Today's Headlines

Bloomberg:

- India said it will reject any new treaty to limit global warming that makes the country reduce greenhouse-gas emissions because that will undermine its energy consumption, transportation and food security. Cutting back on climate-warming gases is a measure that instead must be taken by industrialized countries, and India is mobilizing developing nations to push that case, Environment Minister Jairam Ramesh told the media today in New Delhi. “India will not accept any emission-reduction target -- period,” Ramesh said. “This is a non-negotiable stand.” “We are not re-negotiating the U.N. Framework Convention on Climate Change,” Ramesh said, referring to the treaty that entered into force in 1994 and laid the groundwork for emissions cuts by richer nations. “There is no way India is going to accept any emission reduction target, period, between now and the Copenhagen meeting and thereafter.” “We reject the use of climate as a non-tariff barrier,” the minister said. “We comprehensively and categorically reject any attempt to introduce climate change” as part of World Trade Organization talks.

- Confidence among U.S. consumers slipped unexpectedly in June, reflecting a weak labor market and rising energy costs. The Conference Board’s sentiment index decreased to 49.3 from a revised 54.8 in May, the New York-based research group said today. “Consumers are feeling the heat this summer from rising gasoline prices to seized-up labor markets,” said Jeffrey Roach, chief economist at Horizon Investments in Charlotte, North Carolina. That “could keep third-quarter consumer spending muted,” slowing an economic recovery, he said. Economists forecast confidence would rise to 55.3 from 54.9 in the prior month, according to the median of 70 forecasts in a Bloomberg News survey. The Conference Board’s measure of present conditions decreased to 24.8 from 29.7 the prior month. The gauge of expectations for the next six months fell to 65.5 from 71.5. The share of consumers who said more jobs will be available in the next six months fell to 17.4 percent from 19.3 percent. The proportion of people who said they expect their incomes to rise over the next six months decreased to 9.8 percent from 10.8 percent. The share of consumers who said jobs were plentiful fell to 4.5 percent, the lowest since February 1992, from 5.8 percent. Those saying jobs were hard to get increased to 44.8 percent from 43.9 percent.

- Delinquency rates on the least risky mortgages more than doubled in the first quarter from a year earlier as U.S. efforts to help homeowners failed to keep pace with job losses that pushed more borrowers toward foreclosure. Prime mortgages 60 days or more past due climbed to 2.9 percent of such loans through March 31 from 1.1 percent at the same point in 2008, the Office of the Comptroller of the Currency and the Office of Thrift Supervision said today in a report. First-time foreclosure filings on the loans rose 22 percent from the fourth quarter, the report said.

- Simon Young, deputy director of research and development for China Cosco Holdings Co., Asia’s biggest container-shipping line, said, “There is too much speculation. There are too many financial institutions involved in this sector.”

- Corn plunged by the Chicago Board of Trade’s limit after a government report showed U.S. farmers planted more acreage with the grain than estimated in March. Wheat and soybeans also tumbled on signs of increasing supplies.

- Commodity assets under management expanded by $34 billion this quarter, the second-largest increase on record, Barclays Capital said. The assets total about $210 billion at the end of the second quarter, Barclays said in a report e-mailed today. The biggest jump was $43 billion in the second quarter last year, said Amrita Sen, a Barclays analyst in London. New inflows were $7 billion at the time, compared with $15 billion this quarter, she said. “Price increases are likely to flatten out” in the next two quarters, Sen said. “Then investment flows are also likely to stabilize rather than grow at the pace they have been growing” this year.

- Gains by commodity currencies may peter out in the second half amid waning risk appetite, Royal Bank of Scotland Group Plc said. “We remain skeptical that the Australian dollar and commodity currencies have all that much further to run,” Greg Gibbs, a strategist in Sydney at RBS, wrote today in a report. “As we head into the second half of the year, global data disappointments are expected to increase. Asset markets will appear to have run out of upside potential and risk of a correction in global risk appetite will increase.”

- Rates to ship coal, iron ore and other goods will fall 15% in the third quarter compared with the previous three months as China imports less ore to make steel, UBS AG said. “There is no doubt the last months have been unprecedented and unsustainable” when it comes to China’s iron-ore imports, Peter Hickson, a global strategist for basic materials at UBS said at a conference.

- The U.K. economy shrank more than previously estimated in the first quarter in the biggest contraction since 1958 as the recession choked industries from construction to services. Gross domestic product fell 2.4 percent from the final three months of 2008, compared with the prior measurement of a 1.9 percent drop, the Office for National Statistics said today in London. The median prediction in a Bloomberg survey of 28 economists was for a 2.1 percent decline. Construction activity plunged almost three times as much as originally estimated.

