Friday May 19 2017 Housing and Economic stories

TOP STORIES:            

#Carmageddon Now: Ford to Slash 10% of its Workforce - (www.wolfstreet.com) Ford’s shares have gotten hammered as it struggles with plunging car sales, and in April even with weak truck sales, mired as automakers are in the US “car recession.” At $10.94 at the close on Monday, shares are down 37% from their high in July 2014, when Mark Fields became CEO. Shares hit a new 52-week low on Friday, despite two consecutive years of record earnings. But Ford announced that profits would decline in 2017, and at a “strategy session” last week, Ford’s frustrated directors put the heat on Fields. After announcing in March that Ford would create 700 jobs in Michigan, more or less an optical illusion as a nod to Trump, it is now time to throw Wall Street a bone. A huge bone. Ford is considering cutting 10% of its global workforce of around 200,000 employees (about half of them in the US), “according to people briefed on the plan,” cited by the Wall Street Journal.

Oregon Officials Threaten To Seize 2,000 Acre Organic Farm, Spray It With Roundup – (www.zerohedge.com) Sherman County Oregon believes the 2,000 acre Azure Farms is not doing enough to control Canada Thistle. To remedy the alleged problem, the county proposes seizing the farm and spraying everything with Roundup and other herbicides. Azure Farms is certified organic. Of course, organic farms cannot by definition use herbicides, so the farm would be forced out of business by the county government. Adding insult to injury, the county would place a lien on the property forcing it to pay for the herbicides.

Rue21 files for bankruptcy as retail woes drag on - (www.cnn.com) The chain of teen clothing stores says it has filed for Chapter 11 bankruptcy protection and is closing about a third of its 1,200 locations... In a press release, Rue21 said it is streamlining to "better align the size of its footprint with market realities, and focus on its hundreds of highly performing locations." The company said it may consider closing even more stories. Rue21 is trying to secure $175 million in financing to stay afloat, subject to court approval.

Obamacare Will Soon Be Zombiecare - (www.mauldineconomics.com) Insurers need months to reprogram systems, train staff, and build provider networks. Congress can't dawdle into summer and then unveil something entirely new. If they do, the 2018 rollout will be a catastrophe. So insurers are doing the rational thing. They're either backing out or raising rates to compensate for all the unknown risks they will be taking. Early signs are ugly: Maryland's top insurer, CareFirst Blue Cross, has requested an average 50% rate increase for 2018; In Virginia, Anthem Blue Cross is asking for 37.7% higher rates; Aetna said it will be pulling out of all Obamacare exchanges nationwide, [and] Iowa is down to only one carrier, Medica, which only covers a few counties.

Debt Island: How $74 Billion in Bonds Bankrupted Puerto Rico - (www.bloomberg.com) San Juan’s gleaming commuter train seemed like a coup -- the kind of big-ticket item many U.S. cities can only dream of. More than a decade on, the Tren Urbano is a monument to the folly, bloat and abuse that finally bankrupted Puerto Rico. Despite years of planning, it sells only a third of the rides it needs to, and loses roughly $50 million a year. The cost so far: $2.25 billion, $1 billion more than planned. That, in a nutshell, is Puerto Rico’s story. With Wall Street’s help, the U.S. commonwealth borrowed tens of billions in the bond markets, only to squander much of it on grand projects, government bureaucracy, everyday expenses and worse. Debts were piled on debts, even as the economy gave way.

OTHER STORIES:

Oil Rally Lifts Stocks as Dollar Slips With Bonds: Markets Wrap - (www.bloomberg.com)
China Shares Gain on Spending Program; Crude Jumps: Markets Wrap - (www.bloomberg.com)
Trump Doctrine Confounds G-7 as Ministers Kick Can to Sicily - (www.bloomberg.com)

A $1 Trillion Pain Trade in Treasuries Divides Top Bond Dealers - (www.bloomberg.com)
China's Growth Dividend for World Economy Shows Signs of Fading - (www.bloomberg.com)