Today's Headlines

Bloomberg:

• German Exports Fell in February Amid Euro-Area Recession. German exports fell more than economists forecast in February as the euro area, the country’s biggest trading partner, struggled to emerge from recession. Exports, adjusted for working days and seasonal changes, dropped 1.5 percent from January, when they gained 1.3 percent, the Federal Statistics Office in Wiesbaden said today. Economists forecast a 0.3 percent decline, according to the median of 15 estimates in a Bloomberg News survey. Imports fell 3.8 percent. Shipments from Germany to the euro area dropped 4.1 percent in February from a year ago, while those to the European Union decreased 3.4 percent. Exports to non-EU members fell 1.9 percent, today’s report showed. 
• European Stocks Are Little Changed; Lagardere Falls. European (SXXP) stocks climbed as mining shares rallied and Alcoa Inc. began the U.S. earnings season with profit that beat analysts’ estimates. 
• Fitch Cuts China Yuan Debt Rating on Local Government Borrowing. Fitch Ratings Ltd. cut China’s long- term local-currency debt rating, citing increasing risks to the country’s financial stability given the lack of transparency in the increased borrowing of local governments. Fitch lowered the rating to “A+”, its fifth-highest level, from “AA-,” the London-based company said in an e- mailed statement today. The company estimates total credit in China’s economy, including various forms of so-called shadow banking, may have reached 198 percent of gross domestic product at the end of 2012, up from 125 percent at end-2008. “Fitch believes Chinese LGs likely have significant additional contingent liabilities arising from debts of LG- linked corporates,” the company said, referring to local governments in China. “The classification of lending between corporate and LG sectors have been opaque. Lack of transparency over the indebtedness of LGs is a shortcoming for China relative to peers.”
• China Surging Wages Threaten Economy’s Competitiveness, ADB Says. China’s surging wages and other costs are showing signs of undermining the competitiveness of the nation’s economy, threatening its growth potential, the Asian Development Bank said. Average inflation-adjusted wages have more than tripled in a decade and non-wage costs for procedures such as hiring and firing have risen since the introduction of a 2008 labor law, the ADB said in a report published today. The labor market is being squeezed across the nation as the pool of working-age people shrank last year. At stake is China’s position as the world’s biggest producer of low-cost goods, while competitors from Vietnam to Mexico stand to gain as investors seek to relocate to countries that have cheaper labor or are closer to big markets in the U.S. and Europe. “Rapid aging of the population is taking its toll on the labor market,” Hamid L. Sharif, the ADB’s country director for China, said at a press briefing in Beijing. “Unless compensated by rising labor productivity, high wages would erode the economy’s competitiveness and growth potential, hampering government development plans.”
• N. Korea Threats Boost Odds of First BOK Rate Cut Since October. North Korea’s threats are raising the odds of the first interest-rate cut by its southern neighbor since October as they threaten to damp business and consumer sentiment in Asia’s fourth-largest economy.
• Egypt Pope Criticizes Mursi Over Sectarian Clashes Response. Egypt’s Coptic pope criticized the Islamist president’s handling of the worst sectarian clashes in months, and demanded stronger action against violence that has deepened the nation’s rifts. Days of Muslim-Christian fighting outside a Coptic cathedral in Cairo and in a nearby town have left at least eight dead, most of them Christians. President Mohamed Mursi demanded an investigation into the violence, vowed the perpetrators would be brought to justice and ordered the revival of a little-known body charged with tackling discrimination. 
• Corn Boom Goes Bust With U.S. Sales in Record Drop: Commodities. The record collapse in U.S. corn exports and shrinking domestic demand are leaving more grain in silos, spurring a bear market just eight months after drought drove prices to an all-time high. Stockpiles will be 836 million bushels (21.2 million metric tons) on Aug. 31, or 32 percent more than the U.S. Department of Agriculture forecast last month, according to the average of 35 analyst estimates compiled by Bloomberg. Export sales from the world’s largest grower and shipper fell 54 percent in the year that began Sept. 1, heading for the biggest annual drop in government data that starts in 1960. 
• Gold, Silver Gain on Bets Central Banks Will Add More Stimulus. Gold rallied to a one-week high on speculation that central bankers in the world’s major economies will take additional steps to spur growth, boosting demand for the precious metal as a store of value. Silver jumped.
• Lacker Says Government Should Be Ready to Let Big Banks Fail. Federal Reserve Bank of Richmond President Jeffrey Lacker said plans to limit the size or change the structure of the largest financial institutions must be made with the intent of allowing a failure without government aid. “It makes perfect sense to constrain the scale and scope of financial firms in a way that ensures that they can be resolved in an orderly manner, without government protection for creditors,” Lacker told a conference at the University of Richmond.

