The worst-kept secret in Washington is that Consumer Financial Protection Bureau Director Richard Cordray may be running for governor of Ohio. Whether that satisfies his political ambitions or not is unclear, given that if he wins he would have to answer to someone other than himself – the state’s taxpayers – a position he doesn’t seem comfortable with.
In a country loaded with way too many arrogant politicians and government officials who think they are above the law and normal standards of decency, Cordray has set the bar pretty low. Few public officials have shown the level of contempt for legitimate questioning from Congress, the White House and the industries his agency oversees than Cordray has shown since he took over the CFPB, and it’s only gotten worse in the past few months as his tenure winds down.
More seriously, his obstinacy, haughtiness, and lack of candor are likely to cost the agency a lot of goodwill and support in Washington, and possibly among the public. He owes it to the agency he helped build and supposedly loves to step down immediately before he creates more damage.
Now comes word that Cordray’s agency may have botched the Wells Fargo scandal – big time. Not only has there been previous evidence that the CFPB was lackadaisical in investigating the bank’s sales practices, at least a year after the Los Angeles Times reported there were problems, but now a recently released internal memo shows that the agency’s lawyers felt there was a strong justification to hit the bank with a $10 billion penalty, instead of settling for a paltry $100 million last September.
My grandmother, a schoolteacher, was widowed at a relatively early age. She inherited a relatively small nest egg my grandfather, a rabbi, had built that included a couple of municipal bonds and 90 shares of stock in a small local bank started by a handful of his congregants.
At the time of her death 40 years later, the bank had grown into one of the largest regional players in the business. Those 90 shares had grown through mergers, splits and stock dividends to over 12,000 shares, with a value of close to $300,000. Not a fortune -- but not too shabby.
Was she some kind of investing genius? She was a smart cookie, but no. She held the stock for what seemed like forever. She banked there forever. She knew the business inside and out. She liked the 5% rain or shine dividend.
Thanks, Old Man Winter. Consumers have already been in a sour mood, and you're not helping matters. Icy roads and bitter winds have left many people to stay at home -- and keep their cash in their pocket.
For companies that have been looking for signs that retail spending is finally ready to grow, this roadblock has been unwelcome. The bleak winter likely explains why retail spending on goods and services like cars, restaurants and gas stations slipped 0.4% in January on a seasonally adjusted basis, according to the National Retail Federation.
The Banking sector is heavily represented in this week's finance sector reports, with all of the sector's big guns like J.P. Morgan (NYSE:JPM), Wells Fargo (NYSE:WFC), Bank of America (NYSE:BAC), Citigroup (NYSE:C), and Goldman Sachs (NYSE:GS) coming out with results this week.
Total earnings for this sector as a whole are expected to be up +19.3% from the same period last year. So, on paper it all looks rosy, as they say. Currently the Trade Triangles are in long positions in the major bank stocks that are reporting earnings this week. Continue reading "Big Banks Report Earnings This Week"→