A Senate bill would prohibit employers from checking credit reports when making hiring decisions. This would be good news for banks. Loan losses often occur after a consumer cannot work their way out of a financial squeeze because employment discrimination prevents them from getting a new job.
Janet Yellen was unofficially confirmed to be the new Fed chair. For procedural reasons, the U.S. Senate must repeat the vote on January 6.
The euro zone seems to be close to an agreement in principle on a banking union, though the all-important details of bank resolution remain elusive. Bank resolution has to be part of the plan because the European Union is not large enough to backstop all of the banks currently known to be in difficulty, should those banks continue to decline.
The Fed is carrying on with its “quantitative easing” asset-buying program, but is slowing its pace of purchases with an eye toward stopping them entirely a few years from now, around 2017 I guess. The Fed is not interested in pushing interest rates upward at this point, so it seems likely that rates will remain below 1 percent at least through 2016.
A court in Israel has sentenced a business tycoon to 1 year in jail for crimes committed as the head of a bank. Danny Dankner’s brief stint as chairman of Bank Hapoalim from 2007 to 2009 reads like a non-stop parade of shady dealings in which he used the bank as a vehicle for personal profit. One wonders whether he was briefed on the concept of fiduciary duty when he became a bank officer. Regulators persuaded him to step down in 2009, after which he was arrested and charged. There are anecdotes elsewhere that suggest that when tycoons bring their deal-making tendencies to banks it leads to turmoil. During his time in jail, Dankner will stand trial in an unrelated bribery case.