Fox News:

• 14 injured in knife attack on Lone Star College campus, suspect arrested. Over 12 people were stabbed Tuesday on the campus of Lone Star Community College campus in Cypress, Texas, after a male suspect reportedly used a small knife, ran from building to building and randomly attacked individuals along the way. Harris Country Sheriff Adrian Garcia says the suspect, described as a young white male, has been taken into custody. No further information about the suspect or about the weapon has been released as the investigation is still active and ongoing.

CNBC:

• France Faces 'Devastating Scandal' as Economy Stalls.
• I'd Be Willing to Scale Back QE, Fed's Bullard Says. (video)

Zero Hedge:

• Broke And Broker: US Casino Spending Tumbling Back To Great Recession Levels. (graph) What the chart shows is quite clear: at a drop of 4.3% Y/Y, far below the cyclical rises in 2011 and 2012, discretionary spending allocated for proceeds one can "afford to lose" is back to Great Recession levels, and sliding lower. 
• Small Businesses Planning To Hire: 0%. (graph)
• Italian Bank Holdings Of Italian Debt Rise To All Time High. (graph)
• What Do Interest Rates Tell Us About The Economy. (graph)
• Charles Gave: "France Is On The Brink of A Secondary Depression".

Business Insider:

• Intel's(INTC) Cable TV Killer Is Blowing Away The People Who See It.
• KOTOK: A Major Transition Is Underway Regarding Bank Deposit Safety.
• China's Bird Flu Problem Is Getting Worse.
• There's No Sign Of Economic Recovery In America's 'Soup Lines' [Chart].
• CHART OF THE DAY: Why The Personal Savings Rate Is Tumbling.

New York Times:

• Prosecutors Said to Be Investigating Tips at KPMG Involving Herbalife(HLF) and Skechers(SKX). Federal prosecutors and securities regulators in Los Angeles are investigating a former senior partner at KPMG for leaking secret information to a stock trader, according to people with direct knowledge of the inquiry. The case involves alleged tips about confidential data related to Herbalife, the nutritional-supplement seller, and Skechers USA, the footwear maker, according to these people. On Tuesday morning, both Herbalife and Skechers announced that KPMG had resigned as their auditor.

Reuters:  

• ECB's Asmussen sees growing risks for H2 recovery. European Central Bank Executive Board member Joerg Asmussen said on Tuesday there were more downside risks to a recovery of the euro zone economy in the second half of the year than one or two months ago. His comments further fuelled expectations that the ECB is getting ready to cut interest rates further, following last week's comments by ECB President Mario Draghi that the bank would "monitor very closely" all data and stands "ready to act". "There are more downside risks to a recovery in the second half of the year than four or eight weeks ago," Asmussen said in a speech in Nuertingen. 

Telegraph:

• Slovenia faces 'severe banking crisis', warns OECD. Slovenia faces a "severe banking crisis" and must act fast to avoid the "daunting outcome" of a prolonged downturn and being cut-off from financial markets, the Organisation for Economic Co-operation and Development has warned.
• Greece enters deflation for first time in 45 years. Greek consumer prices fell year-on-year in March, taking the battered economy into deflationary territory for the first time since 1968.

Yonhap News:

• North Korea completed preparation for mid-range missile launch, citing South Korean govt officials. North Korea is technically able to launch missile as early as tomorrow.

