Help the administration overhaul mortgage-finance companies Fannie Mae and Freddie Mac, or he will do what he can on his own as director of the Federal Housing Finance Agency. Fannie and Freddie are critical to half the nation’s mortgages and have been under government control since 2008. For more than a decade, policy makers have tried and failed to return them to the private sector. Calabria is expected to send his ideas to Congress as early as this week. (The Wall Street Journal | Jun 12)
The SEC should deter bond dealers from using an “abusive” trading practice that hurts market competitiveness, the agency’s Fixed Income Market Structure Advisory Committee said. The tactic, known as “pennying,” describes a dealer sending a client’s request to sell a bond to the market and giving the customer the same or a slightly better price for it than the best bid out there. This use of “last look” in the auction process discourages competing dealers from making aggressive bids or even participating. (Bloomberg Law | Jun 11)
Bitcoin and its fellow cryptocurrencies have surged in popularity partly because they’ve offered a way to skirt the government oversight exercised over traditional financial systems. Well, get ready to kiss much of that autonomy goodbye. (Bloomberg Cryptocurrencies | Jun 11)
Some financial firms and Republican lawmakers are concerned that time is running out for US regulators to make progress in rolling back post-crisis financial rules under the 2010 Dodd-Frank Act before the country's 2020 election. Regulators say they are making changes as fast as they can. (The
Wall Street Journal | Jun 10)
The Commodity Futures Trading Commission has done little to correct shortcomings in stress tests of clearinghouses, the CFTC's inspector general said in a report. "We also remain concerned that market participants may be given a misleading impression about the substantive quality and independence of CFTC's stress-testing reports and capabilities," the report said.
The inspectors said they were “disappointed” that mid-level CFTC officials found responsible for “mismanagement and dysfunction” last year remain part of the stress-testing program.
(MLex | Jun 10)
