The Senate Banking Committee yesterday held a confirmation hearing for Neil M. Barofsky, the White House nominee to be special inspector general for the plan, and members were nearly unanimous in their praise for his work as a federal prosecutor in New York. Several explicitly said they would vote for him.
"Clearly, we want to have you on the job as fast as we can," said Sen. Christopher J. Dodd (D-Conn.), who chairs the committee.
Dodd said he hoped the full Senate would vote on the confirmation by the end of the week, when the lame-duck session of Congress is scheduled to conclude. Majority Leader Harry M. Reid (D-Nev.) is looking into whether it is possible to schedule it, his spokesman Jim Manley said. The committee has not yet scheduled its own vote.
Some lawmakers and outside watchdog groups have raised concerns that the language of the bailout bill would prevent the inspector general, who is allocated a $50 million budget, from having the authority to look at most of the money being spent.
"I wonder why taxpayers should have to pay $50 million to a watchdog who will have nothing to watch," Sen. Jim Bunning (R-Ky.) said.
Barofsky, 38, the head of the mortgage fraud unit for the U.S. Attorney's Office in Manhattan, agreed with Dodd that the legislation grants the inspector general authority to look at all aspects of the program. Barofsky pledged to be aggressive in protecting taxpayer dollars and rooting out conflicts of interest.
Sens. Claire McCaskill (D-Mo.) and Charles E. Grassley (R-Iowa) introduced legislation yesterday to make clear that the inspector general has authority over all aspects of the bailout program. It would also allow the office to hire staff quickly without being delayed by the normal time-consuming civil service process.
Republican Congressional leaders also nominated the final two members of a congressional oversight panel mandated by the bailout legislation. They named Sen. Judd Gregg (R-N.H.), who was involved in negotiations over the program, and Rep. Jeb Hensarling (R-Tex.), a fiscal conservative who voted against the legislation.
Community Bank became the latest in a string of retail bank failures in the last few weeks.
The Georgia-based bank was closed by the Georgia Department of Banking and Finance and put into Federal Deposit Insurance Corporation receivership Friday evening.
Bank of Essex, based in Tappahannock, Va., will acquire all of Community's deposits and branches. As a result, all deposits will be protected and accessible as usual, the release said. Customers' accounts at Essex will also be insured by the FDIC.
Community Bank had $681.0 million in assets as of October 17, and Essex acquired about $84 million of those assets in addition to the deposits it claimed. The FDIC says it will hold on to the remaining assets for sale at a later date.
This makes the third bank to be closed by regulators in November, according to the FDIC's Web site.
Customers of Community Bank can log on to http://www.fdic.gov or call 888-206-4662 with any questions regarding bank closings.
Target Corp. said late Friday that it will not pursue ideas proposed by Pershing Square regarding its real estate portfolio. The company concluded that the potential value created through the deals proposed by Pershing is too speculative and insufficient. "Target does not share Pershing Square's perspective that execution of this proposed transaction will generate measurable shareholder value over time and believes the risks, particularly in light of the serious challenges facing our retail and credit card segments in 2008 and 2009, are significant," said Chief Executive Gregg Steinhafel in a statement. Pershing Square, a hedge-fund firm run by activist investor Bill Ackman, had proposed that Target spin off the land it owns into a real estate investment trust in a bid to boost Target's value.
Retailers will remain under the spotlight next week as investors look for some signs that consumers haven't given up on spending. Housing numbers will also be scrutinized during a short week that includes the Thanksgiving Day holiday.
Among the retail companies reporting third quarter earnings are: jeweler Tiffany & Co. (TIF), book seller Borders Group (BGP) and clothing companies J. Crew (JCG), Talbots (TLB) and American Eagle Outfitters (AEO).
In addition, earnings from computer maker Hewlett-Packard (HPQ), Campbell Soup (CPB) home builder D.R. Horton (DHI) and agricultural-equipment maker Deere & Co. (DE) will all provide insight into the struggling U.S. economy.
October home sales will be released, and they're likely to be down from a year ago. In addition, the government will report on existing and new-home sales. And the S&P/Case-Shiller indexes will detail home prices in 20 major U.S. cities in September.
Also on the economic front, preliminary third-quarter gross domestic product figure is due and some analysts are expecting a decline of 0.6%.
The private Conference Board's Consumer Confidence Index for November will gauge consumer sentiment heading into the holidays.
MONDAY: earnings from Hewlett-Packard and Campbell Soup, plus existing home sales.
TUESDAY: earnings from American Eagle Outfitters, Borders, Dollar Tree (DLTR), Talbots and D.R. Horton, plus preliminary GDP figures and consumer confidence.
WEDNESDAY: earnings from Deere & Co., Tiffany & Co. and J. Crew, plus new home sales, and government figures on October durable-goods orders, personal income and personal spending, as well as the final number for the Reuters/University of Michigan Consumer Sentiment Index for November.
THURSDAY: Thanksgiving Day holiday, markets closed.
FRIDAY: New York Stock Exchange closes at 1 p.m.
Will
WSJ, Dow Jones & Co., FDIC
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