Tuesday, April 16, 2013

Wednesday April 17 Housing and Economic stories


TOP STORIES:

France to Apply 75% Tax to Soccer Players’ Compensation - (www.businessweek.com) Paris Saint-Germain, France’s richest soccer club, will have more on its agenda than controlling Lionel Messi when it takes on Barcelona, the world’s best team, tonight. PSG’s Qatari owners also have the tax man to think about. After conflicting messages by government officials, Prime Minister Jean-Marc Ayrault’s office issued a statement today confirming that a 75 percent surcharge on salaries above 1 million euros ($1.3 million) will apply to soccer clubs. “This new tax will cost first-division teams 82 million euros,” France’s Football League said in a statement. “With these crazy labor costs, France will lose its best players, our clubs will see their competitiveness in Europe decline, and the government will lose its best taxpayers.”

Cyprus Seeks More Time to Meet Targets in Talks With Troika - (www.bloomberg.com) Cyprus government officials are seeking easier bailout terms in talks with representatives of the European Union and International Monetary Fund today, before a meeting of euro-area finance officials later this week. “Final outstanding issues in talks with the troika primarily relate to the wider financial sector and fiscal policy and adjustment,” Christos Stylianides, the government’s spokesman, said in Nicosia yesterday. The government has been granted a one-year extension to 2017 to secure a primary budget surplus, which excludes interest payments, and it hopes to negotiate an additional year, he said. Cyprus’s government wants more time to reach targets required in return for 10 billion euros ($12.8 billion) in international funds after agreeing to impose losses on uninsured depositors at the country’s two biggest banks, Bank of Cyprus Pcl and Cyprus Popular Bank Pcl (CPB). Economists including Gabriel Sterne at Exotix Ltd. in Londonhave said the government’s measures to secure the bailout will hurt the nation’s economy.

Insight: Inside Laiki - Countdown to catastrophe - (www.reuters.com) On the evening of the last Wednesday in March, the directors of Laiki bank, the second largest in Cyprus, gathered in their sixth floor board room for the last time. With the portraits of chairmen past staring down at them, they all resigned, something that had become inevitable earlier in the week when each director received a letter from the Central Bank of Cyprus telling them a special administrator had been appointed to run their bank and the board was suspended. After less than an hour, the board broke up for the last time, its members accepting that their 112-year-old institution was no more. "It was like a funeral," one director said. The death of Laiki, also known as Cyprus Popular Bank, was brutal. Board members said they had fought to the bitter end, imploring political leaders not to accept the bank's closure as part of a 10 billion euro ($13 billion) bailout deal last week to save the country from bankruptcy.

California City's Bankruptcy Poses Risk to Pensions - (online.wsj.com) A federal judge allowed Stockton, Calif., to restructure its finances under bankruptcy protection Monday, but he signaled it might have to cut payments to its pension fund, possibly setting a precedent for other cities. Stockton, a port and agriculture center of 300,000 residents 80 miles east of San Francisco, filed in June 2012 for Chapter 9 under the U.S. Bankruptcy Code, which allows municipalities to seek protection from creditors by establishing a plan to resolve their debt. It is the largest U.S. city to file for bankruptcy. Judge Christopher Klein of the U.S. Bankruptcy Court in Sacramento on Monday declined a request by the city's creditors that he dismiss the bankruptcy case, saying the city "will not be able to perform its obligations to its citizens relating to such fundamental matters as public safety, as well as other basic governmental services," without bankruptcy powers. he U.S. Bankruptcy Court refuses on Monday to dismiss the Stockton, Calif., Chapter 9 case. Stockton is the latest in a string of California cities that have moved toward bankruptcy—it follows San Bernardino, Vallejo and Mammoth Lakes—after their finances crumbled in the face of the recent recession and as costs such as city pension obligations mounted.

ZeekRewards scam leaves N.C. town millions poorer - (www.usatoday.com) In the hardware store on South Main Street, the owner pulled Caron Myers aside to tell her about the best thing to happen in years to this once-thriving furniture and textile town. Did she hear about the online company ZeekRewards? For a small investment, she could make a fortune. He had invested. So had his grandsons. And so were more and more people in Lexington, including doctors, lawyers and accountants. Skeptical at first, Myers drove a few blocks to the company's one-story, red-brick office and spotted a line of people circling the building. She was sold, and plunked down several thousand dollars. But months later, Myers, like hundreds of thousands of others, discovered the truth: ZeekRewards was a scam. "I was duped," Meyer said. "We trusted this man. The community is still in shock." Authorities say owner Paul Burks was the mastermind of a $600 million Ponzi scheme — one of the biggest in U.S. history — that attracted 1 million investors, including nearly 50,000 in North Carolina. Many were recruited by friends and family in Lexington, a quintessential small town where neighbors look out for each other.





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