Thursday, October 30, 2014

Friday October 31 Housing and Economic stories

Official WHO Ebola toll near 5,000 with true number nearer 15,000 - ( At least 4,877 people have died in the world's worst recorded outbreak of Ebola, and at least 9,936 cases of the disease had been recorded as of Oct. 19, the World Health Organization (WHO) said on Wednesday, but the true toll may be three times as much. The WHO has said real numbers of cases are believed to be much higher than reported: by a factor of 1.5 in Guinea, 2 in Sierra Leone and 2.5 in Liberia, while the death rate is thought to be about 70 percent of all cases. That would suggest a toll of almost 15,000.

Oil Producers Cramming Wells in Risky Push to Extend Boom - ( U.S. shale producers are cramming more wells into the juiciest spots of their oilfields in a move that may help keep the drilling boom going as prices plunge. The technique known as downspacing aims to pull more oil at less cost from each field, allowing companies to boost profit, attract more investment and arrange needed loans to continue drilling. Energy companies see closely-packed wells as their best chance to add billions more barrels of oil to U.S. production that’s already the highest in a quarter century. “We would be dealing with more than a decade of inventory,” said Manuj Nikhanj, co-head of energy research for ITG Investment Research in Calgary. “If you can go twice as tight, the multiplication effect is massive.”

2,447 Bottles of Wine on the Wall and State Plans to Dump Them All - ( Christina Turley’s father, Larry, produces California wine from vines that date back to the late 1800s. Sought by collectors, several bottles may be dumped down a Philadelphia sink. Pennsylvania plans to destroy 2,447 bottles seized from Arthur Goldman, a Philadelphia-area lawyer who was charged this year with illegally reselling wine. While he has agreed to penalties, he’s fighting the jettisoning of his collection, which encompasses small-batch California producers such as Turley Wine Cellars, Martinelli Winery and Kistler Vineyards. For the authorities, destruction is the natural culmination of the case. For Christina Turley and Regina Martinelli, a fifth-generation winemaker, it would waste the products of years of devotion and passion.

Shale Boom’s Allure to Wall Street Tested by Bear Market - ( Falling oil prices are testing investors’ commitment to the Wall Street-funded shale boom. Energy stocks led the plunge earlier this month in U.S. equities and the cost of borrowing rose. The Energy Select Sector Index is down 14 percent since the end of August, compared with 3.8 percent for the Standard & Poor’s 500 Index. The yield for 190 bonds issued by U.S. shale companies increased by an average of 1.16 percentage points. Investors’ sentiment toward the oil and gas industry has “certainly changed in the last 30 days,” said Ron Ormand, managing director of investment banking for New York-based MLV & Co. with more than 30 years of experience in energy. “I don’t think the boom is over but I do think we’re in a period now where people are going to start evaluating their budgets.”

 ‘Poker Player’ Putin Bluffed and Won, French Envoy Says - ( Vladimir Putin has outmaneuvered his opponents and humiliated Ukraine by continuing to back pro-Russian separatists and flouting a cease-fire, making it crucial that sanctions on Russia remain firm, France’s ambassador to the U.S. said. The Russian president “has won because we were not ready to die for Ukraine, while apparently he was,” Ambassador Gerard Araud said yesterday at a Bloomberg Government breakfast in Washington, in remarks he said represented his personal opinion. Echoing the view of other European envoys in Washington, Araud expressed concern that the Ukraine conflict has hit an impasse, leaving Putin the winner by default.

Wednesday, October 29, 2014

Thursday October 30 Housing and Economic stories

Living The Grecovery Dream: Two Jobless Parents, Two Kids, One Cat All Living In A Car - ( This is in Greece (not the US), just so there is no confusion!! Squeezed between steering wheel, handbrake, door and dashboard, Katerina reads in her history book, takes notes for school. Next to her, on the driver’s seat, cat Eddy stares right in the camera lens. It may look like a cute snapshot on a sunny day, if it wasn’t for a sad detail: a withering spring stuck in a roll of toilet paper.  A distinctive memory of a former normal life that turned into a grim reality for a family of four. At night the seat where Katerina sits during the day turns into a bed for her sister Fay. Cat Eddy cuddles with Katerina on the back seat. Father Nikos and mother Maria sleep in shifts on the driver’s seat. When the one parent is in the car, the other spends the night on a bench of the park where the car has been parked, on a side road of Irakleio suburb of West Athens. “It’s dangerous when it gets dark,” Maria says “we have to watch out.” With both parents without a job and all savings already spent, the family of four has been living in the uncomfortable environment of an old car for the last two weeks. They were evicted from the home they were renting due to a mountain of outstanding debts to the landlord and utility companies.

