Janet Yellen To Be Named Fed Chairman (Bloomberg)
Obama will announce the nomination at 3 p.m. today in Washington, a White House official said in an e-mailed statement. Yellen, 67, would succeed Ben S. Bernanke, whose term expires on Jan. 31. Obama turned to Yellen, vice chairman of the Fed since 2010, after the other leading candidate, former Treasury secretary and White House economic adviser Lawrence Summers, withdrew from consideration amid mounting opposition from Democrats on the Senate Banking Committee. “She’s an excellent choice, and I believe she’ll be confirmed by a wide margin,” Charles Schumer of New York, the Senate’s No. 3 Democrat, said in a statement. Senate Banking Committee Chairman Tim Johnson, a South Dakota Democrat, pledged to work “to move her nomination forward in a timely manner,” saying her depth of experience is unmatched.
U.S. In for a Scolding on Debt Threat (WSJ)
Top U.S. officials are expected to get an earful this week at a gathering of foreign finance ministers and central bankers, with global concern spreading that political gridlock in Washington would result in the U.S. not making good on its financial obligations. The International Monetary Fund and the World Bank will host top economic officials from around the world in Washington beginning Thursday for several days of talks, and the U.S. situation will be a primary focus. IMF leaders have already warned that a U.S. failure to pay its bills after not raising the debt ceiling would be "catastrophic."
Recession Looms If Treasury Uses Tools to Prevent a Default (Bloomberg)
Economists at Goldman Sachs Group Inc., IHS Inc. and BNP Paribas SA said they expect the Treasury to husband the tax money it collects to make sure it can meet interest payments on the nation’s debt. Other obligations, from salaries of government workers to payments to defense contractors, would face the ax. The result: $175 billion less in government spending during November alone, said Goldman’s Alec Phillips in Washington. “The cutting would be so huge it would put the U.S. back into recession,” said Jim O’Neill, former chairman of Goldman Sachs Asset Management who is now a Bloomberg View columnist.
IMF: Premature Fed Exit Could Fuel $2.3 Trillion in Global Bond Losses (WSJ)
Although the IMF assumes in its latest economic forecasts that the U.S. central bank will unravel its policies at a tempered pace, the fund said the market's volatile reaction to Fed exit comments earlier this year show there is still a risk of moving too fast. "Engineering a smooth transition to monetary normalization will require a clear and well-timed communication strategy by the Federal Reserve to minimize interest rate volatility," said Jose Vinals, the IMF's top financial counselor.
RBS Aids U.K. Regulator in Forex Probe (WSJ)
The Royal Bank of Scotland has given Britain's Financial Conduct Authority electronic communications conducted by a former employee as part of the regulator's probe of foreign-exchange markets, according to a person familiar with the matter. The bank's apparent cooperation is the latest indication that the investigation of so-called fixes—a standard feature of foreign-exchange markets—is gaining traction. It couldn't be learned whether the former employee's communications form the bank's entire submission to the FCA, which has been investigating allegations of potential efforts to rig currencies rates since June. The person familiar with the matter said the former employee left the bank for reasons unrelated to the probe.
Shutdown Hits Craft Beers (AP)
Stores will still offer plenty of suds. But the shutdown has closed an obscure agency that quietly approves new breweries, recipes and labels, which could create huge delays throughout the rapidly growing craft industry, whose customers expect a constant supply of inventive and seasonal beers. Mike Brenner is trying to open a craft brewery in Milwaukee by December. His application to include a tasting room is now on hold, as are his plans to file paperwork for four labels over the next few weeks. He expects to lose about $8,000 for every month his opening is delayed. “My dream, this is six years in the making, is to open this brewery,” Brenner said. “I’ve been working so hard, and I find all these great investors. And now I can’t get started because people are fighting over this or that in Washington. … This is something people don’t mess around with. Even in a bad economy, people drink beer.”
World Bank's Kim warns even U.S. default threat hurts poorest (Reuters)
World Bank President Jim Yong Kim on Wednesday said even the threat of a U.S. default could hurt emerging markets and the world's most vulnerable people. "We're very concerned. Because right now there's so many headwinds as it is for emerging markets and the developing world, that that kind of impact really could be devastating," Kim said in an interview with CNN broadcast live at the World Bank, the Washington-based poverty-fighting institution.
JP Morgan To Cull Some Clients (WSJ)
The bank is looking to scale back lending to pawn shops, payday lenders, check cashers and certain car dealerships as it seeks to tighten controls in a period of heightened regulatory scrutiny, said people close to the situation.
Commodity Prices Wrong as Often as 27% of the Time (Bloomberg)
In a Bloomberg News survey conducted during the past eight weeks, 85 traders and analysts said they have little confidence in the assessed prices of crude, metals and iron ore. Regulators, including European Union Competition Commissioner Joaquin Almunia, may examine commodities markets, having already increased investigations of manipulation of benchmarks for interest rates, derivatives, foreign exchange and oil.
Drunk Driver Led Cops On Chase So He Would Have Time To Finish His Big Mac (TSG)
After exiting a McDonald’s drive-thru lane, an intoxicated Ohio motorist led cops on a short chase because he “just wanted to eat his Big Mac before he stopped,” according to a police report. Responding to a call about a reckless driver, Brunswick Police Department officers located suspect Randall Miller, 31, behind the wheel of a silver SUV that was departing McDonald’s around 1 AM on September 28. “I initiated a traffic stop and the subject failed to stop,” noted Officer Clifford Smith, who added that he chased Miller until the motorist pulled over. Miller, who smelled of booze and was slurring his speech, apologized to Smith, saying he “was too drunk and he just wanted to eat his Big Mac before he stopped.”