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Friday, August 20, 2010
Written by Matt Jessee

Department of Labor Weekly Unemployment Report Released 

On Friday, the Department of Labor announced that the unemployment rate fell in 18 states during the month of July. The Department also said the jobless rate rose in 14 states and stayed the same in the remaining 18 states. Nationwide, the unemployment rate remained stuck at 9.5 percent in July. New York and Massachusetts reported strong job gains with Massachusetts reporting that it added 19,200 private-sector jobs in July, the largest monthly gain for any state in more than 20 years.　

Housing Conference Foreshadows Fight Ahead 

On Tuesday, the Departments of Treasury and HUD invited a cross section of housing and banking industry participants to Washington for a summit on the future of the housing finance industry. The industry representatives voiced overwhelming support for the government to maintain a large role in supporting the nearly $11 trillion mortgage market. Participants expressed support for a new program that would allow homeowners to refinance their mortgages at lower interest rates through Fannie Mae and Freddie Mac, although Treasury officials indicated they have no plans to enact such a program.

 Treasury Secretary Timothy Geithner pledged “fundamental change” to the structure of Fannie and Freddie, but saying that the two companies were not the only cause of the financial crisis. While Geithner did not offer a specific strategy for reforming the two mortgage giants, he said that the government could remain involved in the mortgage system by guaranteeing that investors in mortgage-backed securities receive fair compensation, even when borrowers default. Representative Spencer Bachus (R-AL), the Ranking Republican on the House Financial Services Committee, accused the Administration of excluding critics of the Administration from Tuesday’s conference. In a letter to Secretary Geithner, Bachus said the housing conference appears to be “laying the groundwork for a predetermined policy outcome that looks uncomfortably similar to the failed status quo.” 

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