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Our Weekly Wall Street/Capitol Hill Crib Sheet: Playing the Expectation Game [Updated 4/24]

Last week we were, of course, dead on to spotlight earnings, Pres. Obama's economic speech, and Federal Reserve Board Chmn. Bernanke's two speeches as the news drivers of the week.

This week earnings were already the week's focus by the time the Sunday papers hit your doorstep and/or your laptop screen. But as always there's much more out there. In particular, Treasury Secy. Geithner is appearing before the Congressional Oversight Panel to take TARP questions come Tuesday (4/21), and we count seven Capitol Hill hearings this week touching on different aspects of the economy. AND, come Friday (4/24) we expect to see the methodology released for those bank stress tests (for TARP recipients) if media reports are right.

For our MBA readers and MBA wannabes why you care: We humbly suggest that this week, more so than others, is about playing the expectation game. As we go to print the market is down, and there are many earnings still to come through out the week. Does the pessimism end up in a rally? Maybe yes, maybe no. We think the week as a snapshot is less important than getting through to Friday and the coverage of the stress test methodology. If deemed to be fair, and the banks end up coming out better than expected on May 4 - than that will be telling. So watch for lots of coverage on each earning, and dissection of whether the expectation game was won or lost. But, don't get too sucked in. Keep your focus on the journalism around the stress test methodology.

Here's your weekly crib sheet of events that will garner press coverage... We do caution that you check back to WhyYouCare.com for updates on scheduling.

MONDAY 4/20
Earnings: Bank of America, Bank of Hawaii, BancorpSouth, Eli Lilly, Halliburton, Hasbro, IBM, Pinnacle Financial, Texas Instruments, Zions Bancorp.

Economic Reports: Federal Reserve's weekly interest rate data; Leading indicators (for March).

Pres. Obama: Speaks to CIA employees "about the importance of CIA's mission to our national security." Press coverage allowed.

Senate: Reconvenes and considers Fraud Enforcement and Recovery Act (FERA) of 2009 (S.386).

Bernanke: Speaks at the Financial Literacy and Education Summit on "Global Best Practices in Financial Education."

Discussion: Brookings Institution - on "Wall Street's role in triggering the economic crisis and the role Wall Street leaders may play in leading us out."

Conference: Financial Services Cmte. Chmn. Rep. Barney Frank speaks at the National Low Income Housing Coalition policy conference.


TUESDAY 4/21
Earnings: Advanced Micro Devices, Bank of New York , BlackRock, Capitol One, Caterpillar, Coach, Coca-Cola, Colonial BancGroup, Comerica, DuPont, Huntington Banc, IberiaBank, KeyCorp, Lockheed Martin, M&T Bank, Manpower, Merck, New York Times, Norfolk Southern, Northern Trust, SanDisk, Schering-Plough, Seagate Tech, State Street, TD Ameritrade, United Health, US Bancorp, Webster Financial, Yahoo!

Pres. Obama: Meets with King Abdullah II of Jordan at the White House.

Treasury Secy. Geithner: Appears before the Congressional Oversight Panel to discuss TARP.

House: Reconvenes from recess.

Nomination: Senate Finance Cmte. votes on HHS Secy. nominee Kathleen Sebelius.

Hearing: House Oversight and Govt. Reform Cmte. holds field hearings on stimulus spending.

Hearing: Joint Economic Cmte's hearing on criteria used to determine if institutions pose systemic risk to the financial system.

Hearing: [POSTPONED] House Oversight and Government Reform Cmte's Domestic Policy Subcmte. holds hearing on "Debating Treasury's Plan for Toxic Assets."

Hearing: House Judiciary Cmte's Courts and Competition Policy Subcmte. holds hearing on "A New Age for Newspapers: Diversity of Voices, Competition and the Internet."

Conference: HUD Secy. Shaun Donovan. speaks at the National Low Income Housing Coalition policy conference.


WEDNESDAY 4/22
Earnings: Altria, Apple, AT&T, Boeing, Continental Air, eBay, Equifax, Kimberly-Clark, Knight Capital Group, McDonald's, Morgan Stanley, Northrop Grumman, Pepsi Bottling, Provident Financial, Qualcomm, WellPoint, Wells Fargo.

Economic Reports: Federal Housing Finance Agency releases monthly house price index estimates; Mortgage Bankers Assoc. releases weekly data on mortgage applications.

Treasury Secy. Geithner: Speaks at the Economic Club of Washington's breakfast.

