Today's Headlines

Bloomberg:

• Volcker Says Quantitative Easing May Create Inflation in Future. Former Federal Reserve Chairman Paul Volcker, an adviser to President Barack Obama, said quantitative easing may spark inflation in the future and the amount involved may be a cause for concern. “When money is too easy for too long, we will have more” asset bubbles, Volcker, 83, said in Singapore today.
• Cotton Advances to Record in New York. Cotton surged to records from New York to China on concern global demand will outstrip supply after cold weather in China and U.S. storms hurt crops. Cotton for December delivery advanced as much as 1.9 percent to $1.3176 a pound on ICE Futures U.S. and traded at $1.3116 at 4 p.m. Tokyo time, gaining for a third day.
• Raw Sugar Jumps to 29-Year High. Raw sugar surged to a 29-year high as dry weather crimps output in Brazil, the world’s biggest producer, and India may limit exports to bolster domestic inventories. Output in Brazil’s Center South, the country’s biggest producing-region, tumbled 30 percent in the first half of October from a year earlier, industry association Unica said on Oct. 28. Stockpiles in India, the second-largest grower, are about 4 million metric tons, compared with the nation’s preferred level of 10 million tons, according to Rabobank International.
• Oracle(ORCL) to Acquire Art Technology(ARTG) for $1 Billion to Add E-Commerce Software. Oracle Corp., the world’s second- largest software maker, agreed to buy Art Technology Group Inc. for about $1 billion in cash to add e-commerce programs. Art Technology investors will receive $6 a share, Oracle said in a statement today. That’s 46 percent more than the company’s closing price yesterday.
• Potash(POT) Options Traders Raise Wagers on Higher Takeover Bid.
• MasterCard(MA) Profit Beats Estimates as Spending Climbs. MasterCard Inc., the world’s second- biggest payments network, posted third-quarter profit that exceeded most Wall Street estimates as more consumers paid with credit and debit cards. Net income climbed 15 percent to $518 million, or $3.94 a share, from $452 million, or $3.45 a share, in the same period a year earlier, the Purchase, New York-based company said today in a statement. The average estimate of 29 analysts surveyed by Bloomberg was for earnings of $3.54 a share.
• China Rejects Clinton's Offer to Mediate With Japan Over Disputed Islands. China rebuffed Secretary of State Hillary Clinton’s offer to mediate a territorial dispute with Japan and rejected her contention that the area at the center of the row falls under the U.S. security blanket.
• China Said to Tell Banks to Demand Faster Payment of Local Government Debt. China told banks to ask for faster repayment of local-government infrastructure loans on concern existing debt terms leave them with too much risk, a person with knowledge of the matter said. About 50 percent of loans to the financing vehicles of local governments are for five years or more, with terms for most credits requiring repayment of the principal on maturity, said the person, who requested anonymity. China’s bank regulator asked lenders to revise terms so that payments start when projects are completed and are made in at least two installments a year after that, the person said. The government is trying to limit risks brought about by last year’s surge in loans to local-government finance vehicles for roads, bridges and railroads.
• U.S. Homeownership at Decade Low as Foreclosures Rise. The U.S. homeownership rate was unchanged at a 10-year low in the third quarter as banks stepped up property seizures from borrowers who defaulted on mortgages. The homeownership rate was 66.9 percent, matching the second-quarter level that was the lowest since 1999, the U.S. Census Bureau said in a report today.
• Buy VIX Put Options on U.S. Midterm Vote, Fed Easing, Goldman(GS) Says. Investors should buy VIX puts because the benchmark measure of U.S. options prices will probably fall should tonight’s elections and the Federal Reserve’s announcement tomorrow meet expectations, Goldman Sachs Group Inc. said.

Wall Street Journal:

• Midterm Elections: Top Races to Watch.

Bloomberg Businessweek:

• Ireland Leads Rise in Government Credit-Default Swaps in Europe. Ireland led an increase in the cost of insuring against losses on European government bonds, according to traders of credit-default swaps. Contracts on Ireland surged 28 basis points to 526, surpassing yesterday’s record closing price, according to data provider CMA. Greek credit-default swaps climbed 18 basis points to 850, the highest level since Sept. 17, while Portugal jumped 15.5 basis points to an almost one-month high of 395. Spain rose 6 to 230 and Italy increased 3.5 to 178.5. The Markit iTraxx SovX Western Europe Index of swaps on 15 governments rose 2.5 to a one-month high of 160. The cost of insuring corporate bonds was little changed, with the Markit iTraxx Europe index of 125 investment-grade companies up 0.75 basis point at 99.25 and the Markit iTraxx Financial Index linked to the senior debt of 25 banks and insurers 1 higher at 127.5, according to JPMorgan Chase & Co. The Markit iTraxx Crossover Index of 50 companies with mostly high-yield credit ratings was unchanged at 457.

