Bloomberg:
- Europe Leaders Bow to Cameron Push, Deepen Spending Cuts. European Union leaders agreed to a seven-year budget that
cuts spending for the first time, bowing to U.K. Prime Minister David
Cameron’s insistence on thrift. The deal, struck after 25 1/2
hours of talks in Brussels, set the budget for 2014-2020 at 960 billion
euros ($1.3 trillion), down from an original proposal of 1.047 trillion
euros and less than the 994 billion euros spent in the current budget
cycle. “We simply could not ignore the extremely difficult
economic realities across Europe,” EU PresidentHerman Van Rompuy told
reporters. “It’s perhaps nobody’s perfect budget, but there’s a lot of
it for everybody. This budget is future- oriented, it is realistic and
it is driven by pressing concerns.”
- European Stocks Post Weekly Drop on Debt-Crisis Concern. European
stocks posted a second weekly decline as political uncertainty in Italy
and Spain revived concern that the nations’ austerity programs may
falter and the euro-area debt crisis may deepen. UniCredit SpA, Italy’s
biggest lender, dropped 5.4 percent as a gauge of European bank shares
fell for a second week. Royal
Imtech NV plunged 47 percent as the Dutch technical-service
provider after predicting writedowns exceeding 100 million euros
($136 million) in Poland. Hargreaves Lansdown Plc jumped 15
percent after the retail stockbroker posted first-half profit
that exceeded analysts’ estimates.
- Aso Says Pace of Yen Decline Too Fast With G-20 Set to Meet.Japanese
Finance Minister Taro Aso said the pace of the yen’s weakening has been
too fast, speaking a week before a meeting of global finance chiefs
where Japan’s
currency stance is forecast to be an issue. Aso’s comment to reporters in Tokyo today came after he
earlier told lawmakers the government hadn’t anticipated a rapid
move to around 90 per dollar.
- Honda Counters Weak Yen Criticism After U.S. Objections. Honda
Motor Co., targeting record U.S. sales this year, said the weaker yen
isn’t giving the Japanese company an advantage after a group
representing U.S.
automakers called for government intervention.
- Huntsman Warns of Risk of China-Japan Clashes in Disputed Areas. Jon
Huntsman, a former U.S. ambassador to China, said he worries about the
danger that a military “incident” between China and Japan may escalate
into
an unintended conflict. “The tensions are real,” he said, citing their
territorial dispute over islands in the East China Sea. The
increasing pace of military activities such as surveillance
flights in the region by other nations, including South Korea
and Russia, also raise risks, he said. “I worry about the military maneuvers in crowded airspaces
and sea lanes” where an incident can escalate to something
“beyond anyone’s ability to then de-escalate it,” Huntsman
said in an interview on Bloomberg Television’s “Political
Capital with Al Hunt” airing this weekend.
- Egyptians Rally as Tunisia Opposition Leader Death Stirs Unrest. Egypt’s army put up barbed wire and
surrounded the gates of the Presidential Palace in Cairo as
protesters pelted government buildings with rocks during rallies
against President Mohamed Mursi and his Muslim Brotherhood. Protesters in Cairo marched from the Mostafa Mahmoud Mosque
to Tahrir Square, and from the Nour Mosque to the palace today.
Demonstrators blocked the subway in the city at Sadat station in
the direction of the southern Helwan suburb, state-run Ahram
Gate said on its website.
- The price-earnings ratio for the S&P 500 has risen 25% to 14.9 since October 2011.
- McDonald’s(MCD) January Store Sales Drop in Asia U.S Gains.
McDonald’s Corp., the world’s largest restaurant chain, posted a
surprise gain in U.S. same-store sales last month while demand slumped
in the Asia Pacific
region. Sales in the U.S. increased 0.9 percent in January, the Oak
Brook, Illinois-based company said today in a statement.
Analysts projected a drop of 0.3 percent, the average of 14
estimates compiled by Consensus Metrix. Sales in Asia Pacific,
the Middle East and Africa plunged 9.5 percent while analysts
anticipated a decline of 5.8 percent.
Wall Street Journal:
- Germany, Italy Data Show Divergence.