National Press Club: Agriculture Secy. Thomas Vilsack speaks on Earth Day.


THURSDAY 4/23
Earnings: Alaska Air, Amazon.com, American Express, American Financial, Amgen, CIT Group, ConocoPhillips, Fifth Third, Ford Motor, Franklin Electric, Genworth Financial, Goodrich, Hershey Foods, Invesco, Janus Capital, Marriott, Microsoft, Novartis, PepsiCo, Phillip Morris International, PNC Bank, Raytheon, Regal Entertainment, Royal Caribbean, SunTrust Banks, Union Pacific, UPS, US Airways.

Economic Reports: Existing home sales (for March), Initial unemployment claims (for 4/18).

Pres. Obama: Washington Post reports that Pres. Obama will meet with 14 banks' credit card division heads regarding customers/practices.

Hearing: Joint Economic Cmte. holds hearing on TARP Inspector General Neil Barofsky's quarterly report. Mr. Barofsky is the witness.

Hearing: House Financial Services Cmte. holds hearing on mortgage regulations/lending practices.

Hearing: Senate Homeland Security and Govt. Cmte. holds a hearing on "Follow the Money: State and Local Oversight of Stimulus Funding."


FRIDAY 4/24
Earnings: 3M, Honeywell, MB Financial, T. Rowe Price, Wilmington Trust, Xerox.

Economic Report: Durable orders (for March), New home sales (for March).

Stress Tests: According to media reports the methodology for those much talked about TARP recipient stress tests is released this day. Results expected on May 4, 2009.

Treasury Secy. Geithner: Hosts G-7 Finance Ministers meeting in Washington, DC. 4:30p ET presser announced per Treasury Dept. [Note: The G-7 are the U.S., U.K, Canada, France, Germany, Italy and Japan.]

Our Weekly Wall Street/Capitol Hill Crib Sheet is Back

After a brief end of fiscal year hiatus we are back. And just in time, because you saw the headlines over the weekend discussing what a big earnings week it will be, so it comes as no shock that Goldman Sachs reported today (one day early). But what will be the other drivers? What if we told you that the Federal Reserve twice yearly report on the economy is due this week? And what if we told you that Pres. Obama will give an economic speech on Tuesday (4/14)? Oh, and what if we told that Federal Reserve Board Chairman Ben Bernanke has not one, but two speeches this week? We think those will be worth keeping an eye on.

For our MBA readers why you care: We suspect you'll see three themes in the press this week - 1) taxes (obvious); 2) earnings (also obvious); and 3) stories about how the economic downturn is hurting countries south of the U.S. border. That's because the Summit of the Americas is at the end of the week with Pres. Obama in attendance but not without making a pit stop in Mexico along the way. Lost in all of this is the Securities and Exchange Commission (SEC) discussion on credit rating agency oversight (4/15). We think your eyes and ears should be tuned into that as much as the other stories.

For our MBA wannabes why you care: Earnings are important (otherwise we wouldn't included notes on them each week), but remember earnings are how a company did the prior quarter, not necessary an iron clad indicator on how it will do the following quarter or in a year.

Here's your weekly crib sheet... We do caution that you check back to WhyYouCare.com for updates on scheduling.

MONDAY 4/13
Earnings: Goldman Sachs* (*One day early).



TUESDAY 4/14
Earnings: Commerce Bancshares, CSX Corp, Intel, Johnson & Johnson.

Economic Reports: Producer Price Index (for March), Retails Sales (for March).

Pres. Obama: 11:30a, Economic speech at Georgetown University.

Bernanke: 1:30p ET speech on the financial crisis at Morehouse College, Atlanta, GA.

Briefing: Citizens Against Government Waste on their Congressional Pig Book (report on federal pork-barrel spending).

Briefing: Transportation Secy. Ray LaHood the stimulus law and transportation funding.

Hearing: Senate Small Business and Entrepreneurship Cmte.'s field hearing on manufacturing plant closures.



WEDNESDAY 4/15 - TAX DAY
Earnings: Abbott Labs, Charles Schwab, Knight Capital Group, Piper Jaffray, Progressive.

Economic Reports: Consumer Price Index (for March), Fed's Beige Book (the Fed's report on the economy), Mortgage Applications data (from Mortgage Bankers Assoc.).

Discussion: Securities and Exchange Commission (SEC) on the oversight of credit rating agencies.



THURSDAY 4/16
Earnings: Associated Banc Corp., BlackRock, Gannett, Genuine Parts, Google, Harley-Davidson, JP Morgan Chase, Nokia.

