Wednesday, February 13, 2013

Today's Headlines

Bloomberg:
  • King Says U.K. Faces Inflation Bout Plus Weak Growth. Bank of England Governor Mervyn King said Britain faces a further bout of inflation and a muted economic recovery, and pledged officials will look through the volatility in prices to keep nurturing growth where they can. “Inflation is likely to rise further in the near term and may remain above the 2 percent target for the next two years,” King said as he presented the central bank’s Inflation Report in London today. “The MPC’s remit is to deliver price stability in the medium term in a way that avoids undesirable volatility in output in the short run. The prospect of a further prolonged period of above-target inflation must therefore be considered alongside the weakness of the real economy.”
  • Fracking Threatens OPEC as U.S. Output at 20-Year High. A surge in U.S. oil production has pushed the country’s output to the highest level since 1992, threatening the dominance of the Organization of Petroleum Exporting Countries. The U.S. pumped 7.06 million barrels a day in the week ended Feb. 8, up 1 percent from the previous week and extending last year’s 19 percent gain, the Energy Information Administration said today. OPEC production fell to the lowest level in a year in January, the Paris-based International Energy Agency said today in its monthly report. Improvements in horizontal drilling and hydraulic fracturing, or fracking, have spurred drilling in states such as Texas, North Dakota and Oklahoma. Saudi Arabia, OPEC’s largest producer, reduced output in December because customers asked for less, Ibrahim al-Muhanna, an adviser to Saudi Arabian Oil Minister Ali al-Naimi, said Jan. 14. “Increasing amounts of North American oil production puts pressure on OPEC to find other markets for their oil,” Andy Lipow, president of Lipow Oil Associates LLC in Houston, said by phone today. “It changes the political dynamics between the U.S. and OPEC.” U.S. crude imports have fallen 5.9 percent so far this year, extending a 21 percent decline last year, according to data from the EIA, the statistical arm of the Energy Department. The U.S. met 84 percent of its energy needs in the first 10 months of last year, on pace to reach the highest annual rate of self-sufficiency since 1991.
Wall Street Journal:
  • Euro's Rise Threatens Corporate Recovery. The euro's high exchange rate is dimming a rare bright spot for European companies: exports. With the euro up 12% against the dollar since July and up 35% to a three-year high against the yen, European companies are squirming. A stronger currency makes a country's exports more expensive abroad—and thus less competitive—and reduces profit when it is brought back home.
CNBC:
  • Zell: US Border Not a Problem, 'Jobs Aren't Here'. (video) America should not worry too much about protecting its porous borders from illegal immigrants because "the jobs aren't here" so they're not coming anymore, entrepreneur Sam Zell told CNBC on Wednesday. Zell noted that the president's call to increase the federal minimum wage from $7.25 an hour to $9 would cost jobs. "There's no history that says raising the minimum wage does anything other than eliminate jobs," he said.
  • Drop Coverage or Cut Hours? Big Companies Grapple With Obamacare. For large retail and restaurant chains the big unknown in the year ahead is how much more they'll pay for health coverage. Employers with 50 or more workers who put in 30 hours a week will be required to provide health care coverage or pay a fine, under the Affordable Care Act, also called the ACA or Obamacare. But the details haven't been settled. "We can't really calculate what it's going to be like," said John Mackey, Co-Founder and Co-CEO of Whole Foods, an outspoken critic of the Obama health reform law. 
  • State of the Union Reaction: Gun Sales Still Strong. The day after President Barack Obama's emotional plea in his State of the Union message for a "vote" on new gun control measures, it is business as usual at the Blue Ridge Arsenal in Chantilly, Va. The post-Sandy Hook boom in gun sales and even ammunition continues.
Reuters: 

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