KeNosHousingPortal.blogspot.com
TOP STORIES:
Americans Clueless Paying Wall Street $20 Billion for Bad Swaps - (www.bloomberg.com) Seven months after Hurricane Katrina ripped holes in the Superdome’s roof in 2005, Louisiana State Bond Commission members made what they were told would be “the best of a bad situation” in financing the stadium’s renovation. Acting against the recommendation of their staff, the commissioners voted for a Merrill Lynch & Co. plan to use debt and interest-rate swaps to pay for the job. While the deal helped keep the National Football League’s New Orleans Saints from leaving town -- and the arena got new scoreboards while 12,000 seats were converted to luxury class -- taxpayers became the losers for supporting a winning team. The cost of financing the work has reached $42 million, almost a quarter of the $187 million spent on Katrina-related repairs and enhancements and three times as much as expected. The deal became so expensive that the state repurchased the debt sold by the New York investment bank to stop the bleeding. “It was a flawed idea out of the gate,” said Robert Brooks, who teaches financial management at the University of Alabama in Tuscaloosa.
ECB sees "substantial" effect from cheap money - (www.reuters.com) The European Central Bank's flood of cheap three-year money is helping the euro zone's banking system substantially and supporting confidence in the bloc's economy which is showing some signs of stabilization, its president said on Thursday. The ECB left interest rates on hold, pausing to assess the impact of back-to-back cuts and a slew of other measures it unleashed late last year that are showing signs of helping fight the euro zone debt crisis.
Little Alarm Shown at Fed At Dawn of Housing Bust - (online.wsj.com) The leaders of the Federal Reserve went around the room saluting Alan Greenspan during his last day as chairman of the central bank. Then Timothy F. Geithner, the future Treasury secretary, made a prediction. “I’d like the record to show that I think you’re pretty terrific, too,” Geithner, who was president of the Federal Reserve Bank of New York, told Greenspan amid laughter on Jan. 31, 2006. “And thinking in terms of probabilities, I think the risk that we decide in the future that you’re even better than we think is higher than the alternative.” On Thursday, the Fed released transcripts of its meetings in 2006, offering a new window into what was on the minds of some of the nation’s top economic and financial thinkers just ahead of the financial crisis and subsequent great recession. The transcripts, which are customarily released after five years, show that Fed leaders, armed with the best economic data available, had little idea of what was looming less than two years off.
Data: Bernanke Ignorant of Housing Bust - (www.newsmax.com) Ben Bernanke presided over his first meeting as Federal Reserve chairman in March 2006 believing the nation's economy could pull off a "soft landing" from falling home prices. Three months later, Bernanke had begun to grasp that he and others had underestimated the risk housing posed to the economy. Newly released transcripts of Fed meetings during Bernanke's first year as chairman show that, among Fed officials, he often expressed the most concern about housing. But no official, according to the transcripts, recognized the extent of the damage a housing bubble would cause. A year later, the housing market's collapse helped send the nation into its worst recession since the Great Depression. In fact, Treasury Secretary Timothy Geithner, then a Fed official, expressed confidence in September 2006 that "collateral damage" from housing could be avoided. The transcripts released Thursday covered the eight meetings of the central bank's chief policy-making body, the Federal Open Market Committee, during 2006. That included the last meeting of Federal Reserve Chairman Alan Greenspan in January of that year and Bernanke's first meeting in March after he had succeeded Greenspan as chairman.
Hedge funds hunker down for Greek debt standoff – (www.reuters.com) Hedge funds are positioning to profit from a plan to slash Greece's towering debt pile as Athens enters final talks that could sway the country's membership of the euro. York Capital, the $14 billion fund part-owned by Swiss banking giant Credit Suisse, New York-listed Och Ziff, and $10 billion-strong Marathon Asset Management are among those who collectively may have built up sufficiently large positions to scupper the bailout deal, several sources close to the debt restructuring told Reuters. The deal asks creditors to voluntarily write down 50 percent of the notional value of their bond holdings. But hedge funds may opt out, hoping that Athens will let them get away with it to save itself political embarassment.
US corporate creditworthiness falls, says S&P - (www.ft.com)
Italian Funding Cost Falls to 4.83% at Auction of 6% November 2014 Notes - (www.bloomberg.com)
China Forex Reserves Drop for 1st Qtr Since ’98 - (www.bloomberg.com)
U.S. Trade Deficit Widens Beyond Forecast - (www.bloomberg.com)
Fed’s image tarnished by newly released documents - (www.washingtonpost.com)
Inside the Fed in 2006: A Coming Crisis, and Banter - (www.nytimes.com)
JPMorgan Profit Falls 23% on Weak Trading - (www.bloomberg.com)
Potential suitors circle American Airlines: sources - (www.bloomberg.com)
No comments:
Post a Comment