Today's Headlines

Bloomberg: 

• Libor Lies Revealed in Rigging of $300 Trillion Benchmark. Every morning, from his desk by the bathroom at the far end of Royal Bank of Scotland Group Plc’s trading floor overlooking London’s Liverpool Street station, Paul White punched a series of numbers into his computer. White, who had joined RBS in 1984, was one of the employees responsible for the firm’s submissions for the London interbank offered rate, or Libor, the global benchmark for more than $300 trillion of contracts from mortgages and student loans to interest-rate swaps. 
• RBS Drops as U.S. Authorities Said to Ask for Libor Plea. Royal Bank of Scotland Group Plc fell the most in four months as U.S. authorities push for criminal charges in the probe into allegations that Britain’s biggest publicly owned lender tried to rig interest rates. The U.S. Justice Department has extended talks to press the Edinburgh-based bank for a guilty plea in any settlement, said two people familiar with the negotiations. RBS may pay about 500 million pounds ($786 million) to U.S. and U.K. authorities to settle the claims as soon as next week, another two people with knowledge of the negotiations said.
• Ford(F) Sees European Losses Worsening Since October Outlook. Ford Motor Co., the second-largest U.S. automaker, said it expects to lose about $2 billion in Europe this year as a likely recession in the region continues to sap demand for cars. Ford Europe lost $732 million in the fourth quarter and $1.75 billion in the region for the full year, more than its previous forecast given in October of about $1.5 billion. The deficit will be worse in 2013 than Ford’s previous projection for a similar loss to a year earlier because a Europe-wide recession is likely this year, Chief Financial Officer Bob Shanks told reporters today. “We’re seeing weakness in the industry; certainly it will be lower than last year,” Shanks said during a briefing at Ford’s headquarters in Dearborn, Michigan. “It’s just a very tough economic environment in Europe. We have a lot of difficult times in front of us.” Ford shares fell, even though fourth-quarter sales and profit exceeded estimates. Ford slid 4 percent to $13.23 at 9:59 a.m. New York time.
• Egypt Defense Chief Warns of ‘Collapse of State’ Amid Unrest. Egypt’s defense chief warned that political unrest could bring about the “collapse” of the state, after almost a week of street battles killed dozens and piled pressure on President Mohamed Mursi. After ignoring a curfew last night, protesters in the Suez Canal province of Port Said -- one of three areas the president has placed under emergency rule -- vowed today to continue their defiance. Yesterday, the main secular opposition bloc rejected calls by Mursi for a national dialogue, saying “serious” political discourse was needed, not security solutions. The conflict between the political forces “and their disagreement on running the country may lead to the collapse of the state,” Defense Minister Abdelfatah Al-Seesi was quoted as saying in a statement posted on the armed forces’ official Facebook page. The political instability and economic challenges “represent a real threat to Egypt’s security.”
• Tanker Glut Worsens on Steepening OPEC Production Cuts. OPEC’s deepest output cut since the global recession in 2008 is creating the biggest surplus of oil tankers in the Persian Gulf in at least three years and lowering earnings for Frontline Ltd. and other ship owners. The Organization of Petroleum Exporting Countries reduced daily supply by almost 1 million barrels in the four months through December, equal to one fully loaded supertanker every two days, data compiled by Bloomberg show. Saudi Arabia, Iran and Iraq led the retreat, leaving 24 percent more ships than cargoes in the world’s largest oil-producing region, the most for the time of year since at least 2010, according to weekly surveys of shipbrokers and owners by Bloomberg. 
• Oil Rises to Four-Month High. Crude oil for March delivery rose 78 cents, or 0.8 percent, to $97.22 a barrel at 9:26 a.m. on the New York Mercantile Exchange. Futures touched $97.32, the highest intraday price since Sept. 17. The average volume of all contracts traded at that time was 10 percent above the 100-day average. Brent crude for March settlement increased 4 cents to $113.52 a barrel on the London-based ICE Futures Europe exchange. The volume of all contracts traded was 27 percent above the 100-day average.
• Apple(AAPL) Debuts IPad With More Memory Amid Mounting Competition. Apple Inc. debuted an iPad with twice the memory of older models, offering users more space to store movies, videos and books amid mounting competition in the tablet market. The new iPad with 128 gigabytes of storage will be available starting Feb. 5 priced at $799 for a Wi-Fi version and $929 for a device that also offers a cellular connection, Cupertino, California-based Apple said today in a statement.
• Overdue Student Loans Reach ‘Unsustainable’ 15%, Fair Isaac Says. Delinquency rates on student loans made in the past two years stand at 15 percent in the U.S. as recent graduates struggle to find jobs, Fair Isaac Corp. (FICO) said. The rate for 2010 through 2012 compares with 12.4 percent for loans made from 2005 to 2007, Fair Isaac’s FICO Labs said in a statement today, citing data from October. Average student- loan debt last year rose to $27,253 from $17,233 in 2005, and almost 60 percent of bank managers surveyed in December expect delinquencies to worsen in six months, FICO said. 
• Wanxiang Wins U.S. Approval to Buy Battery Maker A123. Wanxiang Group Co., China’s biggest auto-parts maker, won approval from the Committee on Foreign Investment in the U.S. to buy most of the assets of A123 Systems Inc. (AONEQ), the bankrupt electric-car battery maker backed with U.S. government funds.

