Print This Post   |  Email This Post

The Weekly Crib Sheet for February 1st – 6th:  The first week of February is all about a) jobs, jobs, and more jobs and b) reading the tea leaves on financial overhaul legislation in the Senate.

MBA readers here’s WHY YOU CARE:  In the wake of the Massachusetts special election to fill the late Sen. Edward Kennedy’s seat the administration has put health care on the side burner in the number two slot and the economy in the number one priority position.  But, there are a number of ways to say economy: jobs, unemployment, budgets, financial reform.  The synonyms abound this week.  So here’s what to look for…

1)  Jobs:  January’s unemployment numbers come out this Friday (2/5 noted below).  We all know it is a lagging indicator of the economy, and we all know it won’t improve dramatically for a while, however, that doesn’t work on Sunday talk shows, nightly newscasts, blogs, and most importantly campaign commercials.  Now that 2010 is here, the events this week (including a town hall with Pres. Obama) are about trying to frame the picture as it were for Democrats.  Look for more events like this in the coming weeks.

2) Budget Time:  Pres. Obama unveils his budget Monday (2/1) then his team have at least eight hearings on Capitol Hill this week.  Most importantly the budget hearings will work on three levels: a) questions about what is in the budget itself and the deficit, b) how the government plans to pay for additional job/economic programs, and c) anything that a particular House member or Senator has on their political agenda.  Look for a mix of theatrics splashed across the political pages, and some solid drill down stories crunching the numbers in the business pages.  Like the January unemployment numbers, the budget will get front page coverage this week.  Meanwhile, Office of Management and Budget Dir. Peter Orszag has four appearances (detailed below) on Capitol Hill and Treasury Secy. Timothy Geithner has three (also detailed below).  And speaking of Secy. Geithner…

3)  Budget Part 2:  Geithner Time:  Unfortunately for Treasury Secy. Geithner his three appearances on Capitol Hill will likely contain about 10% budget questions and 90% political questions on TARP, AIG, stimulus, etc.  The key here is whether he actually gets questions on components of the financial overhaul bill currently being retooled in the Senate Banking Committee.  That will not make front page news, but will find its way into the business pages.  You can be sure that Wall Street will watch for that, and this is where you should be too.

4)  How to Watch the Volcker/Bankers Hearings:  One reason that Senate Banking Committee Chairman Christopher Dodd’s latest draft of financial reform legislation has been delayed is the administration’s sudden move to announce what is now being called the “Volcker Rule” (explained below).  That language now has to be worked into the bill.  You may get a sense of it on Tuesday (2/2) during former Fed Chairman Paul Volcker’s appearance before the Senate Banking Committee (detailed below).  Better yet, listen to HOW it is going to get worked into the bill – that will offer a insight into both the status and the substance of Chairman Dodd’s legislation.  He wants it out of committee by the first part of March.  Possible, but the Senate Banking Committee has lots of work to do.  Similarly, when representatives from Citi, JPMorgan and Goldman Sachs appear before the same committee on Thursday (2/4) look for the same types of questions.  Substantively, what is in the legislation and where it stands is the paramount issue.

MBA wannabes here’s WHY YOU CARE:  Last week we said that the best way to cut through the clutter of coverage was to keep your eyes peeled for stories pointing out where health care is going.  We were right, and now we know it has taken a back seat to finance reform as the administration’s number one issue.  Similarly, we told you to keep on the look out for stories on the finance reform bill’s status in the Senate.  With the announcement last week of the proposal to limit some banking activities by those institutions with deposits, we now know that the Senate Banking Committee has to work that language into the bill before releasing the next draft.  Luckily, those hearings are this week.  So, this week we say, click through the business pages looking for pieces that decipher the substance of the Senate Banking Committee’s questions for Mr. Volcker and banking heads (Tuesday and Thursday respectively).  You’ll be glad you did.

Here’s the week:

MONDAY 2/1

Earnings:  Gannett.

Economic Reports:  Construction Spending, Personal Income & Spending (all for Dec.).

Pres. Obama: Submits his budget.

Treasury:  Asst. Treasury Secy. for Financial Institutions Michael Barr before the American Securitization Forum.

TUESDAY 2/2

Earnings:  MetLife, Inc.; News Corporation; The Dow Chemical Company; The Hershey Company; United Parcel Service, Inc.

Economic Reports:   Car & Truck Sales (for Jan.), Pending Home Sales (for Dec.).

Pres. Obama: Town hall meeting in New Hampshire on jobs.

Senate Hearing:  Senate Finance Committee holds a hearing on the 2011 budget. Witness:  Treasury Secy. Timothy Geithner.

Senate Hearing:  Senate Budget Committee holds a hearing on the 2011 budget.  Witness:  Office of Management and Budget Dir. Peter Orszag.

