Today's Headlines

Bloomberg:

• Draghi Keeps Gradual Recovery Faith as ECB Cuts Forecasts. European Central Bank President Mario Draghi stuck to his view that the euro region will gradually recover later this year even as officials trimmed their economic forecasts and considered cutting interest rates. “Later in 2013 economic activity should gradually recover, supported by a strengthening global backdrop and our accommodative monetary policy stance,” Draghi told a press conference in Frankfurt after the ECB left its benchmark interest rate at 0.75 percent, a record low. While officials discussed cutting borrowing costs today, the “prevailing consensus was to leave the rates unchanged,” Draghi said.
• Bersani Clings to Premiership Goal as Allies Predict Failure. Pier Luigi Bersani will probably fail to win the consensus needed to form a government in Italy, some allies said yesterday after giving the Democratic Party head a mandate to negotiate parliamentary backing with rivals. Bersani revamped his program to entice Beppe Grillo’s Five Star Movement into an alliance with the Democratic Party, or PD. He repudiated his previous commitment to budget rigor and added policy proposals reminiscent of Five Star’s. Still, success depends on smoothing over differences with Grillo, who called Bersani a “dead man talking” after the PD failed to win a parliamentary majority in Feb. 24-25 elections. 
• Berlusconi Is Convicted in Wiretapping Trial. Former Italian Prime Minister Silvio Berlusconi was convicted in a wiretapping case related to the 2006 battle for control of Banca Nazionale del Lavoro SpA, the first of three corruption rulings he faces this month.
• German Factory Orders Fall as Euro Crisis Curbs Demand. German factory orders unexpectedly fell in January as the sovereign debt crisis curbed demand in the euro area. Orders, adjusted for seasonal swings and inflation, declined 1.9 percent from December, when they rose a revised 1.1 percent, the Economy Ministry in Berlin said today. Economists forecast a 0.6 percent gain, according to the median of 41 estimates in a Bloomberg News survey. In the year, workday- adjusted orders dropped 2.5 percent. 
• China Inflation Over 3.5% May Prompt Rate Rise: NDRC Chen. China may need to raise interest rates should gains in the consumer-price index stay at more than 3.5 percent for three months, a senior researcher affiliated with the country’s top planning agency said. “In theory, if CPI remains above 3.5 percent for three months, there should be an interest-rate movement,” Chen Dongqi, the deputy head of the National Development and Reform Commission’s macroeconomic research institute, said in an interview yesterday after a speech at Tsinghua University in Beijing.
• Academic Use of CFTC’s Private Derivatives Data Investigated. The top U.S. derivatives regulator has suspended a program of visiting academic researchers over concerns about the handling of confidential trading data. The Commodity Futures Trading Commission said in a statement yesterday that it began an internal management review and asked the agency’s inspector general to investigate its oversight of data used to research issues including high- frequency trading. The commission’s concerns were initially triggered by an outside person who raised questions about academic research that referenced CFTC data, according to the statement. “The management review, which is ongoing, has preliminarily discovered issues regarding the manner in which academic consultants and contractors were brought into the agency, their status with respect to the agency, their access to CFTC systems and information, and the adequacy of related documentation,” the CFTC said. “To date, we have not confirmed any specific incidents of improper or unauthorized data disclosure.”
• Fed's Balance Sheet Has Nothing on These Banks.(video) 
• U.S. Will Be 99% Energy Independent by 2030: BP CEO. (video)

Wall Street Journal: 

• U.S. Household Wealth at Highest Level Since Late '07. The net worth of U.S. families rose by $1.17 trillion at the end of 2012 to the highest level since late 2007, as rising home values and gains in stock holdings boosted household balance sheets. U.S. households' net worth—the value of homes, stocks and other investments minus debts and other liabilities—rose 1.8% to $66.07 trillion from October through December, the highest level since the fourth quarter of 2007, according to a Federal Reserve report released Thursday.
• Bad-News Bears Crash the Party. The Dow Jones Industrial Average has hit an all-time high. The Standard & Poor's 500-stock index is close behind. Stock prices remain reasonably priced based on many measures, individual investors are shifting back to stocks and corporate profits have been strong. So what are a group of hedge funds and other investors doing? Selling.

CNBC:

• China's 'Ghost Cities' Warn of Property Bubble: Chanos. (video)
• The Fed's Great Stress Test Show. Later Thursday, we're going to get the first round of results from the Federal Reserve's stress tests, which will show broadly how the Fed thinks the banking sector would look under crisis situations.Critics will complain that this is all just for show. But this complaint largely misses the mark. In large part, the stress tests are a show. And that's part of the point.
• In News Feed Revamp, Facebook(FB) Creates 'Personalized Newspaper'.

Zero Hedge: 

• Okun Shrugs With Productivity Plunging, Labor Costs Surging, And Claims Improving. (graphs)
• Chart Of The Day: Plunging Gasoline Demand vs The "Soaring" Recovery And Record Dow Jones. (graph)
• Former Head Of Plunge Protection Team Lands At DE Shaw. 
• The ECB's Press Corps Realize They Have No Idea What OMT Is: "The Rules Are What They Are" Explains Draghi. (video) 
• Cross-Border Flows Drive European Dis-Integration. (graph)

Business Insider: 

• Attorney General Sends Brief And Snarky Letter To Rand Paul. 
• GASPARINO: Mysterious Dark Pools Are Seeing More Trading Action Than The NYSE For The First Time Ever. 
• How Google(GOOG) Glass Will Revolutionize 9 Industries. 

NYPost:

• Pink slips are high fashion at JCPenney(JCP). The flailing retailer — whose CEO, Ron Johnson, is now fighting for his own job — has fired 1,500 store-level department managers and merchandising positions across its chain, The Post has learned.

Reuters: 

• North Korea threatens nuclear strike, U.N. expands sanctions. North Korea threatened the United States on Thursday with a preemptive nuclear strike, raising the level of rhetoric just before the U.N. Security Council approved new sanctions against the reclusive country. The White House said North Korea's threats would only lead to Pyongyang's further international isolation and declared that the United States was "fully capable" of defending against any North Korean missile attack.
• TABLE-US Feb ICSC retail sales up 1.7 pct vs year ago.

Telegraph:

• Accounting change could cost banks billions. Banks could be hit with billions of pounds in new losses under changes to the way they are required to account for assets, in a move intended to make the financial system less prone to a crisis.

People's Daily:

• New policies announced by the government may cause "panic selling" and lead to a subsequent drop in existing home sales, citing Qin Hong, director of policy research at the Ministry of Housing and Urban-Rural Development.