Record German export statistics released Friday contrast sharply with
Italy's feeble industrial performance, highlighting the two countries'
economic divergence at a time when a strengthening euro is threatening
to hurt foreign trade. Italian industrial production hit a 22-year low last year, as output
dropped 6.7% from 2011, Italy's statistics institute Istat said Friday,
as the economy remains mired in recession. "This was a year of suffering for Italian industry," Istat said.
CNBC:
- Subprime Is Back: Will This End Badly? The subprime market for risky mortgage backed securities is hot again
and its revival is exceeding many people's expectations, the chief
market strategist at Rosenblatt Securities said. However, he expects it
will end badly. "The subprime market's revival is proving to be even stronger than we
had anticipated," Brian Reynolds said, in a research note. "This is
just a credit cycle, and it will eventually end badly like the others."
Rosenblatt Securities has been worried before. It showed outrage when
General Motors bought AmeriCredit car loans firm in 2010. The deal
repeated the excesses of the last credit cycle, it said at the time,
when GM had to
hive off its financial subsidiaries which then needed taxpayers' money
to survive. And it has noticed another huge development this week. The Wall Street Journal reported that a joint venture between AIG and Fortress will be issuing a securitization of personal loans. "The average coupon on some of these loans is 25 percent, as some of them
have no collateral. The A-rated tranche is expected to yield a whopping
(for this environment) 2.5 percent, and we're pretty sure the enhanced
cash and cash-plus pseudo-money market funds will gobble this up." This
search for yield has angered Reynolds, who thought he would never see
subprime personal loans again. He said the situation was now reminiscent
of the structured finance boom that began in 1994. "We're tempted to go
check the attic to see if we have some old Beanie Babies that we could
securitize," he said.
Business Insider:
4-Traders.com:
Reuters:
- U.S. Treasury in no rush to exit Ally Financial stake -source. The U.S. Treasury, under pressure to
quickly wind down its crisis-era bailouts, believes it will take
time to shed auto lender Ally Financial because the company's
mortgage lending unit is in a messy bankruptcy, a person
familiar with the matter told Reuters. Ally is one of Treasury's largest remaining holdings, but
the lender will be hard to exit as long as it is working through
the bankruptcy of its Residential Capital unit and is also
selling its international operations, the person said.
- Canada hit with surprise jobs loss, weak housing starts. Canada's economy unexpectedly shed jobs in January, while housing starts plunged, suggesting global uncertainty, weak prices for Canadian oil, and a government
clampdown on the property market will drag on growth in early
2013.
AP:
- Iraq bombs kill 36, Sunnis stage protest rallies. Car bombs struck two outdoor markets and a group of taxi vans in Shiite
areas across Iraq on Friday, killing at least 36 people and wounding
nearly 100 in the bloodiest day in more than two months, as minority
Sunnis staged large anti-government protests.
Style Underperformer:
Sector Underperformers:
- 1) Education -1.1% 2) Gold & Silver -.63% 3) Construction -.60%
Stocks Falling on Unusual Volume:
- SKUL, TVL, SD, HK, NUAN, CXW, RVBD, WHZ, MCO, CSTR, CTRX, VSAT, NSP, RSG, KEYW, INTU, VPFG, TSRA, LBTYK, HTWR, VECO, IVC, EFX, TCK, PTP, BR, LH, SSD, MHP and VPFG
Stocks With Unusual Put Option Activity:
- 1) NUAN 2) CCL 3) XLP 4) TGT 5) LNKD
Stocks With Most Negative News Mentions:
- 1) TCK 2) ETR 3) LPL 4) RL 5) BAC
Charts:
Style Outperformer:
Sector Outperformers:
- 1) HMOs +2.06% 2) Gaming +1.47% 3) Internet +.95%
Stocks Rising on Unusual Volume:
- CXO, CZR, ATVI, LNKD, FLT, MOH, AOL, MCHP, TWI, ACM, SNCR, WWWW, MOH, RKUS, MDR, ACM, GES, NTI and NCR
Stocks With Unusual Call Option Activity:
- 1) ATVI 2) BYD 3) GRA 4) NUAN 5) MCO
Stocks With Most Positive News Mentions:
- 1) MCHP 2) AAP 3) ATVI 4) AOL 5) RVBD
Charts:
Evening Headlines
Bloomberg:
- Bemoaning
Euro Strength Masks Hollande Export Woes: Euro Credit. President
Francois Hollande's call for a weaker euro masks France's real issue: a
loss of competitiveness against countries that share the currency. With
French labor costs up about 19% in a decade and Germany's almost
unchanged, France's share of euro-area exports dropped by 3.5%, more
than any country in the region, according to a study published earlier
this year by research group Coe-Rexecode in Paris. "France is losing the
competitiveness war not just to the dollar-Asia block but also to
peripheral Europe, Spain in particular," said Lena Komileva, a
strategist at G+ Economics Ltd. in London.
