Thursday, December 06, 2012

Today's Headlines

Posted by Gary .....at 3:34 PM
Bloomberg: 
  • Draghi Leaves Rate-Cut Door Ajar as ECB Reduces Forecasts. The European Central Bank cut its growth and inflation forecasts and President Mario Draghi said the euro area won’t start to shake off its slump until the second half of 2013, leaving the door ajar for further interest- rate reductions. “Weak activity is expected to extend into next year,” Draghi said today at a press conference in Frankfurt after policy makers left the benchmark rate at a record low of 0.75 percent. “By the second part of the next year, we should see the beginning of a recovery” as global demand strengthens and the ECB’s low rates feed through to the economy, he said.
  • Depression Deepens Greek Middle Class Despair With Crime. Anastasia Karagaitanaki, 57, is a former model and cafe owner in Thessaloniki, Greece. After losing her business to the financial crisis, she now sleeps on a daybed next to the refrigerator in her mother’s kitchen and depends on charity for food and insulin for her diabetes. “I feel like my life has slipped through my hands,” said Karagaitanaki, whose brother also shares the one-bedroom apartment. “I feel like I’m dead.” For thousands of Greeks like Karagaitanaki, the fabric of middle-class life is unraveling. Teachers, salaries slashed by a third, are stealing electricity. Families in once-stable neighborhoods are afraid to leave their homes because of rising street crime.
  • Euro Weakens as ECB Reduces Economic Forecasts. The euro declined the most in a month against the dollar after European Central Bank President Mario Draghi said economic weakness will persist next year, suggesting the central bank has scope to lower interest rates. The 17-nation currency dropped from almost a seven-month high against the yen after the ECB cut its growth forecasts and said it saw “downside risks” for the region. The yen strengthened versus most of its major counterparts as investors sought safer assets. New Zealand’s dollar rose to a two-month high against the greenback after the nation’s Reserve Bank said growth was likely to quicken.
  • 54% of used-vehicle loans were subprime in 3Q vs 52% during the same period in 2011, S&P analyst Erkan Erturk wrote, citing Experian, subprimenews.com. Subprime loans made up 25% of financing of new vehicles in Q3, up from 22% in Q3 2011. 
  • Copper Retreats as European Growth Concerns Dim Demand Outlook. Copper futures dropped the most in four weeks amid concern that persistent economic weakness in Europe will undercut demand for the metal. A report today showed the euro-area’s economy shrank in the third quarter, slipping 0.1 percent from the previous three months and confirming data from last month showing the currency union fell into a recession. The European Central Bank cut its forecast for 2013 to a contraction of 0.3 percent, rather than expected growth of 0.5 percent. “The commentary out of the ECB is weighing on the market,” Fain Shaffer, the president of Infinity Trading Corp. in Medford, Oregon, said in a telephone interview. “The problems in Europe aren’t going away.” Copper futures for March delivery fell 1.1 percent to $3.6445 a pound at 1:17 p.m. on the Comex in New York, the biggest drop since Nov. 7. 
  • IRS Warns Congress About Failure to Address Alternate Tax. Failure by Congress to act on the alternative minimum tax by year’s end will lead to “significant” delays in tax filing and a strain on taxpayers, said Steven Miller, the Internal Revenue Service’s acting commissioner. The alternative minimum tax, or AMT, is part of the so- called fiscal negotiations in Congress. Leaving it untouched would affect taxpayers early in 2013, because its reach would be expanded for returns filed for tax year 2012.
  • Greenspan Says Painless Solution to U.S. Debt is Fantasy. (video)
  • Jobless Claims in U.S. Decline as Sandy Effect Wanes. Fewer Americans than projected filed applications for unemployment benefits last week as disruptions caused by superstorm Sandy waned. Jobless claims decreased by 25,000 to 370,000 in the week ended Dec. 1, Labor Department figures showed today in Washington. The median forecast of 52 economists surveyed by Bloomberg called for a drop to 380,000. A Labor Department spokesman said there was nothing unusual in last week’s data. 
  • U.S. Shows Signs of Flexibility at UN Climate Discussions. President Barack Obama’s envoy at United Nations global-warming negotiations said he’s willing to participate in discussions on the issue of fairness in how nations plan to curb climate change, paving the way for drafting a new treaty by 2015. Todd Stern, the State Department official heading the U.S. delegation at the UN climate conference in Doha, also acknowledged yesterday that the U.S. has more work to do to reduce fossil-fuel emissions. “As President Obama said just a few weeks ago, we need to do more and we intend to do more,” he told delegates. 
  • Apple to Invest in Manufacturing Macs in U.S., Cook Says. Apple Inc. (AAPL) plans to spend more than $100 million next year on building Mac computers in the U.S., shifting a small portion of manufacturing away from China, the country that has handled assembly of its products for years. 
  • Apple(AAPL) IPhone to Be Sold by T-Mobile in 2013. T-Mobile USA Inc. will begin offering Apple Inc. (AAPL)’s iPhone next year, becoming the last of the four largest U.S. carriers to offer the best-selling device. Deutsche Telekom AG (DTE), T-Mobile’s parent, disclosed the agreement to sell Apple products in 2013 in a statement today. Larger U.S. competitors Verizon Wireless, AT&T Inc. (T) and Sprint Nextel Corp. (S) all sell the iPhone.
Wall Street Journal:
Reuters: 
  • Monti govt at risk after Berlusconi withdraws support. Silvio Berlusconi's party withdrew its support for Prime Minister Mario Monti on Thursday, raising the risk of a snap election in Italy, but President Giorgio Napolitano said he would work to avoid a crisis and there was no need for alarm. 
  • Russia says US rights bill 'absurd', may retaliate. Russia denounced as "absurd" a trade bill that passed the U.S. Senate on Thursday with a provision to punish Russian human rights violators, and a senior Russian lawmaker said Moscow may respond with a similar law. "The decision of the U.S. Senate...is a performance in the theatre of the absurd," the Foreign Ministry said in a statement on its website.
    Alexei Pushkov, the head of the lower house of parliament's international affairs committee told Itar-Tass that Moscow could pass a "corresponding law".

Telegraph:

Ansa:

  • Finance Minister Grilli Says Italy Not on Verge of Abyss. "We certainly know that the situation is difficult", Grilli said. Grilli's comments come after former PM Berlusconi last night signaled he may run for the premiership as Italy is on "the edge of the abyss."

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