Social Security's looming $11 trillion shortfall - (www.cnbc.com) President-elect Donald Trump has said he will preserve Social Security, though if he and Congress do nothing to fix the funding, the financial reckoning will be huge — as much as $11.4 trillion down the road. The last time Congress changed Social Security in a significant way with a series of benefit cuts and payroll tax increases was in 1983 under President Ronald Reagan. Back then, the federal government needed to fill a funding gap of about 1 percent of taxable workers' wages. By the time Social Security's trust funds are projected to run out in the early 2030s, the federal government will have to plug a hole of more than 3 percent, according to estimates by Charles Blahous, a senior research fellow at George Mason University's Mercatus Center.
Portugal Bonds Falter as ECB Running Out of Eligible Debt to Buy - (www.bloomberg.com) The European Central Bank is running out of Portuguese bonds to buy. The central bank’s holdings of Portugal’s debt are already pushing the limit set by its own guidelines, leaving it likely to buy less this year to avoid breaking those rules. That prospect has led to a selloff in Portuguese government bonds, with 10-year yields having risen almost 40 basis points since the ECB’s December meeting to hit an 11-month high last week. The ECB will have to scale back Portuguese purchases by around a half, according to Commerzbank AG, while ABN AMRO Group NV sees it stopping or suspending them by June.
European leaders shocked as Trump slams NATO and E.U., raising fears of transatlantic split - (www.washingtonpost.com) European leaders grappled with the jolting reality of President-elect Donald Trump’s skepticism of the European Union on Monday, saying they might have to stand without the United States at their side during the Trump presidency. The possibility of an unprecedented breach in transatlantic relations came after Trump — who embraced anti-E.U. insurgents during his campaign and following his victory — said in weekend remarks that the 28-nation European Union was bound for a breakup and that he was indifferent to its fate. He also said NATO’s current configuration is “obsolete,” even as he professed commitment to Europe’s defense.
China Shares Head for Longest Losing Streak Since August 2015 - (www.bloomberg.com) Stocks in China’s second-largest equity market plunged the most in 10 months, underscoring the increasing fragility of the nation’s financial assets. The Shenzhen Composite Index sank as much as 6.1 percent, the biggest loss since Feb. 29. Traders pointed to concern that regulators will accelerate the pace of initial public offerings, already at a 19-year high, diverting liquidity from existing shares. The Shanghai Composite Index dropped as much as 2.2 percent in minutes before paring losses amid speculated buying by state-backed funds.
Davos elite faces evaporating trust of populace - (www.reuters.com) Trust in governments, companies and the media plunged last year as ballots from the United States to Britain to the Philippines rocked political establishments and scandals hit business. The majority of people now believe the economic and political system is failing them, according to the annual Edelman Trust Barometer, released on Monday ahead of the Jan. 17-20 World Economic Forum (WEF). "There's a sense that the system is broken," Richard Edelman, head of the communications marketing firm that commissioned the research, told Reuters. "The most shocking statistic of this whole study is that half the people who are high-income, college-educated and well-informed also believe the system doesn't work." The 3,000 business, political and academic leaders meeting in the Swiss Alps this week find themselves increasingly out of step with many voters and populist leaders around the world who distrust elites.
Emerging Markets Drop on Trade Jitters as Mozambique Bonds Slide - (www.bloomberg.com)
Investors turn wary as Brexit, Trump uncertainty grows - (www.reuters.com)
South Korea Prosecutor Seeks Arrest of Samsung’s Jay Y. Lee - (www.bloomberg.com)
Exclusive: China to target around 6.5 percent growth in 2017 - sources - (www.reuters.com)
Trump's offer to Putin: an end to sanctions for nuclear arms cut - London Times - (www.reuters.com)