- Italian Vote Seen Inconclusive as Risk of Second Election Grows. Italy’s election in three weeks may
yield a hung parliament, requiring a follow-up vote to establish
a governing majority, a member of poll leader Pier Luigi Bersani’s campaign said for the first time.
“Returning to polls is the answer in a situation of ungovernability,”
Stefano Fassina, Bersani’s head of economic policy, wrote on Twitter
yesterday. Bersani’s lead in opinion polls is shrinking as former
Premier Silvio Berlusconi gains. The difference between their
two blocs nationally was within the 4 percentage point margin of
error for a second day, according to a Tecne poll aired by
SkyTG24 yesterday. The gap fell to less than 5 percentage points
in six key regions that will determine the outcome in the
Senate, Tecne said.
- Draghi Finds Powerful Weapon in Words as Markets Heed His Voice. European
Central Bank President Mario Draghi has found his most effective weapon
is the sound of his own voice. Draghi yesterday caused the euro’s
biggest drop in seven months by suggesting its recent appreciation could
damp inflation, a signal that further interest-rate cuts remain a
possibility. His pledge in July to buy government bonds
precipitated a sea-change in sentiment that helped to shore up
the 17-nation euro area economy, yet the ECB hasn’t spent a cent
so far in its so-called Outright Monetary Transactions program.
- RBA Cuts GDP, Inflation Outlook on Currency, Investment. The Reserve Bank of Australia reduced
its economic growth and inflation forecasts as investment
outside the mining industry remains elusive, the labor market
softens and a high local currency contains prices. “The soft outlook over the next year or so reflects a
number of factors,” the RBA said in its quarterly monetary
policy statement released in Sydney today. “Mining investment
is expected to peak, both fiscal consolidation and the
persistently high level of the Australian dollar will weigh on
growth, and there is little sign of a near-term pick-up in non-
mining business investment.”
- Japan Posts Back-to-Back Current-Account Deficit in December. Japan
posted back-to-back monthly current-account deficits for the first time
since 1981, highlighting challenges for Prime Minister Shinzo Abe’s
campaign to revive the economy. The shortfall in the widest measure of the nation’s trade was 264.1 billion yen ($2.8 billion) in December, the Ministry
of Finance said in Tokyo today. The median estimate of 23
economists surveyed by Bloomberg News was for a deficit of 144.2
billion yen. The last consecutive monthly current-account deficit was in
February 1981, according to the ministry. Exports to China in 2012 fell 10.8 percent from 2011, as
slower Chinese growth and a territorial dispute affected a
merchandise trade relationship worth 26.5 trillion yen in 2012,
according to ministry data.
- Malaysia December Exports Unexpectedly Fall, Output Growth Slows. Malaysia’s
exports unexpectedly
dropped in December amid fewer shipments to the U.S. and China, while
industrial production rose less than economists estimated. Overseas
shipments fell 5.8 percent from a year earlier after rising a revised
2.3 percent in November, the Trade Ministry said today. The median of 17
estimates in a Bloomberg News survey was for a 1.4 percent increase.
- BRICs Fall From Google(GOOG) Favor as Searches Drop With Brazil. The BRICs are falling off the investment map.