Economic Reports: Initial Claims (for 4/11), Housing Starts, Building Permits.

National Press Club: Dominique Strauss-Kahn, Managing Director of the International Monetary Fund discusses the recession.

Pres. Obama: Stops in Mexico on his way to the Summit of the Americas.



FRIDAY 4/17
Earnings: BB&T Corp., Citigroup, First Horizon, General Electric, Mattel, Prosperity Bancshares.

Economic Report: Federal Reserve System's data on the assets and liabilities of U.S. commercial banks.

Pres. Obama: Participates in the Summit of the Americas in Trinidad and Tobago.

Bernanke: 12:30p ET speech on "Challenges Presented by Innovations in Financial Services for the Underserved."

Treasury's Final Piece of the Puzzle + Your Capitol Hill & Wall Street Events Cheat Sheet

Last week we were correct to say that the focus would be on the many Capitol Hill hearings related to the financial recovery. We were also spot on when we told you to keep your eye out for news on the Treasury's final piece of the recovery puzzle: the public-private bank partnership. Et voila, by the end of last week you had bits and pieces of news on the program, over the weekend it got front page treatment, and today the Treasury Department is unveiling it.

For our MBA readers here's why you care: You can find Treasury's press release here which will give you the white paper, and the term sheets to the two components of the "Public-Private Investment Program" which are programs targeting loans and securities. We note that the press release includes a mention of avoiding the "Japanese experience" which is certainly an acknowledgement that the concern is just how long the recovery will take.

For our MBA-Wannabes here's why you care: The Washington Post's Neil Irwin has a good synopsis of the program, which you need to understand because the Treasury is banking on this plan to get banks lending again, and most notably shorten the length of the recession.

As you can imagine this week will be dominated by dissecting the Treasury's new program. In particular Pres. Obama has a prime-time news conference on Tuesday. However, Treasury Secy. Geithner and Federal Reserve Chmn. Bernanke will be back on Capitol Hill, this time for another round of AIG hearings which will gather headlines. But that's not all, Secy. Geithner is also giving a talk to the Wall Street Journal. Shall we say full court sales press? The result should be extended coverage of the new program and the recovery, and we suspect by the end of the week our MBA-Wannabes will be talking like our MBAs.

Here's your cheat sheet... We do caution that you check back to WhyYouCare.com for updates on scheduling.

Here's why you care about this week's trends in earnings, reports and hearings:
Reports: Home Prices (3/24), Homes Sales (3/25), and Unemployment (3/26).

Such a big week that you could almost miss it?: CNN, AP and NPR heads at the National Press Club talk the future of journalism in a tough financial reality.

MONDAY 3/23
Earnings: Focus Media, Providence Service Corp., Sonic, Tiffany & Co., Walgreen.

Economic Report: Existing Home Sales (for Feb.)

Pres. Obama: Along with VP Biden, Treasury Secy. Geithner, FDIC Chmn. Bair and Federal Reserve Chmn. Bernanke has economic briefing followed renewable energy statement.

Briefing: Treasury Secy. Geithner, "pen & pad" on the administration financial recovery plan.

Briefing: Rep. Mike Pence (R-IN) House Republican Conference Chmn. Has "pen & pad" reporting briefing.

Conference: Wall Street Journal's "Future of Finance Initiative" conference. Speaker: Treasury Secy. Geithner.

Hearing: House Financial Services Cmte. on "Seeking Solutions: Finding Credit for Small and Mid-Size Businesses in Massachusetts."

Conference: Kalb Report at the National Press Club: The future of journalism, hosted by Marvin Kalb with guests - AP President Tom Curley, NPR President Vivian Schiller, CNN President Jon Klein and Knight Foundation President Alberto Ibarguen.


TUESDAY 3/24
Earnings: Carnival, Commercial Metals, Williams-Sonoma.

Economic Report: FHFA Home Prices (for Feb.).

Pres. Obama: 8p ET - Prime-Time News Conference.

Hearings:

Senate Banking, Housing and Urban Affairs Cmte. on banking regulation.

Senate Judiciary Cmte's Administrative Oversight Subcmte. on "Abusive Credit Card Practices and Bankruptcy."

House Financial Services Cmte. on the government's intervention in AIG: Witnesses: Treasury Secy. Geithner and Federal Reserve Chmn. Bernanke.

House Energy and Commerce Cmte's Commerce, Trade and Consumer Protection Subcmte. on "Consumer Credit and Debt: The Role of the Federal Trade Commission in Protecting the Public."

