President Obama’s nominee to lead the Department of Housing and Urban Development urged lawmakers Tuesday to move forward with efforts to shutter Fannie Mae and Freddie Mac, saying the current housing finance system is not serving Americans well.
Julian Castro told the Senate Banking Committee that, if confirmed, he would seek to ensure taxpayers are never again on the hook in a housing crisis as they were when the government stepped in to bail out the two mortgage financiers.
“I absolutely believe that there are better alternatives than what we have in place with this duopoly and with this conservatorship,” Castro said.
Castro, mayor of San Antonio, was nominated by Obama last month to replace Shaun Donovan, who was picked to lead the White House budget office. Castro has been lauded for his housing and economic development programs in San Antonio, the nation’s seventh-largest city.
● Former Goldman Sachs Group director Rajat Gupta, convicted of insider trading in a scheme masterminded by convicted hedge fund billionaire Raj Rajaratnam, joined his co-conspirator in a Massachusetts federal prison to begin serving a two-year sentence. Gupta, 65, reported to the Federal Medical Center Devens, where he’s assigned to a minimum security satellite camp, said Ed Ross, a Federal Bureau of Prisons spokesman. Gupta on Tuesday lost his appeal of a $13.9 million civil fine by the Securities and Exchange Commission.
● Canada’s government approved a controversial pipeline proposal that would bring oil to the Pacific Coast for shipment to Asia, a major step in the country’s efforts to diversify its oil exports if it can overcome fierce opposition from environmental and aboriginal groups. Enbridge’s Northern Gateway pipeline would transport 525,000 barrels of oil a day from Alberta’s oil sands to the Pacific to deliver oil to Asia, mainly energy-hungry China. About 220 large oil tankers a year would visit the Pacific coast town of Kitimat, and opponents fear pipeline leaks and a potential tanker spill on the pristine Pacific coast.
● The pace of U.S. home construction slipped in May with many Americans still struggling to afford new houses. Builders started work at a seasonally adjusted annual rate of 1.01 million homes last month, the Commerce Department said Tuesday. That was down 6.5 percent from 1.07 million in April. Housing starts have risen 9.4 percent during the past 12 months. But apartments account for most of the gains, suggesting that more Americans will be renting instead of owning homes.
● SolarCity, one of the nation’s largest installers of rooftop solar systems, is buying Silveo, a solar-panel manufacturer. It’s the latest in a string of moves by solar-power companies to engage in a broader part of the solar market, from manufacturing panels and modules to developing and financing projects to installing and building systems. The deal was announced by SolarCity Chairman Elon Musk. The terms were not disclosed.
● North Dakota, home to the Bakken shale formation, became the fourth state in U.S. history to produce more than 1 million barrels of oil a day in April. Output increased by 2.5 percent from March to 1,001,149 barrels a day, the state’s Department of Mineral Resources said. Texas, California and Alaska have crossed the million-barrel mark. Only Texas remains above it, at almost 3 million barrels a day.
● Japan logged its 23rd successive month of trade deficits in May, as exports and imports both declined despite signs of recovering demand in the United States and Europe. The deficit in May was 909 billion yen ($8.8 billion), the Finance Ministry reported, as exports to the U.S. fell by nearly 3 percent from a year earlier. Exports fell 2.7 percent to $54.9 billion, while imports dropped 3.6 percent to $63.7 billion.
— From news services
● 2 p.m.: Federal Open Market Committee meeting announcement and forecast.
● 2:30 a.m.: Federal Reserve Chair Janet L. Yellen’s news conference.