The term for Brazil, Russia, India and China, where stocks gained 424
percent during the decade ended 2010, appeared in the fewest news
stories last month since November 2008, according to
data compiled by Bloomberg. BRIC searches on Google Inc.’s
website fell to a seven-year low in December, while mutual funds
that invest in the biggest emerging markets had outflows in 46
of the past 47 weeks.
- Zinc Leads Metals Slump as Europe Crisis Fuels Demand Concerns. Zinc fell to the lowest price this
week, leading a slump for industrial metals, on renewed concern
that Europe’s debt crisis is worsening and will curb demand. Industrial output in Spain dropped for a 16th month in
December, a report showed today. European Central Bank President
Mario Draghi said risks to the region’s economy remain on the
“downside.” The dollar rose against a basket of six currencies
including the euro, reducing the appeal of metals as alternative
assets. Financial markets in China, the world’s biggest metals
user, will be shut next week for Lunar New Year celebrations.
Wall Street Journal:
- Probe Adds to Rating Firms' Woes. New York's top prosecutor has launched a probe into the conduct of
the three major credit-ratings firms, according to a person familiar
with the matter, opening another legal front for an industry that remains in the cross hairs of state and federal investigators.
New York Attorney General Eric Schneiderman this week subpoenaed
Standard & Poor's Ratings Services and formally requested
information from Moody's Investors Service and Fitch Ratings to examine
ratings they issued in the run-up to the financial crisis, the person
said. His office is investigating the
ratings the three firms issued on mortgage-backed deals before the
crisis, the person said.
- Rate-Rig Spotlight Falls on 'Rain Man'.
Many anonymous traders are implicated in the tall stack of documents
regulators published this week detailing Royal Bank of Scotland Group
attempts to rig the lending benchmark known as Libor. But only
one trader is cited by name: a 33-year-old so brainy yet socially
awkward that colleagues nicknamed him "Rain Man."
- Obama Blocked Rebel Arms. White House Opposed Pentagon, CIA, State Plan to Ship Weapons to Syrian Resistance. A proposal to arm Syrian rebels was backed by the Pentagon, the State
Department and the Central Intelligence Agency, but the White House
decided not to act on the plan.
Defense Secretary Leon Panetta and Gen.
Martin Dempsey, the chairman of the Joint Chiefs of Staff, revealed
publicly for the first time at a Senate hearing on Thursday that they
supported the proposal last year by senior officials including
then-Secretary of State Hillary Clinton and then-CIA director David
Petraeus.
- Iran Leader Rebuffs Direct Talks With U.S. Iran's Supreme Leader Ayatollah Ali Khamenei rejected a U.S. proposal
for one-on-one talks, dimming hopes that the two countries would resume
diplomatic relations soon. Mr. Khamenei, who has the final decision
on key state matters, was responding for the first time to an offer
Vice President Joe Biden made last week to hold one-on-one talks with
Iran whenever Mr. Khamenei was ready.
- Scant Pickup in Economic Growth Seen for 2013. Economists are forecasting the same steady, if unspectacular, growth
this year that they were expecting in 2012. Last year's predictions
proved too optimistic, but they say this year the economic fundamentals
are sturdier. At the start of last year, economists surveyed by The Wall Street
Journal were on average predicting 2.4% year-over-year growth in gross
domestic product for 2012. The Commerce Department last week said the
expansion was a more tepid 1.5%. It was the second year in a row that
actual GDP came in below economists' forecasts. For 2013, the economists again expect the economy to grow 2.4%.
- The Real Problem With Obama's Drone Memo. The U.S. has dropped the clarity of the rules of war for the vague balancing tests that govern cops on the beat. President Obama's antiterrorism policies are drawing new fire after this
week's leak of the administration's legal memo defending the targeted
killing of Americans. According to the Justice Department white paper
obtained by NBC News, the U.S. can kill a citizen who is "continually
planning attacks" for al Qaeda when an "informed, high-ranking" official
decides that the target "poses an imminent threat" and capture is
"infeasible."
