Wednesday, March 23, 2011

Today's Headlines

Posted by Gary .....at 3:11 PM

Bloomberg:
  • NATO Struggles to Define Libya Role as U.S. Prepares Strike. NATO members failed to agree on an expanded role in Libya, as squabbles prevented the U.S. from handing off command of the campaign against leader Muammar Qaddafi. The 28-member bloc has yet to find the formula to balance military needs and political sensitivities in the five-day-old operation. France is resisting overall NATO command to encourage more involvement by Arab countries. “It paints a pretty bad picture of the political dynamics,” Bastian Giegerich, a consulting fellow at the London-based International Institute for Strategic Studies, said in an interview. “Normally the U.S. is the first among equals in NATO, but with the Americans stepping back it makes it more difficult to create consensus.”
  • Crude Oil Advances in N.Y. as Allies Prepare Additional Libya Airstrikes. Crude climbed to a two-week high as the U.S. and its allies prepared to attack Libyan leader Muammar Qaddafi’s troops and protesters clashed with government forces in Syria, bolstering concern that supply will be disrupted. Oil rose as much as 1.3 percent after U.S. Admiral Samuel Locklear said more strikes will be launched in the “coming hours and days.” Prices advanced 15 percent this year as unrest spread from Tunisia to Egypt, Yemen, Bahrain and Syria. A U.S. government report showed that crude supplies climbed last week as gasoline stockpiles fell to the lowest level this year. Mercantile Exchange. Futures touched $106.34, the highest intraday price for a front-month contract since March 7. Crude oil for May delivery rose 82 cents, or 0.8 percent, to $105.79 a barrel at 12:20 p.m. on the New York Brent crude oil for May settlement increased 21 cents to $115.91 a barrel on the London-based ICE Futures Europe exchange.
  • U.S. New Home Sales Unexpectedly Fall to Lowest on Record. Purchases of new U.S. homes unexpectedly declined in February to the slowest pace on record and prices dropped to the lowest level since December 2003, adding to evidence the industry is floundering. Sales decreased 16.9 percent to a 250,000 annual pace, figures from the Commerce Department showed today in Washington. Economists surveyed by Bloomberg News projected a gain to a 290,000 rate, according to the median estimate. The median price fell 8.9 percent from the same month in 2010. Sales slumped 57 percent in the Northeast, 28 percent in the Midwest and 15 percent in the West. The South showed a 6.3 percent decrease. The median sales price dropped to $202,100 in February from $221,900 a year earlier, today’s report showed. Last month’s median price was the lowest since $196,000 in December 2003. The share of homes sold for $500,000 or more fell in February, matching January 2009 as the lowest on record. The supply of homes at the current sales rate rose to 8.9 month’s worth from 7.4 months in January. There were 186,000 new houses on the market at the end of February, the same as a month earlier.
  • Irish Notes, Portuguese Bonds Drop as Debt Crisis Deepens Ahead of Summit. Irish two-year notes slumped, leading the bonds of the region’s most-indebted nations lower, on concern a permanent solution to the fiscal crisis will elude European Union leaders meeting at a summit starting tomorrow. The declines drove the yield on the Irish security to more than 10 percent for the second consecutive day, while the extra yield investors demand to hold the nation’s 10-year bonds instead of German bunds climbed to a record. Portuguese bonds slid as Prime Minister Jose Socrates faces a vote today against his deficit-cutting plan that may spur early elections and the need for an EU bailout. “It’s death by a thousand cuts,” said Charles Diebel, head of market strategy at Lloyds Bank Corporate Markets in London. “We’re waiting for Portugal. There isn’t actually a solution to the problem. Yields remain at unsustainable levels, technically forcing insolvency.” The yield on the two-year Irish note surged 57 basis points to 10.44 percent as of 2:38 p.m. in London, after rising to 10.70 percent. The yield has climbed from 9.09 percent at the end of last week. The 10-year yield advanced 23 basis points to 10.06 percent, widening the spread over bunds by 27 basis points to 685 basis points. It earlier increased to 694 basis points. The Portuguese 10-year yield climbed 11 basis points to 7.61 percent, with the similar-maturity Greek yield up six basis points to 12.57 percent. The Portuguese five-year note yield rose to as much as 8.19 percent, the highest since before the euro was introduced in 1999.
  • Euro Declines on Debt-Fund Plan Delay, Portugal. The euro slumped against most of its major counterparts as Portugal began debating a budget that may lead the government to fall and European leaders pushed back a decision on funding a regional bailout mechanism. The 17-nation currency fell for a second day against the dollar before a Portuguese vote that may force the nation to an early election and bailout and reports the expansion of the European Union European Financial Stability Facility will not be decided until June.
  • Tokyo Warns About Water, Japan Bids to Calm Radiation Fears. Tokyo authorities said city tap water may be unsafe for infants while Japan’s government sought to assure people that radiation levels detected in the food chain following a nuclear accident don’t pose a health threat. Radioactive iodine levels taken yesterday at a treatment facility in Katsushika ward were double the recommended limit for babies, a city official said in a televised briefing today. The water would pose a health risk if drunk over the long term, such as a year, he said. Tokyo’s population is estimated to be about 13 million people. Disclosures of rising contamination, coupled with assurances that risks are minimal, underscore the government’s struggle to contain the ripple effects of a magnitude-9 earthquake and tsunami on March 11 that crippled a nuclear facility north of Tokyo.
  • Fed's Fisher Sees 'Extraordinary Speculative Activity'. Federal Reserve Bank of Dallas President Richard W. Fisher said he sees “extraordinary speculative activity” in the U.S. after the central bank pumped record amounts of stimulus into the economy. “There is an enormous amount of liquidity sloshing around,” the regional bank chief, who votes on monetary policy this year, said in a speech today in Berlin. “There is abundant liquidity in the machine we know as the United States economy.”
  • Nissan's Ghosn Says 40 Japan Auto Suppliers Still in Difficulty. Nissan Motor Co. Chief Executive Officer Carlos Ghosn said about 40 component suppliers in Japan remain in difficulty after the nation’s record earthquake, complicating automakers’ efforts to restart car production. Electronic components, plastics and rubber are in short supply and will affect Japanese automakers and rivals outside the country, Ghosn, 57, said in a telephone interview. Carmakers are jointly offering stricken component-makers support via Japan’s automobile manufacturers association, he said. “This is serious and it’s still difficult to evaluate,” Ghosn said late yesterday. “You have the earthquake, you have the tsunami, rolling blackouts, and fuel shortages hitting at the same time, and they aren’t only hitting the car manufacturers, but also the suppliers and the dealers.”
  • Apple(AAPL) Is Said to Consider Expanding AirPlay for Streaming Video. Apple Inc. (AAPL) is weighing an expansion of its AirPlay audio service to include streaming video from an iPhone or iPad to television sets, according to two people familiar with the project. Under the plan, Apple would license its AirPlay software to consumer-electronics makers that could use it in devices for streaming movies, TV shows and other video content, said the people, who asked to remain anonymous because the plans haven’t been made public.
  • Explosion at Jerusalem Bus Station Kills 1, Hurts 30; Palestinians Blamed. A bomb blast near a bus stop outside Jerusalem’s central station killed one person and injured at least 30. Public Security Minister Yitzhak Aharonovitch said Palestinians were behind the explosion, and that it was caused by a bomb placed in a bag. Interior Minister Eli Yishai linked the blast to the rising number of rocket and mortar attacks on southern Israel from the Gaza Strip and warned that “if the trend continues then, no doubt, we will have to take action.”