- German unemployment rose to the highest since 2007 in June as falling demand and rising bankruptcies forced companies to cut jobs.

- European consumer prices recorded their first annual decline this month as energy costs fell and the economic slump pushed unemployment to a 10-year high. The 0.1 percent drop in euro-region prices is the first since compilation of the data began in 1996, the European Union statistics office in Luxembourg said in an initial estimate today. Loans to households and companies in Europe grew at the slowest pace on record in May, a separate report from the European Central Bank showed today.

- Al-Qaeda threatened revenge against France for President Nicolas Sarkozy’s comments that the burqa garment is “not welcome” in his country, Agence France-Presse reported, citing the SITE Intelligence group, which tracks terrorist Web sites.

- A car bomb in the northern Iraqi oil hub of Kirkuk killed at least 41 people and wounded 120 others on the day U.S. forces withdrew from all the Middle Eastern country’s cities.

- BP Plc and China National Petroleum Corp. won the right to develop Rumaila, the largest Iraqi oil field in today’s licensing round, as the war-torn country seeks to more than double production over the next six years. The six oil and two gas fields in today’s bidding round may yield $1.7 trillion in profit over 20 years for the country, Oil Minister Hussain al-Shahristani said in a speech broadcast on live television. “It’s a great move forward for Iraq and the revenue is enormous,” Peter McGuire, managing director of Commodity Warrants Australia, said in a Bloomberg TV interview yesterday. “So it’s a massive amount of money for Iraq, huge.” Holder of the world’s third-largest oil reserves, Iraq is struggling to raise output and revenue from crude sales after six years of conflict and prior sanctions destroyed the economy and infrastructure. The government aims to boost oil output to 4 million barrels a day within the next five years, from about 2.4 million barrels. Rumaila, which now produces 956,000 barrels of oil a day, is the largest field on offer and the first awarded today. The BP group proposed to boost Rumaila’s output to a plateau of 2.85 million barrels of oil a day at an average cost of $3.99 a barrel, according to the initial bid presentation. Iraq later this year plans to hold a second auction round for 11 oil and gas fields with the aim to boost production to about 6 million barrels a day by 2015. Saudi Arabia, the world’s biggest oil exporter, produces 8 million barrels a day.

FINalternatives:
- Austin Capital Management, a fund of hedge funds shop that had some 7.5% of its assets invested with Ponzi scheme mastermind Bernard Madoff, is going on the defensive against a lawsuit filed on behalf of two New Mexico state funds. The firm, which is based in the Texas capital, said last week that it would “vigorously” defend itself against the lawsuit, filed by the National Education Association of New Mexico, a teachers union, over $25 million in losses suffered by state’s Educational Retirement Board and State Investment Council. The union lawsuit alleges that Austin ignored several red flags because of its longstanding relationship with Madoff, who was sentenced to 150 years in prison for running a $65 billion Ponzi scheme yesterday.

Business Insider:

- Tax Hikes, Coming Soon! Every politician (except Michael Dukakis) has campaigned on some version of "no new taxes" and most ended up breaking that promise. It's how we do things in America, and as voters we've come to accept how it works. We're masochists. We like to be lied to. Obama said he wouldn't raise taxes on anyone making under $250,000, a promise that's technically already been violated by new taxes on cigarettes and his pledge to sign cap & trade if it gets through The Senate. His aides would say those don't count. But evens setting those aside, real tax hikes are almost certainly in the works, if only due to the massive amount of new spending (particularly on healthcare) this government has planned. The idea that it can all be financed on the (dwindling) $250k+ crowd is absurd. Altman believes that sometime next year the Congress will be forced to bring up a new tax, possibly some kind of Europe-like VAT scheme. Others have suggested that Obama will wait until after the 2012 election, when he's a lame duck though that may be too long a wait if the budget situation continues to deteriorate. Bear in mind, this isn't all coming from Wall Street or conservative publications eager to undermine Obama's presidency. Liberal commentator Matthew Yglesias penned a highly praised piece for the American Prospect arguing that liberals needed to embrace taxes sooner rather than later, and that selling Americans on the idea of higher taxes should be part and parcel with selling Americans on the idea of a more active role for government in life -- which Obama has done pretty well, both in the campaign and since taking office:

NY Post:

- JPMorgan Chase(JPM) boss Jamie Dimon is considering jacking up base salaries for his investment bankers as bailed-out rivals like Citigroup(C) and Bank of America(BAC) move to sweeten their compensation packages to lure talent.

