Student loan forgiveness may be coming - (www.cnbc.com) The new entitled class - Government workers. For many members of the class of 2014 who borrowed money to attend college, the clock is ticking on what is likely to be their biggest expense after graduation. They'll have to start paying back their federal student loans in November or December—as the six-month grace period that lenders give new grads comes to an end. But depending on their income—or lack of income, if they're still looking for work—some borrowers may be eligible for much lower payments than they'd anticipated. And eventually they could have their federal loans forgiven altogether. "If total student debt exceeds one's annual income, then you will likely qualify for some sort of payment plan and receive a financial benefit from participation" in an income-driven repayment plan, said Mark Kantrowitz, senior vice president and publisher of Edvisors.com, a website that provides information, advice and tools for helping families plan and pay for college.
Italy delays repayment of commercial debts - (www.reuters.com) Italy will settle the debt arrears it owes to private sector suppliers by the end of this year, Economy Minister Pier Carlo Padoan said in a newspaper interview on Sunday, pushing back previous commitments. The Italian state owes some 75 billion euros ($102 billion)to private suppliers, according to the most recent data from the Bank of Italy. The unpaid bills have starved companies of cash and triggered layoffs, factory closures and bankruptcies. "We will ensure that the arrears are paid off by the end of the year," Padoan told Corriere della Sera daily. Prime Minister Matteo Renzi promised in March to pay back all the debt arrears by July. Within a week he put back the target date to September. The government is finding it hard to tackle the problem because of public financeconstraints, inefficiency, uncertainty over exactly how much is owed and a reluctance on the part of some public bodies to acknowledge their debts.
Argentina gets set for debt talks by calling U.S. judge biased - (www.bloomberg.com) Argentina on Friday accused a U.S. judge of being biased in favor of hedge funds that have sued the South American country for full repayment of defaulted bonds, cementing the tough stance it has taken ahead of debt talks set for New York next week. A series of rulings by U.S. District Court Judge Thomas Griesa leave Argentina just three weeks to clinch a deal with the funds before falling into another default, which would heap financial stress on its already shrinking economy. The government of President Christina Fernandez denounces the funds as vultures bent on crippling Argentina, Latin America's third largest economy, for the sake of profit. "A lot of officials in the United States say its judicial branch is independent," Argentine cabinet chief Jorge Capitanich said. "But it is not independent of the vulture funds because its decisions show clear partiality." The legal fight stems from Argentina's 2002 default on about $100 billion in bonds. The financial crisis thrust millions of middle-class Argentines into poverty. The economy snapped back from 2003 to 2008 before being weighed down by high inflation and heavy-handed trade and currency controls.
France hits out at dollar hegemony in global deals Financial Times - (www.cnbc.com) France's political and business establishment has hit out against the hegemony of the dollar in international transactions after U.S. authorities fined BNP Paribas $9 billion for helping countries avoid sanctions. Michel Sapin, the French finance minister, called for a "rebalancing" of the currencies used for global payments, saying the BNP Paribas case should "make us realize the necessity of using a variety of currencies". He said, in an interview with the Financial Times on the sidelines of a weekend economics conference: "We [Europeans] are selling to ourselves in dollars, for instance when we sell planes. Is that necessary? I don't think so. I think a rebalancing is possible and necessary, not just regarding the euro but also for the big currencies of the emerging countries, which account for more and more of global trade." Christophe de Margerie, the chief executive of Total, France's biggest company by market capitalization, said he saw no reason for oil purchases to be made in dollars, even if the benchmark price in dollars was likely to remain.
Bond Anxiety Grows in $1.6 Trillion Repo Market as Failures Soar - (www.bloomberg.com) In the relative calm that is the market for U.S. Treasuries, a sense of unease over a vital cog in the financial system’s plumbing is beginning to rise. The Federal Reserve’s bond purchases combined with demand from banks to meet tightened regulatory requirements is making it harder for traders to easily borrow and lend certain desired securities in the $1.6 trillion-a-day market for repurchase agreements. That’s causing such trades to go uncompleted at some of the highest rates since the financial crisis. Disruptions in so-called repos, which Wall Street’s biggest banks rely on for their day-to-day financing needs, are another unintended consequence of extraordinary central-bank policies that pulled the economy out of the worst financial crisis since the Great Depression. They also belie the stability projected by bond yields at about record lows. “You have a little bit of a perfect storm here,” said Stanley Sun, a New York-based interest-rate strategist at Nomura Holdings Inc., one of the 22 primary dealers that bid at Treasury auctions, in a telephone interview June 30. A smoothly functioning repo market is vital to the health of markets. The fall of Bear Stearns Cos., which was taken over by JPMorgan Chase & Co. in 2008 after an emergency bailout orchestrated by the Fed, and collapse of Lehman Brothers Holdings Inc., whose bankruptcy in September of that year plunged markets into a crisis, was hastened after they lost access to such financing.