KeNo's Housing and Economic Portal: Friday August 8 Housing and Economic stories

Thursday, August 7, 2014

Friday August 8 Housing and Economic stories

Fed’s Junk Loan Bubble-Busting Faces Trouble as Sales Jump - (www.bloomberg.com) One of the Federal Reserve’s first post-crisis tests of its ability to quash excessive risk-taking using regulatory tools is so far looking like a failure. The Fed’s Board of Governors told Congress last week that it’s engaged in “strong supervisory follow-up” to guidance given to banks in 2013 to improve their underwriting standards for high-yield loans. Despite those efforts, Chair Janet Yellen said she’s still seeing a “marked deterioration” in quality. For the first time, more than half of the junk-rated loans arranged in the U.S. this year lack typical lender protections like limits on the amount of debt borrowers can amass relative to earnings. Yellen’s own easy-money policies are boosting demand for such high-yielding products at the same time that she tests her doctrine that financial bubbles should be constrained by supervisory actions, not a general rise in interest rates.

Russian Billionaires ‘in Horror’ as Putin Risks Isolation - (www.bloomberg.com) Russia’s richest businessmen are increasingly frantic that PresidentVladimir Putin’s policies in Ukraine will lead to crippling sanctions and are too scared of reprisal to say so publicly, billionaires and analysts said. If Putin doesn’t move to end the war in Ukraine in the wake of last week’s downing of a Malaysia Air jet in rebel-held territory, he risks becoming an international outcast like Belarus’s Aleksandr Lukashenko, whom the U.S. famously labeled Europe’s last dictator, one Russian billionaire said on condition of anonymity. What’s happening is bad for business and bad for Russia, he said.

White House Press Secretary Faces Reporter Revolt After Criticizing Media At Briefing - (www.businessinsider.com) The White House press secretary, Josh Earnest, faced a minor media revolt at his daily press briefing Monday after he criticized a Washington Post story for its reliance on anonymous sources. Several reporters at the briefing challenged Earnest's critique by pointing out White House officials regularly insist information be anonymously attributed to members of the administration in conference calls and other communications. "You criticize anonymous sources but we have anonymous sources from you every day," one reporter said. "How can you criticize that when that's what you basically give us every day, except for the briefing?"

Clinton Earns $12 Million Speaking, Writing After Service - (www.bloomberg.com) Hillary Clinton has earned at least $12 million in 16 months since leaving the State Department, a windfall at odds with her party’s call to shrink the gap between the rich and the poor. Clinton’s income since her resignation as secretary of state in February 2013 is derived mostly from her latest memoir, speeches and paid appearances at corporate retreats, according to an analysis of data compiled by Bloomberg. At least 12 organizations that previously booked President Bill Clinton -- who has been paid almost $106 million in speaking fees alone since he left the White House -- also hired his wife. Among them: Goldman Sachs Group Inc. (GS) and the National Association of Realtors.

A Grocery Store Chain Fired A Popular CEO — And Now Workers Are Making The Company Pay - (www.businessinsider.com) The popular CEO of Boston grocery chain Market Basket was just fired, and workers are furious. Arthur T. Demoulas was fired in June after a family dispute, according to Boston.com. Demoulas' cousin allegedly gained control of the board and replaced him with two executives outside the family, Jim Gooch and Felicia Thornton. Demoulas was so popular, that thousands of employees immediately revolted. More than a dozen politicians have also asked shoppers to boycott the store until Demoulas is re-hired. More than 2,500 workers and supporters attended a protest over the weekend, leading to a crisis in stores. Workers are halting deliveries until Demoulas is reinstated, writes Adam Vaccaro at Boston.com. Several Market Basket Stores have signs apologizing for the thin inventory.

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