Today's Headlines

Bloomberg:

• State Bank of India Shares Drop as Profit Falls on Defaults. State Bank of India shares dropped to the lowest in five months after the country’s largest lender posted a bigger decline in third-quarter profit than analysts had estimated amid rising bad loans. Net income fell 34 percent to 22.3 billion rupees ($359 million), or 32.66 rupees a share, for the three months ended Dec. 31, from 34 billion rupees, or 50.61 rupees, a year earlier, the Mumbai-based lender said in an exchange filing today. The lowest profit in nine quarters missed the 25.2 billion-rupee median of 38 estimates compiled by Bloomberg. 

• Russia Holds Rate as Ruble Drop Compounds Inflation Above Target. Russia’s central bank refrained from cutting borrowing costs for a 17th month as the ruble’s record drop frustrates efforts to relax monetary policy. The one-week auction rate, the benchmark introduced in September, was kept at 5.5 percent at a meeting today, Bank Rossii in Moscow said in a website statement. That matched the forecasts of all 22 economists in a Bloomberg survey. The central bank said it “will be ready” to tighten policy if inflation risks worsen and the ruble depreciates further.

• Obama Bid for Russia Reset Slips Amid Cold War Iciness. If mounting U.S. frustration with Russia wasn’t clear enough after President Barack Obama blamed Moscow on Feb. 11 for the starvation of Syrian civilians, this week offered plenty of other signals. Director of National Intelligence James Clapper told Congress that “an assertive Russia” poses a risk to the U.S. and aired his anger over damage to national security caused by Edward Snowden, who’s in Russia under asylum after exposing classified American spy programs. Elsewhere on Capitol Hill, lawmakers voiced concern that Russia may have violated a nuclear-arms treaty and is undermining U.S. influence in the Middle East.

• European Banks Avoiding Risky-Loan Disclosure Face Review. A dark corner of European finance is about to be illuminated by European Central Bank inspectors who are sifting through loans that banks restructure for clients and don’t fully disclose. “What’s scaring investors is the question of whether banks are giving money to companies that deserve to go bankrupt and keeping them alive to avoid recording losses,” Mascia Bedendo, an assistant professor of finance at Bocconi University in Milan, said in a phone interview. “The amount of forborne and nonperforming loans is still very obscure.”   

• Europe Stocks Rise on Euro-Area GDP, U.S. Confidence Data. European stocks advanced, posting their biggest weekly gain this year, as better-than-forecast euro-area economic growth and U.S. consumer-confidence reports outweighed worse-than-estimated U.S. industrial output data. ThyssenKrupp AG rose the most since May after Germany’s largest steelmaker reported first-quarter profit that beat analyst predictions. Fresnillo Plc led a gauge of commodity producers higher as gold and silver prices increased. Schindler (SCHP) Holding AG dropped 1 percent after the maker of elevators said annual profit fell 37 percent. The Stoxx Europe 600 Index gained 0.6 percent to 333.32 at the close of trading.

• Gold Heads for Biggest Weekly Gain Since August on Haven Demand. Gold futures for April delivery rose 1.3 percent to $1,316.80 an ounce at 12:08 p.m. on the Comex in New York. Prices headed for a 4.3 percent weekly gain, the biggest such increase since the week ended Aug. 16.

• Fisher Backs QE Tapering Even With Weather Hurting U.S. Growth. Federal Reserve Bank of Dallas President Richard Fisher said the central bank should stick to its strategy of gradually reducing bond purchases even as harsh winter weather slows U.S. economic growth. “I am not persuaded continuing to taper should be altered,” Fisher said today in a Bloomberg Radio interview in Dallas with Kathleen Hays and Vonnie Quinn. “Obviously weather is playing a significant role here.”

• Treasury Lets Banks Offer Accounts to Pot Businesses. The Treasury Department today said it would allow banks to accept accounts from marijuana businesses, letting an industry that is illegal in a majority of U.S. states open business checking accounts and accept credit cards.

Wall Street Journal: 

• Jos. A. Bank to Acquire Eddie Bauer for $825 Million. Deal Adds to Takeover Battle Between the Suit Retailer and Men's Wearhouse.

Barron's:

• Trulia(TRLA) Drops 14%: Q4 Rev Beats, EPS Misses; Q1, Year Rev Views Beat.

Fox News:

• De Blasio digs in on liberal agenda, runs into pushback from fellow Dems.

MarketWatch:

• When push comes to shove, many think Cleveland Fed’s new president will be hawkish.

ZeroHedge:

• The Crisis Circle Is Complete: Wells Fargo Returns To Subprime. (graph)

• The "Sick Man Of Europe" Is Back - German Economy Barely Grows In 2013. (graph)

• Industrial Production Plunges, Fed Blames Weather. (graph)

• "Catastrophic" Winter Storms Send Consumer Confidence Outlook To 6-Month Highs. (graph)

• Peak Employment? (graph)

• The US Participation Rate Is At A 35 Year Low: This Is How It Looks Broken Down By State. (map)

ValueWalk: 

• Prem Watsa “China Reminds Me Of US Housing In Boom". China takes almost 40% to 50% of every commodity so of course China will have an impact on Canada and we’ll have an impact on many of the commodity producing countries like Australia and Brazil, other countries in the world. So we are focused on protecting ourselves first and foremost. Reminds me what happened in the housing crisis in 2003, ’04, ’05 the boom in housing reminds me of takes me back to the tech boom where companies big companies like Northern Telecom and others were buying companies small little companies for $10 billion and $20 billion with no sales, no revenues and nothing other than a few engineers together.

Business Insider:

• Venezuela's Central Bank Is Increasingly Disconnected From Reality.

• Foreclosures Suddenly Jump 57% in California (And Soar In Much Of The Country). (graph)

CNN:

• Snow burying parts of the Northeast in massive winter storm.

• Top 10 cities people are moving to. Whether it's the warm weather, jobs or cheap cost of living, these are the top 10 cities Americans are moving to, according Penske Truck Rental's annual list.

Reuters:

• Italy won't have leeway on investment spending in 2014-EU source. Italy will not be allowed to make use this year of a so-called "investment clause" which allows some flexibility on public spending because it failed to present a document requested by the European Commission, an EU source said on Friday. 

• Weak Brazil activity index raises specter of recession. Economic activity in Brazil fell sharply in December, raising the specter that Latin America's largest economy may have slipped into recession as the government phased out massive economic stimulus to battle inflation. The Brazilian central bank's IBC-Br economic activity index declined 1.35 percent in December from November in seasonally adjusted terms, more than most economists expected, central bank data released on Friday showed. The index, a rough reflection for gross domestic product data, rose 2.57 percent in 2013 as a whole but fell for two straight quarters, which characterizes a technical recession. It dropped 0.17 percent in the fourth quarter and fell 0.21 percent in the third quarter.

• U.S. to pursue trade dispute over Chinese, Taiwanese solar imports. The United States took a step on Friday towards potentially extending import duties on Chinese solar energy products to also cover panels made with parts from Taiwan in a case that could have a major impact on the fast-growing U.S. solar market.

Telegraph:

• Eurozone crisis is just getting started. The project to impose political union is bringing economic ruin, making the legitimacy of the EU project ever more vulnerable. 

• Why China's banking system is in so much trouble. The full transcript of the Telegraph interview with China expert Charlene Chu.