• Treasury Secretary Janet Yellen said in an interview with ABC’s “This Week” that there are “no good options” for raising the federal debt ceiling outside of action by Congress, dismissing ideas that President Joe Biden could use powers granted to the executive branch in the 14th Amendment to bypass the House and Senate. House Financial Services Committee Chair Patrick McHenry (R-N.C.) said in a separate interview with CBS’s “Face the Nation” that “everything is on the table at this point,” including a deal for a short-term debt limit increase. (Bloomberg)
• Senate Minority Leader Mitch McConnell (R-Ky.) and more than 40 Republican senators have signed a letter addressed to Senate Majority Leader Chuck Schumer (D-N.Y.) stating that they will not back any bill to raise the federal borrowing limit without substantial spending and budget reforms, according to sources. Sources said McConnell worked behind the scenes to gather support for the letter, an effort led by Sen. Mike Lee (R-Utah), who is looking to ensure that the GOP can sustain a filibuster of Democrats’ attempt at a clean debt ceiling raise. (The Hill)
• The Securities and Exchange Commission said it has given $279 million — its largest-ever award — to an unnamed whistleblower who provided information and assistance that led to an enforcement action for which the agency did not provide details. SEC Division of Enforcement Director Gurbir Grewal said in a statement that the large award is meant to incentivize witnesses to disclose potential securities law violations and that the whistleblower program has led to the SEC’s recovery of more than $4 billion in ill-gotten gains and interest. (CNBC)
• The Justice Department is investigating whether crypto exchange Binance Holdings Ltd. or company officials allowed the movement of money through its platforms in violation of sanctions related to Russia’s invasion of Ukraine, according to five people familiar with the matter. One source said this investigation is running in parallel with an existing inquiry by the department’s criminal division, and Binance is additionally in discussions with the DOJ to resolve previous complaints related to the alleged violation of sanctions against Iran. (Bloomberg)

Wages Grow Steadily, Defying Fed’s Hopes as it Fights Inflation

The New York Times

TurboTax to begin payouts after it ‘cheated’ customers, New York AG says

Dan Rosenzweig-Ziff, The New York Times

TurboTax will begin sending checks next week to nearly 4.4 million low-income Americans whom the company deceived into paying for tax services that should have been free, New York Attorney General Letitia James said.

Biden names Neera Tanden as White House domestic policy chief

John T. Bennett, Roll Call

President Joe Biden has appointed a lightning rod of Republican scorn to lead domestic policy-making inside the West Wing as Susan Rice steps aside.

SEC Buyback-Disclosure Rule Stirs Worry Over Costs and Compliance

Mark Maurer and Jennifer Williams-Alvarez, The Wall Street Journal

Finance executives welcome the effort to improve transparency but question aspects of the requirements and remain concerned over ‘undesirable side effects’

Future of student loan forgiveness looms over Biden in 2024

Alex Gangitano and Lexi Lonas, The Hill

The issue of student loans stands to loom over President Biden’s 2024 bid as he tackles one of his key first-term campaign promises being tied up at the Supreme Court.

New cars, once part of the American Dream, now out of reach for many

Rachel Siegel and Jeanne Whalen, The New York Times

Higher interest rates have hit as automakers double down on pricier models, as the average price for a new car hit $48,008 in March.

Lines Stretch Down the Block at Food Banks as Costs Go Up and Pandemic Aid Expires

Mike Dorning, Bloomberg

The line outside Boston’s American Red Cross Food Pantry on a recent Saturday morning stretched the length of two football fields. The number of people filing into the red-brick industrial-zone warehouse on some days now exceeds the worst periods of the pandemic economic crisis and in April it had the second highest monthly traffic since it opened in 1982, according to David Andre, the director.

Let’s make a deal on the Child Tax Credit — or not

Brian Faler, Politico Pro

The ingredients are there for an agreement between Republicans and Democrats on cherished tax breaks, but the details — and the cost — are still obstacles.

What Would the G.O.P. Plan Actually Do to the Budget?

Margot Sanger-Katz and Alicia Parlapiano, The Upshot

House Republicans want to cut federal spending — and they just passed a bill that would do that.

14th Amendment emerges as last-ditch fix to ward off default

Julia Mueller, The Hill

Top political figures are swirling the possibility that President Biden could use the powers of a clause in the 14th Amendment as a last-ditch effort to ward off the looming threat that the U.S. could default on its debt as soon as next month.

Biden, Lawmakers Look to Break Impasse on Debt Ceiling

David Harrison, The Wall Street Journal

Top Democrats and Republicans are racing to try to find a politically acceptable way to raise the nation’s borrowing limit in the coming weeks, diving into talks that President Biden has avoided during months of impasse.

Political calculus complicates path to US debt ceiling deal

Lauren Fedor and James Politi, Financial Times

Biden refuses Republican preconditions for raising $31tn borrowing cap ahead of White House talks

Trillion dollar coin? 14th Amendment? Some argue for far-out fixes to the debt ceiling crisis

Ben Werschkul, Yahoo Finance

Minting a trillion-dollar coin? Invoking the 14th Amendment? Even getting rid of the debt ceiling altogether? A number of unusual solutions to the ongoing debt-ceiling crisis have gotten new attention in the past week as skepticism abounds that a bipartisan agreement can be reached ahead of a key deadline on June 1.