Wall Street Journal:
  • Allies Strike Forces Around Besieged Libyan Cities. Allied forces bombed Libyan government targets involved in the siege of the cities of Misrata and Ajdabiya as NATO warships started patrolling off Libya's coast to enforce the United Nations arms embargo, amid a debate over who would lead the campaign. As the coalition campaign moved into its fifth day, several residents of Misrata, Libya's third-largest city and an important commercial hub, recounted a grim humanitarian situation and atrocities still being committed by Col. Moammar Gadhafi's troops.
  • IMF Plan Sees Role for Fund in Crises. The International Monetary Fund is working on a proposal to become a more significant lender of dollars, euros and other hard currencies during times of crisis, essentially sharing the role of global lender of last resort with the U.S. Federal Reserve. Under the plan, which has been encouraged by the U.S. and other members of the Group of 20 nations, the IMF would provide short-term foreign-exchange swaps to central banks in developing nations as a way to handle financial shocks that leave those nations short of hard currencies.
  • Apple's(AAPL) Area 51: The Truth Is Out There. Scheduled to go live sometime this spring, Apple’s 505,000-square-foot North Carolina data center is, according to COO Tim Cook, intended to support iTunes and MobileMe. But we don’t yet know in what capacity, and Cook’s remark, which is at once unambiguous and utterly cryptic, leaves plenty of room for speculation. And theories about the potential capabilities of this new facility abound.
CNBC.com:
Business Insider:
New York Times:
Boston Herald:
New York Magazine:
  • Elevated Radioactive Iodine Found in Tokyo Tap Water. Japanese officials said tap water tests in Tokyo found more than twice the limit for radioactive iodine considered safe for infants. Although the level is not an immediate health risk for adults, officials said babies should not be given tap water. Radioactive iodine can cause thyroid cancer, but officials said there was no reason to worry if infants already consumed small amounts. Authorities are not certain, but they suspect that airborne iodine from the Fukushima Daiichi plant drifted over rivers that feed into Tokyo's water system and then came down in rainfall this week.
Politico:
Reuters:
Corriere della Sera:
  • The U.K.'s MI5 intelligence service warned counterparts in NATO countries of the risk of terrorist attacks following military action in Libya. In a March 18 memo sent to agencies in other NATO countries, MI5 cited wiretaps of Libyans living in the U.K. which included discussions of "actions of support" for leader Muammar Qaddafi. Libyans in one call were quoted as saying, "we should act where we are."
Yomiuri:
  • Seven nations including Germany and Switzerland moved embassy operations out of Tokyo because of concerns about the Fukushima Dai-Ichi nuclear plant and rolling blackouts.
  • Japan's Nuclear Safety Commission said nuclear fuel at the No. 1 reactor of Tokyo Electric Power's Fukushima Dai-Ichi nuclear plant may have melted considerably. An official of the regulator said the temperature and pressure inside the reactor is reaching a dangerous point, and authorities are considering releasing steam.
Xinhua:
  • Carrefour SA will increase wages for its Shanghai workers by 8% under a new agreement reached through collective bargaining, citing labor-union officials.
China Business News:
  • China may face an "arduous" task in controlling consumer prices at 4% this year, citing Zhang Yansheng, a researcher with the National Development and Reform Commission. Imported inflation pressures are rising, he said.

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