By Kevin Cirilli - 06/05/14 06:40 PM EDT
TOP TALKER – CBS NABS ADVANCE COPY OF HILLARY’S BOOK. In the former secretary of State’s “Hard Choices,” she says she was asked abroad during the government shutdown whether people could still trust the U.S. economy.
"The answer I gave was, of course, yes. I said that I was confident a deal would be reached. Privately I crossed my fingers and hoped it was true... The secretary of state shouldn't have to publicly reassure people in other nations that we'll pay our debts. Period,” Hillary writes, according to CBS.
TOMORROW STARTS TONIGHT: The Labor Department will release its May jobs report tomorrow at 8:30 a.m. What you need to know:
1.) Most economists forecast May unemployment at 6.4 percent, a slight uptick from April’s 6.3 percent.
2.) Economists will be watching the work force participation rate. “Labor force participation has been declining for quite some time, weather may have exacerbated the trend but the trend has been well established,” Lindsey M. Piegza told OVERNIGHT FINANCE.
April’s 6.3 percent unemployment was a 0.4 percent reduction from March’s 6.7 percent. Skeptics were critical of the Labor Department’s 806K reduction in the labor force (people looking for jobs) used to calculate unemployment.
3.) Fed-watchers don’t expect tomorrow’s jobs report to influence the central’s banks decision to taper. This is the final jobs report before the Fed’s policy meeting on June 17 and 18, when Fed Chairwoman Janet Yellen will give her second press conference.
But Piegza doesn’t expect this report to impact the Fed’s decision to ease off its stimulus policies. “If it had been the Bernanke Fed? Maybe,” she said. “But Yellen is more likely to wait to see more economic improvement. She’ll keep her foot on the gas.”
THIS IS OVERNIGHT FINANCE, where we always keep our foot on the gas. And actually, I’m headed to Annapolis this weekend to escape my phanatic Phillies misery.
Tomorrow is Friday, enjoy the weekend. Not yet. Busy day. Back to work...
CONFIRMED -- MASSAD AT CFTC. Timothy Massad was sworn-in today as chairman of the Commodity Futures Trading Commission. Pete Schroeder recaps for the hometown paper: http://bit.ly/Ug0sMu.
EXTENDERS WATCH: WITHOUT REID, WYDEN MOVES FORWARD. Senate Finance Committee Chairman Ron Wyden (D-Ore.) finally spoke out after Majority Leader Harry Reid (D-Nev.) said he’s not moving a bill worth $85 billion in tax breaks, dubbed “extenders.’
--WHAT WYDEN SAID: "In all of my conversations with the leadership the message has always been keep reaching out, keep trying to find common ground.” He and Finance ranking member Orrin Hatch (R-Utah) will host more tax reform hearings this summer.
But extenders? Still dead until after midterms...
--SENATE GOP OPPOSITION INTENSIFIES. Senate GOPers are blocking the bill to protest how Reid is running the upper chamber. Sen. Chuck Grassley (R-Iowa): “He doesn’t want amendments. If he would run the Senate like the Senate ought to be run — that could be passed in less than a week.” Sen. Mike Crapo (R-Idaho): “We should not keep lurking like this and particularly, doing it retroactively... it's a huge discouragement and roadblock to capital formation.
--INVESTORS WEARY OF DELAY. The extenders delay sets up a political showdown in December. IRS officials typically release drafted forms in September. Critics argue the uncertainty surrounding extenders will discourage firms from spending because they’re unsure if they’ll receive a tax break.
While Congress' latest wrangling won't escalate to shutdown proportions, it’s bad news for incumbents facing business leaders who say Washington’s theatrics hinder economic growth.
"The result has been that many businesses have put their new investments on hold waiting for Congress to act," Grafton 'Cap' Willey, managing director at CBIZ MHM, a top national professional services and accounting provider. "The real problem is the inability to plan for businesses and taxpayers... Congress has not demonstrated that they understand that businesses need to plan for their investments.”