McDonald’s Gets More Expensive, Turning Off Some Diners - ( Mike Hiner used to take his grandsons to McDonald’s (MCD)when they wanted a treat. With higher wage and food costs pushing up prices at the Golden Arches, he’s increasingly taking them to IHOP, Denny’s and Chili’s instead. “Those meals are the same price,” said Hiner, a 58-year-old geologist in Houston. “And they’re better.” The loss of bargain-seeking customers like Hiner underscores a growing challenge for McDonald’s Corp.: While the company still offers several items for $1, its menu is quietly getting more expensive. 

Oil Workers Earning $179,000 Expose Norway to Crude Crash - ( Norway, where oil helped create one of the world’s most stable and prosperous societies, is among the most exposed to falling crude prices. Though the blessings of energy wealth have hardly turned to a curse, the industry’s labor costs, which saw the average offshore worker earn $179,000 last year, threaten to curb investment in new projects as oil tumbles. The country has already been coping with 13 years of production declines from its aging North Sea fields and reduced revenue will imperil further developments to replace that oil. Three projects led by state-owned Statoil ASA (STL), which is borrowing and selling assets to cover dividend payments, are at risk of being delayed or shelved, said Jarand Rystad, managing partner of Oslo-based consultant Rystad Energy.

FHFA Said to Plan Steps to Ease Lending to Riskier Buyers - ( Fannie Mae (FNMA),Freddie Mac and their regulator are nearing agreement with mortgage issuers on efforts to boost lending and ease banks’ concerns that they will get stuck with bad loans when borrowers default. The initiatives include a consensus on when defaulted loans are so flawed that lenders must buy them back from the two mortgage-finance companies, a key sticking point in efforts to unlock credit, according to three people familiar with the discussions. The steps are part of a broader push to increase lending after banks had to repurchase billions of dollars of mortgages that were issued during the housing bubble.

A Scary Sentence From IBM ... - ( "We saw a marked slowdown in September in client buying behavior, and our results also point to the unprecedented pace of change in our industry." CEO Ginni Rometty said this in IBM's Q3 earnings announcement, which revealed tumbling revenue and profits at the company. The statement is troubling because as a global provider of business software and services, IBM is a bellwether of business spending. And a boom in business spending is central to the bullish outlooks of many economists and market strategists.

Tuesday, October 28, 2014

Wednesday October 29 Housing and Economic stories

Leveraged Money Spurs Selloff as Record Treasuries Trade - ( When markets are buckling and volatility is signaling a crisis, you sell what you can, not what you want. That’s what happened last week on Wall Street, where slowing economic growth in Europe, Ebola anxiety and escalating conflicts in the Middle East and Ukraine tore through the calm with a force not seen in three years. Loath to find out what their record holdings of corporate bonds and leveraged loans were worth as liquidity thinned and markets slid, professional traders turned to stocks and Treasuries to defuse risk. The result was a frenzy. U.S. government debt volume surged to an all-time high of $946 billion at ICAP Plc, the world’s largest interdealer broker, more than 40 percent above the previous record. 

Two Female Japan Ministers Resign in a Day in Blow to Abe - ( Japanese Prime Minister Shinzo Abe rushed to appoint two new members of his cabinet yesterday, after two female ministers were forced to resign as he confronts some of the most difficult decisions since he took office. Trade and Industry Minister Yuko Obuchi, 40, and Justice Minister Midori Matsushima, 58, quit over allegations of financial impropriety. Abe picked Yoichi Miyazawa, a 64-year-old man, for the trade position and Yoko Kamikawa, a 61-year-old woman and former gender equality minister, for the Justice Ministry.

