Today's Headlines

Bloomberg:

• Mortgage-Bond Yields That Guide Loan Rates Fall to 3-Week Low. Yields on Fannie Mae and Freddie Mac mortgage securities that guide home-loan rates declined to the lowest in three weeks, signaling falling financing costs after a recent increase. Fannie Mae’s current-coupon 30-year fixed-rate mortgage bonds dropped about 0.02 percentage point to 4.43 percent as of 9:50 a.m. in New York, down from an eight-month high of 4.67 percent on April 5, according to data compiled by Bloomberg. “The Fed ended its MBS purchase program, and the world did not end,” Chris Flanagan and Tim Isgro, analysts in New York at Bank of America Corp., wrote in a weekly report April 9.
  
• Brazil May Offer Iran Credit Line to Boost Exports, Estado Says. Brazil’s government may establish a line of credit with Iran to expand exports to the Islamic Republic by as much as 40 percent, O Estado de S. Paulo reported, without saying where it got the information. Trade Minister Miguel Jorge, on a visit to Tehran with 80 Brazilian businessmen, discussed creating a credit line between the two countries’ central banks with Iranian officials yesterday, the Sao Paulo-based newspaper said. Today he meets with Iranian President Mahmoud Ahmadinejad. President Luiz Inacio Lula da Silva may sign the trade agreement when he travels to Tehran next month, Estado said. Iranian officials estimate that annual Brazilian exports of $1.2 billion could expand by 40 percent if a credit line is established, Estado said.
• Greece Aid Fails to Cut Downgrade Risk, Moody's Says. The Mediterranean nation faces “significant execution risk,” in implementing a plan to reduce its budget deficit, Sarah Carlson, the Moody’s lead analyst for Greece, said in a telephone interview yesterday in London.
• Nintendo Says 3DS Biggest Handheld Product Since 2004.
• Buy Dendreon(DNDN) Calls Before FDA Decision, JPMorgan(JPM) Says. Investors should buy bullish Dendreon Corp. options because the U.S. Food and Drug Administration is likely to approve its prostate cancer therapy Provenge next month and boost the stock to a record, JPMorgan Chase & Co. said.
• Small-Business Confidence in U.S. Dropped in March. Confidence among U.S. small businesses fell in March to the lowest level since July 2009 as executives grew more concerned about earnings and sales, a private survey found. The National Federation of Independent Business’s optimism index dropped to 86.8 last month from 88 in February, the Washington-based group said today. Seven of the index’s 10 components declined last month and two were unchanged from February.
• WaMu Excluded From 'Too Clubby to Fail' Group, Killinger Says. K erry Killinger, the former chief executive officer of Washington Mutual Inc., said his company became the largest bank failure in U.S. history in part because it was excluded from a group of financial institutions favored by U.S. policy makers. Washington Mutual wasn’t protected from short sellers and the U.S. Treasury Department excluded the company from information sessions it held with competitors, Killinger said today in written testimony for the Senate Permanent Subcommittee on Investigations. “For those that were part of the inner circle and were ‘too clubby to fail,’ the benefits were obvious,” Killinger, 60, said. “For those outside the club, the penalty was severe.” Washington Mutual, once the nation’s biggest savings and loan, reported losses totaling $6.3 billion in its final three quarters as a public company. Killinger said in his first public comments since the bank was taken over. “I fear consumers will ultimately pay the price of this vision through less competition, higher fees and lower interest rates on their deposits.” He said Washington Mutual shouldn’t have been seized and sold for a “Federal regulators seized the bank in September 2008 and sold it to JPMorgan Chase & Co. for $1.9 billion. “The actions taken by policy makers reflect a vision of a banking industry dominated by large Wall Street banks,”bargain price,” and said he is “deeply saddened” by what happened. The company was the nation’s largest thrift, with $300 billion in assets, $188 billion in deposits and 43,000 employees.
• Ford(F) 'Encouraged' as U.S. April Sales Top 2009 Level. Ford Motor Co. is “encouraged” by April U.S. sales running ahead of a year earlier and experienced a boost in revenue in the first quarter, the automaker’s Americas chief said. “We’re starting to see the economic metrics start to go in the right direction,” Americas President Mark Fields said today at an auto-industry breakfast in Detroit. “I’m cautiously optimistic on consumer confidence.”
• Buffett Bet on Goldman Sachs(GS) 'Integrity,' Olson Says. Warren Buffett’s $5 billion investment in Goldman Sachs Group Inc. was partly a bet on the “integrity” of the Wall Street firm, Berkshire Hathaway Inc. Director Ronald Olson said. “When Warren and Berkshire stepped up to make this investment, it was a very strong statement of its belief, his belief, in not just the strength of Goldman but its integrity,” Olson said in an interview this week with Bloomberg Television. Goldman Sachs, the most profitable firm in Wall Street history, has been criticized for benefiting from $10 billion in bailout funds in 2008 and its role in the subprime mortgage- securities market. Buffett’s investment in Goldman Sachs preferred shares, as financial firms were shut off from their usual sources of funding in 2008, earns 10 percent interest. Omaha, Nebraska- based Berkshire also obtained warrants to buy $5 billion of Goldman Sachs common stock for $115 a share. The bank closed at $177.84 on the New York Stock exchange yesterday, and has gained about 37 percent in the past 12 months through yesterday.
• Teacher Pension Deficit at $900 Billion May Be Triple Reported. Taxpayers across the U.S. owe public school teacher retirement accounts about $933 billion, nearly triple the amount reported by the plans themselves, a study says.

