Today's Headlines

Bloomberg: 

• Euro Exports Fell in Fourth Quarter as Slump Deepened: Economy. Euro-area exports fell in the fourth quarter for the first time in more than three years and investment declined as the sovereign debt crisis pushed the region deeper into a recession. Shipments from the euro area dropped 0.9 percent in the last three months of 2012, helping to drive gross domestic product down 0.6 percent, the European Union’s statistics office in Luxembourg said today. Exports last declined in the second quarter of 2009. Imports also fell 0.9 percent in the fourth quarter. “Real economic activity is yet to show major improvement in many countries and it looks highly likely that growth will remain a major struggle for the euro zone for some time to come,” Howard Archer, chief European economist at IHS Global Insight in London, wrote in a note today.
• Bersani Says Recession Emergency as He Bids for Premiership. Democratic Party leader Pier Luigi Bersani called on Beppe Grillo’s anti-establishment Five Star Movement and Prime Minister Mario Monti’s coalition to back his efforts to form a government based on a program of easing austerity in recession-wracked Italy. The nation’s priority is getting “out of the austerity cage,” Bersani, whose bloc won the most votes in inconclusive election last month, told about 100 members of the party’s top body in Rome today. Italy’s next government should be an “active protagonist of a rectification of the European policies for stability,” he said.
• Monti Won’t Back Italian Government That Threatens EU Reforms. Italian Prime Minister Mario Monti said he won’t back a new government that would threaten his country’s commitments to the Europe Union and that Italy should hold a new vote rather than install an administration that could reverse fiscal discipline. In his most detailed comments since Feb. 24-25 elections produced a hung parliament and saw his coalition win less than 10 percent of the vote, Monti said none of Italy’s political parties is capable of addressing the country’s problems. “If the alternative is a government oriented to interrupting Italy’s European path or the way of reforms, I believe it would be better to hold new elections,” Monti said at a press conference in Rome today.
• Kuroda to Hit ‘Wall of Reality’ at BOJ, Ex-Board Member Says. Haruhiko Kuroda will have limited options for aggressive easing if he’s confirmed as central bank governor as more Japanese government bond purchases heighten the risk of a market bubble, a former BOJ policy board member said. “Kuroda will hit the wall of reality,” Atsushi Mizuno, vice chairman at Credit Suisse AG in Tokyo and a member of the BOJ board from 2004 to 2009, said in an interview today. “Increased bond buying would cause over-dependence on the BOJ and that’s not healthy for the market. I see the risk of a JGB bubble.”
• AIG Betting on Homeowners as Benmosche Chases Yield: Mortgages. American International Group Inc., the insurer that was rescued by the U.S. government in 2008 after soured bets on mortgage securities, is building a unit to buy individual home loans amid a rebound in the housing market. AIG plans to buy loans backed by its United Guaranty Corp. unit, the largest seller of traditional private mortgage insurance last year, according to Donna DeMaio, 54, the unit’s chief executive officer. The debt will be held as long-term investments by AIG insurance companies.
  AIG has boosted investment in U.S. property markets less than five years after real-estate wagers forced the government to rescue the insurer, once the world’s largest. The Fed had to step in after AIG sold derivatives to banks protecting them against losses on housing debt, with the U.S. bailout reaching $182.3 billion.
• Too-Big-to-Fail Banks Limit Prosecutor Options, Holder Testifies. The size of the largest financial institutions has made it difficult for the U.S. Justice Department to bring criminal charges, Attorney General Eric Holder said. Criminal charges against a bank -- something that could threaten its existence -- may also endanger the national or global economies in the case of the largest ones, because of their size and interconnectedness. That has “made it difficult for us to prosecute” some of those institutions, Holder said today at a Senate Judiciary Committee hearing.

Wall Street Journal:

• Honeywell's(HON) Hiring Is Bleak. Conglomerate's CEO Says Job Growth Won't Pick Up Until GDP Growth Tops 3%. Honeywell International Inc. Chief Executive David Cote says job growth won't improve much until U.S. economic growth tops 3%, in a bleak outlook for employment as the economy continues to bump along.
• House Approves Stopgap Budget Deal. The U.S. House on Wednesday voted to extend spending cuts that went into effect on March 1 and keep the government operating for the remainder of the fiscal year, which ends on Sept. 30. The legislation is necessary to keep the federal government open after current funding runs out on March 27. It would keep in place automatic spending cuts known as the sequester for all federal agencies, while giving the Defense and Veterans Affairs departments more flexibility in setting spending priorities.
• Syrian Rebels Seize U.N. Forces in Golan Height. Around 20 United Nations peacekeepers in the Golan Heights were abducted by a Syrian rebel group, which said it would keep them as hostages unless the Syrian government withdraws its forces from the region within 24 hours, a U.N. spokesman said Wednesday. "The U.N. Disengagement Observer Force, or Undof, has reported that, earlier today, approximately 30 armed fighters stopped and detained a group of around 20 peacekeepers" in the demilitarized zone patrolled by the U.N., said U.N. spokesman Farhan Haq in New York. 
• CIC President Warns Japan on Yen Devaluation. The president of China's giant sovereign-wealth fund warned Japan against using its neighbors as a "garbage bin" by deliberately devaluing the yen, joining a growing number of Chinese officials sounding alarms about a potential currency war. "I would hope that it doesn't do that as a responsible government," Gao Xiqing, president of China Investment Corp., said in an interview with The Wall Street Journal on Wednesday. He was responding to questions about worries among some finance ministers and central bankers that the new Japanese government would devalue its currency to boost exports at other countries' expense.
• Chávez Death Opens Uncertain Period. Crowds of weeping supporters surrounded the flag-draped coffin of President Hugo Chávez Wednesday as it was escorted through the streets of the capital, with many in this deeply divided nation mourning the loss of a man they considered their champion and others hoping for change after 14 years of populist policies.

