Wednesday, November 14, 2012

Today's Headlines

Posted by Gary .....at 3:28 PM
Bloomberg: 
  • Europe Protests Austerity With Strikes in Spain, Italy. Spanish workers staged a second general strike this year as unions across Europe prepared the biggest coordinated protests yet against budget cuts that policy makers say are unavoidable and labor leaders called economic suicide. In Spain, unions said most auto and metal workers joined the strike and demand for electricity was 12 percent below usual. One of Portugal’s two biggest labor groups also called a strike. Partial walkouts are planned in Greece and Italy, and French unions are urging workers to join protest marches. Opposition to the cuts in health, education and welfare benefits demanded by AAA-rated euro members such as Germany and Finland is growing along with evidence that those measures are failing to rein in the budget deficits or bring down borrowing costs. Demands for less austerity are gaining traction as the International Monetary Fund recommends nations including Spain slow the pace of budget cuts. “This is a strike against the suicidal economic policies of the government,” Ignacio Fernandez Toxo, head of Spain’s CCOO union, told supporters late yesterday.
  • Italy Yields Decline at Sale as German Notes Fetch Negative Rate. Italy sold 3.5 billion euros ($4.46 billion) of three-year notes at the lowest rate in more than two years and the Treasury tapped growing demand for the country’s debt to auction longer-dated securities. The nation attracted bids for 1.5 billion euros of bonds due in 2023 and 2029, its first sale of debt due in more the 15 years since May 2011. The German government sold two-year notes at a negative yield for only the second time on record.   
  • Portuguese Economy Contracts for an Eighth Straight Quarter. Portugal’s economy shrank for an eighth quarter and unemployment rose to a euro-era record as the government implemented austerity measures in an attempt to rein in its budget deficit and curb debt. Gross domestic product declined 0.8 percent in the third quarter from the second quarter, when it fell 1.1 percent, the National Statistics Institute said in a preliminary report today. Economists projected a decrease of 0.6 percent, the median of nine estimates in a Bloomberg survey showed. The jobless rate rose to 15.8 percent in the three months through September from 15 percent in the second quarter, the Lisbon- based statistics institute said in a separate statement.
  • European Stocks Decline on Output Drop, Greek Recession. European (SXXP) stocks fell for the fifth day in six as industrial production dropped the most in at least three years, Greece’s recession deepened, and company results from ICAP Plc (IAP) to Mediaset SpA disappointed investors. ICAP retreated 9.7 percent after the world’s largest broker of transactions between banks reported a slump in earnings. Mediaset declined 3.2 percent after the broadcaster cut its full-year profit forecast. Banca Monte dei Paschi di Siena SpA (BMPS) slid 4.6 percent after posting an unexpected loss.
  • Turkey, Israel Warn Syria Against Violations of Territory. Turkey scrambled its warplanes and warned that it will respond to any violation of its airspace as Syrian jets bombed a rebel-held town near the border for a third day. Israel also vowed to defend its borders. Turkish soldiers were monitoring the fighting from newly dug foxholes in the town of Ceylanpinar as gunfire crackled across the border, NTV television showed today. Authorities used loudspeakers to warn residents to stay away as a Syrian jet dropped four bombs on the town of Ras al-Ayn, the state-run Anatolia news agency said. Several bullets hit houses, businesses and government buildings without causing casualties today, Anatolia said.
  • Oil Advances in New York After Airstrikes by Israel. Oil advanced after an Israeli airstrike killed a leader of Hamas’s militant wing in the Gaza Strip, bolstering concern that unrest in the Middle East will intensify curbing supplies. Futures rose as much as 1.4 percent after the attack, which killed Ahmed al-Jabari and another man, according to Ashraf al- Qedra, a spokesman for the Hamas-run Health Ministry. The strike follows the firing of about 115 rockets from Gaza into Israel this week. Oil fell earlier as U.S. retail sales declined for the first time in four months in October. “The Israeli strike on Gaza has raised the security premium,” said John Kilduff, a partner at Again Capital LLC, a New York-based energy hedge fund. “The Israelis made it clear that this may be the first of many strikes. This episode raises tension in an already troubled region.” Crude oil for December delivery advanced 61 cents, or 0.7 percent, to $85.99 a barrel at 11:12 a.m. on the New York Mercantile Exchange.
