Tales from the Trail

President Obama is too closely tied to Wall Street, claims a new web video that takes the tone of Occupy Wall Street, though it was produced by a conservative group.

The video, released by the American Future Fund, an Iowa-based organization designed to be “a voice for conservative principles” and “free market ideals,” alleges that raising tens of millions of dollars from Wall Street gave Obama reason to let (presumably culpable) Wall Street executives off easy:

“Nearly four years after America’s financial collapse, not a single senior Wall Street executive has been charged with a crime. Not one. Why? Could it be because Obama raised $49 million from Wall Street – more than any candidate in history? He rewarded top Wall Street donors and supporters with senior jobs. His chief of staff made millions from Wall Street — after Wall Street received billions in bailout money.”

The ad names Jon Corzine, the former Democratic senator and New Jersey governor who headed MF Global until it filed for Chapter 11 bankruptcy last fall, as a particular example. Corzine “lost $1.6 billion in customers’ money but hasn’t been charged” the narrator says.

“Under Obama, Wall Street keeps winning, and Obama keeps taking their cash. Tell Obama to stop protecting his Wall Street donors.”

Curses are like young chicken: they always come home to roost, to quote the title page of Robert Southey’s poem The Curse of Kehama, published in 1810.

The controversy over the handling of home foreclosures came back to hurt the nation’s biggest banks with a vengeance today. There may not be a lot of sympathy on Wall Street for people who missed their mortgage payments, but then again, there probably isn’t much sympathy on Main Street for the practice of “robo-signers” to approve home seizures, especially since banks probably shouldn’t have extended many of the defaulting mortgages in the first place.

Investors have no room for sentiment either way. They dumped bank stocks on fears a prolonged investigation into potentially shoddy foreclosures, one of the biggest legal probes of the mortgage industry in decades, will eat into profits. The fear: it will delay sales of bank-owned properties, draw fines from regulators, and spawn lawsuits from both homeowners and investors in mortgage-backed securities. Jamie Dimon of JP Morgan admitted it could slow down the recovery in the housing market, but said “we’re hoping it won’t kill it.”

Last night Reuters correspondent Scot Paltrow revealed that a bill had sailed through the Senate last week — without public debate — which would have made it significantly harder for homeowners to challenge improper attempts to foreclose on their houses. The legislation, which was sitting on President Barack Obama’s desk for his signature, would have forced courts to recognize out-of-state notarizations, including those stamped en masse by computers in other states, a practice critics say has been used improperly to push through foreclosure orders. Computer notarizations, now valid in around a dozen states, would effectively have become legal nationally, and challenges to improper notarizations made in other states would have become harder and costlier.

Today, after the story became public, the White House announced that Obama was sending the legislation back to the House of Representatives for further discussion – a so-called “pocket veto.” Given the rising chorus of lawmakers calling for all foreclosures to be suspended, the legislation now looks dead.

As Reuters Breakingviews columnist James Pethokoukis wrote today, the foreclosure scandal is lousy timing for Wall Street, the fallout likely to further erode the financial industry’s standing among the general public and in Washington. That could make it harder for Wall Street to influence lawmakers and regulators next year as they seek to implement and flesh out this year’s sweeping financial reforms.

Republicans stand poised to gain substantial influence in Congress, putting at stake billions of dollars in investment as a shift among power brokers throws legislative initiatives old and new into doubt. Reuters Washington Summit will bring together an influential line-up of insiders just weeks before Americans cast their votes, promising a must-read stream of exclusive news on the outlook for Congress and President Barack Obama's agenda. Editors and correspondents from the Reuters Washington bureau are sitting down with senior lawmakers, including GOP heavyweights in line for leadership, and regulators whose implementation of Wall Street and healthcare reform could be complicated by a change in control on Capitol Hill.

The Summit will generate exclusive stories, investable insights, online videos and blog postings, which will be immediately available only to Thomson Reuters clients during the Summit. Key interviews will air live exclusively on Reuters Insider - a new multimedia platform delivering relevant news, analysis and trade ideas presented through a personalized video experience. Visit http://etv.thomsonreuters.com/

Consumer advocate Elizabeth Warren is among a handful of candidates President Barack Obama is considering to become the first chief of the Consumer Financial Protection Bureau. Some ardent supporters clearly think the Harvard law professor (and chief of a panel monitoring the government’s $700 billion bailout of the financial system)  is up for the task of heading the independent agency created under the  financial reform bill signed into law last month.

A group called The Main Street Brigade, which supported creating the consumer agency, really wants Warren to be the boss.  The group has taken its case to YouTube  in a western-themed music video,  “Elizabeth Warren Rap Video – Got a new Sheriff.”

The new consumer financial protection agency will regulate a range of consumer financial businesses from mortgage lending to payday loans and check cashing businesses. Its mission — to protect ordinary borrowers from abuses by lenders.

After a laid-back family getaway on Maine’s scenic shoreline, it’s back to political reality for President Barack Obama.

The first family wrapped up a three-day mini-vacation in the upscale Bar Harbor resort and boarded a small presidential jet headed for Washington, where Obama will again face the daily pressures and policy battles.

In the coming week, he will weigh the latest dose of good news together with lingering concerns about the BP oil spill, sign a Wall Street overhaul into law and hold talks with new British Prime Minister David Cameron. Enduring problems like the struggling economy, high unemployment and the war in Afghanistan also remain on his plate.

TV cameras zoomed in on corporate executives squirming, a top federal regulator promising answers and U.S. lawmakers venting anger.

All of this and more unfolded during a series of nationally broadcast dramas on Tuesday as two congressional panels held hearings on the spreading BP oil spill, and a third probed last week’s mysterious collapse on Wall Street.

Such high-profile investigative proceedings have been a regular feature on Capitol Hill for years.

Ed Yingling, president and CEO of the American Bankers Association, is a little worried about the rhetoric that's been flying around as Congress tries to produce financial reform legislation.

And he wants people to be clear that the problems are with Wall Street, not banks.

Though, the differentiation gets a little tricky here because some of the largest banks in the country and biggest players on Wall Street are members of his organization and received taxpayer bailouts. The thousands of other banks that his trade association represents did not.

Have Republicans really met their Waterloo? George W. Bush’s former speech writer David Frum thinks so. And he may have a point, though making it in public has proved costly.

Only six months ago, Republican opposition to healthcare reform was whacking away gleefully at President Barack Obama’s approval ratings. An army of conservative Tea Party activists were flooding Washington’s National Mall in a show of force against the Obama legislative agenda. And Republican nice guy Scott Brown was on his merry way to a Senate upset in bluest of blue Massachusetts.

Now healthcare reform is law and newly energized Democrats are moving to counter those evils of Wall Street that voters love to hate. The grass-roots army has brought Republicans one or two liabilities. And Obama’s job approval rating shows signs of firming up.

House Republican leader John Boehner’s comment about “punk staffers” involved in the writing of the financial regulation bill did not seem to sit well with White House economic adviser Lawrence Summers.

In an appearance at the National Press Club, Summers made a point of bringing up the comments by Boehner, who urged bankers to stand up for themselves and said they should not “let those little punk staffers” working on the bill take advantage of them.

Boehner may not have been spoiling for a fight, but he got one.

Summers pressed his criticism of lobbyists who the Obama administration accuse of trying to water down the proposals for tighter regulation of Wall Street.