Barron's:
CNBC:
- Banks Need to Reduce Risk: Krawchek. (video) It's
high time to talk about reducing risk in the banks, former Bank of
America Wealth Management President Sallie Krawcheck said Thursday on
CNBC. On "Fast Money," she said that it was "probably pretty unlikely"
that any of the too-big-to-fail financial institutions would be broken
up. "Heck, we couldn't even do money fund reform, which is pretty clear
we need, given the risk there," she said. Krawcheck said that the
problem was not being addressed. "What
we do really need to have a discussion of – and we're not, as a country
– is reducing the risks in the banks. Is the risk wrung out to good
enough degree? Is there enough capital?" she said. "That's not a discussion we're having head-on right now."
- Just How Skewed Is China's Trade Data? China's
January trade data on Friday appear impressive at first glance, but
beneath the favorable Lunar New Year distortions, the global and
domestic demand picture
remains fragile, economists tell CNBC. "The import data suggests that
underlying demand domestically is not as
strong as we think," Liu Li-gang, chief China economist at ANZ told
CNBC.
Zero Hedge:
Business Insider:
NY Times:
- Hewlett(HPQ). Directs Its Suppliers in China to Limit Student Labor.
Hewlett-Packard, one of the world’s largest makers of computers and
other electronics, is imposing new limits on the employment of students
and temporary agency workers at factories across China. The move,
following recent efforts by Apple to increase scrutiny of
student workers, reflects a significant shift in how electronics
companies view problematic labor practices in China.
The Blaze:
Reuters:
- Justice Department, states weigh action against Moody's(MCO). The
Justice Department and multiple states are discussing also suing
Moody's Corp for defrauding investors, according to people familiar with
the matter, but any such move will likely wait until a similar lawsuit
against rival Standard and Poor's is tested in the courts. Inquiries
into Moody's are in the early stages, largely because state and federal
authorities have dedicated more resources to
the S&P lawsuit, said the sources, who were not authorized to speak
publicly about enforcement discussions.
- Exclusive: Dell(DELL) shareholder Southeastern unhappy with buyout. Dell
Inc's largest independent shareholder, Southeastern Asset Management
Inc, has told the computer maker that a $24.4 billion buyout bid
undervalues it,
adding to a chorus of investor dissatisfaction with the landmark deal
to take it private, two sources close to the situation said.
Southeastern has privately told
the company that it is "disturbed" by a $13.65 per share offer for the
third-largest PC maker by a consortium led by founder and CEO Michael
Dell, and instead believes Dell is worth $20 per share, the sources said
on Thursday.
- FED FOCUS-When time's ripe, Fed officials see tapering bond buying. The U.S. Federal Reserve
should scale back rather than abruptly end its massive
bond-buying stimulus once the labor market gets its legs, a
growing number of Fed policymakers say. Chicago Federal Reserve Bank President Charles Evans, one of
the central bank's most aggressive doves, became the latest top
Fed official to publicly embrace such a strategy.
Evening Recommendations
Night Trading
- Asian equity indices are -.50% to +.75% on average.
- Asia Ex-Japan Investment Grade CDS Index 115.50 +.5 basis point.
- Asia Pacific Sovereign CDS Index 88.5 -.25 basis point.
- NASDAQ 100 futures +.18%.
Morning Preview Links
Earnings of Note
Company/Estimate
Economic Releases
8:30 am EST
- The Trade Deficit for December is estimated at -$46.0B versus -$48.7B in November.
- Wholesale Inventories for December are estimated to rise +.4% versus a +.6% gain in November.
Upcoming Splits
Other Potential Market Movers
- The Fed's Kocherlakota speaking, China inflation/trade data, Eurozone Trade/Production/CPI data, (GLW) investor meeting, USDA crop report and the (MAT) analyst meeting could also impact trading today.
BOTTOM LINE: Asian indices are mostly higher, boosted by industrial and commodity shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.
Broad Market Tone:
- Advance/Decline Line: Lower
- Sector Performance: Most Sectors Declining
- Market Leading Stocks: Performing In Line
Equity Investor Angst:
- ISE Sentiment Index 97.0 -16.4%
- Total Put/Call 1.05 +8.25%
Credit Investor Angst:
- North American Investment Grade CDS Index 89.88 +.28%
- European Financial Sector CDS Index 158.50 +.46%
- Western Europe Sovereign Debt CDS Index 106.67 -.11%
- Emerging Market CDS Index 232.93 -1.18%
- 2-Year Swap Spread 15.5 -.5 bp
- 3-Month EUR/USD Cross-Currency Basis Swap -18.0 -1.25 bps
Economic Gauges:
- 3-Month T-Bill Yield .06% unch.
