Today's Headlines

Bloomberg:

- Greek bonds fell, pushing the yield to the highest relative to German bunds in more than 11 years, on concern that the government may have to offer a discount to attract buyers to a planned debt sale. The declines drove the yield on the 10-year bond up as much as 23 basis points. Greece hired six banks to sell a five-year note in euros. Spyros Papanicolaou, the head of the country’s debt-management agency, said earlier the nation plans to sell a minimum of 3 billion euros ($4.3 billion) of five- or 10-year bonds through banks in the “near future.” “You might argue that the spread at this level is attractive, but I wouldn’t catch a falling knife, and Greece is a falling knife,” said Christoph Kind, head of asset allocation at Frankfurt Trust, which manages about $20 billion. “The spread reflects investor perception of Greece and I can’t ignore that. It will be a positive message if they manage to successfully raise funds in the capital market.”

- Employment dropped in 39 U.S. states in December, seven more than in the prior month, indicating job losses were widespread. Payrolls in California showed the biggest decline, falling by 38,800 last month, according to figures issued today by the Labor Department in Washington. Texas followed with a 23,900 decline and Ohio was next with a 16,700 drop.

- Crude oil fell to a one-month low in New York after equities dropped on President Barack Obama’s proposed restrictions on risk-taking at financial institutions and on speculation China will raise interest rates.

- Representative Barney Frank said his committee will push to replace Fannie Mae and Freddie Mac, seized by regulators almost 17 months ago, with a different model for U.S. mortgage financing. “The committee will be recommending abolishing Fannie Mae and Freddie Mac in their current form and coming up with a whole new system of housing finance,” Frank, a Massachusetts Democrat and chairman of the House Financial Services Committee, said at a hearing in Washington today. “That’s the approach, rather than a piecemeal one.”

- China said remarks made by U.S. Secretary of State Hillary Clinton criticizing the country’s censorship of the Internet were unjustified and damaged bilateral ties. In a speech in Washington yesterday, Clinton called on U.S. technology companies to resist censorship of the Internet and said perpetrators of cyber attacks such as those who targeted Google Inc. must face consequences. Clinton also said China’s Internet controls could harm the Asian nation’s development. “We are firmly opposed to these words and deeds which are against the facts and damage Sino-U.S. relations,” Foreign Ministry Spokesman Ma Zhaoxu said in a Chinese-language statement posted on the ministry’s Web site. “We urge the U.S. side to respect facts and stop using the issue of so-called Internet freedom to make unjustified attacks on China.”

- Union membership in the private sector declined in 2009 to a record low of 7.2 percent, as a recession eroded employment in labor-organized industries such as construction and manufacturing, a U.S. report showed. The figure compares with 7.6 percent in 2008, according to data released today by the Labor Department. Union membership made up 12.3 percent of the total workforce, down from 12.4 percent in 2008. It increased among government workers to 37.4 percent from 36.8 percent.

Wall Street Journal:

- Federal Reserve Chairman Ben Bernanke's path to a second term got rockier as two more Democrats decided to vote against his nomination.

- When Rick Berry heard on Tuesday that a Republican had won the U.S. Senate race in Massachusetts, he emailed one of his friends: "Maybe there's hope for the country after all!" The message was bad news for Baron Hill, a five-term Democratic congressman who represents Mr. Berry's district. Mr. Berry, the president of Madison's city council, is a registered Democrat and a former supporter of Mr. Hill. The political winds that buffeted Massachusetts this week are now blowing across the cornfields of southeast Indiana—smack into Mr. Hill. After supporting President Barack Obama's health-care plan and his economic-stimulus package, the congressman stands accused by Mr. Berry and others here of jettisoning the Ninth District's bedrock fiscal conservatism. "Being a Democrat doesn't mean you want the government to take over every single aspect of your life," according to Mr. Berry, who owns a small embroidery business. "If that health-care legislation passes, I think it will be the death knell for the economy."

FoxNews:

- Which wireless carrier will offer Apple's(AAPL) soon-to-be-released mystery device? Will it be Verizon(VZ)? AT&T(T)? The answer, according to sources at the two companies, is both.

Washington Post:

- A Justice Department-led task force has concluded that nearly 50 of the 196 detainees at the U.S. military prison at Guantanamo Bay, Cuba, should be held indefinitely without trial under the laws of war, according to Obama administration officials. Human rights advocates have bemoaned the administration's failure to fulfill President Obama's promise last January to close the Guantanamo Bay facility within a year as well as its reliance on indefinite detention, a mechanism devised during George W. Bush's administration that they deem unconstitutional.

- The White House Correspondents Association has picked Jay Leno -- also known as this week's most publicly unpopular stand-up comic -- to headline the White House Correspondents Dinner in May.

