KeNo's Housing and Economic Portal: Wednesday August 3 Housing and Economic stories

Tuesday, August 2, 2011

Wednesday August 3 Housing and Economic stories

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TOP STORIES:

June U.S. Jobs Picture Gloomy in Many States - (www.bloomberg.com) Jobless rates jumped in June from the month before in more than half of the U.S. states as sinking public employment reversed the trend of steadily improving labor conditions in the first half of 2011, Labor Department data released on Friday showed. Altogether, 28 states and the District of Columbia registered unemployment rate increases from the month before and eight states had rate decreases. From a year before, the rates dropped in 39 states and rose in eight states and the District of Columbia, Labor Department data showed. In May, only 13 states and the District registered increases over the month and only four states had increases over the year. The unemployment rate in Nevada rose to 12.4 percent from 12.1 percent in May, in the first rise this year. The state continued to register the highest jobless rate in the country.

Players in a Greek Drama - (www.nytimes.com) This summer, David Riley is one of the world’s most powerful financial analysts. Not only does he have the power to effectively put a “sell” on Uncle Sam, but on Friday he roiled global markets after he said the Greek rescue package would constitute a limited default on the country’s debt. The analyst, who is based in London, oversees the 30-person government bonds team inside Fitch Ratings, which could soon downgrade the debt of the United States government from its historical, gold-plated, triple-A rating if politicians in Washington cannot agree to raise the debt limit.

Fitch calls default, Greece pledges no let-up on debt - (www.reuters.com) Fitch ratings agency declared Greecewould be in temporary default as the result of a second bailout, which Athens said had bought it breathing space. But the agency pledged to give Greece a higher, "low speculative grade" after its bonds had been exchanged and said Athens now had some hope of tackling its debt mountain, which most economists still expect to force a deeper restructuring in the future. An emergency summit of leaders of the 17-nation currency area agreed a second rescue package on Thursday with an extra 109 billion euros ($157 billion) of government money, plus a contribution by private sector bondholders estimated to total as much as 50 billion euros by mid-2014. Under the bailout of Greece, which supplements a 110 billion euro rescue plan by the European Union and the International Monetary Fund in May last year, banks and insurers will voluntarily swap their Greek bonds for longer maturities at lower rates.

Borders collapse signals a new retail chapter - (www.ft.com) At a store on the southwest corner of New York’s Central Park, signs blaring “Everything must go!” and “Nothing held back” were put up overnight, confirming that Borders had entered its final chapter – and that US retail was beginning a new one. The loss-making book chain was sent into liquidation this week and its going-out-of-business discounts, flagged in big yellow letters on Friday, dispelled the usually cosy feel of its Columbus Circle store. The previous day several lunchtime customers had nestled into its quieter corners: a woman browsing the religion section with a bowl of water for her dog; a man splayed like a sun-bather on the floor of the events zone. Borders’ role as a home-away-from-home is one reason why its extinction has been greeted with sadness. But the company’s demise – leavingBarnes & Noble as the US’s only national book chain – is about more than the end of an era in books.

The calls grow louder for Obama to just ignore the debt ceiling - (www.businessinsider.com) The debt ceiling is currently a political crisis threatening to be an economic one, and soon it could turn into a constitutional crisis. The calls are getting louder for Obama to ignore Congress and unilaterally raise the debt ceiling. In a NYT op-ed, Eric Posner and Adrian Vermeule liken a unilateral hike in the debt ceiling by Obama to Abraham Lincoln's suspension of Habeus Corpus during the Civil War -- a unilateral move done for the good of the country. Paul Krugman loved Obama's fiery press conference yesterday, and said the 14th Amendment route was the likely step forward: "Let the GOP go ahead and try to impeach: the whole world knows who’s intransigent here."