Fox News:

• Obama Falls Farther Behind in Spending Fight. “So it is our opinion that however you manage that reduction, you need to make sure you are not contradicting what we said the impact would be.” -- An email from USDA official Charles Brown rejecting a subordinate’s suggestion of a way to lessen the consequences of budget cuts for citizens. Americans have a government that now claims the power to execute its own citizens on its own soil without trial but that cannot find a way to afford public tours of government buildings.

CNBC: 

• Retail Investor Sentiment Near All-Time High: TD Ameritrade. "Retail investors and professionals are both bullish on stocks," said Tom Bradley, president of retail distribution at TD Ameritrade on "Squawk on the Street." "Bullish sentiment is definitely high," he added, citing a TD Ameritrade index on sentiment of both retail and professional investors.

Zero Hedge: 

• ADP Beats As Small Businesses Respond To Payroll Tax Cash Crunch By Hiring More. (graph)
• One Hundred And Eighteen Million Dollars An Hour.
• Yet Another Funny Chart: January Factory Orders Confirm Manufacturing Slump Continues. 
• European Crisis Over? Not So Fast. (graphs)
• A Look at U.S. Taxes and Hauser's Law.

Business Insider: 

• FED SURVEY: Businesses Say They're Hiring Less And Laying Off Workers Because Of Obamacare. 
• REPORT: Carl Icahn Is Snapping Up A BIG Position In Dell, And Will Oppose The Buyout Deal. 
• GOOGLE(GOOG): US Government Spying Has Risen 122 Percent. 
• CHART OF THE DAY: A Stock Market Trend Has Developed That Coincided With The Last 3 Recessions. 
• BofA(BAC): NYSE Margin Debt Is Generating A Sell Signal We Haven't Seen In Three Years. (graph)

Propublica:

• After Sandy, Government Lends to Rebuild in Flood Zones. The Small Business Administration has approved the restaurant for a disaster loan of almost $1 million. There’s just one problem: Newly drawn FEMA flood maps show the cafe is at high risk of flooding again, raising the question of whether it makes sense to rebuild there or move elsewhere.

Reuters:

• China blames manipulation for iron ore price surge. China's top economic planning agency lashed out at the world's top three iron ore miners on Wednesday, accusing them and some traders of manipulating the market to drive an 80 percent rally in ore prices in just six months. "The three major miners and some traders have delayed shipments and held back cargoes to control supplies in order to send a fake market signal that there was a supply shortage," according to a report published on the National Development & Reform Commission (NDRC) website.
• DBRS downgrades Italy's debt rating over political uncertainty. Credit-rating agency DBRS downgraded Italy's debt to A (low) from A with a negative outlook on Wednesday, the first downgrade of the heavily indebted country since elections last month produced a political stalemate. 
• American Eagle Outfitters(AEO) outlook soft. American Eagle Outfitters Inc on Wednesday gave a profit forecast that fell short of Wall Street expectations and said same-store sales would fall in the current quarter, a setback for a company that has been winning market share from rivals. Shares were down 10.2 percent to $20.26 in late morning trading.
• Euro slides vs dollar as ECB seen signaling future easing.

 eFXNews:

• Italy 'Too Big To Ignore'; Needs EUR To Fall To 1.19 To Make A Good Recovery - Morgan Stanley. The message provided by the Italian electorate is also a cry for economic growth, especially by the younger generation. The ECB may have to listen.

Telegraph:

• French and Italian debt chiefs warn on EU Tobin Tax. Officials in charge of managing French and Italian public debt have warned that Europe’s ‘Tobin Tax’ on financial trades risks damaging the sovereign bond market and may prove self-defeating.

Handelsblatt:

• BDI's Grillo Sees Potential Return to Crisis. Ulrich Grillo, president of Germany's BDI industry association, cites developments in Italy and France. The Italian elections and deindustrialization of France show the danger, Grillo said in an interview.

CNTV:

• China's property control measures may get "stricter," citing Housing and Urban-Rural Development Minister Jiang Weixin. China won't cancel its latest property curbs "for awhile," Jiang said.

Shanghai Securities News:

• People's Bank of China adviser Qian Yingyi said today that he can't rule out an interest rate increase this year. China faces "very big" pressures in achieving M2 growth target of 13% and CPI growth target of 3.5%, Qian said.