Bear Radar

Style Underperformer:

• Small-Cap Value +.16%

Sector Underperformers:

• 1) Homebuilders -.83% 2) Restaurants -.68% 3) Hospitals -.65%

Stocks Falling on Unusual Volume:

• BOFI, IRDM, FLO, MA, CMG, DEO, SONC, STWD, MG, JCP, SHLM, TTEK, ESS, FCN, OIS, VIPS, CNQR, AAP, PDCO, BG, DEO, FIRE, RLGY, QCOR, DLTR and STWD

Stocks With Unusual Put Option Activity:

• 1) TJX 2) EWJ 3) LOW 4) TXN 5) PHM
  

Stocks With Most Negative News Mentions:

• 1) STJ 2) PDCO 3) MA 4) HLF 5) A
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Large-Cap Value +.05%

Sector Outperformers:

• 1) Gold & Silver +3.8% 2) Steel +3.08% 3) Alt Energy +.93%
  

Stocks Rising on Unusual Volume:

• NIHD, SNFCA, VHC, ANV, RIO and CLF

Stocks With Unusual Call Option Activity:

• 1) IRM 2) CIEN 3) NUAN 4) JDSU 5) KERX
  

Stocks With Most Positive News Mentions:

• 1) MAKO 2) JEC 3) RS 4) AGU 5) LMT
  

Charts:

• ETFs Rising on Unusual Volume 

• Stocks Rising on Unusual Volume

Tuesday Watch

Evening Headlines 
Bloomberg: 

• Developing Asia Rebound Faces Risk From Capital Flows, ADB Says. Developing Asia’s growth recovery faces the risk of asset bubbles from rising capital inflows, the Asian Development Bank said. Gross domestic product will increase 6.6 percent in 2013 and 6.7 percent next year, the Manila-based lender said in its Asian Development Outlook 2013 released today. Consumer prices will rise 4 percent in 2013 and 4.2 percent next year, it said.

• China Failed Mining Deals Top $45 Billion on Hanlong Bungle. Sichuan Hanlong Group’s botched $1.2 billion bid for Australia’s Sundance Resources Ltd. (SDL) brings the value of China’s recent failed mining deals to $45 billion, a record that’s prompted stricter Chinese scrutiny of acquisitions. Chinese companies attempted $107 billion worth of mining takeovers over the past five years, with about $45 billion, or 42 percent by value, of deals ending in failure. Of $562 billion of deals proposed globally in the same period, $180 billion, or 32 percent, didn’t proceed, according to data compiled by Bloomberg.

• Rogers Says North Korea’s Kim Likely to Cause ‘Skirmish’. North Korea will probably carry out a small military attack in the region so the country’s leader, Kim Jong Un, can brandish his power, the chairman of the U.S. House intelligence panel said today. “I do think there will be some small skirmish before this is over,” Representative Mike Rogers, a Michigan Republican, said in an interview at Bloomberg News headquarters in New York. North Korea has threatened to carry out pre-emptive nuclear strikes against the U.S. and South Korea, a move that escalated tensions in the region and prompted calls for dialogue. “I almost think they are looking for some small engagement so that he can brandish his credentials with the military,” Rogers said. He called Kim’s behavior “brazen” and said the new dictator is surrounded by “hardliners.” 

• North Korea Acts a Clear Threat, U.S. Commander to Tell Congress. North Korea’s development of nuclear weapons and long-range missiles poses a “direct threat” to the U.S. and its allies, a top U.S. military commander plans to tell Congress today amid rising tensions on the Korean peninsula. The situation, fanned by hostile rhetoric from dictator Kim Jong Un, “creates an environment marked by the potential for miscalculation” and military escalation, Admiral Samuel Locklear, the head of the U.S. Pacific Command, said in prepared testimony for a Senate Armed Services Committee hearing. Efforts by Kim’s regime to build and test nuclear weapons and ballistic missiles violate United Nations Security Council resolutions and “represent a clear and direct threat to U.S. national security and regional peace and stability,” Locklear said in his testimony. 

• Bernanke Says Interest on Reserves Would Be Main Tightening Tool. Federal Reserve Chairman Ben S. Bernanke said the Fed will raise the interest rate on excess reserves as its primary tool for tightening monetary policy rather than selling assets from its balance sheet. “The principal tool that we contemplate is the interest rate paid on excess reserves,” Bernanke said today in response to audience questions at a conference in Stone Mountain, Georgia. During a tightening, money market rates will probably stay close to the interest rate on excess reserves, he said.

• J.C. Penney(JCP) Ousts CEO Johnson, Brings Back Ullman. J.C. Penney Co. ousted Chief Executive Officer Ron Johnson and reinstated his predecessor, Myron E. Ullman III, as the department-store chain works to rebound from its worst sales year in more than two decades. The shares slid in late trading.

