TOP
STORIES:
Struggling factories underline fragility of world growth -
(www.reuters.com) Manufacturing across the world stumbled last month, underlining the
fragility of the global economy and building
the case for more action from leading central banks. Gloomy purchasing managers
indexes - surveys of factory activity that correlate strongly with economic
activity - added to a string of other economic data that has already soured
optimism that a budding pickup in the world economy will flower. Over the past
two days, manufacturing indexes for the United States, euro zone - including
powerhouse Germany - and China have
all declined. Britain's improved but was still signaling contraction. "There
is not a great amount of positive news out there. Globally, we do see a weaker
second quarter - there are no arguments about that," said Victoria Clarke,
economist at Investec.
Americans
are increasingly foolish with debt - (www.ochousingnews.com)
After 30 years of falling interest rates, Americans have become addicted
to cheap credit and personal Ponzi schemes. People have learned they can take
on large debts, consolidate them at lower and lower interest rates, and service
that debt with a portion of their income. It’s a bit like learning to live with
a lamprey slowly sucking your financial juices. Often it’s not enough to kill,
so it’s a parasite people learn to live with. Oftentimes when people get in
trouble with debt, they stop using it. As Jesus would say, “sin no more.”
Through falling interest rates, loan consolidations, and other methods of
“working with borrowers,” lenders have learned out not to kill their hosts.
Lenders have intentionally fostered moral hazard by teaching people to live
with their parasites rather than learning how to get rid of them.
ECB Cuts Key Interest Rate to Record Low as Recession Lingers
- (www.bloomberg.com) Policy makers meeting in Bratislava today lowered the main refinancing rate to
0.5 percent from 0.75 percent, a move predicted by 45 of 70 economists in a Bloomberg News survey. The
ECB kept the deposit rate at zero and reduced the marginal lending rate to 1
percent from 1.5 percent to preserve a symmetrical rate corridor. President Mario Draghi holds a press conference in
the Slovakian capital at 2:30 p.m. Since Draghi said last month that he stood
ready to act ifEurope’s economic outlook
worsened, inflation plunged, economic confidence slumped and unemployment rose.
Today’s cut, the first since July last year, takes the ECB closer to exhausting
its conventional policy tools, raising the prospect of a negative deposit rate
or new non-standard measures.
The rate cut “will not have any significant
impact on short-term interbank rates,” said Nick Kounis, head of macro research atABN Amro in Amsterdam. However, it will
“reduce funding costs for the mainly peripheral banks that use the ECB’s
lending facilities, so in that sense it is a targeted move.”
Big
Tobacco Is Scrambling To Get A Piece Of The Booming E-Cigarette Business –
(www.businessinsider.com) Yesterday, we showcased the 10 technologies Citi
says are going to "disrupt" the world. In other words, these are things that will
dramatically alter how their respective industries operate. There was one
technology you could put in your mouth: e-cigarettes. What are e-cigarettes?
They're basically thin pipes of vaporized, flavored nicotine. When you take a
drag, a pressure-activated switch turns on a miniature heater that emits fake
smoke. They're said to be less addictive than regular smokes, and more
importantly, cheaper.
U.S.
Homeownership Rate Lowest Since 1995 - (www.bloomberg.com) The U.S. homeownership rate fell to the lowest in almost 18 years,
reflecting rising demand for rentals and investor purchases in the housing
market. The share of Americans who own their homes was 65
percent in the first quarter, down from 65.4 percent a year earlier and the
lowest level since the third quarter of 1995, the Census Bureau reported today.
The vacancy rate for rented homes dropped
to 8.6 percent from 8.8 percent a year earlier, while vacancies for owner-occupied houses
fell to 2.1 percent from 2.2 percent. Investors are buying single-family homes
and renting them out to capitalize on demand among families unable to qualify
for a mortgage. Their purchases, many made with cash, are helping to support
the housing recovery and pushing up prices. Home values in 20 cities increased
9.3 percent in February from a year earlier, the most since May 2006, according
to the S&P/Case- Shiller (SPCS20Y%) index
released today.
No comments:
Post a Comment