Although an 11th-hour agreement on the debt ceiling by the congressional leadership was reached, and the US was not forced to default, the collateral damage of this debate was evident late Friday evening when Standard & Poor‘s announced that it was downgrading the US credit rating from AAA to AA.
Earlier this week, in a speech before the International Monetary Conference, Treasury Secretary Geithner stressed that efforts to delay or lessen the impact of financial regulation would hurt the financial industry.
While Treasury Secretary Geithner warned against undermining efforts to stall or water down financial regulation, Senate Republicans are refusing to confirm nominees to crucial financial regulatory posts.
As expected, the House failed to pass a “clean” bill on Tuesday that would have raised the debt ceiling by $2.4 trillion, by a vote of 97-318.
Sen. Jon Testers (D-MT) amendment to delay implementation of the Federal Reserve rule on debit interchange fees by 15 months could be addressed as soon as this coming week.
On May 31st, one hundred and sixty-eight members of the House signed on a letter urging financial regulators to exempt home loans with lower down payments from new risk retention requirements if the loans are backed by private mortgage insurance.
In a speech Friday in Washington, D.C., Federal Reserve Governor Daniel Tarullo stated that federal regulators should mandate capital surcharges as a means of disincentivizing mergers by systemically important financial institutions (“SIFIs”), in cases that would increase risk without yielding substantial public benefits.
During the week of June 6th, the Senate will be back in session, but the House of Representatives will be in recess until the week of June 13th
On Thursday, the Senate Banking Committee called all representatives of the Financial Stability Oversight Council (FSOC) to testify, ostensibly for an oversight hearing on Dodd-Frank implementation.