- China Import Iron Ore Spot $155.10/Metric Tonne unch.
- Citi US Economic Surprise Index -30.0 -.2 point
- 10-Year TIPS Spread 2.55 unch.
Overseas Futures:
- Nikkei Futures: Indicating -7 open in Japan
- DAX Futures: Indicating +12 open in Germany
Portfolio:
- Slightly Lower: On losses in my biotech/retail sector longs
- Disclosed Trades: Added to my (IWM)/(QQQ) hedges, then covered some of them
- Market Exposure: 50% Net Long
Bloomberg:
- Draghi Signals Euro Strength May Hurt ECB’s Recovery Efforts. European
Central Bank President Mario Draghi signaled policy makers are
concerned that the euro’s strength will hamper their efforts to pull the
economy out of recession. “The exchange rate is not a policy
target, but it is important for growth and price stability,” Draghi said
at a press conference in Frankfurt today after the ECB kept its
benchmark rate at a record low of 0.75 percent. “We want to see if the appreciation is sustained, and if it alters our assessment of the risks to price stability.” The comments pushed the currency down more than a cent
against the dollar. While latest data show the 17-nation euro
economy is starting to stabilize after the sovereign debt crisis drove
it into recession last year, the euro’s gains could stymie a recovery
before it has begun by curbing exports and pushing inflation too low.
Draghi noted that the ECB will publish new economic projections next
month and stressed that officials will “maintain our accommodative
monetary stance.” “This was a verbal intervention,” said Joerg Kraemer,
chief economist at Commerzbank AG in Frankfurt. “Draghi reinforced
multiple times that the ECB will keep up its accommodative policy stance
and he indirectly suggested that the ECB may revise its inflation
projections downward next month.”
- Spain Borrowing Costs Rise Amid Corruption Allegations. Spain’s borrowing costs rose even as
it beat its maximum target of 4.5 billion euros ($6.11 billion)
at a debt sale today as corruption allegations targeting the
government threaten to reverse last month’s rally. The Madrid-based
Treasury sold a total of 4.61 billion
euros of debt, including a 2.75 percent 2015 note with a yield
of 2.823 percent, compared with 2.476 percent the last time it
was sold on Jan. 10. A 2018 note yielded 4.123 percent, up from
3.770 percent on Jan. 17, and it sold a 2029 bond at 5.787 percent,
compared with 5.555 percent at its last 15-year benchmark bond sale on
Jan. 10.
- Euro Falls Most Since July as Draghi Warns of Slowing Inflation. The euro fell the most since July
against the dollar after European Central Bank President Mario
Draghi said the recent strength of the currency creates a
concern that inflation will slow.
The 17-nation euro declined versus all but two of 16 major
counterparts as Draghi said after a policy meeting in Frankfurt
that the risk to the region’s growth remains on the
“downside.”
- Leverage Comeback in Stocks Seen as Sentiment Improves: EcoPulse. Shares of
companies with high operating or financial leverage are outperforming
the market, as investor sentiment about the economy improves. Two portfolio indexes of such stocks maintained by Goldman Sachs
Group Inc. have outpaced the Standard & Poor’s 500 Index since
October, a sign that riskier investment strategies are gaining favor. As
the expansion strengthens, companies with higher fixed cost structures
or weaker balance sheets are “more likely to benefit from that
recovery,” said Tim Ghriskey, who oversees about $2 billion as chief
investment officer of Solaris Group LLC, based in Bedford Hills, New
York.
- India Predicts Growth at Decade Low as Investment Slows. India forecast the weakest economic
growth in a decade as subdued investment and elevated inflation
add pressure on Prime Minister Manmohan Singh to extend policy
changes and revive his development agenda.