Barron's:

• Apple(AAPL) Takes 95.5% of Tablet Market in Q3, Research Firms Says. This is obvious, but nonetheless astonishing.

Business Insider:

• Deutsche Bank: Here's Exactly What The FOMC Statement Will Look Like Tomorrow.
• 5 Reasons Holiday Spending Will Shock You By How Good it Is.
  

Zero Hedge:

• S&P Estimate of Dodd-Frank Costs on Too Big to Fail: Up to $22 Billion.
• Paul Ferrell on the One Thing Buffett, Gross, Grantham, Faber, And Stiglitz All Agree On: "Bernanke Plan a Disaster".
  

MarketWatch.com:

• The Big Mo. Commentary: The Stock Market Has Built Up Quite a Head of Steam.

New York Times:

• Gene Patent Ruling Raises Questions for Industry. When the Justice Department declared in a court filing late Friday that genes should not be eligible for patents because they are products of nature, Harold C. Wegner, an influential patent lawyer in Washington, did not mince words. “Eric Holder Hijacks the Patent System, Flunks Patents 101,” Mr. Wegner wrote in an e-mail to 1,250 people, referring to the attorney general. Sharp reaction greeted the declaration that human and other genes are not patentable, a reversal of what had been the government’s policy for decades.One patent lawyer characterized the new position as dumb. The Biotechnology Industry Organization warned that such a policy, if carried out, would “undermine U.S. global leadership and investment in the life sciences.”

FINalternatives:

• Illinois Firm Launches Iraqi-Focused Hedge Fund. Illinois-based hedge fund firm Global Capital Investments has launched a new fund that will primarily invest in shares listed on the Iraq Stock Exchange.

Politico:

• What to Watch Tonight. All the outstanding questions of the 2010 campaign boil down to this: How big is the wave? Republicans appear to be on the cusp of a historic victory, potentially extending into every level of state and federal government. Beyond the race-by-race polling — across 435 House districts, 37 Senate races and 37 gubernatorial races — all the large-scale signals point toward the GOP.
• Dems Prepare for a Long, Tough Night. Democrats braced for deep losses across the country as voters headed to the polls Tuesday, casting ballots in an election that’s expected to deliver a painful rebuke to the party that currently controls both chambers of Congress, a majority of the nation’s governorships and the White House.

Rasmussen Reports:

• Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Tuesday, Election Day, shows that 30% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty-five percent (45%) Strongly Disapprove, giving Obama a Presidential Approval Index rating of -15 (see trends).

Reuters:

• Dell(DELL) Plans Cloud Computing Acquisition, Tablet PC Push.
• Applebee's Improves, DineEquity(DIN) Shares Soar. DineEquity Inc's (DIN) Applebee's chain posted its first quarterly gain in sales at established restaurants in more than two years and shares rose 13.5 percent.
• Option Traders Turn Wary Before Fed, Job Report. In a week of great uncertainty, with the announcement of a massive Federal Reserve buying program widely expected and the jobs report for October due, options traders have become more defensive as they await the unknown.
• AMSC(AMSC) in Talks For Over Dozen Superconductor Projects.
  

Telegraph:

• Midterms 2010: Americans Aren't Stupid - But They Are Angry With Barack Obama. Today's mid-term elections will highlight the divide between Barack Obama's big government and disaffected voters, says Toby Harnden.
• US Federal Reserve's Latest Bubble Threatens Mayhem. The prospect of more quantitative easing (QE) is driving government bond yields to levels that price in a depression.
• Oil Price Spikes on Libyan Talk of $100 Barrel. Oil jumped after OPEC member Libya said oil producers would find prices of $100 a barrel more comfortable because of higher food prices and a weaker dollar.

Handelsblatt:

• German exports to Iran climbed 11.6% in the first eight months of the year, indicating that European Union sanctions aren't deterring companies from doing business with the Gulf nation.

Kathimerini:

• Greece will have to implement further spending cuts this year after lower-than-targeted revenue for 2010, with even stronger measures for 2011. A 2.3% increase on the year in state revenue in the first 10 months, compared with an annual target for an 8.7% rise, will probably lead to revenue shortfall of as much as 2 billion euros and impact on the 2010 budget deficit target.

Les Echos:

• BlackRock Inc.'s(BLK) CEO Laurence D. Fink said investors should buy stocks, citing an interview. "Today, bonds are too expensive," Fink said. "We're seeing there is a very significant source of opportunities." The "main threat" isn't that of double dip recession but "a too rapid recovery," Frank said. This would be very damaging for investors, "most of whom are over-invested in bonds and are very reluctant to buy stocks," he said.

Xinhua:

• Almost 40% of China's cities are developing in an unsustainable way, citing joint research by Columbia University, Tsinghua University and McKinsey & Co. Of the 112 cities studied in the 2005-2008 period, 44 had become mush less sustainable during the period.