Monday July 20 Housing and Economic stories

TOP STORIES:

Bundesbank’s Weidmann warns Greek banks concerns ‘rising by day’ - (www.ft.com) Jens Weidmann, the president of Germany’s Bundesbank, has said doubts about Greek banks’ solvency are “legitimate” and “rising by the day”. Mr Weidmann also said the majority of Greeks who had voted “no” in Sunday’s referendum had “spoken out . . . against contributing any further to the solvency of their country through additional consolidation measures and reforms”. The Bundesbank president, a member of the governing council of the European Central Bank who has called for Greek banks’ €89bn liquidity lifeline to be scrapped, said it needed to be “crystal clear” that responsibility for Greece lay with Athens and international creditors, and not the ECB. “The Eurosystem [of eurozone central banks] should not increase the liquidity provision, and capital controls need to stay in force until an appropriate support package has been agreed by all parties and the solvency of both the Greek government and the Greek banking system has been ensured.”

[Bloomberg] China Junk Bond Premiums Gap Most in Two Months Amid Stock Rout - (www.bloomberg.com) The extra yield investors demand to hold junk debt in China widened the most in two months as the government’s failure to avert a stock slump damped demand for risky assets. The gap between five-year top-rated and AA- rated corporate bond yields increased seven basis points Wednesday to 142.25, matching the steepest climb since May 15, ChinaBond data show. Notes rated AA- or below are considered junk in China’s onshore market. The Shanghai Composite Index has tumbled more than 30 percent from its June 12 peak as traders unwind margin bets. The bruising rout in China equities has spread to bond and commodities markets even after the central bank pledged Wednesday to prevent any regional or systemic financial risks. China needs a 4 trillion yuan ($644 billion) package to halt the panic, Tim Condon, the head of Asia research at ING Groep NV, wrote in a note today.

[Bloomberg] This Doomsday Deadline for Greece Might Actually Count - (www.bloomberg.com) European leaders trudging wearily back to Brussels for another crunch summit on Greece this weekend can take solace in the fact it might just possibly be the last. Maybe. Since the Jan. 25 election that propelled Alexis Tsipras’s anti-austerity Syriza coalition to power, the stalemate over Greek aid has occupied euro-area government leaders or their finance chiefs on at least 27 occasions, picking up frequency in June with the result that the past six weeks have seemed to merge into one long meeting. They’ve often been late-night affairs, stretching into the small hours of the following morning. And they’ve run the emotional gamut: stormy, depressed, complimentary,baffled and, most recently, frustrated, as ministers were hauled back from family vacations only to find there was no decision to be taken.

Gerald Celente – Was The Suspicious NYSE Trading Halt An Attempt To Stop A Crash In U.S. Markets? - (www.kingworldnews.com) Yesterday's Suspicious Trading Halt On The New York Stock Exchange. The people running the NYSE were watching China’s stock markets crash, and all the sudden they shut the NYSE down in the U.S. and canceled all of the open orders.  The NYSE was beginning to look like it might go into a possible free-fall, and then the market is suddenly shut down until they can calm things down? As I’ve been saying to you, Eric, there is panic on the streets.  Greece just announced they are closing the banks until Monday.  Look at what’s going on with copper, iron-ore and nickel prices — it’s a collapse of commodity prices because there’s a global collapse underway.  It’s happening around the world and people can hear it if they just listen.

Asian Millionaires Are Dumping Chinese Junk Bonds – (www.bloomberg.com)  Chinese developers led the worst dollar junk-bond rout in at least six months amid speculation private banks are dumping notes to bolster rich clients’ collateral eroded by a collapse in equities. Chinese high-yield bonds fell 1.35 percent Wednesday, according to a Bank of America Merrill Lynch index, the most since a 2.6 percent slump Jan. 6. The selloff is continuing as some property issuers, including Evergrande Real Estate Group Ltd. and Agile Property Holdings Ltd., cap the worst losses since their notes’ debut. The gauge of 97 junk-rated companies in Asia’s largest economy has shed $797 million in market value in a little under a week. Developers make up three-quarters of the index. About 30 percent of Chinese property bonds were sold to retail or private banks, mostly based in Asia, according to Nomura Holdings Inc. The Shanghai Composite Index has plummeted more than 30 percent from its June 12 peak and about half of China’s stock market is frozen as companies attempt to stem the rout.

OTHER STORIES:

China’s Stocks Cap Biggest Gain Since 2009 as Volatility Surges - (www.bloomberg.com)
Asia stocks rise as China fall stemmed, yen off highs - (www.reuters.com)
Greece Latest-EU's Tusk says debt issue must be part of a final Greek deal - (www.reuters.com)
The Latest: Merkel Rejects Any Outright Debt Cut for Greece - (www.nytimes.com)

Draghi said to doubt Greek solution as Tsipras reforms awaited - (www.reuters.com)
This Doomsday Deadline for Greece Might Actually Count - (www.bloomberg.com)
Tsipras Stuck Between a German Rock and a Greek Left Hard Place - (www.bloomberg.com)
China's Gray Market in Margin Lending Is Probably Massive - (www.bloomberg.com)