IBM Plunges as CEO Abandons 2015 Earnings Forecast - ( International Business Machines Corp. (IBM) plunged the most in more than four years after abandoning an earnings forecast for 2015, as the company struggles to transform fast enough to handle the shift to cloud computing. IBM said it will provide an update on its projections in January, ditching a five-year plan to boost profit. The shares tumbled as much as 8.4 percent, dragging down the Dow Jones Industrial Average. Warren Buffett, IBM’s biggest shareholder, had as much as $1 billion of his investment wiped out. While Chief Executive Officer Ginni Rometty had been banking on a strong second half of the year, IBM instead faced weaker-than-expected software sales and lower productivity in services in the third quarter. With technology customers moving from owning hardware to storing data in the cloud, IBM is now cutting more jobs, reducing its forecast for free cash flow and offloading an unprofitable chip unit to Globalfoundries Inc.

Ebola Front-Line Doctors at Breaking Point - ( At 3:30 a.m. in the world’s biggest Ebola treatment center, Daniel Lucey found the outbreak reduced to its essentials: patients lying on mattresses on the floor and vomiting in the dark, visible only by the wavering flashlight beam of a single volunteer doctor. “I don’t see a light at the end of the tunnel,” said Lucey, a physician and professor from Georgetown Universitywho is halfway through a five-week tour in Liberia with Medecins Sans Frontieres, the medical charity known in English as Doctors Without Borders. “The epidemic is still getting worse,” he said by phone between shifts.

OPEC Finding U.S. Shale Harder to Crack as Rout Deepens  - (  OPEC is resisting pressure to cut oil production while demand slumps as it tests how low prices must go to make U.S. shale oil unprofitable. As producers become more efficient, that floor is sinking. The Organization of Petroleum Exporting Countries boosted output by the most in 13 months in September, even as crude plunged into a bear market and demand growth weakens to a five-year low, according to the International Energy Agency. Saudi Arabia and Kuwait, the largest and third-largest members of OPEC, indicated the price slump doesn’t warrant immediate production cuts, the IEA said. While OPEC acted as a “swing producer” over the past decade, responding to surpluses by cutting output, it’s now letting oil slide to see if North American production can withstand lower prices, said Antoine Halff, head of the IEA’s oil industry and markets division. So far drillers are showing no signs of cracking, with the U.S. government forecasting record shale output in November, helping boost the nation’s crude supply to the highest level since 1986.

Monday, October 27, 2014

Tuesday October 28 Housing and Economic stories

Debt Crisis Reawakens in European Bonds as Greece Roils Market - ( European government-bond traders would be forgiven for thinking they’d stepped back in time to 2012. Today’s selloff in Greek securities, the biggest since July of that year, triggered a schism in sovereign debt evocative of those days before European Central Bank President Mario Draghi pledged to do whatever it took to defend the euro. Yields on 10-year securities from Europe’s most-indebted nations surged, led by Greece and sweeping up Portugal, Ireland and Italy. At the same time, benchmark yields in the so-called core, which includes Germany and France, tumbled to records as investors sought the safest assets.

Nurses Say No Ebola Protocol Meant Tape to Cover Skin - ( Texas Health Presbyterian Hospital inDallas, where two health-care workers contracted Ebola after treating a patient with the deadly illness, lacked protocols for dealing with the virus and resisted employee calls for stricter isolation and sanitation measures, a nurses union said. National Nurses United said there was inadequate protective equipment for the nurses who initially cared for Thomas Eric Duncan, the Ebola patient from Liberia who died in Dallas last week. The union said the allegations came from nurses who were reluctant to be identified for fear of retaliation.

Abnormal bond market move signals bears capitulating - ( A wild and historic move in the Treasury market Wednesday stunned traders and signaled capitulation by some investors who have been clinging to bearish positions. The dramatic buying and big swing in rates coincided with a swift downdraft in stocks and was blamed on a combination of factors. The weakness in Europe, worries Greece would exit its bailout, the possible breakdown of the AbbVie-Shire merger, Ebola concerns, and weak U.S. retail sales data were all cited as factors for the jump in bond prices and slide in yields. The yield on the 10-year slid to 1.86 percent in a quick move down—its lowest level in intraday trading since May 2013—before later reversing to 2.1 percent in the biggest one day move since November 2008, according to Jefferies. "We've had our shock and awe short-covering rally, and all that, but something has changed," said David Ader, chief Treasury strategist at CRT Capital. 