• Killing Keystone Seen as Risking More Oil Spills by Rail. A rejection of the Keystone XL pipeline by President Barack Obama would push more of Canada’s $73 billion oil exports onto trains, which register almost three times more spills than pipelines.

Wall Street Journal: 

• Margaret Thatcher Dies: Streaming Coverage.

• China's Xi Says Fast Growth Over. Chinese President Xi Jinping said China's days of breakneck growth are over as the world's No. 2 economy tries to balance expansion with sustainability and increasing environmental awareness. Speaking before business leaders at the Boao Forum for Asia in southern China on Monday, Mr. Xi said "it's not impossible to grow faster," but added, "we don't want to grow too fast." "I don't think China can sustain super-high or ultra-high-speed growth," he said, citing the need to balance economic growth with other issues. He said China's slowdown last year to 7.8% economic growth is "partially due to our efforts to control the speed of growth."

• A Primer for Understanding Obama's Budget. Congress and the White House routinely hide the impact on the deficit of their proposals and laws.

Fox News: 

• As support for gun bill filibuster grows, Obama says backers trying to use 'political stunts'. The White House lashed out Monday at Republican lawmakers threatening to filibuster gun control legislation in the Senate, accusing them of trying to pull “political stunts” and "hide" behind procedural maneuvers -- as support for the filibuster continued to grow. Sen. Mike Lee, R-Utah, announced early Monday that 13 senators had signed a letter to Majority Leader Harry Reid threatening to oppose "any legislation that would infringe on the American people's constitutional right to bear arms."

CNBC: 

• China March CPI Up 2.1%, PPI Falls 1.9%.

Zero Hedge: 

• The Next Domino: Australia Doubles Tax On Retirement Savings.

• "Do You Believe In Miracles": IceCap Asset Management Monthly Letter.

• Yen Surges As Japan's Deputy PM Says Excessive Yen Gain "Corrected".

• Why RINs Could Be 2013's 4-Letter Word For Gas Prices. 

• Why Austerity Is Necessary.

Business Insider: 

• Here's How Much Americans Will Lose From The Payroll Tax Hike.

• Here's Why Wall Street Doesn't Like The Return Of JCPenney's Old CEO. 

• Food Stamps Are The New Normal In The US Lackluster Economic Recovery.

• China Battles Bird Flu With Spray And Mass Slaughters [PHOTOS].

New York Times:

• Exchanges Are Moving to Curb Private Trades. The chief executives of the three largest stock exchanges are joining forces for the first time to push regulators to rein in the increasing amount of trading that is moving off public exchanges and onto platforms like so-called dark pools. The leaders of the New York Stock Exchange, Nasdaq and BATS Global Markets, the third largest exchange operator, are planning to meet on Tuesday with officials of the Securities and Exchange Commission, according to people briefed on the meeting.

Reuters:

• N.Koreans don't show for work at Kaesong factory park. North Korean labourers did not show up for work on Tuesday at a factory complex operated with South Korea, companies with operations there said, effectively shutting down the zone for the first time since it began shipments in 2004.
  
  
  Pyongyang's decision to halt work at the Kaesong industrial park coincided with speculation it would carry out a missile launch, or even another nuclear test, in what has become one of the worst periods of tension on the peninsula since the end of the Korean War in 1953.

• GM(GM) cuts S.Korean output due to weak Chevy sales in Europe. General Motors Co plans to deepen cuts to output at one of its South Korean plants in April to cope with lacklustre sales in Europe, a company official said on Tuesday. GM's South Korean unit will idle its plant in the southwestern city of Gunsan for nine days this month, up from six days in March, the official said. 

• U.S. watchdog subpoenas swaps association over benchmark. The top U.S. derivatives regulator is probing a widely used benchmark for swaps, the trade body overseeing the rate said, dealing a further blow to the market after the sprawling Libor probe. The Commodity Futures Trading Commission (CFTC) has subpoenaed the International Swaps and Derivatives Association (ISDA) over its ISDAfix benchmark, widely used to anchor market rates, a spokeswoman for ISDA said. Bloomberg reported on Monday that the CFTC was investigating derivatives broker ICAP Plc and as many as 15 banks in a probe into the possible manipulation of the benchmark.