Wall Street Journal:

• HTC 2ND-Quarter Shipments Likely Up Over 30% Vs First Quarter - Source. HTC Corp., a Taiwanese maker of phones based on Microsoft Corp. and Google Inc. operating systems, expects shipments of smart phones in the second quarter to rise by at least 30% from the previous three months helped by strong sales in the U.S. and new product launches, a person familiar with the situation said Tuesday.
• EU Lawmakers To Mull Deal On Non-EU Hedge Funds. The lawmaker leading the debate at the European Parliament over a new law for hedge funds and private-equity firms wants to allow hedge funds outside of the EU to market their funds across the 27-nation bloc if they pledge to follow the EU rules.
• Demand Is Strong for Greek Debt. Greece saw strong demand for its latest debt auction but was forced to pay a hefty interest rate while yields on longer-term bonds jumped again, a sign that investors remain wary about Athens' solvency. Greece's debt agency sold €780 million ($1.061 billion) apiece of the six- and 12-month Treasury bills at yields of 4.55% and 4.85%, respectively.
• China Slap Duties on Steel Imports. China has imposed duties on imports from the U.S. and Russia of a common type of electrical steel used in the power sector, following a final decision on its countervailing and antidumping investigation, the nation's Ministry of Commerce said Tuesday.

CNBC:

• Intel's Market Sweet Spot. As Intel(INTC) prepares to release earnings tonight after the close, investors are clearly expecting good news. And for good reason.
  

NY Post:

• Tax Hikes Forever.

Business Insider:

• 12 Reasons Americans Are Incredibly Angry About The State Of The U.S. Economy.

zerohedge:

• Gary Shilling On The Chinese Excess Capacity "House of Cards", Sees Yuan Dropping If China Relaxes Controls.

TBIResearch:

• The Apple(AAPL) Investor: iPad Already Killing The Kindle!

Huffington Post:

• Rahm Emanuel and Magnetar Capital: The Definition of Compromised. Magnetar 1) A neutron star with an intense magnetic field, capable of emitting toxic radiation across galaxies 2) A hedge fund, the single market player most responsible for the severity of the 2008 financial crisis, through the toxic instruments it created. Rahm Emanuel 1) White House Chief of Staff 2) Politician selected by Magnetar's CEO to be sole recipient of his political donations, 2006-2008.

Politico:

• Hedge Fund Managers Invest on Hill. John Paulson, one of the world’s richest hedge fund managers, has not been shy about spreading his wealth to Senate campaign coffers — or to the chairman of the committee that could directly affect his bottom line. Paulson held a ritzy $1,000-per-head fundraiser for Senate Banking Committee Chairman Chris Dodd last year — and then maxed out his donation with $4,800 more for the Connecticut Democrat’s now-aborted reelection run. Paulson is hardly alone. According to a review of Federal Election Commission records, the nation’s 10 richest hedge fund managers have dumped nearly $1 million into campaign accounts over the past several years — with much of it going to senators who’ve given them a friendly reception on Capitol Hill. And despite all the tough talk about a crackdown on Wall Street, consumer advocates and critics from other financial sectors say hedge funds would get off pretty easily under the regulatory reform bill Dodd’s committee approved last month — a charge Dodd’s aides reject. Many hedge funds enjoyed an enormously profitable year in 2009, in part because of good bets that federal dollars would be used to rescue “too-big-to-fail” financial institutions. And the Top 25 earners made more than $25 billion last year, according to a recently released survey by Absolute Return + Alpha magazine. Those Top 25 feature some familiar names in Capitol Hill’s fundraising quarters, including liberal investor George Soros, who earned $3.3 billion last year and has dropped $42,000 of his cash into Democratic campaigns in the past few years. Paulson has donated $30,300 since 2007, with most of it going to senators, including Democrats Arlen Specter , Frank Lautenberg, Finance Committee Chairman Max Baucus, Majority Whip Dick Durbin and Senate Majority Leader Harry Reid and Republican Scott Brown.
• President Obama Warns Against Threat of Nuclear Terrorism. As the 47-country Nuclear Security Summit opens in Washington this morning, President Barack Obama is warning that only a concerted effort by the global community can head off the looming threat of nuclear terrorism. "Two decades after the end of the Cold War, we face a cruel irony of history — the risk of a nuclear confrontation between nations has gone down, but the risk of [a] nuclear attack has gone up," Obama said in a brief speech to the summit’s first formal session. "It is increasingly clear that the danger of nuclear terrorism is one of the greatest threats to global security — to our collective security."
• Mitch McConnell: Regulatory Bill Won't Solve Problems. Senate Minority Leader Mitch McConnell (R-Ky.) came out in opposition Tuesday to the Democratic financial regulatory reform bill, saying it “wouldn’t solve the problems that led to the financial crisis.” In a floor speech that detailed the Republican case against the bill, McConnell said the version that passed through the Banking Committee last month on a party-line vote would continue to prop up financial institutions deemed “too big to fail” and provides the government with new authorities that could be abused. McConnell raised the specter of a filibuster on the Senate floor unless the bill is changed.

Reuters:

• VMware(VMW), Salesforce.com(CRM) Team Up on New Product.
• Energy Ties Grow as China Resists Iran Sanctions - Sources. Chinese state oil firms have maintained the pace of project development in Iran while Beijing resists any new sanctions on the energy sector designed to press Tehran to curb its nuclear programme, industry sources said on Tuesday. China, which has close economic ties with Iran, has much to lose from any sanctions that limit new investment to develop the world's second-largest oil and gas reserves.

European Commission:

• EU Says Its Labor Market Deteriorating at Moderate Pace.