Senate debates bill on bank rule changes
The Senate debated a banking bill Thursday after GOP leaders added some further limits on regulators as well as consumer benefits to the legislation rolling back restraints on banks, as substantial support from Democrats helped edge the bill closer to passage.
The legislation before the Senate would alter key elements of the Dodd-Frank law enacted to prevent a repeat of the financial crisis 10 years ago that brought the economy to the edge of collapse. The bill has 13 Republican and 13 Democratic or independent co-sponsors, a rare level of bipartisanship for significant legislation in the current Congress. A final vote is expected early next week.
At the bill’s core is a five-fold increase, to $250 billion, in the level of assets at which banks are deemed so big and intertwined with the financial system that their failure could bring severe disruption. The change would ease regulations on more than two dozen financial companies, including BB&T Corp., Sun- Trust Banks Inc. and American Express.
The measure’s primary author, Senate Banking Committee Chairman Mike Crapo, R-Idaho, expanded it with some new provisions late Wednesday. They include limits on regulators’ ability to curb banks’ commercial real estate lending but also affirm the Federal Reserve’s authority to closely oversee U.S. operations of big foreign banks.
Mortgage rates up to four year high
Long-term U.S. mortgage rates climbed this week to their highest average in more than four years, ratcheting up affordability pressures at the start of the traditional spring home buying season.
Mortgage buyer Freddie Mac said Thursday that the average rate on 30-year, fixed-rate mortgages climbed to 4.46 percent this week from 4.43 percent last week. This marks the highest average since January 2014. The 30-year rate averaged 4.21 percent a year ago.
The average rate on 15-year, fixed-rate loans rose to 3.94 percent from 3.90 percent last week.
Tax change boosts Kroger’s profits
Kroger’s fourth-quarter profit soared 70 percent, mainly due to a large tax benefit. But its stock dropped 12 percent Thursday after it gave a disappointing earnings outlook as it spends more to compete with Amazon.
Grocers have been racing to boost their digital efforts, especially since Amazon acquired grocer Whole Foods and its 470 stores last year. Kroger offers delivery and online ordering and pickup in some stores; it said Thursday that digital sales jumped 90 percent in 2017 from the year before.
“So for us, you should expect to see us continually expanding the way customers can engage with us and do that digitally and with the mobile app,” CEO Rodney McMullenhe said.
Kroger Co. shares fell $3.25 to $22.98 Thursday, after the company said it earned $854 million, or 96 cents per share, in the fourth quarter, helped by a $957 million tax benefit, with about $400 million coming from the recent tax changes.
Household wealth up to $98.7 trillion
A soaring U.S. stock market and healthy home price gains lifted Americans’ net worth to $98.7 trillion in the final three months of last year, a gain that could lift household spending.
The value of U.S. stock portfolios jumped $1.3 trillion in the October-
December quarter compared with the previous three months, the Federal Reserve said Thursday. That figure includes stocks held through mutual funds and in retirement accounts.
Home values, which make up the bulk of middle-class wealth, increased $500 billion.
The figures are at a record high, though they are not adjusted for inflation or population growth. They predate February’s sharp gyrations in the stock market, though stock market indexes are still up about 2 percent this year.
McDonald’s flips for Women’s Day
McDonald’s has temporarily flipped its famous Golden Arches to look like a “W” – a move it said it made to recognize International Women’s Day.
The upside-down logo appeared Thursday on the fast-food giant’s website and social media accounts. It also flipped the arches at one restaurant in Lynwood, Calif. McDonald’s said that at about 100 of its 14,000 restaurants, packaging and worker uniforms will have the flipped logo.
McDonald’s also said 6 out of 10 of its restaurant managers are women and it wanted to honor their accomplishments.
The company said it’s the first time it has flipped its Golden Arches logo since it first appeared at a restaurant six decades ago.