Rep. Spencer Bachus (R-Ala.) has called on House Financial Services Committee Chairman Barney Frank (D-Mass.) to convene a hearing in September on whether Fannie Mae executives improperly implemented the Home Affordable Modification Program (HAMP) in order to benefit from incentive payments offered by the Treasury Department.

Bachus is the committee's ranking member and in an Aug. 6 letter to Frank said he was concerned by reports that Fannie Mae executives allegedly pushed as many borrowers as possible into short-term trial modifications to receive incentive payments from the Treasury. 

Government-controlled mortgage giant Freddie Mac is requesting $1.8 billion more in federal help after a larger second-quarter loss. 

Voters favor tax breaks, but are ambivalent about breaks benefiting the wealthy, according to a new poll.

FED LIKELY TO DOWNGRADE OUTLOOK — Financial Times on Tuesday's meeting: "Faced with weak economic data and rising fears of a double-dip recession, the Federal Open Market Committee is likely to ensure its policy is not constraining growth and to use its statement to signal greater concern about the economy. It is, however, unlikely to agree big new steps to boost growth." http://bit.ly/dgiU94

WSJ says the Fed meeting is "likely to feature further debate over whether the Fed should renew extraordinary measures to kick-start growth [...] may include resuming purchases of Treasury debt or mortgage-backed bonds, likely, at least to start with, by using money generated from existing holdings of such debt as they mature." http://bit.ly/9bfDRI

Also Tuesday, the House returns to vote on the $26.1 billion jobs bill with state aid.

Unions, who pushed hard for the bill, will "rev up campaign machinery" once President Obama signs it. The Hill's Kevin Bogardus: http://bit.ly/d3EWgY

THE NEW NORMAL: HIGH UNEMPLOYMENT, LOW RETURNS — ICYMI, the Sunday NYT's must-read on pessimism over the economy, a view shared by Clinton and Bush economists: "The 'new normal,' as it has come to be called on Wall Street, academia and CNBC, envisions an economy in which growth is too slow to bring down the unemployment rate, while the government is forced to intervene ever more forcefully in a struggling private sector. Stocks and bonds yield paltry returns, with better opportunities available for investors overseas."

Glenn Hubbard, former Bush adviser, calls for more federal investments in education: “If there is a new normal, it’s more about the labor market than GDP. ... We have to help people face a new world.”

Laura Tyson, former Clinton adviser: “I think we’re going to have slower growth, a higher household savings rate and an elevated unemployment rate for several years.” http://nyti.ms/blEaQp

(Tyson is being floated by the administration as possible successor to Christina Romer as chairwoman of the Council of Economic Advisers. Reuters: http://yhoo.it/cdMsHE)

AND/BUT... Monday's must-read — WSJ: "SOME FIRMS STRUGGLE TO FILL JOBS..."

"Employers and economists" blame it on: 1) extending jobless benefits to 99 weeks; 2) homeowners unable to move; and 3) the job market's shift away from middle-wage jobs that's created "a glut of people who can't qualify for highly skilled jobs but have a hard time adjusting to low-pay, unskilled work." http://bit.ly/aVY1yO

More people filing early for Social Security. WaPo: http://bit.ly/91dt3r

Gibbs tells The Hill the WH economics team is "exhausted," and that friction with Lawrence Summers wasn't the cause for Romer's departure. http://bit.ly/chhA0J

FINREG — Another financial crisis could hit before Wall Street reforms in place. Bloomberg: "Many of the measures ordered by Congress and global regulators, aimed at cushioning the financial system in future crises, are years away from being implemented. The Basel Committee on Banking Supervision plans to give the world’s banks until 2018 to comply with limits on how much they can borrow. Parts of the Volcker rule, a provision of the new Dodd-Frank Act that would force firms to cut stakes in in-house hedge funds and private-equity units, may not go into effect for a dozen years." http://bit.ly/bY0b79 (h/t Silla)

How banks are trying to get around the Volcker Rule. WSJ: http://bit.ly/cEuEyn

DEFICIT V. STIMULUS — Bob Rubin opposes another stimulus, favors finding a plan to deal with deficits in about two years. HuffPo: http://huff.to/a8jHfh

Robert Samuelson warns that deficit reduction through higher taxes may mean less kids: http://bit.ly/d9w20y

Megan McArdle says Paul Krugman's wrong about the Ryan Roadmap. http://bit.ly/9k9laq

Rep. Dan Burton (R-Ind.) said Friday that "a lot of people want to jump off" and follow Christina Romer out of the Obama administration.

The number of brokerage employees has now reached the lowest point since 2001, on the eve of the boom.

Sen. John Barrasso (R-Wyo.) referencing the departure of Christina Romer, said the administration had "really over promised and under delivered."

Christina Romer said Friday she would consider the top spot at the San Francisco Federal Reserve Bank, once it officially opens up. 

Romer, who announced late Thursday her Sept. 3 departure as chairwoman of the Council of Economic Advisers, will return to northern California to her former teaching position at the University of California at Berkeley. Romer said she's heading home because her son is starting high school. 

"I am certainly headed back to my job at Berkeley, which I loved and am looking forward to doing," Romer said today during an interview on MSNBC. "I would be honored to be considered by the San Francisco Fed but, of course, that's not a decision for me to make or for anyone at the White House to play a role in."

Janet Yellen, the bank's current president of the San Francisco Fed, has been nominated to assume the No. 2 position on the Federal Reserve Board of Governors. 

Senior administration officials have praised Elizabeth Warren as a candidate to head a new consumer financial protection agency.

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