Monday August 17 Housing and Economic stories

TOP STORIES:

Puerto Rico Debt-Crisis Grows as Payments Halt, Agency Defaults - (www.bloomberg.com) Puerto Rico’s debt crisis escalated as it suspended deposits into a fund that pays its general-obligation bonds and one of its agencies defaulted for the first time, jeopardizing the cash-strapped government’s ability to raise money. The events underscore the risk to investors as the island is pushed to the brink from years of borrowing to cover budget deficits. Governor Alejandro Garcia Padilla is seeking to restructure Puerto Rico’s $72 billion of debt, saying bondholders need to share in the commonwealth’s sacrifices. Struggling to conserve cash, Puerto Rico temporarily halted monthly transfers into a fund that pays down $13 billion of general-obligation debt, it said in a regulatory filing late Monday. That came after its Public Finance Corp. made only $628,000 of a $58 million debt-service payment because the legislature didn’t appropriate enough money.

Seattle CEO who raised all workers' pay now faces backlash – (www.sun-sentinel.com) The Seattle CEO who raised salaries for all of his employees to a minimum of $70,000 a year, drawing accusations of socialism, now says he has fallen on hard times, the Washington Times reported Saturday. Dan Price, the 31-year-old CEO of credit-card processing firm Gravity Payments, told The New York Times that things have gotten so bad for him financially that he’s been forced to rent out his own house to make ends meet. What's more, he's gotten backlash from customer and his employees, some of whom have quit in resent over the fact that newer, less skilled employees ended up with bigger salary hikes than those who had been working longer for the company.

Commodities Rout Erases Billions from Africa's Biggest Fortunes - (www.bloomberg.com) The collapse in commodity prices and the rise of the African middle class has flipped the fortune trends of the continent's richest people. Commodities tycoons Aliko Dangote and Patrice Motsepe have lost almost $4 billion in 2015, while Nigerian telecom billionaire Mike Adenuga and South African retail mogul Christo Wiese have added almost $2 billion, according to the Bloomberg Billionaires Index. "The go-go years of African billionaires whose wealth has been built around oil is over," said Martyn Davies, CEO of Johannesburg, South Africa-based investment research firm, Frontier Advisory. "We have placed far too much emphasis on a handful of people making significant capital through distorted-priced resources. True wealth creation is where billionaires are created from non-resource assets."

Oil-and-Gas Debt Deals Sting Investors - (online.wsj.com)  It is shaping up as a cruel summer for debt investors wagering on a rebound in the oil-and-gas business. Funds managed by Franklin Resources Inc., Blackstone Group LP and Oaktree Capital Group LLC, among others, are facing paper losses on substantial investments this year in exploration-and-production companies. The sector is coming under further pressure as oil prices have turned downward again, dropping below $46 a barrel in New York to a four-month low. Many of the investments amounted to a doubling down on existing stakes, as the firms committed hundreds of millions of dollars to lend to or invest in energy companies whose debt they already held. Among those gaining access to much needed cash: Warren Resources Inc., Goodrich Petroleum Co. and Energy XXI Ltd.

It Could Be Time to Say Bye-Bye to Medicare - (www.foxbusiness.com) Without beating around the bush -- or making any more terrible puns -- Jeb's plan is radical relative to the middle of the road approach that most presidential hopefuls have taken in 2016 and years past. Medicare is an especially important topic to seniors and pre-retirees, and completely reshaping a program that's been in place for 50 years could certainly rile a few people up. Even if the program remains untouched for current enrollees, the fact that their children and grandchildren may not be able to participate despite paying into the system may be a difficult objection to overcome.

OTHER STORIES:

Bank Shares Lead European Stock Drop as Greece Falls for 2nd Day - (www.bloomberg.com)
China central bank vows to stabilize market expectations - (www.bloomberg.com)
China stock exchanges step up crackdown on short-selling - (www.reuters.com)
Fed’s Limited-Time Offer in Money Markets May Be Hard to Cut Off - (www.bloomberg.com)

China Dethroned as World’s Most Liquid Stock Market After Curbs - (www.bloomberg.com)
China’s Response to Stock Rout Exposes Regulatory Disarray - (online.wsj.com)
Russia Seen Turning to Crisis Playbook to Prevent Ruble Rout - (www.bloomberg.com)
Regulators Question High-Speed Trading in Treasurys  - (online.wsj.com)
Southeast Asian nations back halt to land reclamation in South China Sea