Economy

• President Donald Trump boasted about the strong economy during his annual State of the Union address, which didn’t mention his ongoing impeachment trial. Trump said he has “reversed the failed economic policies of the previous administration,” which is why the world is now “witnessing this great economic success.” 

• U.S. employers added 225,000 jobs in January, boosting the three-month hiring average to 211,000 as mild winter weather fueled payroll growth in industries such as construction and transportation. Wages grew 3.1 percent from the year-ago period, while the unemployment rate inched up to 3.6 percent from 3.5 percent in December, which the Labor Department attributed to more Americans seeking work.

• The White House National Economic Council and the Council of Economic Advisers are studying the potential hit to the U.S. economy from the coronavirus, according to two people familiar with the matter. The economists see limited economic impact in the first three months of 2020, tracking with external analysis, although administration officials said the work is preliminary and precautionary.

• Ahead of Federal Reserve Chair Jerome Powell’s appearances before the House Financial Services and Senate Banking committees this week, the central bank wrote in its semiannual report to Congress that the “effects of the coronavirus in China have presented a new risk” to the economic outlook in the United States. The Fed’s report also highlighted risks in corporate debt markets, low interest rates leading to higher asset valuations and a slowdown in manufacturing.

• Treasury Secretary Steven Mnuchin warned that the U.S. economy in 2020 will likely not reach the 3 percent growth promised by the Trump administration in light of Boeing Co.’s 737 problems. 

Banks

• Goldman Sachs Group Inc. is close to reaching a deal with Amazon.com Inc. to offer small business loans in the United States via Amazon‘s lending platform, according to two people briefed on discussions. One of the people said the product could be ready as early as March.

• The Federal Reserve has permanently banned Andrea Vella, a former Goldman Sachs banker, from the banking industry after allegations that he failed to inform the bank that a businessman who allegedly masterminded the 1MDB scandal was involved in 1MDB bond offerings that Goldman handled in 2012 and 2013. 

• Michael Cleary, co-president of Santander Holdings USA Inc., will oversee Wells Fargo & Co.’s sales practices, according to an internal memo.

Housing

• JPMorgan Chase & Co. is considering a return to offering more loans insured by the Federal Housing Administration, people familiar with the matter said. The bank is weighing this option as Trump’s administration promises to make it easier to avoid fines for underwriting errors, according to the people, after banks pulled out of the market in frustration over penalties levied under the False Claims Act. 

• The Federal Housing Finance Agency has tapped investment bank Houlihan Lokey Capital to advise on the potential privatization of Fannie Mae and Freddie Mac, paying the investment bank up to $45 million over five and a half years. Hiring an adviser is a key step to releasing Fannie and Freddie from government conservatorship, and FHFA Director Mark Calabria has said he wants the agency to avoid a conflict by hiring an adviser before the mortgage giants hire their own.

Taxes

• More than 14 million people could have used for free tax prep software that they paid for, according to an audit by the Treasury Inspector General for Tax Administration. An analysis of tax preparation fees shows that totals roughly $1 billion of revenue for TurboTax maker Intuit Inc., H&R Block Inc. and other tax prep software companies.

• The House and Senate are in session this week.

• Powell will give his semiannual testimony on the state of the economy to the House Financial Services Committee on Tuesday and to the Senate Banking Committee on Wednesday.

• The Senate Banking Committee will hold its Fed nomination hearing Thursday for Judy Shelton and Christopher Waller.

1) Goldman Sachs in talks with Amazon to offer small business loans
Laura Noonan, Financial Times

2) Houlihan Lokey named as adviser on U.S. overhaul of Fannie, Freddie
Pete Schroeder, Reuters

3) Banks Expect Tighter Lending Standards, Weaker Loan Performance in 2020
David Harrison, The Wall Street Journal

4) The Parental Leave Boomlet in the U.S. Is Leaving Women Behind
Rebecca Greenfield and Christopher Cannon, Bloomberg

5) Big investors battle SEC on shareholder resolution changes
Billy Nauman, Financial Times

6) The Money Behind Trump’s Money
David Enrich, The New York Times

7) As Trump Touts U.S. Economy, Data Shows Consumers More Upbeat About Finances
Claire Williams, Morning Consult

8) Mnuchin Says U.S. 2020 Growth to Be Less Than 3% Due to Boeing
Kate Davidson, The Wall Street Journal

9) Bloomberg Proposes $5 Trillion in Taxes on the Rich and Corporations
Jim Tankersley and Alexander Burns, The New York Times

10) Lordy, there’s a tape of Trump discussing VA loan legislation
Kathleen Howley, Housing Wire