Conference: National Press Club hosts Fmr. Congressional Budget Office Director Alice Rivlin on "The Economy and the financial meltdown--what happened and what can we do now?"

Conference: Wall Street Journal's "Future of Finance Initiative" conference. Speakers: Sen. Evan Bayh (D-IN) and Rep. Carolyn Maloney (D-NY).


WEDNESDAY 3/25
Earnings: Paychex, Red Hat, SAIC.

Economic Reports: Mortgage Applications data, New Home Sales (for Feb.).

Hearings:

House Oversight and Government Reform Cmte's Government Management, Organization and Procurement Subcmte. on "Roles and Responsibilities of Inspectors General in Financial Markets Regulatory Agencies."

House Financial Services Cmte. drafts legislation prohibiting companies receiving government financial recovery funds from paying bonuses until the government is paid back.


THURSDAY 3/26
Earnings: Accenture, Aladin Knowledge Systems, Best Buy, ConAgra, Conns, Dr. Pepper Snapple, Fred's, Movado Group, Texas Industries,

Economic Reports: Initial (Unemployment) Claims (for 3/21), Fourth Quarter GDP.

Hearings:

Senate Banking, Housing and Urban Affairs Cmte. on the regulation of securities markets.

House Financial Services Cmte. on "Addressing the Need for Comprehensive Regulatory Reform." Witness: Treasury Secy. Geithner.



FRIDAY 3/27
Earnings: KB Home.

Economic Report: Personal Income/Personal Spending (for Feb.).


SATURDAY 3/28
Hearing: House Financial Services Cmte's Housing and Community Opportunity Subcmte. field hearing on foreclosures in Los Angeles.

Canary in the Coal Mine Business Story You Shouldn't Miss

While the lead story today will continue to be on executive bonuses, we think the story you shouldn't miss is on the financial recovery process itself.

For our MBA-Wannabes here's why you care: The LA Times' Roger Vincent has a terrific story examining the commercial real estate market in Los Angeles. Sectors like commercial real estate are something of a canary in coal mine for measuring the health of the economy as transactions rely on lending, credit, functioning banks, and so forth. Vincent's story matters to you because he deftly shows how the economy has left buyers and sellers without a way to really tell the value of a property which only further paralyzes the market. He also shows how this ultimately makes it a good time be a business in search of a lease. Take a moment and read Vincent's piece and consider what other cities are going through similar scenarios - New York, Miami, etc.

For our MBAs here's why you care: We note that the one commercial market that is not in LA style dire straights is actually Washington, D.C. Why? The expansion of the federal government will keep occupancy rates higher in DC than in other cities. That's not to say there are no vacancies, but it certainly is a different calculation.

Your Capitol Hill & Wall Street Events Cheat Sheet (Bernanke Bookends Addition)

Last week we were correct to say that the focus would be on Treasury Secy. Timothy Geithner's and the director of the Office of Management and Budget (OMB), Peter Orszag's myriad trips to Capitol Hill. Early in the week, we updated the website with a link to a terrific piece outlining what the FDIC's Sheila Bair thought would happen next in the recovery. We spotlighted it because she was focused on the public/private bank partnership (which will assist banks in unloading unwanted assets) that has been called everything from a bad bank to an aggregator bank. The most important part of that story was a source saying we might get the details as early as this week.

We were disappointed to hear over the weekend on the Sunday talk shows that the administration needs more time, however, we suspect this week you may see some leaks on this topic.

This week is bookended by Federal Reserve Chmn. Ben Bernanke due to his 60 Minutes interview last night (which you can easily watch and read on the web) where he said the recovery would begin in 2010. The week will end with a speech by Chmn. Bernanke, and it may end up being interesting depending on how the news cycle dissects his Scott Pelley interview.

In the meantime, we've outline a dozen hearings this week in Congress that will be fodder to scrutinize the Troubled Asset Relief Program "TARP," Chmn. Bernanke's comments, and oh - of course - certain bonuses that have gotten headlines in the past few days.

Here's your cheat sheet... We do caution that you check back to WhyYouCare.com for updates on scheduling.

Here's why you care about next week's trends in earnings, reports and hearings:
Reports: Building Permits and Housing Starts (3/17), Retails Sales and Unemployment (3/19).

Such a big week that you could almost miss it?: Commerce Secy. confirmation hearing (3/18).

