Friday March 17 2017 Housing and Economic stories

TOP STORIES:            

The Great Corporate Bond Rush of 2017 Persists as Fed Mulls Hike - (www.bloomberg.com) Companies are issuing bonds in the U.S. at the fastest pace ever. And investors say the Federal Reserve’s next rate hike may do little to change that. Investment-grade firms are on track to complete the busiest first quarter for debt sales since at least 1999. Firms from Apple Inc. to Morgan Stanley have pushed new issues to more than $360 billion so far in 2017, closing in on the previous record of $381 billion from 2009, according to data compiled by Bloomberg. That puts bond sales 14 percent ahead of last year’s record pace. Low borrowing costs, rising stock prices, positive economic data and strong quarterly earnings results have all helped fuel the boom, said Dominic Pappalardo, a money manager at McDonnell Investment Management in Oakbrook Terrace, Illinois, which manages $11.5 billion. The extra yield over Treasuries investors demand to purchase the bonds has reached multi-year lows in recent weeks, even as companies such as Delta Air Lines Inc. to Walt Disney Co. have sold more than $78 billion of bonds to investors in so far March.

Inflation Hits Consumers, Mortgage Rates Take Off, “Financial Repression” for Bondholders and Savers - (www.wolfstreet.com) Retail sales in February were lousy, and even lousier after inflation, though it was reportedly the warmest February in 100 years, without a big winter storm keeping the all-important consumers cooped up at home instead of shopping. Total retail sales, including online and food services, edged up 0.1% to $474 billion in February, from January, the slowest increase in 6 months, the Commerce Department reported today. This came after an upwardly revised 0.8% jump in January. General merchandise sales and auto sales showed negative “growth.” These numbers are adjusted for seasonal and calendar factors, but not for inflation. We’ll get to that in a moment. On a year-over-year basis, not seasonally adjusted, total retail sales in February rose by $9.5 billion, or 2.2%. Gasoline sales alone soared by $7.2 billion, or 22%, on a juicy 30.7% price increase (more in a moment). And sales at non-store retailers jumped by $3.4 billion, or 8%.

"Rotating Carousel Of Prostitutes" For Defense Contracts; 9 Navy Officers Charged In Bribery Scandal - (www.zerohedge.com) 9 senior Navy officials have been charged in a bribery scandal after allegedly accepting, among other things, "a raging multi-day party, with a rotating carousel of prostitutes" in exchange for defense contracts awarded to a Singapore-based contractor, Leonard Glenn Francis (a.k.a. "Fat Leonard"). The ironically named Rear Admiral Bruce Loveless (so many potential one-liners here but we'll let you create your own), along with 8 other senior Navy officials, including four retired captains and a retired marine colonel, have been arrested today in the so-called 'Fat Leonard' bribery scandal and charged with bribery, conspiracy to commit bribery, honest services fraud, obstruction of justice and making false statements to federal investigators. According to a federal grand jury indictment unsealed today, the Navy officers worked together to help Singapore-based defense contractor Leonard Glenn Francis (a.k.a. "Fat Leonard") and his company, Glenn Defense Marine Asia (GDMA), pull off a 'colossal fraud' that cost the Navy – and ultimately U.S. taxpayers – tens of millions of dollars. The indictment alleges that, among other things, 'Fat Leonard' and his associates repeatedly bribed Navy officials with "meals, entertainment, travel and hotel expenses, gifts, cash, and the services of prostitutes." Per RT: The indictment also alleges that Francis frequently sponsored sex parties for many officers assigned to the ‘USS Blue Ridge’ and other warships.

The US Is About To Hit $20 Trillion In Debt: Here's How It Affects You - (www.zerohedge.com) As the vulture pundits in the mainstream media pick apart hollow political scandals, the essential bankruptcy of the federal government looms just ahead. The national debt is creeping toward 20 trillion dollars, and the United State’s largest problem is once again staring the world in the face. Just before the government was slated to shut down in 2015 (as it did in 2013), Congress was able to pass a delay on the debt ceiling decision until March 15th of this year — Wednesday of this week. Recurring uncertainty caused by events like this has implications that extend far beyond our own borders. The amount of leverage in the current system has already forced foreign holders of U.S. debt to question the real value of America’s full faith and credit. 2016 was a record-setting year for the liquidation of foreign-held U.S. bonds, topping out at nearly $405 billion. The selling was led by China, America’s second-biggest creditor, which currently holds over $1 trillion of U.S. debt, almost 28% of the total held by foreign central banks. They weren’t alone, though, and even the U.S.’ number one lender, Japan, has rolled back their positions to protect themselves as the reality of U.S. insolvency comes into focus. A gradual change has been set in motion, and the global superpower status of the United States may be systematically eroded — not militarily, but economically.

China property sales surge despite gov't efforts to cool market - (www.reuters.com) China's property sales surged in the first two months of the year despite government measures to cool the market, though growth in real estate investment showed signs of easing, according to official data on Tuesday. Property sales by area rose 25.1 percent year-on-year in January and February. That was above the 22.5 percent annual gain in 2016, which was the strongest annual growth in seven years thanks to a property boom in top-tier cities. It was also a marked surge from December, when property sales by area rose 11.8 percent from a year earlier, according to Reuters' calculations. After sharp home price rises last year, China's policymakers have started to worry about overheating in the property market and the risk of a sudden and sharp correction that would knock the economy.

OTHER STORIES:

Oil Slumps on Saudi Output, Stocks Slip Before Fed: Markets Wrap - (www.bloomberg.com)
U.S. Producer Prices Climbed More Than Forecast in February - (www.bloomberg.com)
Fed, in shift, may move to faster pace of rate hikes - (www.reuters.com)

Saudis Tell OPEC They Eased Cuts by Pumping 10 Million Barrels - (www.bloomberg.com)
Rising rates will speed up the clock on retail's $3.7 billion time bomb - (www.cnbc.com)
Brexit Bulletin: The Battles of Britain - (www.bloomberg.com)