Tuesday, December 16, 2014

Wednesday December 17 Housing and Economic stories


It's Time to Start Paying Attention to Greece Again - (www.businessweek.com) It’s been awhile since Greece was front-page news, so here’s a refresher: A few years ago, it looked as though Greece might be forced to leave the euro zone, as investors lost faith in the country’s ability to pay its debts. In late 2011, 10-year Greek bonds were trading with a yield around 35 percent. The crisis began to dissipate in the summer of 2012, when the center-right New Democracy party eked out the narrowest of election victories and cobbled together a coalition that agreed to a bailout under harsh terms. Since then financial markets have eased considerably, although the economy is still in the gutter. Anyway, you might want to start paying attention again. Greece may see elections early next year, and a new poll just out has the radical leftist Syriza party in first place by more than 3 percent. If Syriza takes power, the relative calm of Greek financial markets could be rocked.

Venezuelan Bond Buyers Pack Into Manhattan Law Office - (www.bloomberg.com) The scores of money managers and analysts who crowded intoCleary Gottlieb Steen & Hamilton LLP’s panel discussion on Venezuela last week are a testament to the deepening concern over whether President Nicolas Maduro can make good on the nation’s debt obligations. During the two-hour event on the 39th floor of the law firm’s downtown Manhattan office, some 150 attendees pressed the lawyers on an array of potential scenarios if Venezuela defaulted, according to interviews with six attendees who asked not to be identified because the meeting was private. Among the topics debated were whether the state oil company’s U.S. gasoline stations could be seized as collateral and whether it was legally possible for Venezuela to restructure the producer as an empty shell to avoid bondholder claims, they said.

Crackdown Weakens Divided Venezuela Opposition as Election Looms - (www.bloomberg.com) Here’s the kind of a year it’s been for Venezuelan opposition leader Maria Corina Machado: She’s been assaulted by pro-government militants, banned from leaving the country, kicked out of Congress -- and last week charged with conspiring to kill President Nicolas Maduro. Machado’s difficulties symbolize a crackdown that is weakening an already divided opposition, reducing its ability to capitalize on popular discontent building over the fastest inflation in the world, shortages ranging from meat to medicine and the repression itself. Maduro’s government, the most unpopular in at least 15 years, is squeezing its opponents as it tries to tighten its grip on power before congressional elections scheduled for next year, said Diego Moya-Ocampos, an analyst at political risk consultancy IHS Inc. A victory by the opposition in the vote could pave the way for a plebiscite in 2016 on whether Maduro should resign. “Maduro’s use of state institutions (SOUNDS AN AWFUL LOT LIKE OBAMA) to go after political opponents hasn’t been seen in Venezuelasince the fall of the last dictatorship in the late 1950s,” Moya-Ocampos said by telephone from London Dec. 8. “This level of repression is unprecedented in the country’s recent history.”

Singer Default Deal Odds Diminish on Argentina Debt Sale - (www.bloomberg.com) Argentina’s plan to push out debt maturities and raise $3 billion locally may allow it to delay a settlement with holdout creditors who tipped the nation into default, according to JPMorgan Chase & Co. and Emso Partners. For the first time since failing to pay its foreign-currency debt five months ago, Argentina is selling bonds as it tries to tackle $12 billion of obligations coming due next year. Since Economy Minister Axel Kicillof announced the plan to sell and buy back debt, its dollar securities governed by local law have outperformed the overseas notes by the most in three weeks. The proposal may enable the country to delay devaluing the peso further, according to JPMorgan. With foreign-currency reserves bolstered by swaps with China and the peso rallying in informal markets, there will be fewer incentives for President Cristina Fernandez de Kirchner to negotiate a resolution to the decade-long debt crisis with holdouts led by billionaire Paul Singer’s Elliott Management, said Emso Partners’s Patrick Esteruelas.

Greece Lurches Back Into Crisis Mode  - (www.bloomberg.com) Greek stocks fell more than at any point during Europe’s debt crisis today after Prime Minister Antonis Samaras gambled his political future on bringing forward a parliamentary vote on a new head of state. Greek stocks tumbled the most since 1987 and three-year yields surged in response to the prime minister’s move. Unless he can persuade 25 opposition lawmakers to support his choice, Samaras will be forced to call a parliamentary election that anti-austerity party Syriza would be favorite to win. “Investors have taken a second look at Syriza and understood that at this point in time it’s more radical than the traditional left in Greece,” said Nicholas Veron, a fellow at the Bruegel research institute in Brussels. “If Syriza takes over it won’t be a smooth ride.”





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