Friday, March 09, 2012

Today's Headlines

Posted by Gary .....at 3:06 PM

Bloomberg:
  • Greece Pushes Bondholders Into Record Debt Swap. Greece pushed through the biggest sovereign restructuring in history after getting private investors to forgive more than 100 billion euros ($132 billion) of debt, opening the way for a second bailout. Euro-region finance ministers agreed on a conference call that with the swap Greece had met the terms for a 130 billion- euro rescue package designed to prevent a collapse of the economy. Ministers freed up 35.5 billion euros in payments and interest for bondholders, with a decision on the balance of the bailout funds to be made at a March 12 meeting in Brussels. “It would be a big mistake to think we are out of the woods,” German Finance Minister Wolfgang Schaeuble told reporters in Berlin after the call today. “We have a chance of making it. And we have to seize that opportunity.”
  • Euro Drops as Greece Forces Investors to Take Part in Debt Swap. The euro weakened for the first time in three days against the dollar after Greece said it triggered an option compelling investors to take part in its debt restructuring, damping demand for the region's assets. The common currency fell versus 11 of its 16 major peers before the International Swaps and Derivatives Association meets to consider a "potential credit event" relating to Greece, following the results of the nation's private-sector involvement plan. "The euro has failed to gather any further support from the Greek news," said Ian Stannard, head of European currency strategy at Morgan Stanley in London. "The market was fully expecting a successful PSI. The rebound we've seen in the euro may be running out of steam."
  • European Stocks Post Weekly Drop; Enel, Peugeot, Salzgitter Lead Decline. European stocks fell this week as investors speculated the Stoxx Europe 600 Index’s best start to a year since 1998 has overshot the outlook for the economy. Enel SpA sank to a record low as Italy’s largest utility cut its dividend target to reduce debt. PSA Peugeot Citroen sank 7.8 percent after Europe’s second-biggest carmaker announced a 1 billion-euro ($1.3 billion) rights offer. Salzgitter AG lost 7 percent after the steelmaker said it was“impossible” to provide an earnings forecast. The benchmark Stoxx 600 (SXXP) slid 0.7 percent to 265.44 this week, the biggest drop since Feb. 10.
  • Gross Says Bond-Contract Sanctity Is Hurt by Greece's Debt Swap: Tom Keene. The “sanctity” of bondholders’ contracts has been diminished by Greece’s pushing through the biggest sovereign restructuring in history, according to Bill Gross of Pacific Investment Management Co. “The rules have been changed here,” Gross, co-chief investment officer at Pimco, said in a radio interview on “Bloomberg Surveillance” with Tom Keene and Ken Prewitt. “The sanctity of their contracts is certainly lessened. Bondholders have that to look forward to going into the future.”
  • Greece's New Bonds Yield More Than Portugal's on Growth Concern. Greek government bonds due to be issued after the nation's debt swap is completed were priced at less than 30 percent of face amount, signaling concern the country will struggle to repay its revised obligations. While the debt swap is "a big step forward, it's not totally out of the woods yet," said Mohit Kumar, the head of European fixed-income strategy at Deutsche Bank AG in London. "There is a premium still demanded for Greece." Greece's economy shrank 7.5 percent in the fourth quarter from the same period in 2010, the Athens-based Hellenic Statistical Authority said today. The contraction, based on non- seasonally adjusted data, was wider than a Feb. 14 preliminary estimate of a 7 percent contraction, the authority said. The 2 percent bonds maturing in February 2023 were bid at 25.5 cents on the euro at 4:25 p.m. London time, BNP Paribas SA data on Bloomberg showed. They were offered at 26 cents, according to Jefferies Group Inc. That left the yield on the securities bid at 19.7 percent and offered at 19.42 percent, the data showed. Portuguese securities maturing in October 2023 yielded less than 14 percent.
  • Greek Swap is 'Dangerous Precedent,' Wraith Says. (video) John Wraith, a fixed-income strategist at Bank of America Merrill Lynch, talks about the restructuring of Greece's sovereign debt. He speaks with Owen Thomas and Linzie Janis on Bloomberg Television's "Countdown."
  • Payrolls in U.S. Climb 227,000; Jobless Rate Holds at 8.3%. The 227,000 increase followed a revised 284,000 gain in January that was bigger than first estimated, Labor Department figures showed today in Washington. The median projection of economists in a Bloomberg News survey called for a 210,000 rise. The jobless rate held at 8.3 percent, even as 476,000 more workers sought employment. The participation rate, which indicates the share of working-age people in the labor force, rose to 63.9 percent from 63.7 percent. Education and health services employment jumped 71,000, the most since September 2006, according the Labor Department. Construction companies reduced payrolls by 13,000 workers last month, the biggest drop since January 2011. Average hourly earnings rose 0.1 percent to $23.31, today’s report showed. The workweek for all employees averaged 34.5 hours for a third consecutive month. The so-called underemployment rate, which includes part- time workers who’d prefer a full-time position and people who want work but have given up looking, decreased to a three-year low of 14.9 percent from 15.1 percent. The report also showed a decrease in long-term unemployed Americans. The number of people without a job for 27 weeks or more fell as a percentage of all jobless, to 42.6 percent from 42.9 percent.
  • Harrisburg, Pennsylvania, Set to Default on $5.27 Million GO Bond Payments. Harrisburg, Pennsylvania’s insolvent capital, says it will miss general-obligation bond payments for the first time next week as its receiver seeks approval for a plan to sell assets. The city, whose debt load of more than $300 million is five times its general-fund budget, will miss $5.27 million in general-obligation bond payments due March 15, according to a notice its receiver posted on the Electronic Municipal Market Access system, a database for filings by municipal-debt issuers.
  • Gold Bulls Strengthening as Bullion Wagers Reach $131 Billion: Commodities. Gold traders are the most bullish in four months after investors accumulated more metal than ever and hedge funds raised bets on gains to a five-month high. Sixteen of 23 analysts surveyed by Bloomberg expect prices to gain next week and one was neutral, the highest proportion since Nov. 11. Investors increased their holdings in exchange- traded products backed by bullion for seven consecutive weeks and now hold 2,407 metric tons valued at $131 billion, data compiled by Bloomberg show.
