Morning Consult Finance: Wells Fargo Said to Plan Expansion of Mortgage Unit

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  • Wells Fargo & Co. is planning to rebuild its mortgage division after the bank laid off nearly 1,000 mortgage workers last year, according to a memo viewed by a media outlet. Banks are expecting a rise in mortgage activity as a result of recent decreases in interest rates, and Wells Fargo plans to make most of its mortgage processing hires in Des Moines, Iowa, and Minneapolis, according to the memo. (Reuters)
  • The Federal Reserve has 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. For example, in July, Powell referred to an interest rate cut as a “midcycle adjustment” instead of the start of a period of successive cuts, which was what investors had anticipated. (CNBC)
  • The Commodity Futures Trading Commission has named Melissa Netram, director of global public policy and regulatory affairs at Intuit Inc., to serve as the director of the CFTC’s fintech innovation unit. (Bloomberg Law)

Chart Review

Households’ lightening debt load
Federal Reserve Economic Data Blog

Events Calendar (All Times Local)

PIIE event: “Currency, Credit and Crisis: Central Banking in Ireland and Europe” 12:15 pm
Eighth annual AEI-CRN housing conference
2019 IIF Annual Membership Meeting
Brookings event: “A conversation with ECB Chief Economist Philip Lane” 10:00 am
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How Brands Can Navigate the New Era of Politics

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Employers Try a New Perk: Matching Student Loan Payments With 401(k) Contributions
Anne Tergesen, The Wall Street Journal

Many workers with student loans postpone saving for retirement. Now, a handful of companies are trying to prevent them from falling behind on retirement savings by matching their student-loan repayments with contributions to a 401(k) plan.

Trump trade deal struggling at the Mexican border
Sean Higgins, Washington Examiner

President Trump’s United States-Mexico-Canada Agreement on trade is one thing the White House would rather not see stuck at the southern border, yet it’s been trapped there for months. Ratification of the deal to replace the 1993 North American Free Trade Agreement is being held up by liberal Democrats who argue that Mexico cannot be trusted to hold up its end of the bargain.

What to Watch to See If World Economy Is Heading Into Recession
Simon Kennedy, Bloomberg

The hottest topic in global financial markets is whether the world economy is heading for recession, but defining such a slump is easier said than done.

Stocks Rally as Trade-Talk Hopes Grow; Oil Jumps: Markets Wrap
Yakob Peterseil, Bloomberg

Stocks rallied on Friday amid growing hopes that the U.S. and China can negotiate a trade truce as high-level talks progress into a second day. Treasuries fluctuated after Thursday’s slump.


FDIC to rescind four policies deemed outdated
Joe Adler, American Banker

The Federal Deposit Insurance Corp. is proposing to retire four “statements of policy” as part of an ongoing effort to explore ways to reduce the industry’s regulatory burden.

Citi rolls out ad campaign highlighting gender pay gap
Laura Alix, American Banker

Citigroup is aiming to draw attention to the gender wage gap, and its own efforts to promote women to senior roles, with a new advertising campaign featuring some of its employees’ children.

AI Has a Solution to Finance’s Bias Toward Mini-Me Lacrosse Bros
Erik Schatzker, Bloomberg Businessweek

When recruiting talent, the overwhelmingly white, male, and elite-educated cohort who run America’s top financial firms reflexively seek out younger versions of themselves. Psychologists call this tendency the “like-me” bias.

Financial Products and Investments

Sallie Mae seeks to fill CARD Act void with student credit cards
Michael Moeser, American Banker

In a move to tap into an underserved market opportunity — but with the potential for political backlash — student lender and consumer banking provider Sallie Mae launched three different cash-back reward credit cards aimed at college students and young adults.

These CEOs broke the rules at a secretive summit to expose a billionaire’s crude sexual comments
Katie Mettler, The Washington Post

But almost as soon as his session began, attendees said online and in interviews with The Washington Post, Fisher used the spotlight to make crude, inappropriate remarks, including comparing his wealth management strategy to picking up women for sex.

Housing and GSEs

Mortgage rates pull back on weaker-than-expected economic data
Kathy Orton, The Washington Post

Mortgage rates retreated this week after the services sector reported its slowest growth rate in three years.

CFPB extends temporary HMDA relief for small institutions
Kate Berry, American Banker

In an expected win for small community banks and credit unions, the Consumer Financial Protection Bureau is giving financial institutions that originate few mortgages an additional reprieve from the Home Mortgage Disclosure Act.

Congress sparks veterans’ ire with mortgage fee hike
Katy O’Donnell, Politico

Months after Congress passed a bill temporarily raising the fees that veterans pay for home loans, lawmakers are quietly seeking to tap the same pot of money again, a move that’s pitting veterans’ groups against one another.


Senate Democrats aim to repeal rules blocking Trump tax law workarounds
Naomi Jagoda, The Hill

Senate Democrats announced Thursday that they are planning to force a vote in the near future on a resolution to repeal IRS rules aimed at blocking blue states’ workarounds to the GOP tax law’s cap on the state and local tax (SALT) deduction.

Financial Technology

CFTC says cryptocurrency ether is a commodity, and ether futures are next
Daniel Roberts, Yahoo Finance

Last December, the Commodity Futures Trading Commission (CFTC) issued a public call for feedback to “better inform the Commission’s understanding” of the Ethereum network and the cryptocurrency ether. Now CFTC Chairman Heath Tarbert, who just took over the role in July, has come to a decision on its status.

Robinhood is launching a new Cash Management feature
Lea Nonninger, Business Insider

The US-based commission-free trading startup has announced its new Cash Management feature, which enables users to earn a monthly interest rate of 2.05% on their money, according to a company blog post. The news comes after the company’s botched attempt to launch a similar service at the end of 2018.

Opinions, Editorials and Perspectives

What No One Told You About Your Student Loans
Jay Fee, Morning Consult

Like taxes and mortgage payments, many people view student debt as non-negotiable — a payment you just have to accept as part of the average American’s financial load. It makes sense, considering that over 40 million Americans owe a collective $1.5 trillion in student loans.

A Small Deal With China Is Trump’s Best Option
Karl W. Smith, Bloomberg

The walls are closing in on the president. With escalating hostilities in Syria and tense relations with China, not to mention impeachment and a slowing economy in the heartland, Donald Trump is desperate for some good news.

Why We Worry About the U.S.-China Trade War
Kevin Rudd et al., The New York Times

The 18-month trade war between the United States and China represents the single greatest threat to global economic growth today. A failure to bring the trade war to a satisfactory conclusion significantly increases the risk of recession next year in the United States, Europe, Japan and other developed and emerging economies.

How to Tax Our Way Back to Justice
Emmanuel Saez and Gabriel Zucman, The New York Times

America’s soaring inequality has a new engine: its regressive tax system. Over the past half century, even as their wealth rose to previously unseen heights, the richest Americans watched their tax rates collapse.

Research Reports

Private Policies and Public Power: When Banks Act as Regulators within a Regime of Privilege
Brian Knight and Trace Mitchell, Mercatus Center

An emerging trend in financial services is banks’ increasingly common refusal to do business with industries for political reasons rather than for traditional business justifications. Banks’ refusals are often explained by a desire to make a difference or send a message.

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