Today's Headlines

Bloomberg:

• ECB Says Overnight Deposits Surge to Record. The European Central Bank said overnight deposits soared to a record after its second allocation of three-year loans. Financial institutions parked 776.9 billion euros ($1.03 trillion) with the Frankfurt-based ECB. That’s the most since the euro was founded in 1999 and up from 475.2 billion euros a day earlier. Banks get 0.25 percent on the deposits. The ECB this week lent banks 529.5 billion euros for three years in the biggest single refinancing operation in its history, taking total long-term lending above 1 trillion euros. Banks received the funds yesterday and pay the average of the ECB’s benchmark rate -- currently 1 percent -- over the period of the loans. The ECB said 800 financial institutions, more than a third of the 2,267 registered to borrow from it, took part in the operation.
  
• Sovereign, Corporate Bond Risk Rises, Credit-Default Swaps Show. The cost of insuring against default on European sovereign and corporate debt rose, according to traders of credit-default swaps. The Markit iTraxx SovX Western Europe Index of swaps on 15 governments gained two basis points to 339 at 8:30 a.m. in London. Contracts on the Markit iTraxx Crossover Index of 50 companies with mostly high-yield credit ratings increased four basis points to 562.5, according to JPMorgan Chase & Co. The Markit iTraxx Europe Index of 125 companies with investment-grade ratings rose 0.75 basis point to 127.5 basis points. The Markit iTraxx Financial Index linked to senior debt of 25 banks and insurers increased two basis points to 201 and the subordinated index climbed 3.5 to 343.5.
• Troika to Have Permanent Presence in Greece, Wieser Tells Format. The “troika” of the European Commission, International Monetary Fund and European Central Bank will have a permanent presence in Greece, Eurogroup Working Group head Thomas Wieser told Austria’s Format magazine. “A permanent presence of the troika on site to monitor the reforms will definitely be the case for several years,” Wieser was cited as saying. Wieser also told the Vienna-based magazine that he is “optimistic” that the Greek economy will grow again in 2013, “be it at a slow pace.” From the middle of the century, growth will “speed up,” he said according to the report.
  
• EIB Privileges in Greek Debt Plan Spur Complaints From Private Investors. Investors are complaining that the European Investment Bank doesn’t deserve the same exemption from losses on its Greek bond holdings as the euro region’s central bank because it didn’t buy the notes to support monetary policy.
• China to Grow Less Than World Bank Estimates, Dow Jones Reports. China’s economic growth will probably be slower than the World Bank estimates, Dow Jones reported, citing Bert Hofman, the Washington-based lender’s chief economist for East Asia and Pacific. The slowdown in China is happening more rapidly than the World Bank expected and expansion may be less than the 8.4 percent the development lender has projected, according to the report published on the website of the Wall Street Journal, citing Hofman in Singapore today.
• Copper Falls as China's Inventories Rise to Highest Since 2003. Copper futures fell on signs of ample supplies as inventories rose to the highest in at least nine years in China, the world’s biggest consumer of industrial metals. Stockpiles monitored by the Shanghai Futures Exchange climbed 2.5 percent to 221,487 metric tons, the highest since at least January 2003, weekly data showed. The dollar’s rally against a basket of major currencies eroded the appeal of raw materials as alternative investment. “Any sign that China is slowing is certainly going to weigh on commodities across the board,” Matthew Zeman, a strategist at Kingsview Financial in Chicago, said in a telephone interview. “The stronger dollar is also a factor.” “Builds in Chinese stocks reflect what is still a weak spot market currently, with consumers keeping buying to an absolute minimum due to uncertainty over future demand levels,” Gayle Berry, an analyst at Barclays Capital, said in a report.
• Crude Drops for First Time in Three Days. Oil fell the most since December as President Barack Obama said a pre-emptive strike on Iran might generate “sympathy” for the Persian Gulf country, easing concern that an attack would take place. Prices fell as much as 2.8 percent after Obama said in an interview with The Atlantic magazine that a strike without warning might allow Iran to portray itself as a victim. Oil for April delivery fell $2.76, or 2.5 percent, to $106.08 a barrel at 1:28 p.m. on the New York Mercantile Exchange. Earlier, prices touched $105.80 a barrel in the largest intraday decline since Dec. 14. Prices are down 3.4 percent this week, the biggest drop since Dec. 16. Brent oil for April settlement slipped $2.41, or 1.9 percent, to $123.79 a barrel on the London-based ICE Futures Europe exchange. It surged to $128.40 yesterday, the highest intraday price since July 2008.
• Buffett's Insurance Growth Engine May Stall. Warren Buffett, the former hedge fund manager who built Berkshire Hathaway Inc. into a $195 billion company by gaining leverage through insurance premiums, said this traditional source of new funds is drying up.
• Yelp(YELP) Surges as Much as 73% in Trade Debut. Yelp Inc. (YELP), the site that lets users review businesses ranging from diners to dentists, surged as much as 73 percent in its first day of trading after selling shares for more than planned in an initial public offering. The stock climbed 64 percent to $24.60 at 11:06 a.m. in New York, after soaring to $26, giving Yelp a market valuation of $1.56 billion. That price is about 19 times Yelp’s annual revenue.

Wall Street Journal:

• Spain Raises Budget Deficit Target. Spanish Prime Minister Mariano Rajoy said Friday his government has raised the budget deficit target for this year to 5.8% of gross domestic product, in what he called a "sovereign" decision that may rile up European Union partners. The new estimate contrasts with the 4.4%-of-GDP target set by Spain's previous left-of-center government, in office until December.
• Copper's Problems Pile Up Quietly.
  
• New Report: Seniors Can't Make Ends Meet. A new report released Thursday for all 50 states, called the Elder Economic Security Standard Index, found that people who are over 65 are struggling to cover basic expenses in all 50 states.
  

CNBC.com:

• Geithner Shows Own 'Amnesia' Over Bank Crisis: Bove. Treasury Secretary Timothy Geithner should have done more to stop the financial crisis before it started, rather than try now to impose unnecessary reforms on the banking system, analyst Dick Bove said.

Business Insider:

• Here's The New Restriction Some Hedge Funds Are Putting On Their Employee's Social Media Activity.
• The Horrific Eurozone Youth Unemployment Chart That Makes Everyone Cringe. (graph)
  

Zero Hedge:

• Foodstamp Use Hits Another Record in December. (graph)
• Who Is Most Exposed To The Oil Price Shock? (graph)
• Bank of America(BAC) Joins Goldman(GS) In Cutting Its Q1 GDP Forecast.
  

Reuters:

• Euro Drops for 3rd Day as Spain Defies EU Fiscal Pact. The euro dropped against the dollar for a third straight day on Friday and was on track for its worst week since mid-December after debt-burdened Spain challenged the European Union's new fiscal pact.

Telegraph:

• Euroland Will Pay For This Monetary Madness. The flood of cheap money from the European Central Bank is storing up grave trouble for the future.
• Debt Crisis: Live. Spain defies Brussels on day leaders sign fiscal pact.

RTHK:

• Fund inflows could cause an asset bubble in Hong Kong after a capital injection into the eurozone banking system, HKMA Chief Executive Norman Chan said.