  • Oil Increases for a Third Day. Oil for April delivery climbed 94 cents, or 0.8 percent, to $107.52 a barrel at 12:41 p.m. on the New York Mercantile Exchange. Prices have advanced 0.8 percent this week and 8.8 percent this year. Brent oil for April settlement gained 35 cents, or 0.3 percent, to $125.79 a barrel on the London-based ICE Futures Europe exchange. Total U.S. fuel demand fell an average 78,000 barrels a day to 18.2 million last week, an Energy Department report on March 7 showed. Consumption was down 7.6 percent from the same week a year earlier.
  • China's February New Yuan Loans Were a Lower Than Estimated $113 Billion. China’s new yuan loans were less than estimated in February and money supply growth was below the government’s target, central bank data showed yesterday. Local-currency-denominated loans were 710.7 billion yuan ($113 billion) last month, the People’s Bank of China said in a statement on its website yesterday. That compares with the 750 billion yuan median estimate in a Bloomberg News survey of 26 economists and 738 billion yuan in January. M2, the broadest measure of money supply, expanded 13 percent in February from a year earlier.
  • Solar Panel Sales Seen Dropping First Time in Decade, Feeding Glut: Energy. Fewer solar panels will be installed this year as the first drop in more than a decade worsens a glut of the unsold devices that’s already slashed margins at the top five manufacturers, an analyst survey showed. Homes and businesses will put up 24.8 gigawatts of solar panels worldwide, according to the average of six forecasts compiled by Bloomberg News. That’s equal to the power of about 20 nuclear reactors and down 10 percent from the 27.7 gigawatts added last year. Installations have grown 61 percent a year on average since 1999, Bloomberg New Energy Finance estimates. The decline would be the first since Germany began offering premium rates for solar power in 2004, opening the way for mass, utility-scale installations. It will exacerbate price-cutting and a surge in inventories that last year forced Solyndra LLC into bankruptcy, prompted SunPower Corp. to seek a buyout and gutted margins at top manufacturers led by Suntech Power Holdings Co. and First Solar Inc. “Overcapacity has been an overhang for this industry, and with Germany tightening it doesn’t seem like it will ease,” said Amir Rozwadowski, an analyst at Barclays Capital Inc. in New York. “It’s difficult to assess where there’s a significant push-out that would lead to accelerating demand, given the anticipated decline in Europe.” Germany and Italy, the biggest photovoltaic markets, cut subsidies to curtail a boom last year, helping depress prices for panels by more than 50 percent.
  • Biggest Shipping Banks Withdraw New Funding, Lender DVB Says. Thirteen of the world’s 19 largest shipping banks stopped new lending to the industry amid an “extreme” vessel surplus that’s cut cash flows and led to vessel seizures, financier DVB Bank SE (DVB) said. The Rotterdam-based transportation lender that’s financing 1,500 vessels through 450 loan agreements is one of six remaining banks funding shipping, Dagfinn Lunde, a member of DVB’s board of managing directors, said at a presentation in London today. As many as 100 were lending to the industry four years ago, he said. Fifteen DVB loans worth $2 billion breached loan-to-value clauses after asset prices fell during the past four years and needed additional cash or security to regain compliance, Lunde said. The bank controls 20 ships, has seized and sold others and is prepared to take over more as rates for vessels “haven’t hit bottom yet,” he said. Lunde didn’t give a total figure for numbers of vessels seized.
  • Obama Rallies Support for Health-Care Law Ahead of Supreme Court Case. While Supreme Court justices weigh the fate of the 2010 health-care overhaul late this month, the White House will help coordinate efforts to showcase the law’s most popular provisions outside the court to blunt relentless Republican attacks. Dozens of consumer, church and public health groups plan events including a prayer vigil to rally support for the health- care overhaul as the Supreme Court holds arguments on the measure March 26 to 28. About 100 supporters met at the White House on March 7 to discuss a coordinated response, according to an administration official who declined to speak on the record because he wasn’t authorized to discuss the gathering.
  • Buffett's NetJets is Countersued by U.S. for $366 Million in Unpaid Taxes. NetJets Inc., the private-plane company owned by Warren Buffett’s Berkshire Hathaway Inc. (BRK/B), was countersued by the U.S. over $366 million in taxes and penalties. NetJets in November sued the U.S., saying the federal government had wrongly imposed taxes, interest and penalties totaling more than $642.7 million. The federal government, in a revised answer and countersuit filed yesterday in federal court in Columbus, rejected NetJets’ claims and alleged that four of the company’s units owe unpaid taxes and penalties. NetJets Aviation Inc. owes more than $302.1 million, and another unit, NetJets International, is liable for $52.9 million, the U.S. said. Executive Jet Management Inc. owes $10 million while NetJets Large Aircraft owes $1.19 million, the U.S. claimed.
Fox News:
  • Factor Investigation: Ex-Obama Official Running Sandra Fluke. (video) As we reported last night "The Factor" believes that the Sandra Fluke contraception controversy was manufactured to divert attention away from the Obama administration's disastrous decision to force Catholic non-profit organizations to provide insurance coverage for birth control and the morning after pill. That might very well be unconstitutional.
CNBC.com:
  • Banks Sit on Huge Aluminum Stocks, Collect Rent. New fronts are opening up in Europe and Asia in the battle between banks and trading houses to expand their storage hubs for aluminum, a metal meant for use in manufacturing but increasingly viewed as a store of value.
  • Most Wealthy Americans Think US Still in Recession. Wealthier Americans aren't very optimistic about the economic recovery, with a surprising 63 percent saying the US is still in a recession, according to a new poll. Some 55 percent think the economy won’t fully recover until 2013 or later, and 14 percent say the recession won’t end at all.
Zero Hedge:
 New York Times:
  • New Republic Gets an Owner Steeped in New Media. The newest owner of The New Republic magazine is Chris Hughes, a new-media guru who co-founded Facebook and helped to run the online organizing machine for Barack Obama’s presidential campaign.
PowerIntelligence:

