Student
loan forgiveness may be coming - (www.cnbc.com) The
new entitled class - Government workers. For many members of the class of 2014 who
borrowed money to attend college, the clock is ticking on what is likely to be
their biggest expense after graduation. They'll have to start paying back their
federal student loans in November or December—as the six-month grace period
that lenders give new grads comes to an end. But depending on their income—or
lack of income, if they're still looking for work—some borrowers may be
eligible for much lower payments than they'd anticipated. And eventually they
could have their federal loans forgiven altogether. "If total student debt
exceeds one's annual income, then you will likely qualify for some sort of
payment plan and receive a financial benefit from participation" in an
income-driven repayment plan, said Mark Kantrowitz, senior vice president and
publisher of Edvisors.com, a website that provides information, advice and
tools for helping families plan and pay for college.
Italy delays repayment of commercial debts - (www.reuters.com) Italy will
settle the debt arrears it owes to private sector suppliers by the end of this
year, Economy Minister
Pier Carlo Padoan said in a newspaper interview on Sunday, pushing back previous
commitments. The Italian state owes some 75 billion euros ($102 billion)to
private suppliers, according to the most recent data from the Bank of Italy.
The unpaid bills have starved companies of cash and triggered layoffs, factory
closures and bankruptcies. "We will ensure that the arrears are paid off
by the end of the year," Padoan told Corriere della Sera daily. Prime
Minister Matteo Renzi promised in March to pay back all the debt arrears by
July. Within a week he put back the target date to September. The government is
finding it hard to tackle the problem because of public financeconstraints, inefficiency, uncertainty over
exactly how much is owed and a reluctance on the part of some public bodies to
acknowledge their debts.
Argentina
gets set for debt talks by calling U.S. judge biased - (www.bloomberg.com) Argentina
on Friday accused a U.S. judge of being biased in favor of hedge funds that
have sued the South American country for full repayment of defaulted bonds,
cementing the tough stance it has taken ahead of debt talks set for New York
next week. A series of rulings by U.S. District Court Judge Thomas Griesa leave
Argentina just three weeks to clinch a deal with the funds before falling into
another default, which would heap financial stress on its already shrinking
economy. The government of President Christina Fernandez denounces the funds as
vultures bent on crippling Argentina, Latin America's third largest economy,
for the sake of profit. "A lot of officials in the United States say its
judicial branch is independent," Argentine cabinet chief Jorge Capitanich
said. "But it is not independent of the vulture funds because its
decisions show clear partiality." The legal fight stems from Argentina's
2002 default on about $100 billion in bonds. The financial crisis thrust
millions of middle-class Argentines into poverty. The economy snapped back from
2003 to 2008 before being weighed down by high inflation and heavy-handed trade
and currency controls.
France
hits out at dollar hegemony in global deals Financial Times - (www.cnbc.com) France's
political and business establishment has hit out against the hegemony of the
dollar in international transactions after U.S. authorities fined BNP Paribas $9 billion for helping countries avoid
sanctions. Michel Sapin, the French finance minister, called for a
"rebalancing" of the currencies used for global payments, saying the
BNP Paribas case should "make us realize the necessity of using a variety
of currencies". He said, in an interview with the Financial Times on the
sidelines of a weekend economics conference: "We [Europeans] are selling
to ourselves in dollars, for instance when we sell planes. Is that necessary? I
don't think so. I think a rebalancing is possible and necessary, not just
regarding the euro but also for the big currencies of the emerging countries,
which account for more and more of global trade." Christophe de Margerie,
the chief executive of Total, France's biggest company by market
capitalization, said he saw no reason for oil purchases to be made in dollars,
even if the benchmark price in dollars was likely to remain.
Bond
Anxiety Grows in $1.6 Trillion Repo Market as Failures Soar - (www.bloomberg.com) In
the relative calm that is the market for U.S. Treasuries, a sense of unease
over a vital cog in the financial system’s plumbing is beginning to rise. The
Federal Reserve’s bond purchases combined with demand from banks to meet
tightened regulatory requirements is making it harder for traders to easily
borrow and lend certain desired securities in the $1.6 trillion-a-day market
for repurchase agreements. That’s causing such trades to go uncompleted at
some of the highest rates since the financial crisis. Disruptions in so-called
repos, which Wall Street’s biggest banks rely on for their day-to-day financing
needs, are another unintended consequence of extraordinary central-bank
policies that pulled the economy out of the worst financial crisis since the Great
Depression. They also belie the stability projected by bond yields at about
record lows. “You have a little bit of a perfect storm here,” said Stanley Sun,
a New York-based interest-rate strategist at Nomura Holdings Inc., one of the
22 primary dealers that bid at Treasury auctions, in a telephone interview June
30. A smoothly functioning repo market is vital to the health of markets. The
fall of Bear Stearns Cos., which was taken over by JPMorgan Chase & Co. in
2008 after an emergency bailout orchestrated by the Fed, and collapse of Lehman
Brothers Holdings Inc., whose bankruptcy in September of that year plunged
markets into a crisis, was hastened after they lost access to such financing.
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