• Alcoa(AA) profit rises, but price concerns linger. Alcoa Inc, the largest U.S. aluminum producer, reported a higher quarterly profit on Monday thanks in part to strength at its raw materials segment, but lower-than-expected revenue and an uncertain outlook dragged down the company's share price. Stubbornly low aluminum prices have weighed on the company's business of mining bauxite, refining it into alumina and smelting alumina to produce aluminum.

• New Medicare cuts threaten U.S. non-profit hospitals -Moody's. Not-for-profit U.S. hospitals began confronting another threat to their shaky finances last week with the start of reductions to Medicare that are included in the universal federal spending cuts known as sequestration, Moody's Investors Service said on Monday.

Sankei:

• North Korea May Fire Missile as Soon as April 10. North Korea told British, Russian, and some other embassies in Pyongyang on April 5 it may fire missile over Japan to the Pacific Ocean side as soon as tomorrow, citing people familiar with the situation.

Japan Daily Press:

• Japan deploys rockets in Tokyo, readies to shoot down North Korean missiles. Two Patriot Advanced Capability-3 surface-to-air missile launchers have been deployed to the defence ministry in Tokyo in preparation for any North Korean attack. The government has authorized Japan’s armed forces to shoot down any missile that will be heading towards the territory. These are part of Japan’s defense preparations as North Korea continues to make threats towards South Korea, the United States and its allies in the region.

China Securities Journal:

• Chinese first-tier cities including Shanghai, Guangzhou and Shenzhen are expected to raise down payment requirements for second homes, following Beijing, citing people familiar with the situation.

• China's Polysilicon Oversupply to Last 1-2 Years. Supplies in the domestic market are expected to increase because of rising output by Chinese makers following Chinese anti-dumping and anti-subsidy measures on foreign products, citing a report from the country's silicon association.

• China Iron Ore Prices to Fall on Oversupply. Iron ore prices are expected to fall because oversupplies in steel and raw material markets will continue, citing a report from the China Iron and Steel Association.

Evening Recommendations 

• None of note

Night Trading

• Asian equity indices are -.25% to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 118.0 -3.0 basis points.

• Asia Pacific Sovereign CDS Index 96.5 -.75 basis point.

• FTSE-100 futures +.69%.

• S&P 500 futures +.12%.

• NASDAQ 100 futures +.21%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (PSMT)/.77

Economic Releases
7:30 am EST

• The NFIB Small Business Optimism Index for March is estimated to fall to 89.8 versus 90.8 in February.

10:00 am EST

• Wholesale Inventories for February are estimated to rise +.5% versus a +1.2% gain in January.

• JOLTs Job Openings for February are estimated to rise to 3740 versus 3693 in January.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Lacker speaking, Fed's Lockhart speaking, Eurozone Trade data, 3Y T-Note auction, weekly retail sales reports and the (FSLR) analyst meeting could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by commodity and real estate shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.

Stocks Reversing Higher into Final Hour on Less Eurozone Debt Angst, Short-Covering, Homebuilding/Gaming Sector Strength

Broad Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• VIX 13.57 -2.51%

• ISE Sentiment Index 117.0 +50.0%

• Total Put/Call .94 -9.62%

• NYSE Arms .77 -21.55%

Credit Investor Angst:

• North American Investment Grade CDS Index 85.49 -1.64%

• European Financial Sector CDS Index 168.10 -4.2%

• Western Europe Sovereign Debt CDS Index 103.34 +.61%

• Emerging Market CDS Index 241.06 -4.6%

• 2-Year Swap Spread 14.75 -.25 bp

• TED Spread 21.75 unch.

• 3-Month EUR/USD Cross-Currency Basis Swap -17.0 +.5 bp

Economic Gauges:

• 3-Month T-Bill Yield .06% unch.

• Yield Curve 151.0 +4 bps

• China Import Iron Ore Spot $137.60/Metric Tonne +1.25%

• Citi US Economic Surprise Index 2.90 -1.1 points

• 10-Year TIPS Spread 2.46 -1 bp

Overseas Futures:

• Nikkei Futures: Indicating +318 open in Japan

• DAX Futures: Indicating +27 open in Germany

Portfolio: 

• Higher: On gains in my tech/medical/biotech/retail sector longs
• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges and some of my (EEM) short
• Market Exposure: Moved to 75% Net Long

Today's Headlines

Bloomberg:

• European Stocks Rebound From Three-Day Drop; Lundin Gains. European stocks climbed, rebounding from the biggest three-day selloff since July, as German industrial production increased more than forecast and investors awaited the start of U.S. earnings season. 

