Puerto
Rico Debt Floats on Dubious Tax Privilege - (www.ritholtz.com) By
not issuing an opinion the IRS and US Treasury postpone the constitutional test
litigation and perpetuate a policy that funnels an indirect subsidy of $2
billion a year to PR; [so] US taxpayers are consequently funding almost
one-fourth of the PR general fund budget without congressional approval, under
the public radar screen, and based on an administrative deferral technique...
The amount involved each year is about equal to the annual interest payment on
ALL of PR's outstanding debt... [thus,] the Obama Administration avoids a
possible embarrassing default by PR [for the time being].
How
Much Does It Cost to Be Ambassador to Hungary? - (www.bloomberg.com) Who
is Colleen Bell? Bell is a soap opera producer -- “The Bold and the Beautiful”
is her masterwork -- who was nominated by Barack Obama's administration to
serve as U.S. ambassador to Hungary. Bell, one of Obama’s larger fundraising
“bundlers,” bought this nomination with more than$500,000
of mostly other people’s money. At her confirmation hearing last month, McCain asked Bell
an exceedingly simple question: “What are our strategic interests in Hungary?” She
gave the following imperishable answer: “Well, we have our strategic interests,
in terms of what are our key priorities in Hungary, I think our key priorities
are to improve upon, as I mentioned, the security relationship and also the law
enforcement and to promote business opportunities, increase trade-- ”
Emerging-Market
Sharks Circle Currency Reserves After Rapid Drop - (www.bloomberg.com) “If
you start to burn too quickly through your foreign reserves, it’s an ominous
sign -- and of course in the forex market, they smell blood,” Robbert Van
Batenburg, the director of market strategy at broker Newedge Group SA in New York, said Feb. 5 by phone. “It creates this domino
effect.” From Argentina to Turkey, emerging markets are under siege as the U.S.
Federal Reserve pares its record stimulus measures
and reports showing a slowdown in Chinese manufacturing raise concerns about
the strength of their economies. A Bloomberg index tracking
20 exchange rates has fallen 2 percent this year, building upon the 7 percent
decline in 2013.
Kazakh
Devaluation Shows Currency War Stirring as Ruble Dips - (www.bloomberg.com) Two
years after Russia,Kazakhstan and Belarus formed a trade pact, a
currency war is breaking out between the former Soviet republics. Kazakhstan
devalued the tenge by 19 percent yesterday, saying the Russian ruble’s plunge
to a record low this month put additional pressure on its currency. The tenge
will trade at 185 per dollar, with a range of 3 tenge on either side after a
previous target of about 150, the National Bank of Kazakhstan said yesterday.
The ruble fell to a record 41.0472 against the Russian central bank’s
dollar-euro basket this month, dropping 6.3 percent this year and 15 percent
from the start of 2013.
China
coal miner’s $50m loan default fuels shadow banking fears – (www.ft.com) A
Chinese mining company, whose flamboyant boss made headlines for spending $11m
on his daughter’s wedding, has defaulted on a $50m trust loan, underlining the
stresses in China’s vast shadow banking system. The investment product, which
was backed by loans to coal miner Liansheng Resources, failed to repay
investors on Friday, according to state media reports. It had raised Rmb289m
($47.7m) from wealthy clients of China Construction Bank. Though this tranche – the fourth of six – is
now technically in default, investors may yet see some of their money returned
under a restructuring of the company. Liansheng has previously failed to repay
investors on earlier tranches of maturing trust loans, having borrowed a total
of Rmb1bn ($165m).
Letta
Pressed to Resign as Italian Premier to Make Way for Renzi - (www.bloomberg.com)
China Trade Growth Defies Signs of Slowdown - (www.bloomberg.com)
China Trade Growth Defies Signs of Slowdown - (www.bloomberg.com)
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