Wyden is also aware, telling me earlier today: "I think it's well known that on important measures like this when you wait until very late in the year — I'll be diplomatic — they have administrative challenges.” Story: http://bit.ly/1i6Kklo.
NEW RULES: SEC TARGETS ‘FLASH BOYS.’ The Hill’s Pete Schroeder has more: “The Securities and Exchange Commission is looking to establish a broad new set of rules to better monitor high-speed traders and other less-watched corners of the market.
“SEC Chairwoman Mary Jo White unveiled the sweeping new initiative Thursday, which aims to bring the regulator up to speed with a high-tech stock market dominated by computer algorithms that trade in fractions of a second.
“White said the SEC has long endeavored to keep up with new technologies as they come into the market, but her push comes amid a renewed debate about the role of high-speed trading following accusations those activities are making the markets unfair to regular investors.” http://bit.ly/1tMDLcN.
--QUOTABLE, Sal Arnuk, partner at Themis Trading in an interview with OVERNIGHT FINANCE: “It’s ironic that it’s taken this long to get the regulators to address high-frequency trading – oh, and a book called ‘Flash Boys.’”
--HOW WILL INDUSTRY RESPOND? The battle for high-frequency traders now turns into fighting against a so-called “Trade-At Rule,” which would restrict how much trading can go on in “dark pools,” or trading occurring outside the exchanges. “It terrifies them,” Arnuk said.
BNP WATCH -- OBAMA WON'T 'MEDDLE' ON INVESTIGATION. Still no word of a settlement between regulators and French financial firm BNP Paribas, which allegedly did business with blacklisted countries, including Iran.
But Obama was asked about it during a presser after the G-7 summit. "The tradition of the United States is that the president does not meddle in prosecutions," Obama said, adding he'll relay the message to French President Francois Hollande. David Jackson has more from USA Today: http://usat.ly/1l9I8Oc.
GSE WATCH: WATT WANTS INPUT ON FANNIE, FREDDIE FEES: Mel Watt sure knows how to make an entrance. In January, the former Democratic congressman turned Federal Housing Finance Agency (FHFA) director suspended implementation of fees announced by his predecessor in an effort make home loans more accessible.
Now FHFA officials said Thursday they're requesting input on the level of guarantee fees that Fannie Mae and Freddie Mac should charge lenders.
As The Hill's Vicki Needham reports: "Watt's announcement temporarily quelled concerns within the housing and mortgage industry over the fees that they argued were too high and were set to happen too soon. They were originally scheduled to go up by 10 basis points this spring." http://bit.ly/1tMI9c2
MEANWHILE... major cities are making housing and economic gains, per a new report. Vicki reports: http://bit.ly/1p0a22l
PAGE TURNER – HILLARY’S BOOK. More excerpts via CBS: She writes on negotiations with Taliban leaders, and even of Army Sgt. Bowe Bergdahl. "I acknowledged, as I had many times before, that opening the door to negotiations with the Taliban would be hard to swallow for many Americans after so many years of war.”
--HILL AND BARRY’S FIRST DATE, Hillary on meeting Obama after the primary battle:"We stared at each other like two teenagers on an awkward first date, taking a few sips of Chardonnay... One silver lining of defeat was that I came out of the experience realizing I no longer cared so much about what the critics said about me."
MORE FROM THE HILL’s FINANCE TEAM:
--Merchants ready Supreme Court 'swipe fee' challenge: http://bit.ly/1ht04V8.
--Report: Majority of largest corporations using tax havens to lower tax bills: http://bit.ly/1xey6AY.
--Senate Finance restarts tax reform debate: http://bit.ly/1pJj1Fp.
--Senators vote to relax night shift rules for truckers: http://bit.ly/1oy45pO.
--McConnell's hemp amendment gets green light from Appropriations: http://bit.ly/1rPoRqE.