MONDAY 3/16
Earnings: Education Realty Trust, Oriental Financial Group, Patriot Capital Funding, PMI Group, Providence Service Corp., Sterling Construction.

Conference: National Association of Housing and Redevelopment Officials 2009 conference in Washington, D.C. In attendance: HUD Secy. Shaun Donovan.

Discussion: Center for American Progress on "Imagining a Mortgage Finance System that Works."


TUESDAY 3/17
Earnings: AAR Corp., Adobe Systems, Anthracite Capital, Goldman Sachs, Pinnacle, Sirius XM Radio

Economic Reports: Building Permits (for Feb.), Housing Starts (for Feb.), Producer Price Index (PPI) (for Feb.)

Hearings:

House Energy and Commerce Cmte's Commerce, Trade and Consumer Protection Subcmte. on "Stimulating the Economy through Trade: Examining the Role of Export Promotion."

House Financial Services Cmte. on regulation of systemic risk in the financial services industry.

House Judiciary Cmte's Courts and Competition Policy Subcmte. on "Too Big To Fail?: The Role of Antitrust Law in Government-Funded Consolidation in the Banking Industry."

Conference: National Association of Housing and Redevelopment Officials 2009 conference in Washington, D.C. In attendance: Rep. Tom Latham (R-IA), Rep. Albio Sires (D-NJ), Rep. Shelley Moore Capito (R-WV).


WEDNESDAY 3/18
Earnings: Actuant, General Mills, Lindsay Corp., Nike, Oracle.

Economic Reports: Consumer Price Index (CPI), FOMC (Federal Open Markets Cmte.) Rate Decision, Mortgage Bankers Association releases weekly data on mortgage applications.

Hearing: House Financial Services Cmte's Capital Markets, Insurance and Government Sponsored Enterprises Subcmte. on "American International Group's Impact on the Global Economy: Before, During and After Federal Intervention." Witness: AIG CEO Edward Liddy.

Confirmation Hearing: Senate Commerce, Science and Transportation Cmte's confirmation hearing for Commerce Secy. nominee Gary Locke.

Conference: National Association of Housing and Redevelopment Officials 2009 conference in Washington, D.C. - closing ceremony.


THURSDAY 3/19
Earnings: 3com, Barnes & Noble, Blockbuster, Carnival, Discover Financial Services, FedEx, Morgan Stanley, Perry Ellis, Ross Stores,

Economic Reports: Initial Unemployment Claims (for 3/14), Primary Mortgage Market Survey (mortgage rate survey).

Hearings:

Senate Small Business and Entrepreneurship Cmte. on small business lending.

House Appropriations Cmte's Financial Services and General Government Subcmte. on fiscal 2010 appropriations.

House Oversight and Government Reform Cmte. on "Preventing Stimulus Waste And Fraud: Who are the Watchdogs?"

House Ways and Means Cmte's Oversight Subcmte. on the Troubled Asset Relief Program.

House Financial Services Cmte's Capital Markets, Insurance and Government Sponsored Enterprises Subcmte. on administration programs that allow homeowners to refinance or modify their mortgages.

Senate Banking, Housing and Urban Affairs Cmte. on modernizing bank supervision and regulation.

Senate Banking, Housing and Urban Affairs Cmte's Financial Institutions Subcmte. on deposit insurance.


FRIDAY 3/20
Earnings: Kirklands

Hearing: House Financial Services Cmte. on "Federal and State Enforcement of Financial Consumer and Investor Protection Laws."

Speech: Federal Reserve Chmn. Ben Bernanke on "The Financial Crisis and Community Banking" at the Independent Community Bankers of America's National Convention in Phoenix, AZ.

FDIC's Head Outlines What's Likely to Happen Next

Here's the headline: More tax dollars are needed, but tax payers may end up making money.

For our MBA-Wannabes here's why you care: We've noted a number of times that you can agree/disagree with the Federal Deposit Insurance Corporation's Chairwoman, Sheila Bair, but what you have to give her and the FDIC credit for is offering up early in the financial crisis a very detailed rescue plan. Many of the elements in place now come from Bair's plan. That's why it is worth your time today to read Washington Post reporter Binyamin Appelbaum's story about what Bair thinks needs to happen next. Not surprisingly it all comes back to how and when banks can sell assets. Recall that the Treasury promoted a public/private partnership to buy the assets dragging down banks' balance sheets. The shape of that partnership is what is being discussed in this article.

For our MBAs here's why you care: The plan to buy/sell bank assets could be detailed as early as next week.