Bloomberg:
- Boehner Says He’s Waiting for Obama’s Specific Spending Cuts. U.S. House Speaker John Boehner reiterated his call for President Barack Obama to offer proposed spending cuts as part of a deficit-reduction package. “Where are the president’s spending cuts?” Boehner, an Ohio Republican, said on the House floor today in Washington. He said he is still “hopeful” the parties can reach a budget agreement before the end of the year. “The longer the White House slow-walks this process, the closer” the economy gets to the so-called fiscal cliff of tax increases and spending cuts set to begin in January, the speaker said in his first public comments since meeting with Obama Dec. 9. “Right now the American people have to be scratching their heads and wondering: When is the president going to be serious?” Boehner said.
- Pimco Sees Global Growth Slowing After U.S. Tightening. Pacific Investment Management Co., manager of the world’s largest mutual fund, said global growth will be hampered next year by a slowdown in the U.S. economy. Global growth will slow to 1.3 percent to 1.8 percent from about 2 percent this year as the private sector isn’t healthy enough to step in and extend credit amid deleveraging, Saumil Parikh, a portfolio manager who leads Newport Beach, California- based Pimco’s cyclical forum, said in a December report being posted on the firm’s website today. Economists expect growth of 2.5 percent in 2013, the average forecast in a Bloomberg survey. “Central banks, while they are effective in boosting asset prices, we think gradually they’re losing effectiveness in helping the real economy,” Parikh said in a telephone interview before the report was released. “The low growth rate of corporate profits and the low rate of investment means a near stall speed of the global economy.” U.S. economic growth will drop to 1.25 to 1.75 percent in 2013 from 2.2 percent in the four quarters ended Sept. 30 because of “a policy mix of untimely fiscal tightening and increasingly ineffective monetary easing,” Parikh said in the report.
- U.K. Fraud Agency Makes First Arrests Over Libor-Rigging. A former Citigroup Inc. (C) trader is among three people held in the first U.K. arrests as part of global probes into tampering with the London interbank offered rate, according to two people familiar with the matter.
- Portugal Considers Measures If Revenue Misses Budget Plan. The Portuguese government is ready to implement additional measures in 2013 if there are slippages in meeting budget targets, the European Commission said. Fiscal consolidation efforts are “in line” with the budget-deficit targets of 5 percent and 4.5 percent of gross domestic product for 2012 and 2013, respectively, the commission said in a report obtained by Bloomberg News about the sixth review of the aid program it conducted together with the International Monetary Fund and the European Central Bank. The program is “broadly on track,” it said.
- Oil Trades Near One-Month Low as Fuel Stockpiles Seen Rising. Oil traded near the lowest close in almost a month in New York on speculation that an Energy Department report will show fuel stockpiles climbed in the U.S., the world’s biggest crude consumer. Futures were little changed after dropping for a fifth day yesterday, the longest losing streak since October. Distillate supplies, including diesel and heating oil, are projected to rise a second week while gasoline inventories may reach the highest level since April, according to a Bloomberg News survey before the government report tomorrow. The Organization of Petroleum Exporting Countries is gathering in Vienna to determine the group’s targets for crude production. “Crude is starting to feel the weight of softer demand given lower refining activity expected in the first quarter,” said Filip Petersson, a commodities strategist at SEB AB in Stockholm.
- U.S. Energy Puts at 18-Month Low. The cost of hedging against losses in U.S. energy companies has fallen to an 18-month low. Puts protecting against a 10% decline in the Energy Select Sector SPDR Fund cost 5.57 points more than calls betting on a 10% rally, the smallest gap since May 2011, according to Bloomberg.
- $822,000 Worker Shows California Leads U.S. Pay Giveaway. Nine years ago, California Democrat Gray Davis became the first U.S. governor in 82 years to be recalled by voters. The state’s 20 million taxpayers still bear the cost of his four years and 10 months on the job. Davis escalated salaries and benefits for 164,000 state workers, including a 34 percent raise for prison guards, the first of a series of steps in which he and successors saddled California with a legacy of dysfunction. Today, the state’s highest-paid employees make far more than comparable workers elsewhere in almost all job and wage categories, from public safety to health care, base pay to overtime.