LA Times:

- Reporting from Washington -- The Environmental Protection Agency will announce today that it is granting California's request to impose tough restrictions on greenhouse gas emissions from cars and trucks -- reversing the Bush administration's position and opening the way for the state to take the lead on global-warming policy. California developed the standards in 2004 but was barred from implementing them. EPA officials say granting California the waiver from federal standards gives the state wide latitude to promulgate stricter rules, restoring a 40-year interpretation of the Clean Air Act.

Rassmussen:

- The Rasmussen Reports daily Presidential Tracking Poll for Tuesday shows that 31% of the nation's voters now Strongly Approve of the way that Barack Obama is performing his role as President. Thirty-three percent (33%) Strongly Disapprove giving Obama a Presidential Approval Index rating of -2. That matches the lowest level yet recorded (see trends).

Politico:

- Republicans believe a handful of junior House Democrats may have taken a career-ending vote by supporting the controversial energy bill last week and are planning to launch an ad campaign in targeted districts to try to seal their fate. The National Republican Congressional Committee is planning to air TV and radio commercials and unleash robocalls against Democrats who hail from districts that could be adversely affected by the narrowly passed legislation, are GOP-leaning or both. Those likely to find themselves with targets on their back after the 219-212 vote: freshman Reps. Harry Teague of New Mexico, Betsy Markey of Colorado, John Boccieri of Ohio, Thomas Perriello of Virginia and Alan Grayson of Florida and second-termer Zack Space of Ohio. “There’s a reason why over 40 Democrats in swing districts voted against this,” said NRCC spokesman Ken Spain.

Washington Times:

- Former Vice President Dick Cheney on Monday expressed concern that the pending pullout of U.S. troops from Iraq's cities could reverse the military progress made by American and Iraqi forces there since the George W. Bush administration's 2007 surge. "I hope the Iraqis can deal with it," Mr. Cheney told The Washington Times' "America's Morning News" radio show. "At some point, they have to stand on their own, but I would not want to see the U.S. waste all the tremendous sacrifice that has gotten us to this point."

USA Today:

- Trying to attract passengers in a recession, airlines are selling tickets much cheaper than a year ago. Fares for travel next month are as much as 63% lower than last summer, according to an analysis by FareCompare.com.

Reuters:
- Nigeria is currently pumping 1.739 million barrels per day (bpd) of crude oil and 560,000 bpd of condensate, the state-run Nigerian National Petroleum Corporation (NNPC) said on Monday. The total amount of production shut in by years of militant attacks and funding shortfalls currently stood at 1.26 million bpd, NNPC spokesman Levi Ajuonoma told Reuters. Industry experts say Nigeria has never been able to produce at its full installed capacity of 3 million bpd, due to violence in the Niger Delta and to funding problems.

- Cisco Systems Inc(CSCO) is considering offering Web-based alternatives to Microsoft Corp's(MSFT) popular Office software as the networking giant expands on the Internet.

- U.S. investigators believe 10 or more people associated with imprisoned swindler Bernard Madoff could be criminally charged in the coming months or beyond, a law enforcement source said on Tuesday. The source, who asked not be identified because of the ongoing investigation into the multibillion-dollar Madoff fraud, said the FBI was "closer to the beginning than the end" of the probe.

- General Electric Co (GE) is teaming up with U.S. biotech company Geron Corp (GERN) to use stem cells to develop products that could give drug developers

an early warning of whether new medicines are toxic. The venture is the largest U.S. conglomerate's most direct attempt to make a commercial products from human embryonic stem cells.

Financial Times:
- Beijing’s order that all new PCs should include internet filtering software is about to be put to the test, with personal computer makers set to miss a deadline on Wednesday for supplying all new machines with the program. s a practical matter, it would be several weeks before most new machines available to Chinese purchasers could carry the software, even if China pushes ahead with the order in spite of international consternation, say retail and PC industry experts. That delay could serve to defuse the issue and provide more time for a face-saving compromise to be found, some observers say. The Chinese authorities “are kind of embarrassed about this, finding a graceful way out of it would be very welcome”, said Rob Enderle, a US PC industry analyst.

The Jerusalem Post:
- Israel rejected as "scandalous" a highly critical report released by the International Committee of the Red Cross on Monday marking six months since Operation Cast Lead, saying it was inconceivable that the document would chastise Israel for the situation in Gaza while ignoring the continued detention of IDF soldier Gilad Schalit or the "intransigent belligerence" of Hamas.