Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Wells Fargo & Co (WFC), JPMorgan Chase & Co. (JPM): President Obama Sits Down With the Masters of the Universe

Thursday morning, Barack Obama met with Jamie Dimon, Lloyd Blankfein, Brian Moynihan, and other members of the country’s largest financial institutions. Let me pause for a minute to let you digest the sheer number of pinstripes and massive egos that strolled into the White House.

While the full details from the meeting between the President and financial leaders weren’t released to the public, it is encouraging to see there is at least some communication present on Capitol Hill. According to the White House, the group discussed housing, education policy, and clean energy financing. Although not explicitly stated, the bankers probably shared their thoughts on the new regulation, such as the Volcker Rule. Of these topics, bank leaders were surely heavily interested in the housing sector.

Wells Fargo & Co (NYSE:WFC)

After drastic deterioration in the housing sector pushed the country into a deep recession, banks and policymakers both received most of the blame. However, looking ahead, a productive relationship between the largest money centers and housing policy makers is absolutely vital to a continued housing and broader economic recovery. The discussion comes at an interesting time, as the nation’s two largest mortgage lenders, Wells Fargo & Co (NYSE:WFC) and JPMorgan Chase & Co. (NYSE:JPM) are set to release earnings on Friday morning.

The two banking behemoths controlled roughly 40% of the mortgage origination market in 2012, and both experienced huge year-over-year revenue increases, as customers’ refinancing accounted for roughly three out of four mortgages. The high refinancing volume was predominantly driven by customers with equity in their homes who jumped at the chance to lock in record low interest rates.

However, the refinancing market is expected to slow, and volume is likely to decline. Enter a necessary productive housing policy. As the refinancing volume becomes a smaller piece of the pie, policymakers and lenders are going to need to be increasingly more in sync. While no one wants to a return to an era of shoddy lending, there is certainly a middle ground that allows banks to support the sector and housing policy while maintaining credit standards.

With the election out of the way, Obama and these leaders may actually be able to make some positive contributions.

The article Obama Sits Down With the Masters of the Universe originally appeared on is written by David Hanson.

David Hanson has no position in any stocks mentioned. The Motley Fool recommends Wells Fargo. The Motley Fool owns shares of JPMorgan Chase & Co (NYSE:JPM). and Wells Fargo.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.