Financial News Friday – September 20, 2013

According to a recent Pew Research survey, 69% of Americans believe the government’s post-recession policies have benefited large banks and financial institutions the most. “Roughly seven-in-ten say government policies have done little or nothing to help the poor (72%), the middle class (71%) and small businesses (67%).” (Pew Research

The Federal Reserve may use reverse repos to remove cash from the banking system and assist the Fed’s exit from quantitative easing. Reverse repos (repo is short for repurchase agreement) occurs when the Fed lends securities to a bank in exchange for cash, at the end of the agreement (many are limited in their period just overnight) the Fed returns the cash to the bank and receives the securities back in return. (Bloomberg)

Warren Buffett says that “the Fed is the greatest hedge fund in history” during a Georgetown University speech to students. He goes on to state that the Fed is generating about “$80 billion or $90 billion a year probably” for the U.S. Government. (Bloomberg)

NASDAQ isn’t the only one having glitches. The U.S. Treasury Department’s $30 billion 90 day treasury bill auction leaves Goldman Sachs’s multibillion dollar order out of the auction due to a computer glitch. (Yahoo Finance)

Another stumble for ObamaCare. Two weeks before the system goes live, the health insurance exchanges cannot correctly price what people should pay for coverage. (Yahoo Finance)

Prudential Financial has been labeled a “Systemic Risk” to the U.S. financial system in a 7-2 vote by the Financial Stability Oversight Council. (Bloomberg)

The U.S. Justice Department is seeking $5 billion in damages against Standard and Poor’s Ratings Services (S&P Ratings Services) due to the inflated ratings it awarded mortgage-backed securities and collateralized debt obligations prior to the financial crisis. (CNNMoney)

IBM and Walgreens retirees that are 65 and older and still on the company health insurance will soon be forced off of the plan. Retirees eligible for Medicare would be forced to seek health insurance plans through the new health insurance exchanges. More companies are expected to follow suit (CNN Money)