–Fed Chairman To Testify Thursday To Hill’s Joint Economic Committee
–Senate Banking Panel To Hold Hearing Wednesday on JP Morgan
–House Tax Panel To Hold Friday Hearing On Tax Extenders

By John Shaw

WASHINGTON (MNI) – With the American people and members of Congress
increasingly concerned about the state of the U.S. economy, Federal
Reserve Board Chairman Ben Bernanke will give his economic assessment to
lawmakers this week.

Bernanke will testify Thursday at 10 a.m. EST to the Joint Economic
Committee. It seems likely that the bulk of the panel’s questions to
the Fed chief will focus on the strength of the American economy, how
Congress should respond to the coming fiscal cliff, and how economic
developments in Europe will impact the U.S. economy.

The Senate Banking Committee will hold a hearing Wednesday at 10
a.m. on how various agencies will implement the Dodd-Frank law as it
pertains to derivatives. The panel will also assess JP Morgan Chase’s
recent trading loss of more than $2 billion.

At the hearing, the Banking Committee will receive testimony from
Neal Wolin, the Deputy Treasury secretary, Daniel Tarrullo, a governor
on the Federal Reserve Board, Tom Curry, Comptroller of the Currency,
Martin Gruenberg, acting chairman of the FDIC, and Richard Cordray,
director of the Consumer Financial Protection Bureau.

The Senate Banking Committee will hear from JP Morgan’s Jamie Dimon
on June 13 about the trading losses at JP Morgan.

In other action this week, the House Financial Services Committee
will hold a hearing Wednesday at 10 a.m. on the Investment Adviser
Oversight Act which would provide for the registration and oversight of
national investment adviser associations. A number of representatives
from the financial services industry will testify.

A subcommittee of the House Financial Services Committee will hold
a hearing Thursday at 10 a.m. on efforts to protect U.S. investors.

Another subcommittee of the House Financial Services Committee will
hold a hearing Thursday at 10 a.m. on multi-family housing programs.

A subcommittee of the House Ways and Means Committee will hold a
hearing Friday at 9:30 a.m. on how Congress should evaluate the raft of
tax provisions that expired in 2011 or will expire in 2012. These
tax provisions are often referred to as tax extenders because they are
routinely extended.

The full House will work this week on the Energy-Water spending
bill for the 2013 fiscal year. The House may also consider the Homeland
Security and Legislative Branch FY’13 spending bills.

The House continues to move its 12 spending bills for FY’13,
despite the fact that the House and Senate are not in full accord on the
overall level of discretionary spending for FY’13.

House Republicans are trying to bring spending down to $1.047
trillion which is $19 billion below the level set in last year’s debt
ceiling agreement.

The Senate will work this week on a pay discrimination bill.

With a key deadline now less than a month away, congressional
leaders may quietly discuss options to pass legislation that would
prevent a mandated increase in some student loan interest rates from
going forward.

Congress passed a bill in 2007 that was signed by President Bush to
temporarily reduce the interest rate on subsidized Stafford loans to
college undergraduates from 6.8 percent to 3.4 percent. That interest
rate decrease is set to expire July 1. Extending the interest rate
reduction would cost $6 billion for one year.

President Obama has called for legislation extending the interest
rate reduction to 3.4 percent.

House Republicans have passed legislation that extends the student
loan interest rate reduction for another year and pays for the $6
billion cost by tapping funds from prevention and public health services
that were established by the 2010 health care law.

Senate Majority Leader Harry Reid has said that extending the
student loan interest rate reduction is important to 7 million students
and should be paid for by ending a tax break for S corporations.

Intense talks between the House and Senate on the issue are likely
to occur later this month, despite the assertions of Republican and
Democratic leaders that the other party must compromise.

House Majority Leader Eric Cantor has announced that the House will
vote in July to renew the Bush era tax cuts. The House has already
approved on a party-line vote a bill to alter the sequestration process,
replacing about $110 billion in scheduled across-the-board spending cuts
will about $300 billion in savings over a decade.

It is unclear when the Senate will vote to extend all or some of
the Bush era tax cuts.

** MNI Washington Bureau: (202) 371-2121 **

[TOPICS: M$U$$$,MFU$$$,MCU$$$]