Today's Headlines

Bloomberg

• Greek Debt Deal Delay Helps Banks as Risks Shift to Public. Delaying Greece's debt restructuring by more than a year reduced banks' potential losses as firms trimmed their holdings and most of the risk shifted to European taxpayers. When Greece was first rescued by the European Union and the International Monetary Fund in May 2010, lenders in other EU nations held $68 billion of its sovereign debt, according to the Bank for International Settlements. If Greece had defaulted, banks would have lost $51 billion at a 25 percent recovery rate. Banks' holdings of Greek bonds fell by more than half to about $31 billion over the next 15 months, according to BIS, cutting creditors' losses at last week's swap by at least 45 percent. Lenders are protected against further losses thanks to sweeteners from the EU to encourage the exchange. Meanwhile, Greece's debt remains almost unchanged and the risk of future default is now mostly borne by the public. The same playbook is being used with Portugal and Ireland. "This is a horrible deal for the EU taxpayer," said Raoul Ruparel, chief economist at Open Europe, a London-based research group. "The longer we wait for these restructurings, the worse the deal gets for the public. There's an ongoing risk transfer from the banks to the taxpayers."
• Spain May Remove Tax Breaks for Large Companies, Cinco Dias Says. Spain may eliminate tax breaks that allowed the biggest companies to reduce their effective tax rate to 17 percent in 2009, Cinco Dias said. Officials are concerned that multinationals are abusing tax breaks to lower their payments from the official rate of 30 percent, the newspaper said, citing people at the tax agency without naming them.
• European Car Sales Decline Most Since October 2010. European car sales dropped the most in more than a year, led by Renault SA (RNO) and PSA Peugeot Citroen (UG) as consumers shied away from purchases amid a weak economy. Registrations in February fell 9.2 percent from a year earlier to 923,381 million vehicles, the fifth consecutive monthly decline, Brussels-based European Automobile Manufacturers’ Association, or ACEA, said today in a statement. The decline was the steepest since a 16 percent drop in October 2010. Two-month sales fell 7.8 percent to 1.93 million vehicles.
• Europe-U.S. Gasoline Cargoes Seen Touching 7-Month Low. Gasoline shipments from Europe across the Atlantic Ocean are set to plunge to the lowest level since August over the next two weeks as U.S. gasoline buying declines, a Bloomberg News survey showed. Traders and oil companies booked or probably will hire 16 ships up to March 29, according to the median estimate in a survey yesterday of seven shipbrokers, traders and owners who specialize in shipping the auto fuel. That’s two tankers fewer than in the two weeks to March 22. U.S. gasoline demand fell 7.2 percent below a year earlier last week, the biggest decline in more than two years, MasterCard Inc. (MA) said in its SpendingPulse report this week. Rising auto fuel prices have curbed demand in the U.S., Vienna- based researcher JBC Energy GmbH said in an e-mailed note March 13. The average gasoline pump price could rise to $4.25 a gallon by May, said JBC, citing the American Automobile Association. “The dire situation for gasoline may not let up anytime soon,” JBC said in the report. Daily returns for tankers carrying gasoline on the Rotterdam-to-New York trade route fell for a fifth day to $10,981, according to the Baltic Exchange yesterday. Some 35 vessels probably will be available to haul cargoes across the Atlantic Ocean, the survey showed. That’s an increase of four from last week, and the biggest surplus in at least eight months, prior survey data show.
• Goldman's(GS) 'Change in Culture' Hurts Clients, Greenberg Says. Maurice “Hank” Greenberg, the former chairman of American International Group Inc. (AIG), said Goldman Sachs Group Inc. had a “change in culture” that made the securities firm less responsive to clients. “You didn’t have investment bankers running the firm, you had traders running the firm” after Goldman Sachs went public, Greenberg told Bloomberg Television’s Betty Liu today in an interview on the “In the Loop” program. “And a trader has a short-term memory, and a short-term look at things, and that change really has changed the culture of Goldman Sachs. It is not the Goldman Sachs that represented companies as an investment banker.”
• Oil Holds Steady in New York, Reversing Earlier Decline. Oil was little changed in New York after reversing an earlier decline of 1.6 percent. Prices fell earlier fell on a report that President Barack Obama discussed a release of strategic crude reserves in a meeting with U.K. Prime Minister David Cameron, then rebounded as Jay Carney, the White House press secretary, said any reports of an agreement aren’t accurate. Crude oil for April delivery rose 2 cents to $105.45 a barrel at 1:10 p.m. on the New York Mercantile Exchange. Brent oil for April settlement fell $1.11, or 0.9 percent, to $123.86 a barrel on the London-based ICE Futures Europe exchange.
• Jobless Claims in U.S. Decrease, Matching Four-Year Low. Applications for unemployment insurance payments fell by 14,000 to 351,000 in the period ended March 10, Labor Department figures showed today. The Bloomberg Consumer Comfort Index rose to minus 33.7 from minus 36.7 in the week ended March 11. The Federal Reserve Bank of New York’s general economic index increased to 20.2 this month, the highest since June 2010, from 19.5 in February. Readings greater than zero signal growth in New York, northern New Jersey and southern Connecticut. A similar index from the Philadelphia Fed showed manufacturing in eastern Pennsylvania, southern New Jersey and Delaware expanded at the fastest pace in 11 months as factory employment picked up. Rising fuel costs threaten to curb corporate profits and consumer spending. The average price of regular gasoline at the pump climbed to a 10-month high of $3.82 a gallon yesterday. Today’s Labor Department report showed the producer-price index rose 0.4 percent in February following a 0.1 percent increase the prior month.
• Cisco(CSCO) Buys NDS in $5 Billion Deal to Add Digital TV Software. Cisco Systems Inc., the largest maker of equipment for computer networks, agreed to buy NDS Group Ltd. in a deal valued at about $5 billion to add software used in next-generation video services.

