlier, passed the upper chamber on a 93-4 vote.”
— THE NO VOTES: Sens. Marco Rubio (R-Fla.), Elizabeth Warren (D-Mass.), Bernie Sanders (I-Vt.) and Maria Cantwell (D-Wash.) opposed the measure.
— ANOTHER CRACK IN DODD-FRANK’S ARMOR: Despite reservations over the Wall Street language, President Obama is expected to sign the bill, the first sent to his desk in the new GOP-controlled Congress. Many Democrats — including Warren — opposed a provision that would amend the 2010 Dodd-Frank Wall Street reform law. The measure, sought in some sectors of the financial services industry, would scrap certain regulations for nonfinancial institutions — dubbed ”end users” — that apply to big banks.
— WARREN AMENDMENT FALLS FLAT… EVEN AMONGST DEMS. Several Democrats split from Warren and voted in line with centrists. Warren’s amendment to remove the “end users” provision failed, by a 66-31 vote tally. Full story: http://bit.ly/17nlQFF.
— INSURERS DECLARE VICTORY. Nat Wienecke, Property Casualty Insurers Association of America’s senior vice president of federal government relations: “Today’s overwhelming bipartisan vote, the first significant legislation to go to the president in the 114th Congress, is a testament to Congress acknowledging the need for this critical program to preserve economic certainty today and provide for economic resiliency in the face of a catastrophic terrorist attack.”
FOR YOUR RADAR: NEXT WEEK – – > BIG WEEK FOR KEYSTONE. Sink: “Sen. Joe Manchin (D-W.Va.) said Thursday he was disappointed that the White House threatened to veto his legislation approving the Keystone XL pipeline, arguing the president’s move was ‘not the way a democracy works.’ The West Virginia lawmaker said he was upset Obama did not reserve judgment on the bill until it went through the committee and amendment process in an interview with Fox News’s ‘America’s Newsroom.'” http://bit.ly/1BLKbxL
Back to Housing…
CASTRO DEFENDS LOWER MORTGAGE FEES, via Vicki Needham: “Housing and Urban Development Secretary Julián Castro on Thursday defended the Obama administration’s plan to cut fees on some government-backed mortgages. Castro said the Federal Housing Administration (FHA) has enough money in its reserve fund to lower borrowing costs aimed at helping many first-time homebuyers.” Needham’s story: http://bit.ly/1BFlc1f
But House Financial Services Committee Chairman Jeb Hensarling (R-Texas) and other Republicans aren’t sold…
HENSARLING TO CASTRO: LET’S TALK IN FEBRUARY. House Financial Services Committee Chairman Jeb Hensarling (R-Texas) sent a letter to Castro earlier today calling on the secretary to testify before the panel in February.
— TALKING POINT PREP: WHY REPUBLICANS OPPOSE OBAMA’S HOUSING PLAN. Republicans argue that it’s careless to risk FHA’s financial health while further increasing the government’s role in the mortgage market. They’re also less enthused about signs that the housing market has fully recovered.
— HENSARLING IN A LETTER TO CASTRO: “A fiscally sound FHA, with a clearly defined mission, ensures home ownership opportunities for creditworthy first-time homebuyers and low-income families…. It is critically important that FHA be able to pay its claims without having to rely on the U.S. Treasury and taxpayers. Lowering premiums only places FHA further behind in developing the appropriate capacity to respond to future crises, while at the same time exposing taxpayers to greater risk of loss.” Read Hensarling’s full letter: http://bit.ly/1xKpMdg
— SEN. BOB CORKER (R-Tenn.), and one of the authors of the last Congress’s bipartisan Senate housing plan: “[Obama’s plan is] bad news for taxpayers and is yet another irresponsible, head-scratching decision from the administration in regards to our nation’s housing finance system.”
MARKET WATCH, via Anora Mahmudova and Barbara Kollmeyer for MarketWatch: (+) S&P 500 SPX: +1.79 percent, +36.26 points to 2,062.14, rising the most in three weeks… (+) Dow Jones Industrial Average: +1.84 percent, 323.35 points to 17,907.87… (+) Nasdaq Composite: +1.84 percent, +85.72 points. http://on.mktw.net/1AMxvZN.
SIDESHOW: HUCKABEE THINKS JAY-Z IS ‘PIMPING’ BEYONCE. Huckabee writes in his new book, “Gods, Guns, Grits and Gravy:” Beyonce is incredibly talented – gifted, in fact. She has an exceptional set of pipes and can actually sing. She is a terrific dancer – without the explicit moves best left for the privacy of her bedroom. Jay-Z is a very shrewd businessman, but I wonder: Does it occur to him that he is arguably crossing the line from husband to pimp by exploiting his wife as a sex object?” Andrew Rafferty for NBC: http://nbcnews.to/1AuMKF2
PELOSI CAUTIOUS ON TRADE, via Needham: “The House’s top Democrat on Thursday took a cautious stance on how her party will tackle the Obama administration’s aggressive trade agenda amid growing Republican support. House Minority Leader Nancy Pelosi (Calif.) said Democrats aren’t opposed to trade and that there are still plenty members of her caucus who have yet to make up their minds on where they stand on renewing trade promotion authority, which would allow trade deals to speed through Congress.” http://bit.ly/1tOrDbT
QUOTABLE, Federal Reserve Bank of Boston president Eric Rosengren on the timing of the central bank’s interest rate increase: “It doesn’t make that much of difference.” WSJ recaps his comments: http://on.wsj.com/1x0BAmC Most economists expect the rate increase to happen in the second half of this year.
NOTABLE, House Speaker John Boehner (R-Ohio), who was still talking to reporters today about how he defeated the Tea Party rebellion: “But what pains me the most is when they describe me as the establishment. I’m the most anti-establishment Speaker we’ve ever had. Who was the guy who got rid of earmarks? Me. Who’s the guy who believes in regular order? Me. Who believes in allowing more members to participate in the process from both sides of the aisle? Me.” Scott Wong is following all the Boehner drama: http://bit.ly/1AMJK8v.
TALK OF THE TOWN: BOXER TO RETIRE. “Sen. Barbara Boxer (D-Calif.) will retire after finishing her current term in Congress, she announced on her website Thursday morning… Boxer is 74 years old, and speculation that she would retire has been brewing for years, fueled recently by her stagnant fundraising. But she insisted that her age doesn’t play a role in her decision… The senator’s decision to retire ends a three-decade congressional career and leaves the Senate without one of its strongest liberal voices on environmental issues. Her decision will also open up the top Democratic spot on the Environment and Public Works Committee, which she chaired last Congress.” Cameron Joseph: http://bit.ly/1464aMC.
TAX WATCH, via Bernie Becker: “A bipartisan group of lawmakers predicted Wednesday that the House could repeal ObamaCare’s tax on medical device sales by the end of March… Republicans have pushed to roll back the tax for years, and have insisted for months that would be a top goal if they wrested away full control on Capitol Hill… Repealing the medical device tax has long had bipartisan support, in large part because several states have large device industries.” http://bit.ly/1ALhbs8.
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