The Business Insider:

- Despite strong global buzz for Obama's bank plan, the EU is not likely to adopt similar measures, according to Reuters. A failure to spread to other nations could make the Volcker Rule dead on arrival.

PRNewswire:

- President Obama's plan to regulate the banks is "not enough," says author and Wall Street insider Zubi Diamond. "If you do not understand the root cause of the problem you will never come up with a permanent solution." Diamond reveals how hedge fund short sellers lobbied the SEC to remove safeguard regulations in place since 1938 to prevent the stock market from crashing and then engineered the economic downfall. Diamond shared what he discovered in research with congressional leaders before publishing his book. As a result of Diamond's efforts, the SEC was asked to restore previous regulations but did so in a way to make the changes meaningless. At that point, Diamond decided to publish his recommendations. Reinstate the uptick rule. Remove mark-to-market accounting and replace it with historic cost accounting. Dismantle and discontinue trading on all the short Exchange Traded Funds (ETFs), also called leveraged inverse ETFs. Reinstate the circuit breakers and the trading curb to kick in whenever the Dow Jones drops 150 points. Regulate the Hedge Funds just like mutual funds and pension funds are regulated. Regulate speculation on crude oil futures by banning margin and leveraging except for the airline industry or any other end user.

Rassmussen:

- The Rasmussen Reports daily Presidential Tracking Poll for Friday shows that 25% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as President. Forty-three percent (43%) Strongly Disapprove giving Obama a Presidential Approval Index rating of -18 (see trends). Larry Sabato takes a look at Obama’s first year in office.

Politico:

- Congressional Democrats — stunned out of silence by Scott Brown’s victory in Massachusetts — say they’re done swallowing their anger with President Barack Obama and ready to go public with their gripes. If the sentiment isn’t quite heads-must-roll, it’s getting there. Hill Democrats are demanding that Obama’s brain trust — especially senior adviser David Axelrod and chief of staff Rahm Emanuel — shelve their grand legislative ambitions to focus on the economic issues that will determine the fates of shaky Democratic majorities in both houses.

- The one thing everyone agrees on about the Massachusetts Senate election is that it showed voters are frustrated and furious at politicians. President Barack Obama is rapidly joining Congress as a primary target. And after his Thursday news conference on bank regulatory reform, Obama may deserve to be the focus of this anger. Instead of bringing real change, Obama’s plans seem more likely to do the opposite of what he says he wants. Obama said that large financial institutions almost ruined the U.S. economy because they took “huge, reckless risks in pursuit of quick profits and massive bonuses.” Unfortunately his latest solution, long on political rhetoric and short on substance, is likely to make the financial system more fragile and more susceptible to government bailouts. You do not have to be a financial genius to figure this out.

- Rep. Michele Bachmann (R-Minn.) says she was “stunned at the arrogance” when Sen. Arlen Specter told her recently to “act like a lady.” The two were on a Philadelphia radio show Wednesday when the Pennsylvania Democrat grew frustrated with Bachmann. “I'm going to treat you like a lady,” Specter said to Bachmann. “Now act like one.”

EE Times:

- Global spending on semiconductor manufacturing equipment is expected to rise by 46.8 percent in 2010 compared in 2009, bringing an end to three consecutive years of decline, according to market research company iSuppli Corp.

USAToday:

- A majority of Americans say President Obama and congressional Democrats should suspend work on the health care bill that has been on the verge of passage and consider alternatives that would draw more Republican support, a USA TODAY/Gallup Poll finds. An overwhelming 72% of those surveyed Wednesday say the Bay State result "reflects frustrations shared by many Americans, and the president and members of Congress should pay attention to it." Eighteen percent say it "reflects political conditions in Massachusetts and doesn't have a larger meaning for national politics." One in four Democrats say lawmakers should draft a new bill, as do 56% of independents and 87% of Republicans.

Reuters:

- A weekly measure of future U.S. economic growth continued to rise in the latest week while its yearly growth rate slipped further, though the data still points to continued strides in economic recovery, a research group said on Friday. The Economic Cycle Research Institute, a New York-based independent forecasting group, said its Weekly Leading Index inched higher to an 83-week high of 132.2 for the week ended Jan. 15, from 132.1 the prior week. The index's annualized growth rate slipped again to a 19-week low of 23.4 percent from 23.7 percent the previous week, which was revised up from an original 23.5 percent. It marked the lowest yearly growth reading since the gauge reached a record high in October. Still, with WLI levels continuing to rise, the recovery "will continue to gain ground in the months ahead," said Lakshman Achuthan, managing director at ECRI, who has recently forecast that the index's steady growth points to improvement in the jobs market in the near term.