Your Evening Briefing: Making Progress as Default Deadline Nears

Everyone seems optimistic in Washington as the government hurtles toward potential economic disaster. President Joe Biden on Thursday said that he and Republican House Speaker Kevin McCarthy “had several productive conversations” and “our staffs continue to meet.” The GOP says both sides are narrowing their differences over raising the debt limit, but still haven’t reached an agreement to avert default. Should a deal be reached soon, Tuesday is emerging as the likely day for a House vote. The Senate would then need to act quickly to send it to Biden’s desk before June 1, the date by which Treasury Secretary Janet Yellen has said her department could start running out of cash. But as the brinkmanship intensifies, not everyone is singing a happy tune. Two ratings agencies, including Fitch, just put America’s AAA credit rating under watch.

Failed regional lender First Republic Bank made its name catering to wealthy clients across California and New York, reeling in many with unusually sweet mortgages. The system made its employees rich. The San Francisco-based bank—which regulators seized and sold to JPMorgan early this month—was said to be paying dozens of employees more than $10 million apiece before its collapse. One of them was even making more than Jamie Dimon. But those days are over it seems: First Republic’s new boss just told 1,000 employees they won’t be returning.