Wall Street Journal:
- Boehner Calls for Details From Obama. Speaker John Boehner (R., Ohio) took to the House floor Tuesday to complain about the status of tax and spending talks with President Barack Obama, accusing the White House of "slow walking" the negotiations and calling again for the administration to say more about how it would cut spending.
- Corporate Pensions on Pace to Hit Year-end Deficit Record. $607.4 billion: The combined amount by which the pension plans of S&P 1500 companies were underfunded at the end of November.
Fox News:
- US sending 20 more F-16s to Egypt, despite turmoil in Cairo. Instability in Egypt, where a newly-elected Islamic government teeters over an angry population, isn't enough to stop the U.S. from sending more than 20 F-16 fighter jets, as part of a $1 billion foreign aid package.
CNBC:
- Stocks Pare Gains After Reid's 'Cliff' Remarks. Stocks eased off their best levels Tuesday after Senate Majority Leader Harry Reid threw cold water on the ongoing "fiscal cliff" negotiations. Reid said it will be hard to reach a budget deal by Christmas, adding that Democrats aren't going to make an offer on spending cuts for Republicans. Earlier, Wall Street shrugged off Speaker John Boehner's negative comments on the ongoing "fiscal cliff" negotiations.
- Why More States May Adopt Right-to-Work Laws. Michigan moved on Tuesday to become the 24th state to adopt a "right to work" law—the controversial provision that prohibits unions from forcing workers to join and pay dues. But while the issue is politically charged—protesters marched in the capital of Lansing during the voting—Michigan's move is partly a matter of economic survival, some analysts say.
- Norquist: Still No Better Argument for Tax Hikes. A powerful anti-tax crusader said President Barack Obama doesn't have a better argument for tax increases today than he did two years ago, when he agreed to extend the Bush tax cuts for all Americans. "Raising taxes is always bad for the economy," Americans For Tax Reform President Grover Norquist told CNBC's "Squawk Box" on Tuesday. "Tax increases are what's done instead of reforming government."
- Wholesale Inventories Hit Record as Sales Tumble. U.S. wholesale inventories rose more than expected in October as sales fell for the first time in three months, according to a government report on Tuesday that hinted at some piling up of goods in warehouses. The Commerce Department said wholesale inventories increased 0.6 percent to a record $497.1 billion after an unrevised 1.1 percent rise in September.Economists polled by Reuters had expected stocks of unsold goods at U.S. wholesalers to rise 0.4 percent.
Zero Hedge:
- October US Exports Plunge By Most Since January 2009 As Trade Deficit With China Hits Record. (graph)
- Berlusconi to Run Against Merkel. An outline of his strategy can be gleaned from the latest FT/Harris Poll: 83% of Italians (surveyed) think that Germany has too much influence in the EU, up from 53% a year ago. Nearly three-quarters of Italians do not think Germany is doing enough (55% of Germans think they are doing too much). Three-quarters also do not have confidence that their government can handle the debt crisis. Two-thirds of Italians think there has been too much austerity.
Business Insider:
Reuters:- Egypt army seeks national unity as crisis mounts. Egypt's army chief called for talks on national unity to end the country's mounting political crisis after a vital loan from the IMF was delayed and thousands of pro- and anti-government demonstrators took to the streets. The meeting scheduled for Wednesday afternoon was called in response to an increasingly destabilising series of protests that has unfolded since President Mohamed Mursi awarded himself sweeping powers on Nov. 22 to push through a new constitution shaped by his Islamist allies in a referendum on Saturday.
- Italy's Monti warns against populism as Berlusconi attacks. Italian Prime Minister Mario Monti warned against a slide into populism on Tuesday as Silvio Berlusconi attacked his technocrat government, accusing it of failed "Germano-centric" policies that had dragged Italy into recession.
- Uncertainty in Greece as buyback programme misses target. Eurozone finance ministers held a conference call on Tuesday evening to discuss the next steps for Greece after its bond buyback programme failed to achieve the debt reduction target set by the IMF, according to reports.
- The Current State of World Debt. (slideshow)
La Stampa:
- Political elections in February don't change much, European Union President Herman Van Rompuy said in an interview. Hopes future govt will continue on Monti's path; there's no alternative to having "solid public finances and a competitive economy. They are the only remedy to beat the recession and create jobs," Van Rompuy said.
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