- Brazil’s Prices Rise at Fastest Pace in Almost Eight Years. Brazilian consumer prices rose in
January at the fastest pace since April 2005, raising pressure
on the central bank, which has said it will keep interest rates
at a record low for a prolonged period. Swap rates rose. Prices as measured by the benchmark IPCA index climbed 0.86
percent in the month, marking the fifth-straight acceleration,
the national statistics agency said today in Rio de Janeiro. Annual inflation accelerated to 6.15
percent from 5.84 percent the previous month.
- Worker Productivity in U.S. Declines, Pushing Up Labor Costs. The productivity of U.S. workers fell
more than projected in the fourth quarter as the economy shrank,
pushing labor expenses up and showing companies are approaching
the limit of how much efficiency they can wring from employees. The measure of employee output per hour decreased at a 2
percent annual rate, the worst performance in almost two years,
after a 3.2 percent gain in the prior three months, a Labor
Department report showed today in Washington. The median
forecast in a Bloomberg survey of 63 economists called for a 1.4
percent drop. Expenses per worker increased at a 4.5 percent
rate, more than estimated.
- Fed’s Evans Says QE Could Stop Before Drop to 7% Jobless.
Charles Evans, president of the Federal Reserve Bank of Chicago, said
today the central bank may stop its asset-purchase program before
unemployment falls to 7 percent. “I tend to think it might be
possible to turn off the quantitative easing,” Evans said in a CNBC
interview. “We might be able to stop before 7 percent” assuming momentum
builds and keeps going.
- Einhorn: What Tim Cook Should Do With Apple Cash. (video)
- Obama Administration to Stay Course on Biofuel Law, Vilsack Says. President Barack Obama’s
administration won’t abandon the nation’s ethanol program and
will encourage Congress to maintain it, Agriculture Secretary
Tom Vilsack said. The Renewable Fuels Standard, passed in 2007, requires the
U.S. to use 13.8 billion gallons of renewable fuels such as
ethanol this year and 15 billion gallons by 2015. The
Agriculture Department estimated this month that 42 percent of
this year’s corn crop will go toward making the fuel. Last summer, lawmakers from both parties called for a
temporary suspension or reduction of the ethanol program as a
drought drove up corn prices. The Environmental Protection
Agency declined the requests.
Wall Street Journal:
- Italian Bank Was Aided by Covert Loan. Monte dei Paschi di Siena SpA, the 541-year-old Italian bank at the center of a burgeoning financial
scandal, was so strapped for cash in late 2011 that it negotiated a
covert loan of nearly €2 billion ($2.7 billion) from the Bank of Italy
even as executives were publicly describing the lender's funding
position as comfortable, according to the Bank of Italy and people
familiar with the deal.
- Live Blog: Brennan’s CIA Confirmation Hearing at 2:30 p.m.
- Fed’s Stein: Signs of Overheating in Credit Markets. A top Federal Reserve official in a speech Thursday
said he sees some signs that credit markets may be overheating, although
he said there is not an imminent threat to the wider financial system. Federal Reserve Board governor Jeremy Stein
highlighted developments in several markets, including junk bonds,
mortgage real-estate investment trusts and commercial banks’ securities
holdings, as areas where potentially troubling trends are emerging as a
result of the Fed’s easy-money policies. Mr. Stein made his remarks at a symposium at the Federal Reserve Bank of St. Louis.
Fox News:
- Supermarkets cry foul as FDA proposes new food labeling rule under ObamaCare. If the Food and Drug Administration gets its way, your trip to the grocery store could get a tad pricier.
Supermarket owners argue a pending federal food-labeling rule that
stems from the new health care law would overburden thousands of grocers
and convenience store owners -- to the tune of $1 billion in the first
year alone.
Reuters:
Telegraph:
Xinhua:
- China Bans 'Pompous Speeches' at Advisory-Body Meeting. The
Chinese People's Political Consultative Conference to adopt reasonable
schedule, print fewer documents, simplify conference hall, reception
arrangements, citing rules issued by CPPCC's general office. Delegates
are told to speak "honestly and briefly" on own concrete opinions and
suggestions, not follow scripts. A no-banquet policy is in effect.