Thousands of Jobs Were Added in April—Even in Industries With Layoffs

Gabriel T. Rubin, The Wall Street Journal

Employers across the economy cranked out jobs last month, despite Amazon, Disney, General Motors and other high-profile companies recently cutting staff.

Black US Unemployment Hits Record Low But Participation Falls

Jonnelle Marte, Bloomberg

Black unemployment dropped to a record low in April but the decline was driven by some troubling trends suggesting Black workers are starting to struggle in an otherwise resilient US labor market.

Fed Can Still Achieve Soft Landing, Bullard Says

Steve Matthews and Catarina Saraiva, Bloomberg

Federal Reserve Bank of St Louis President James Bullard said policymakers will probably have to push rates higher to cool inflation, but said he would wait and see what the data show before deciding what move to support in June.

PacWest Leads Rally in Regional Banks After Slashing Dividend

Macarena Munoz Montijano, Bloomberg

PacWest Bancorp rose as much as 16% in premarket trading Monday, extending Friday’s brisk rebound and leading gains in US regional banks, after it slashed its quarterly dividend and said business remains “sound.”

US Bank Lending Rises for Fourth Week, Led by Small Institutions

Alexandre Tanzi, Bloomberg

US bank lending increased for a fourth straight week, suggesting credit conditions remain relatively stable despite elevated concerns about regional lenders.

Warren Buffett says American banks could face more turbulence ahead, but deposits are safe

Hugh Son, CNBC

Berkshire Hathaway CEO Warren Buffett on Saturday assailed regulators, politicians and the media for confusing the public about the safety of U.S. banks and said that conditions could worsen from here.

StanChart CEO Winters Says Too Big to Fail Must be Reviewed After US Crisis

Nicolas Parasie and Manus Cranny, Bloomberg

The idea of banks being too big to fail needs to be reviewed in the wake of the recent turmoil that’s seen four US lenders — including Silicon Valley Bank — collapse, according to Standard Chartered Plc Chief Executive Officer Bill Winters.

Banks’ new problem: The market is predicting they will fail

Sam Sutton and Victoria Guida, Politico

The chaos in the banking industry is one more headache for the Biden administration as officials try to steer the economy away from recession.

Bank buyers expect sweeteners as US government sets new bar

Saeed Azhar et al., Reuters

The government-brokered purchases of First Republic, Signature and Silicon Valley banks have created a vicious cycle in which troubled lenders need to fail — and get government assistance — before buyers will step up, industry sources say.

The CEO of a massive private equity firm says he knows exactly what’s going on with the ‘non-recession’ recession we’re having right now

Tristan Bove, Fortune

All the rules say the U.S. is supposed to be in a downturn right now, but most Americans aren’t feeling one. That may be because this is a different type of recession than the one economists are used to, according to Marc Rowan, billionaire investor and CEO of Apollo Management, a private equity firm with over $500 billion under management.

Gold Investors Turn to Gold IRAs Amid Economic Uncertainty

Lori Ioannou, The Wall Street Journal

These investment vehicles work like regular IRAs, but with some additional regulations.

CalSTRS adopts low-carbon strategy for its credit portfolio

Arleen Jacobius, Pensions & Investments

The $306 billion California State Teachers’ Retirement System’s investment committee approved a strategy reducing by 12% the carbon footprint of the internally managed portion of its $11 billion credit portfolio.

Anti-ESG law has Oklahoma pension funds asking questions about asset-manager blacklist

Margarida Correia, Pensions & Investments

Oklahoma’s pension funds are scrambling to comply with the state’s new law prohibiting them from investing with financial firms that incorporate environmental, social and governance considerations in their investment decision-making.

Carbon Markets Get Boost From Wall Street

Amrith Ramkumar, The Wall Street Journal

State Street will offer back-office services needed for carbon-credit exchange-traded funds.

FHFA interview about LLPA changes

Chris Clow, Housing Wire

Michael Shemi, Principal Advisor at the Federal Housing Finance Agency, answers questions on controversial changes.

Mortgage Fees (Seriously) Spurred Outrage on TikTok. Here’s Why.

Tara Siegel Bernard, The New York Times

Changes to fees applied to federal mortgages have led to a misconception that borrowers with low credit scores will pay less at the expense of borrowers with good credit.

A TikToker exposes how much people pay for rent. Viewers can’t get enough.

Anumita Kaur, The New York Times

Her 80-square-foot apartment has no oven. There’s just one window, staring out at a brick building. To sleep, she pulls her bed down from the wall, she demonstrated for TikToker Caleb Simpson. But at least it’s just $1,750 a month in Manhattan.

Binance resumes Bitcoin withdrawals after temporary closure

Reuters

Crypto exchange Binance said that it has resumed Bitcoin withdrawals after a brief closure due to a congestion issue. Binance had paused withdrawal of Bitcoin, the world’s largest cryptocurrency, for more than an hour.

Binance Moved $4.4 Billion of Bitcoin Across its Wallets, Data Indicate

Sidhartha Shukla and Suvashree Ghosh, Bloomberg

Binance, the largest cryptocurrency exchange, moved about $4.4 billion worth of Bitcoin across its digital-asset wallets on Sunday based on an analysis from research company CryptoQuant.

Voyager Digital Plans to Liquidate Assets, Wind Down After Sale Dreams Crushed

Cheyenne Ligon, CoinDesk

Voyager’s creditors will recover an estimated 36% of their assets – a far smaller slice of the pie than they would have received if the platform’s sale to FTX or Binance US went through.