Senate Hearing:  Senate Banking Committee holds a hearing on “Prohibiting Certain High-Risk Investment Activities by Banks and Bank Holding Companies”  (aka the “Volcker Rule.”)  Witnesses include: Paul Volcker, chairman of Pres. Obama’s Economic Recovery Advisory Board and former Federal Reserve Chairman and Treasury Deputy Secretary Neal Wolin. [Updated: 2/2 to add Wolin].

Senate Hearing:  Senate Armed Services Cmte. on the 2011 Dept. of Defense budget and the 2011 Missile Defense Review plus the 2011 Quadrennial Defense Review.  Witnesses:  Defense Secy. Robert Gates and Joint Chiefs of Staff Adm. Mike Mullen.

House Hearing:  House Budget Cmte. holds a hearing on the 2011 budget.  Witness:  Office of Management and Budget Dir. Peter Orszag.

WEDNESDAY 2/3

Earnings:  Carlisle Companies; Cisco Systems; Comcast Corporation; Honda Motor Co. Ltd.; Lazard Ltd.; Pfizer; Time Warner Inc.; Visa, Inc.

Economic Report:   Mortgage Bankers Assoc’s weekly mortgage application info.

Pres. Obama:  Meets with governors on energy policy (at the White House).

Senate Hearing:  Senate Finance Committee holds a hearing on health care proposals. Witness:  HHS Secy. Kathleen Sebelius.

House Hearing:  House Ways and Means Committee holds a hearing on the 2011 budget.  Witness:  Treasury Secy. Timothy Geithner.

House Hearing:  House Ways and Means Committee holds a hearing on the 2011 budget.  Witness:  Office of Management and Budget Dir. Peter Orszag.

Treasury:  Acting Asst. Treasury Secy. for Financial Markets Karthik Ramanathan and Dep. Asst. Treasury Secy. for Federal Finance Matthew Rutherford re: Nov. 2009 Quarterly Refunding Statement and Webcast.

THURSDAY 2/4

Earnings:  Kellogg Co.; MasterCard Incorporated; Moody’s Corporation; Northrop Grumman; Sony Corporation.

Economic Report: Initial Unemployment Claims (for 1/30), Factory Orders (for Dec.).

Pres. Obama:  Attends Natl. Prayer Breakfast.

Senate Hearing:  Senate Budget Committee holds a hearing on the 2011 budget.  Witness:  Treasury Secy. Timothy Geithner.

Commerce Dept.:  Commerce Secy. Gary Locke speech on jobs at the Natl. Press Club.

Senate Hearing:  Senate Banking Committee to follow up the February 2nd hearing on risk and banks with second hearing on the “Volcker Rule.”  Witnesses include:  Goldman Sachs’ Managing Dir. Gerald Corrigan, Fmr. Citigroup CEO, and JPMorgan Chase’s executive VP and chief risk officer Barry Zubrow.

Senate Hearing:  Senate Commerce Committee is expected to have a hearing on the Federal Trade Commission’s role in protecting consumers with regards to financial services.

Senate Hearing:  Senate Finance Committee holds a hearing on the 2011 budget. Witness:  Office of Management and Budget Dir. Peter Orszag.

Senate Hearing:  Senate Judiciary Cmte’s Subcmte. on Antitrust on proposed Comcast/NBC Universal transaction.  Witnesses include:  Comcast CEO Brian Robert and NBC Universal CEO Jeff Zucker.

House Hearing:  House Energy & Commerce Cmte’s Subcmte. on Communications on proposed Comcast/NBC Universal transaction.  Witnesses include:  Comcast CEO Brian Robert and NBC Universal CEO Jeff Zucker.

FRIDAY 2/5

Economic Reports:  Consumer Credit (for Dec.), Hourly Earnings (for Jan.), and Unemployment Rate (for Jan.).

Pres. Obama:  TBD.

Treasury:  Treasury Chief Economist and Asst. Secy. for Economic Policy Alan Krueger – pen and pad briefing on unemployment numbers and economic recovery.

Hearing:  Joint Economic Cmte. hearing on January unemployment numbers.

House Hearing:  House Financial Services Cmte. and House Small Business Cmte. on small business lending programs. [Editor's Note: This is now postponed to a date later to be determined].[Updated: 2/2].

SATURDAY 2/6

Treasury:  Treasury Secy.. Geithner participates in a joint press conference with the G-7 Finance Ministers in Iqaluit, Canada.

LOOK AHEAD:

February 17th:  Federal Open Market Cmte. releases minutes from 1/26-27 meeting.

February 10th:  House Budget Cmte. on the 2011 budget.  Witness:  Treasury Secy. Timothy Geithner.