Wednesday April 26 2017 Housing and Economic stories

TOP STORIES:            

Desperate Malls Turn to Concerts and Food Trucks  - (www.bloomberg.com) With customer traffic sagging, U.S. retail landlords are using their sprawling concrete lots to host events such as carnivals, concerts and food-truck festivals. They're aiming to lure visitors with experiences that can't be replicated online -- and then get them inside the properties to spend some money. .. The idea is gaining traction. Next month, Simon Property is having the first carnival in its Round Rock Premium Outlets parking lot, about 20 miles (32 kilometers) north of Austin, Texas. Similar events are being held for the first time at locations such as Central Mall in Port Arthur, Texas, managed by Jones Lang LaSalle Inc., and a Cheyenne, Wyoming, mall owned by CBL & Associates Properties Inc. In July, Simon Property's Orland Square Mall, southwest of Chicago, will be holding its first parking-lot food-truck festival, with plans for live music performances, Herkimer said.

Mexico’s Economy Is Being Plundered Dry - (www.wolfstreet.com) The government of Mexico has a new problem on its hands: what to do with the burgeoning ranks of state governors, current or former, that are facing prosecution for fraud or corruption. It’s a particularly sensitive problem given that most of the suspects belong to the governing political party, the Institutional Revolutionary Party (PRI), which ruled Mexico uninterruptedly from 1929 to 2000. It returned to power in December 2012 with the election of Enrique Peña Nieto. And it clearly hasn’t changed its ways. Some of the accused governors were so compromised they went on the run. In the last few weeks, two of them, Tomás Yarrington, former state governor of Tamaulipas, and Javier Duarte, former governor of Veracruz, were tracked down. Yarrington, accused of laundering proceeds from drug trafficking as well as helping Mexico’s Gulf Cartel export “large quantities” of cocaine to the United States, was ensnared by Italian Police in the Tuscan city of Florence. He faces possible extradition to the United States.

When Low-Wage Workers Are Better Than Robots - (www.zerohedge.com) Automation is not always the best course of action and, as cost effective as automation has proved in many areas of our life, we are finding a rise of businesses beginning to automate for reasons other than improved productivity or cost effectiveness. Time and time again, these pages have listed numerous benefits of automation and robotics. The discussions point out that mechanization doesn’t make us poor, that attempting to tax machines is counter-productive. Automation even makes our jobs safer as we can offload dangerous tasks to a metal creation. However, automation is not always the best course of action and, as cost effective as automation has proved in many areas of our life, we are finding a rise of businesses beginning to automate for reasons other than improved productivity or cost effectiveness.

The latest news is that a company called Miso Robotics has developed an automatic burger flipper called Flippy. Naturally, media outlets are already writing headlines of how this is replacing jobs. The issue in this case is that this particular form of automation isn’t being driven by any kind of cost effective plan but as a result of government action.

"Liquidity supernova" keeping markets afloat, Europe in demand - BAML - (www.reuters.com) The $1 trillion of financial assets that central banks in Europe and Japan have bought so far this year is the best explanation for the gains seen in global stocks and bonds despite lingering political risks, Bank of America Merrill Lynch said on Friday. If the current pace of central bank buying, dubbed the "liquidity supernova" by BAML, continues through the year, 2017 would record their largest financial asset purchases in a decade, the broker said in its weekly report on investment flows. Shorter-term investor flows pointed to a mild "risk-off" with $3.8 billion pumped into bond funds and $0.6 billion pulled from equities over the past week, BAML said. A run of disappointing U.S. economic data, questions about whether the Trump administration can push through tax cuts and uncertainty around the French election have dented some of the enthusiasm for risky assets in recent weeks.

Traders Are Losing Faith in European Banks as Earnings Loom - (www.bloomberg.com) Investors in European lenders are getting cold feet. Riding on a wave of optimism over the economic and earnings outlook, an index of the region’s banks rallied to a 15-month high in March -- before posting the second-biggest decline among industry groups this month. At the same time, bets for swings in lenders’ stocks have jumped, and options reached their highest prices since February 2016 relative to those for euro-area blue chips. There’s little doubt the environment for European banks has brightened, with profits forecast to grow at the fastest pace in three years in 2017 as quicker inflation fuels expectations for monetary tightening. Yet higher valuations are now unnerving investors, especially ahead of an uncertain French election in which far-right candidate Marine Le Pen is campaigning on leaving the euro.

OTHER STORIES:

U.S. Stocks Pare Drop, Bonds Trim Gain on Tax Plan: Markets Wrap - (www.bloomberg.com)
Sales of Existing U.S. Homes Rise to Fastest Pace in a Decade - (www.bloomberg.com)

Fannie-Freddie Overhaul Is 'Very Important' Goal, Mnuchin Says - (www.bloomberg.com)
Quants Fire Back at Paul Tudor Jones After His Attack on Risk Parity - (www.bloomberg.com)