  • Thousands Seen Dying If Terrorists Attack ‘Vulnerable’ U.S. Grid. A terrorist attack on the U.S. power grid could be more destructive than superstorm Sandy, possibly costing hundreds of billions of dollars and leading to thousands of deaths, the National Academy of Sciences said. While such an event probably wouldn’t kill people immediately, it could cause widespread blackouts for weeks or months, according to a recently declassified report released today by the Academy. If it occurred during extreme weather, heat stress or exposure to cold may lead to “hundreds or even thousands of deaths,” the authors of the study wrote.
  • Wholesale Prices in U.S. Unexpectedly Fall on Fuel, Vehicles. Wholesale prices in the U.S. unexpectedly fell in October for the first time in five months as energy and vehicle costs dropped. The 0.2 percent decline in the producer price index came after a 1.1 percent increase the prior month, Labor Department figures showed today in Washington. The median estimate in a Bloomberg survey of 73 economists called for a 0.2 percent rise. Excluding volatile food and energy, the so-called core measure decreased 0.2 percent, the first drop since November 2010.
  • Fed Says ‘a Number’ on FOMC Saw Need for Additional QE. A number of Federal Reserve officials said the central bank may need to expand its monthly purchases of bonds next year after the expiration of Operation Twist, according to minutes of their last meeting. “A number of participants indicated that additional asset purchases would likely be appropriate next year after the conclusion of the maturity-extension program,” according to the record of the Federal Open Market Committee’s Oct. 23-24 gathering released today in Washington.
Wall Street Journal: 
CNBC: 
  • How 'Fiscal Cliff' Could Affect Mortgage Interest Deduction. It is arguably one of the most popular U.S. tax deductions, and for some it is the necessary stimulus to buy a home. The mortgage interest deduction, however, is now at risk, due to negotiations over the so-called “fiscal cliff”—the year-end deadline for large spending cuts and the expiration of tax cuts. While it is impossible at this point to know what the outcome will be, it is certainly worth running through the possibilities.  
  • Why More Bankers May Be Starting Hedge Funds. The hedge fund industry is expected to see a wave of new launches in the next year by traders who have lost their jobs at investment banks or who have left in search of better pay.
Forbes:
  • Qihoo Reportedly Launches Mobile Search; Baidu(BIDU) Slides. Qihoo 360, the China-based Internet software provider, has shaken up the country’s Internet search market with its recent entry into the business. As a provider of a popular Web browser, Qihoo was well positioned for a rapid takeoff in the search sector, and in fact appears to be causing considerable trouble for sector leader Baidu.
Reuters: 
  • Greece Sinks Deeper into Depression in Third Quarter.  Greece's economic slump deepened in the third quarter, with output shrinking 7.2 percent on an annual basis as the debt-laden country heads into its sixth year of depression and struggles to meet its bailout targets. The contraction was deeper than the second quarter's 6.3 percent drop and follows the passage of a tough 2013 budget by Prime Minister Antonis Samaras's government that is expected to continue to smother growth for most of next year. Since 2009, the Mediterranean state's economic decline - which Samaras has dubbed Greece's "Great Depression" - has wiped a fifth off economic output and sent unemployment to a record high, putting one in four Greeks out of work. The reading could point to an even grimmer outlook, analysts said, because it was offset by better-than-expected returns from the country's vital tourism sector, which accounts for a fifth of Greece's 215 billion euro economy. A new wave of wage and pension cuts and tax hikes agreed with the country's international lenders for 2013, coupled with a liquidity shortage, was expected to add to the economic misery, making recovery even more distant."The recession will continue to deepen until the first half of 2013, due to the implementation of all the cuts," said Xenophon Damalas, head of investment services at Marfin Egnatia bank in Athens.
  • France considers broad tax clampdown on web companies.
Telegraph:
Immerisia:
  • Greece to Tax Capital Gains on Stocks at 20%. The rate will apply to capital gains on stocks, mutual funds and real estate, citing a copy of draft legislation for tax changes. Greece will apply 3 income tax bands of 21%, 36% and 45%. Tax on deposit interest will increase to 15% from 10%. Greece will increase the corporate tax rate to 26% from 20%.
Australian Financial Review:
  • Australia on Same Path as Spain: S&P. Australia must get its budget into surplus by 2014 to help avoid revision of its AAA credit rating, warns the global director of pubic finance at Standard & Poor’s Financial Services. 
Israel Defense Forces:

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