Wall Street Journal:

• Goldman(GS) Plays Damage Control. Goldman Sachs Group Inc. said it will examine claims by an employee who quit Wednesday that executives "callously" talk about "ripping their clients off" in order to make more money for the securities firm.

Business Insider:

• Here Comes The 2012 Tidal Wave of Foreclosures.
• The Taliban Breaks Off Peace Talks With US.
• Qaddafi's Missing State Of The Art Missiles Are Now Pointed At Israel.
• Art Cashin's Warning Came True, A Top Chinese Politician Was Just Replaced By A North Korean-Trained Economist.
• Matt Taibbi's Newest Rolling Stone Piece Is The Harshest Thing We've Ever Read About Bank Of America.

Zero Hedge:

• S&P Says Improbable Any Economic Improvement Would Bring Back US AAA Bond Rating.
• Spanish Housing Re-Plunging. (graph)
• The "New Normal" American Dream of Renting Is About to Become Very Expensive.
• Jens Weidmann Defends Bundesbank Against Allegations Of TARGET2-Induced Instability.

Seeking Alpha:

• 8 Outperforming Retail Stocks Being Bought Up By Hedge Funds.

Reuters:

• Ford(F) Sued, Said to Hide Truck Fuel Tank Defect. Ford Motor Co has been sued for allegedly selling trucks with defective fuel tank linings over a 10-year period, and hiding the problem from consumers even as it warned dealers. The lawsuit filed Wednesday in a New Jersey federal court said fuel tank linings on 10 E- and F-series truck models made between 1999 and 2008 would "separate and flake off." It said this would clog fuel systems with debris and rust, causing a sudden loss of engine power, and potentially causing vehicles to buck or kick or suddenly stall. Ford in 2007 issued a "secret" technical service bulletin to dealers advising them of the problem, but neither recalled the affected trucks nor offered to repair them for free, the complaint said. "Hundreds, if not thousands," of drivers have experienced the defect, it added.
• Canadian Pacific(CP), Unimin Strike Frack Sand Deal. Canadian Pacific Railway said on Thursday it will provide exclusive rail service to Unimin Corp to transport frack sand from a Wisconsin facility the industrial mineral producer expects to open in 2013. The new facility in Tunnel City will produce two million tons of frack sand annually - used in the drilling industry in hydraulic fracturing - for markets in North Dakota, Texas, Colorado and elsewhere.

Handelsblatt:

• German Debt to Grow to 2.14 Trillion Euros. Germany's debt will continue to grow this year and next, confounding the hopes of Finance Minister Wolfgang Schaeuble that it is stagnating, citing a forecast by the IfW economic institute. Debt-crisis measures alone will add 54 billion euros to accumulated debt this year and help bring the total to 2.14 trillion euros, or 81.6% of economic growth, Kiel-based IfW's calculations show. Debt will grow by another 85 billion euros next year. The euro's stability rules stipulate that the debt of individual member states must remain within 60% of annual gross domestic product.
  

21st Century Business Herald:

• Slower China Power Consumption Adds to Hard Landing Concerns. March 15, China’s power consumption expanded at a slower pace in the first 2 months from the same period a year earlier, further adding to concern the world’s second-largest economy could experience a “hard landing”. China's power consumption rose 6.7 percent year-on-year to 749.7 billion kilowatt-hours in the first 2 months, lower than the 11.7 percent growth in full-year 2011, the National Energy Administration said on Wednesday. Primary industries saw power consumption decrease by 4.7 percent year-on-year to 12.3 billion kilowatt-hours, and that of secondary industries rose only 4.8 percent to 531.6 billion kilowatt-hours, a sharp decrease compared with the 11.41 percent growth over the same period last year. A retreat in electricity consumption is the latest data suggesting China could be headed for a hard landing. Official data released last week showed China’s factory output in the first 2 months of the year rose the least since 2009, while retail sales increased less than market expectations and inflation eased to the slowest pace in 20 months. Adrian Mowat, JPMorgan Chase & Co.’s chief Asian and emerging-market strategist, said at a conference in Singapore on Wednesday that China’s economy is already in a so- called “hard landing”. “China is in a hard landing. Car sales are down, cement production is down, steel production is down, construction stocks are down. It’s not a debate anymore, it’s a fact,” Bloomberg quoted Mowat as saying. Gary Shilling, president of a U.S.-based consulting company, told Bloomberg that China’s economy is headed for a “hard landing” this year as weaker demand overseas chokes off exports. China’s exports in January fell 0.5 percent from a year earlier, the biggest slowdown in more than 2 years, and rose 4 percent in February after seasonal adjustments.