Tuesday, February 3, 2015

Wednesday February 4 Housing and Economic stories


Obama AG nominee Loretta Lynch quietly dropped $450000 civil forfeiture case a week before hearings - (www.rawstory.com) Lynch’s office described as ‘major forfeiture operation;’ seized $113 million in two years. When Long Island businessman Jeff Hirsch stepped up to the bank window to make a deposit one morning in May, 2012, the teller shot him a worried look. “You know, your account has been frozen,” she told Hirsch. “I’m not sure you want to put any money in there this morning.” In fact, the disbelieving Hirsch soon learned, the office of the U.S. Attorney for the Eastern District of New York had, without warning, seized the entire working capital — $447,000 — of Bi-County Distributors in Ronkonkoma, N.Y., the business Hirsch co-owns with his two brothers. For Hirsch, it was one of those petrifying moments that could only elicit an incredulous, “This can’t be true!” But it was true. Hirsch and his brothers, like thousands of other Americans in the past 10 years, had been targeted by law enforcement authorities on suspicion of a crime he had never heard of. His money had been seized as part of a federally sanctioned wave of “civil asset forfeitures,” with citizens losing homes and automobiles and life savings merely because they were suspected of some crime.

Puerto Rico Lawmakers Seek Alternatives to $2 Billion Bond Sale - (www.bloomberg.com) Puerto Rico lawmakers are urging the Government Development Bank to seek other ways to raise cash beyond a planned $2 billion petroleum tax-backed bond sale. The debt deal would repay money the Highways & Transportation Authority owes the GDB. The bank, which lends to the struggling U.S. commonwealth and its localities, needs the funds to bolster its balance sheet. It said it had about $1.1 billion of net liquidity as of Dec. 31. That’s 17 percent below the bank’s October projection, according to Moody’s Investors Service. The pricing guidelines that legislators set this month for the borrowing plan would offer yields below current trading levels on the junk-rated island’s debt, dimming the deal’s appeal. The bank should consider other financing options, according to Senator Jose Nadal Power. The island has at times used bank loans to raise cash rather than borrowing through the municipal debt market. “We are aware of the difficulties on obtaining traditional financing within the maximum rates approved by the legislature,” Power, who chairs the Finance Committee, wrote in an e-mail. “We are currently encouraging the GDB to look for additional financing alternatives while we consider whether additional legislative action would have the necessary internal support among lawmakers.”

Cointerra, Bitcoin Company, Files to Liquidate in Bankruptcy - (www.bloomberg.com) The bitcoin mining company Cointerra Inc. filed to liquidate its assets under Chapter 7 of the U.S. Bankruptcy Code, following the bitcoin exchange Mt. Gox in declaring insolvency as the virtual currency falls in value. The company listed assets and debt of as much as $50 million each in a Chapter 7 filing Saturday inU.S. Bankruptcy Court in Austin, Texas. No reason was given for the filing. The value of Bitcoin in dollars fell almost 70 percent last year and has continued to plunge in 2015. “Mining,” a nod to the excavation of minerals and metal ore, is entirely digital. The mining process gets increasingly complicated as more bitcoins are created, driving demand for computing power.

Obama drops proposal to tax 529 savings plans - (www.cnbc.com) The Obama administration has decided to scrap a plan to tax 529 college savings plan withdrawals. A White House official called the proposed change a "distraction" and said there are plenty of other ways to raise revenue as part of their budget. According to a source familiar with the matter, in addition to GOP complaints, House Minority Leader Nancy Pelosi had pressed Obama to drop the 529 plan. Obama had proposed raising $1 billion over 10 years by taxing capital gains realized in withdrawals from 529 college savings accounts. The White House cited surveys showing that 70 percent of the assets in such accounts are held by families earning more than $200,000 per year, and noted that higher-income families benefit most from the current tax exemption for such gains.

Serbia Won't Follow Hungary, Croatia to Ease Franc Loan Burden - (www.bloomberg.com) Serbia won’t fix the dinar against the Swiss franc or impose industrywide solutions for borrowers as it tries to prevent a surge in bad loans and avoid undermining public finances after the franc’s surge. The National Bank of Serbia and commercial banks see adjusting interest rates on franc-indexed mortgages as the solution that provides them with the most leeway. They’re also exploring the possibility of restructuring some loans and offering conversions of Swiss franc debt into euros, central bank Governor Jorgovanka Tabakovic told reporters today. “Solutions should not be rushed,” Tabakovic said in Belgrade after the meeting with banking officials. “Regulators in other markets have not come up with optimal solutions either.” After committing to a fiscal consolidation plan under a three-year loan program with the International Monetary Fund, Premier Aleksandar Vucic’s government has no space to assist borrowers hit by the franc’s surge following Switzerland’s decision to end its currency cap Jan. 15, Tabakovic said. The move prompted governments across eastern Europe to seek new ways to help borrowers whose monthly payments jumped along with the Swiss currency.





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