BoyGenius:

  • 'Anonymous' Hackers Lead Norton AntiVirus Source Code. Hackers associated with the group “Anonymous” have published Symantec’s(SYMC) Norton AntiVirus source code on The Pirate Bay. The source code was stolen in 2006 and after alleged attempts to extort money from Symantec failed, the hactivist group released it late Thursday evening.

Rasmussen Reports:

  • Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Friday shows that 28% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty-four percent (44%) Strongly Disapprove, giving Obama a Presidential Approval Index rating of -16 (see trends).
Reuters:
  • GE(GE) Sees Slower Revenue Growth in Southeast Asia. With China's growth losing steam from its peak of more than 10 percent, GE is increasingly dependent on a strong performance in Southeast Asia.
  • GE's(GE) Immelt Sees Long Period of Unstable Economies. General Electric Co will keep its focus on boosting its dividend and improving margins as it faces what Chief Executive Jeff Immelt expects to be an extended period of economic instability. "We live in what most business commentators call a volatile world. I would argue that when the environment is continuously unstable, it is no longer volatile. Rather, we have entered a new economic era," the head of the largest U.S. conglomerate said in his annual letter to shareholders. "It could remain this way for a long time."
  • ISDA Declares Greek Credit Event, CDS Payments Triggered.

MailOnline:

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