As US Politicians Consider Travel Bans, Istanbul Quarantines Hospital Of Suspected Ebola Patient - (  Istanbul's Marmar University Training and Research Hospital is not accepting new patients after, as Daily Sabah reports, a person suspected of being infected with Ebola has been quarantined. The patient, who arrived by plane from Ivory Coast, is suffering high fever and nausea. While Lagos, Nigeria was CDC Director Frieden's worst nightmare with regard Ebola contagion, we suspect Istanbul is a close second with over 14 million people living there. This news comes as US politicians begin to call for visa restrictions and travel bans from infected nations.

Oil Slump Heaps Losses on Energy Debt in $50 Billion Glut - ( Gobbling up $50 billion of high-yielding U.S. junk-bond offerings by energy companies this year may have seemed like a good idea when oil was above $100 a barrel and yields were at record lows. With prices falling toward $80, bond buyers have instead been saddled with more than $2 billion of lost market value and growing concern that too much credit has been extended too fast amid America’s shale boom. Prices on $1.6 billion of speculative-grade bonds sold by the upstart exploration firm of former Chesapeake Energy Corp. chief Aubrey McClendon have plunged as much as 19 percent since being issued in July. Another $1.1 billion issued the same month by Paragon Offshore Plc are down as much as 28 percent.

Sunday, October 26, 2014

Monday October 27 Housing and Economic stories

Exec For Apple Supplier Dumped $2 Million In Stock Before His Company Went Bankrupt - ( GT Advanced Technologies COO Daniel Squiller sold nearly $2 million in company stock before the firm filed Chapter 11 bankruptcy last week, according to The Wall Street Journal's Diasuke Wakabayashi. GTAT supplies Apple's sapphire display, which is expected to be used on the Apple Watch. Last week, The Wall Street Journal reported that GTAT's CEO sold a large amount of stock before Apple announced it would not be using sapphire on the iPhone 6 (except on the camera).  Squiller unloaded roughly $1.2 million in shares last May and has sold $750,000 in shares since then. These sales came after signs of production trouble, with Apple delaying payments starting in February, according to the WSJ.

Texas college bans students from 'Ebola countries' - ( At least two students from Nigeria who applied to a Texas college were told they wouldn't be admitted because of Ebola. Kamorudeen Abidogun, a Texas man originally from Nigeria, said he received two letters from Navarro College, a two-year community college with a campus about 58 miles from Dallas. Abidogun has five relatives in Nigeria who were applying to the school and who were using his home in Richmond, Texas, as a U.S. mailing address, he told CNBC. The college rejected the applications, citing confirmed Ebola cases in the country as the reason for the admissions decision.

Venezuela Bonds Fall as Harvard Team Says Default Likely - ( Venezuela’s bonds declined to a three-year low after oil fell and Harvard University economists Carmen Reinhart and Kenneth Rogoff said the South American country will probably default on its foreign debt. The price on the country’s benchmark dollar bonds due 2027 tumbled 2.4 cents to 62.17 cents on the dollar at 1:45 p.m. in New York, the lowest level since October 2011. Yields climbed 0.63 percentage point to 16.37 percent. Borrowing costs are surging as oil prices fall and a shortage of dollars makes it harder for the government to meet its citizens’ basic needs.

Oil and Junk Don’t Mix as Worst Bonds Sink as Much as 19% - ( If you’re wondering why junk bonds keep selling off, consider this:Oil prices are tanking and energy companies now account for a record proportion of the below investment-grade market. Debt of high-yield energy companies has tumbled 4.6 percent since August, leading the market down as the price of Brent crude futures plummeted to the lowest in about four years. Some securities have fared much worse, like the 19 percent plunge in oil and gas producer Samson Investment Co.’s bonds. “It’s been a pretty sharp move,” said Matt Eagan, a fund manager at Loomis Sayles & Co. in Boston. “This is the first time in a long time where a sector has seen a big setback.”

If The Oil Plunge Continues, "Now May Be A Time To Panic" For US Shale Companies - ( Over the past 5 years, the shale industry, fabricated or real reserves notwithstanding, has been a significant boon to the US economy for four main reasons: it has been the target of billions in fixed investment and CapEx spending, it has resulted in tens of thousands of high-paying jobs, its output has been a major tailwind for the US trade deficit, and has generally been a significant contributor to GDP (not to mention various Buffett-controlled or otherwise railway corporations). And perhaps, most importantly, it has become a huge buffer to the price of global oil, as the cost curve of US shale is horizontal, with a massive 10,000 kbls/day available within pennies of $85/bl.