Morning Consult Finance: Week in Review & What’s Ahead


Week in Review

U.S.-China trade talks

  • The United States has agreed to delay a tariff increase on China set for next week as part of a partial trade agreement reached between the two countries Friday. As part of the deal, which could be finalized as soon as next month, China has agreed to some intellectual property measures and concessions tied to financial services and currency and will increase purchases of U.S. agricultural goods, according to President Donald Trump.

Federal Reserve

  • The Federal Reserve finalized a package of regulations that relax capital and liquidity requirements for both domestic and foreign banks that were put in place after the financial crisis. The Fed also relaxed scheduling for “living wills” detailing how banks would safely dissolve.
  • The Fed posted a job opening for a senior speechwriter for Chairman Jerome Powell, which comes after certain statements by Powell over the past year have roiled the stock markets.
  • Fed policymakers expressed concerns about economic risks associated with the U.S.-China trade war and geopolitics, according to minutes released from the Fed’s September policy meeting. The Fed pointed out that household spending is increasing at a “strong pace” but also mentioned that business fixed investment and exports “weakened” since the Fed’s July meeting, when it cut interest rates for the first time since the financial crisis.

Libra

  • PayPal Holdings Inc. announced that it will no longer participate in the coalition for Facebook Inc.’s Libra cryptocurrency project, which has faced scrutiny from U.S. and European regulators. A week later, eBay Inc., Stripe Inc., Mastercard Inc. and Visa Inc. all followed suit in dropping out of the project.
  • Facebook Chief Executive Mark Zuckerberg has agreed to testify at an Oct. 23 House Financial Services Committee hearing, where he will likely face questions about the social media company’s proposed Libra cryptocurrency.

Trump tax returns

  • U.S. District Judge Victor Marrero ruled that Trump cannot prevent his accountants at Mazars USA LLP from turning over eight years of his tax returns and other financial documents to Manhattan District Attorney Cyrus Vance Jr., who is leading an investigation into alleged hush payments, though the president immediately appealed the decision and won a temporary delay. Marrero ruled that Trump’s request for an injunction should have been filed in state court rather than federal court and that the president’s claim that he, his company and business associates have presidential immunity from criminal investigation “would constitute an overreach of executive power.”
  • The U.S Court of Appeals for the D.C. Circuit ruled in a 2-1 vote that Congress can subpoena eight years of Trump’s business records from his accounting firm, Mazars USA. The court rejected Trump’s claim that the House’s subpoenas are invalid because they lack a “legitimate legislative purpose.”
  • A federal appeals court said Deutsche Bank AG does not have Trump’s tax returns sought by House Democrats in a subpoena. The court said that Deutsche Bank wrote in an August letter that it has tax records “for individuals or entities named in the subpoenas” that do not belong to Trump, but the court rejected a motion from media outlets seeking release of the identities.

What’s Ahead

  • The House and Senate are in session this week.
  • The Fed will start buying Treasury securities Tuesday to expand its balance sheet, with initial purchases starting at $60 billion over the month. The Fed will continue purchasing unspecified amounts of Treasury bills in the second quarter of next year.
  • The House Financial Services Committee will host a hearing at 10 a.m. Wednesday for the semi-annual review of the Consumer Financial Protection Bureau. The Senate Banking, Housing and Urban Affairs Committee will host its hearing on the CFPB semi-annual review at 10 a.m. Thursday.

Events Calendar (All Times Local)

10/15/2019
PIIE event: “Currency, Credit and Crisis: Central Banking in Ireland and Europe” 12:15 pm
10/16/2019
Eighth annual AEI-CRN housing conference
2019 IIF Annual Membership Meeting
U.S. Chamber of Commerce CO-Summit
Brookings event: “A conversation with ECB Chief Economist Philip Lane” 10:00 am
House Energy and Commerce Joint Subcommittee Hearing Titled “Fostering a Healthier Internet to Protect Consumers” 10:00 am
House Financial Services Committee Hearing Titled “Who Is Standing Up for Consumers? A Semi-Annual Review of the Consumer Financial Protection Bureau” 10:00 am
House Budget Committee Hearing Titled “Strengthening Our Fiscal Toolkit: Policy Options to Improve Economic Resiliency” 10:00 am
House Small Business Committee Hearing Titled “SBA Management Review: SBA IG Report on the Most Serious Management and Performance Challenges Facing the SBA” 11:30 am
House Financial Services Committee Hearing on The Reauthorization of the Terrorism Risk Insurance Program 2:00 pm
Brookings Institution Event Titled “Recession preparation: What happens when a big domestic bank fails?” 2:00 pm
Senate Joint Economic Committee Hearing on Measuring Economic Inequality in the United States 2:15 pm
View full calendar

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