Wednesday August 12 Housing and Economic stories

TOP STORIES:

New York Mayor de Blasio Demands A Federal Bailout For ... - (www.zerohedge.com)  While Greece may have kicked the can for the time being by imposing a third bailout whose terms are sure to led to the terminal collapse of the Greek economy (which has already moved on to barter), and lead to yet another in the immediate future, a bailout which even the IMF now openly opposes demanding a concrete debt haircut before it participates with more funds,the insolvency soap opera is about to jump the Atlantic to Puerto Rico where a default is now just 48 hours away. As a reminder, August 1 is the due date for Puerto Rico's public agencies to make close to $200 million in bond payments. Next month, the commonwealth is on the hook for $635 million in payments. Over the next 12 months, it has to cover over $5 billion in bond payments. Last month, Puerto Rico Governor Alejandro Garcia Padilla announced that the commonwealth was no longer capable of making payments on its $72 billion dollars in public debt. Not long after his declaration, Puerto Rico's Power Authority narrowly avoided default with a last-minute $128 million bridge loan so it could cover a $415 million payment.

Puerto Rico Risking Point of No Return With Debt Payment Default - (www.bloomberg.com) Puerto Rico is poised to set in motion a chain of events to force investors into negotiating a restructuring of the island’s $72 billion debt burden. The commonwealth’s Public Finance Corp. will likely fail to make $58 million in bond payments due Aug. 1, the first default since Puerto Rico was ceded to the U.S. following the Spanish-American War. Government officials say they can’t make the payment because the legislature didn’t appropriate the funds last month for the current fiscal year. A default would be the biggest salvo yet between creditors and the debt-ridden island since Governor Alejandro Garcia Padilla said in June that Puerto Rico cannot repay its obligations and was seeking to delay debt payments for a number of years. Prices of the securities are tumbling as officials, who are pursuing the use of bankruptcy, prepare to release a debt-restructuring plan by Sept. 1.

China markets regulator warns media on ‘market disturbance’ – (www.ft.com) China’s stock market regulator began its most recent press briefing with a telling instruction for the mostly local journalists in attendance. “We have a requirement concerning speculative reports,” said the China Securities Regulatory Commission. “They must first be confirmed by the CSRC in order to prevent the spread of false information and market disturbance.” The warning was a reminder that as a “national team” comprised of largely state-owned entities struggles to shore up China’s stock market, the government is orchestrating an equally important cheerleading campaign involving a broad array of state media outlets. Illustrating just how delicate investor sentiment remains despite the government’s all-out propaganda war, the Shanghai Composite Index experienced the second-largest points fall in its 25-year history on the first trading day after CSRC’s remarks. The 8.5 per cent fall on July 27 left the SCI just 200 points above 3,500 — the level at which the government’s rescue effort began in earnest on July 8.

Banks Squirm As Congress Moves To Cut The 6% Dividend ... - (www.zerohedge.com)  Did you know that the Federal Reserve pays an annual 6% dividend to its shareholders, i.e., the member banks of the cartel? Must be nice, considering savers who had nothing to do with cratering the world economy, and failed to receive a taxpayer funded bailout, can barely earn 0.5% on their money. It’s also quite bizarre. How many other “public institutions” have private shareholders to whom they pay 6% risk free dividends? None, which once again highlights the point that the Federal Reserve is NOT a public institution working on behalf of the citizenry, but is rather a banking cartel designed to enriched and protect its member banks (as we saw on clear display in 2008). It appears that some members of Congress are now targeting the estimated $17 billion per year paid out by the Fed to its member banks via the highway-funding bill. The Hill reportsthat: The banking industry is scrambling to kill a provision in the Senate highway-funding bill that would reap billions of dollars in revenue by cutting a century-old system that has reaped annual awards for banks.

Merkel Lawmakers Want Investors to Bear Brunt of State Defaults - (www.bloomberg.com) Members of German Chancellor Angela Merkel’s coalition are seeking to amend euro-region rules to ensure private investors bear the financial brunt of an insolvency by a member state of the currency union. The lawmakers are pushing to tweak the rules for the euro area’s financial backstop to allow an arbitration court to mediate between debtors and creditors at the request of a cash-strapped country. Currently, those buying euro-region bonds can rely on taxpayer-funded bailouts to cover losses. “We need to create a legal framework to clean up the debts of a country in cases like Greece,” Heribert Hirte, a law professor and CDU parliamentarian on the Bundestag’s European Affairs committee, said in an interview. “The process needs to be freed from purely political considerations.”

OTHER STORIES:

Banks Tracking Physical Location of Customers - (www.infowars.com)

GDP Rises 2.3% in Second Quarter; First Quarter Revised Upward - (www.bloomberg.com)
Emerging Stocks Fall as Currencies Weaken to Record Low on Fed - (www.bloomberg.com)
Oil Market Embraces Lower-for-Longer Price View as Futures Sink - (www.bloomberg.com)
China Stocks Fall as Traders Puzzle Over Sudden Late-Day Swings - (www.bloomberg.com)
The Amount of ETF Shares Being Traded Has Eclipsed U.S. GDP - (www.bloomberg.com)

Puerto Rico Risking Point of No Return With Debt Payment Default - (www.bloomberg.com)
Fed Preps Careful Path for Rate Hike - (online.wsj.com)
Banks Pitch Swaps as Alternative to Buying Stock - (online.wsj.com)
China vows more targeted policy steps to lift economy - (www.reuters.com)
Merkel Lawmakers Want Investors to Bear Brunt of State Defaults - (www.bloomberg.com)