• Sentix European Investor Confidence Falls After Cyprus Bailout. European investor confidence declined more than economists forecast in April, after the bail- in of Cypriot bank depositors rattled financial markets, the Sentix research institute said today. An index measuring sentiment in the euro-area fell to minus 17.3 from minus 10.6 in March, the Limburg, Germany-based institute said in an e-mailed statement. That’s the second drop in a row and the lowest reading since December. Economists had predicted a decline to minus 12.8, according to the median of 18 estimates in a Bloomberg News survey. A gauge of economic expectations decreased to 0.5 from 8.3, while a measure of current conditions fell to minus 33.5 from minus 27.8.

• China Export-Data Skepticism Deepens From Goldman to Nomura. China’s unprecedented run of better- than-forecast export growth has spurred deeper skepticism of the data at banks including Goldman Sachs Group Inc., casting doubt on the strength of the recovery. Gains in overseas shipments exceeded forecasts by at least 7.5 percentage points in December, January and February, the first time that’s happened in three straight months in the eight years Bloomberg has compiled analyst estimates for the data. March figures are due to be released tomorrow at 10 a.m. at a briefing in Beijing, giving the customs administration an opportunity to address the issue. Overstated exports would mean China is failing to get the boost from global demand that the data suggest as the new government under Premier Li Keqiang seeks to sustain an economic rebound.

• Soros Sees China Shadow-Banking Risks Similar to Subprime. Billionaire investor George Soros said China has a “couple of years” to control risks from nontraditional financing whose expansion has parallels with the cause of the global financial crisis. “The rapid growth of shadow banking has some disturbing similarities with the subprime-mortgage market in the U.S. that caused the financial crisis of 2007-2008,” Soros said today in a speech at the Boao Forum for Asia in China. “I’m sure the authorities are aware of the dangers. They have both the skills and the resources to deflate an incipient bubble gradually. The comments add to concerns that the increase in credit risks triggering turmoil that would cause an economic downturn. Aggregate financing, an indicator started by the central bank in 2011 to provide a broader gauge of funding, more than doubled to a record in January from a year earlier. 

• VIX Bets Climb to Three-Yera High on Earnings Concern: Options. Wagers that U.S. stock volatility will increase have reached a three-year high on concern American companies are getting ready to report the first slump in profit since 2009. There were 6.54 million calls on the CBOE Volatility Index and 2.34 million puts on April 4, according to Bloomberg. The ratio jumped to 2.93-to-1.0 last month, the highest since March 2010.

• Dimon Exit Seen Hastened If JPMorgan(JPM) Names Separate Chairman. JPMorgan Chase & Co. investors risk shortening Jamie Dimon’s tenure as chief executive officer if they appoint a separate chairman to help lead the bank, according to Charles Peabody, an analyst at Portales Partners.

• Fisker Struggles Mark Blow to Obama’s Electric-Car Goal. The possible bankruptcy of Fisker Automotive Inc., which last week fired three-quarters of its workforce, is the latest blow to President Barack Obama’s goal of having 1 million electric vehicles on U.S. roads by 2015. Fisker’s downfall after receiving $193 million in U.S. taxpayer money and producing 2,500 cars may complete the U.S. government’s transformation from electric-vehicle promoter and financier to debt collector, two years after it approved its last loan. Obama’s goal was “misguided” in the first place, putting the administration’s eagerness to rush out loans and grants while money was available ahead of due diligence, said Menahem Anderman, president of Total Battery Consulting Inc., in Oregon House, California. “The timing was based on the government’s spending schedule rather than the schedule of the market and the readiness of the technology,” Anderman said. “You had a very complex vehicle to produce, a questionable market, in terms of demand, with a team that hadn’t proven it could build it or sell it.”