Wall Street Journal:

• Comex Copper Erases Gains on Large Rise in Stockpiles. Copper futures eased Tuesday after a large jump in warehouse stockpiles of the metal pushed some traders to cash out. The amount of copper stored at London Metal Exchange-monitored warehouses climbed by 9% on Monday, according to exchange data released early Tuesday. The rise was almost entirely the result of 31,425 metric ton increase in stocks held at warehouses in Antwerp, Belgium. Supply-and-demand indicators are under the microscope this year because of widespread expectations that global production of the industrial metal will outpace demand for the first time since 2009. The amount of copper held in LME warehouses is up 61% since the beginning of November, to 371,750 tons.

MarketWatch.com:

• Why tiny Cyprus is still too big to leave the euro. Commentary: Latest bailout belies congratulatory mood in Europe.

Fox News:

• Aide to Egyptian President Morsi claims Holocaust a US hoax. A key figure in Egyptian President Mohammed Morsi's government called the Holocaust a hoax cooked up by U.S. intelligence operatives and claimed the 6 million Jews who were killed by Nazis simply moved to the U.S. The outrageous claims, by Fathi Shihab-Eddim, a senior figure close to President Morsi who is now responsible for appointing the editors of all state-run Egyptian newspapers, came as the world marked Holocaust Remembrance Day on Jan. 27, and also as the U.S. continues to assess its relationship with the increasingly radical Arab state.

CNBC:

• QE Program a 'Disaster', Say UK Saving and Pension Groups. The policy of quantitative easing (QE) pursued by the Bank of England since 2008 has hurt the nation's savers and any further stimulus would have marginal benefits, according to evidence heard by U.K. policymakers. "QE (quantitative easing)is an inflationary policy as they admit, and with inflation currently running higher than the increase in wages, it isn't just savers and pensioners, it's everybody who is suffering and feeling the pinch," Simon Rose from the group Save our Savers said at a meeting of the U.K. parliament's Treasury committee. He argued that millions are now worse off. "From the saver's point of view, QE has been an utter disaster, both whether they're saving through a pension fund or whether they're saving through cash deposits." With inflation now above the current interest rate, Rose said that the resulting negative interest rate means that savers are unable to preserve the value of their cash. "It's quite an appalling confiscation of wealth," he said.

Zero Hedge:

• Blatant Price Manipulation Takes Place Every Day in Oil Markets.
• Spain Is World's Most "Miserable" Nation, Worse Than Greece, Venezuela And South Africa. 
• Case-Shiller Home Price Index Posts Second Consecutive Monthly Decline, Average Home Prices Back To Fall 2003 Levels. (graph) 
• Consumer Confidence Crashes To 2011 Levels After Biggest Plunge Since August 2011 Debt Ceiling Debacle. (graph)
• The Complete World Currency War Heatmap.

Business Insider:

• One Of Facebook's(FB) Great Hopes For Huge Revenues Is Fading. 
• This Chart Must Be Utterly Brutal For Microsoft(MSFT) Executives To Look At.

AdAge:

• YouTube Set to Introduce Paid Subscriptions This Spring. A new chapter in online video is about to begin. YouTube is prepping to launch paid subscriptions for individual channels on its video platform in its latest attempt to lure content producers, eyeballs, and advertiser dollars away from traditional TV, according to multiple people familiar with the plans.

The Blaze: 

• Here Are All the Surprisingly Tough Questions Matt Lauer Fired at Al Gore During Contentious Interview on Al Jazeera ‘Hypocrisy’. (video)
• Worried? New Drone-Mounted Camera Can Tell What You’re Wearing From 17,500 Feet.

Reuters:

• Exclusive: Researchers warn of widespread networking gear bugs. Bugs in widely used networking technology expose tens of millions of personal computers, printers and storage drives to attack by hackers over the regular Internet, researchers with a security software maker said. The long list of devices includes products from manufacturers including Belkin, D-Link, Cisco Systems Inc's Linksys division and Netgear.
• D.R Horton's(DHI) profit soars as prices rise; orders jump. Top U.S homebuilder D.R. Horton Inc's quarterly profit more than doubled as it sold more homes at higher prices, and the company reported a 39 percent jump in orders, underlining a firming U.S. housing recovery. Shares of the company rose as much as 7 percent to $22.75 on the New York Stock Exchange in early morning trade, adding to the nearly 50 percent jump seen in the stock in the last 12 months.

Financial Times:

• China averts local government defaults. Chinese banks have rolled over at least three-quarters of all loans to local governments that were due to mature by the end of 2012, an indication of the immense challenge facing China in working down its debt load. Local governments borrowed heavily from banks to fuel China’s stimulus programme during the global financial crisis and are now struggling to generate the revenue to pay them back, a shortfall that could cast a shadow over Chinese economic growth.

Telegraph:

• Mario Draghi confronts Berlin over contagion from Cyprus default. Leading European Union officials have warned Germany it would be a grave mistake to let Cyprus default or to impose losses on private creditors, fearing a repeat of errors made when Greece first flew out of control.

Handelsblatt:

• German Ifo Jobs Index Unexpectedly Falls. The jobs index published by Germany's Ifo economic institute erased recent gains, falling to 106.6 in January from 106.9.