Wall Street Journal:

• Former British Prime Minister Margaret Thatcher Dies. 'Iron Lady' Was Among Most Influential Global Leaders of Postwar Period. Margaret Thatcher, the former British prime minister who became one of the most influential global leaders of the postwar period, died on Monday, three decades after her championing of free-market economics and individual choice transformed Britain's economy and her vigorous foreign policy played a key role in the end of the Cold War. "It is with great sadness that Mark and Carol Thatcher announced that their mother, Baroness Thatcher, died peacefully following a stroke this morning," said Mrs. Thatcher's spokesman, Timothy Bell. She was 87. "We've lost a great prime minister, a great leader, a great Briton," said U.K. Prime Minister David Cameron, who cut short a Europe trip to return to the U.K. on Monday afternoon. "She saved our country and I believe she will go down as the greatest British peacetime prime minister."

• Pyongyang Suspends Kaesong Operations. North Korea said it intends to withdraw all its workers from an industrial park jointly run with South Korea and is considering closing the complex permanently. That would leave the last remaining symbol of inter-Korean cooperation close to collapse and mark a significant exacerbation of tensions on the Korean peninsula. The move, coming as Seoul continues to face a barrage of war threats from the North, provides a fresh challenge for new South Korean President Park Geun-hye's pledge to improve ties with Pyongyang. Some 53,000 North Koreans work at the complex. As of late Monday, 475 South Koreans and four Chinese nationals remained on the site.

CNBC:

• Housing's Big Challenge: $1 Trillion in Student Debt. (video)

Zero Hedge: 

• As Confidence In Dollar Wanes, Over A Dozen States Push For Gold As Legal Tender.

• European Financials Drop To 7-Month Lows. (graph)

• The Real Cyprus Template (The One You're Not Supposed To Notice).

• Record 2,564 Spanish Firms File For Bankruptcy In Q1, 45% Higher Than Year Ago.

• More Than 101 Million Working Age Americans Do Not Have A Job.

Business Insider: 

• KEITH JUROW: The US Housing Recovery Is A Mirage And A Serious Delinquency Crisis Is Coming.

• VIDEO REVIEW: HTC's Newest Smartphone, The One.

• Watch Margaret Thatcher Slap Down A Socialist Politician For Wanting To Make The Poor Even Poorer. (video)

• More And More Americans Are Convinced The Economy Is On The Wrong Track. (graph)

Reuters:

• GE(GE) to buy oil pump maker Lufkin(LUFK) for nearly $3 billion. General Electric Co is buying oilfield pump maker Lufkin Industries Inc for $2.98 billion, sharply increasing its presence in the fast-growing market to extract oil and natural gas from shale rock, the conglomerate said on Monday. 

• Brazil stocks slip as oil companies weigh.

• Italy public debt to rise 3 points after companies paid. Italy's public debt will rise by at least three percentage points over the next two years due to government plans to pay some 40 billion euros of debts owed by the state to private suppliers, its economy minister said. Italy's debt hit a record 127 percent of gross domestic product at the end of last year, the second highest in the euro zone after Greece.

• ECB warns of risks in correspondent banking. The ECB warned on Monday against concentration in the correspondent banking business, which handles payments between smaller banks, saying if a major player failed it could threaten financial stability.

Financial Times:

• Banks pull back from lending to emerging markets groups. Lending by western banks to companies across emerging markets is falling sharply as the eurozone banking crisis grinds on, new research shows. The value of new syndicated loans made to EM businesses fell 20 per cent to $276bn in 2012 from $343.2bn in the previous year, according to a report given to FTfm by Cordiant, a private debt fund manager based in Montreal. This lending slowdown suggests businesses in the developing world are just as caught out by the dry-up in financing as their western counterparts, and face difficulty growing.

• Fed warned to rein in QE. One of Wall Street’s biggest money managers has called on the Federal Reserve to rein in its programme of quantitative easing, saying its bond-buying tactics are a “large and dull hammer” that have distorted markets and risk stoking inflation. Rick Rieder, who oversees $763bn in fixed income investments for BlackRock, spoke out as the Fed debates how long to persist with the unorthodox measures it has used to stimulate the US economy. His comments add BlackRock to the growing list of Fed critics who are warning of trouble ahead for the bond market.

Telegraph:

• Portugal's top court has ruled out euro membership. Whether Portugal's judges realise it or not, they have just ruled that the eurozone doctrine of "internal devaluation" is unconstitutional.