Saturday January 17 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Ford May Be Forced to Seek U.S. Aid as Economy Imperils Sales - (www.bloomberg.com) -- Ford Motor Co., the second-largest U.S. automaker, may have to abandon a plan to forgo federal loans as the weakening economy threatens to drive domestic sales 10 percent lower than the company’s forecast. Ford predicts that U.S. light-vehicle sales will reach 12.2 million units this year, almost 2 million more than the annualized sales rate over the last 3 months. Chrysler LLC forecasts that sales may reach 11 million, while General Motors Corp. projected a range yesterday of 10 million to 11 million. “The market will not reach 12.2 million units this year, no way, no how,” said John Wolkonowicz, an IHS Global Insight analyst. The Lexington, Massachusetts-based consulting firm trimmed its 2009 sales estimate last week to between 10 million and 10.5 million. Sales at that level would trigger the need for as much as $13 billion in loans, Ford told Congress last month. That would undercut the company’s attempt to win customers by portraying itself as Detroit’s healthiest automaker, after GM and Chrysler both sought federal financial aid.

Strauss-Kahn Says IMF May Need Another $150 Billion for Crisis - (www.bloomberg.com) The International Monetary Fund may need another $150 billion to help counter the hit to emerging markets and poorer countries from a worsening global economic downturn, Managing Director Dominique Strauss-Kahn said. The IMF chief, in an interview in Washington, also chided European leaders for failing to grasp the depth of the coming slump in their region, creating the risk of social upheaval. The fund will make a “significant” increase in its $1.4 trillion projection of global financial losses and writedowns, he added. The remarks by Strauss-Kahn, a former French finance minister and presidential contender, may help build momentum for proposed stimulus packages in Germany and France. They also indicate that the fund may put pressure on nations with large foreign-exchange reserves, such as China and Saudi Arabia, to step up contributions. “If in six months from now the crisis has worsened and many other of our members need our help, the demand may be above what we have,” Strauss-Kahn said in the Jan. 9 interview in his office. “If the political decision is made to do something, I’m convinced that it will not be difficult to find the extra $150 billion” that would double the lender’s resources compared with a year ago, to a total of $500 billion, he said.

Could the 2010 WINTER OLYMPICS BE cancelled? A BILLION DOLLAR BAILOUT IS NEEDED! - (www.ml-implode.com) - Vancouver taxpayers are on the hook for the entire billion-dollar Olympic Athletes' Village project after the lender cut off funding to the troubled development, Mayor Gregor Robertson said Friday. Now, the city is scrambling to renegotiate its deal with Fortress Investment Group before Feb. 15, when the money flow is to evaporate and construction will be halted unless a new deal is in place. "The Olympic village is a billion-dollar project, and the city taxpayers are on the hook for all of it," Robertson said. "We are financially and legally committed to completing this project." Robertson and senior city staff revealed details of the deal negotiated by the city, developer Millennium Development and lender Fortress to build the 17-acre village, touted as a model of sustainability. Fortress stopped in September doling out the monthly money needed to keep construction going after its agreement with Millennium went sour. Since then, the city has been paying to keep construction going, to the tune of $79 million over three months.

California officials going after noncompliant LLCs - (www.latimes.com) California officials are on the prowl for thousands of limited liability companies that have failed to file required forms or pay fees and taxes. Under a new state program, those LLCs face suspension if they didn't file state income returns, pay income fees owed, pay the $800 annual LLC tax or make an information filing that is required every two years. It's the first time since state law allowed the popular business entities 15 years ago that California has taken steps to suspend noncompliant companies registered as LLCs. Suspension means that a company loses the right to its name and its ability to sue or be represented in court, its contracts are unenforceable and it cannot legally do business in California, according to the Franchise Tax Board, the state tax agency. Even if a business registered as an LLC in California never conducted business here, it continues to rack up the annual tax of $800, plus interest and penalties, until it formally cancels the registration. Out-of-state companies that registered as LLCs in California are also subject to suspension for noncompliance. "When LLCs came about, we had many people set up LLCs -- small mom-and-pops or husband-and-wives -- and then they just never did their paperwork, never filled out income returns or filled it out the first year and that was that," said Gina Rodriquez, Sacramento editor of Spidell's California Taxletter.

Men losing jobs at higher rate than women in recession - (www.usatoday.com) Women are holding onto their jobs more than their male counterparts in the recession as the types of jobs women hold generally offer more stability, albeit at less pay. In the year since the recession began in December 2007, the jobless rate for men rose from 4.4% to 7.2%. At the same time, the jobless rate for women rose from 4.3% to 5.9%. Given that women are more likely to work now than in prior downturns, dual-income households may be on better footing to withstand this recession, says Donna Ginther, director of the Center for Economic and Business Analysis at the University of Kansas. Approximately 61% of women 20 and older were in the labor force in December, up from 37% 50 years ago. "It's a kind of built-in insurance. If you lose one of two incomes and you are losing the highest income, it hurts, but it's not as catastrophic as say, losing the only income in a household."

Bonds Show It's 'Ferociously Dangerous': Hendry - (www.cnbc.com) Bonds are showing us that "it is ferociously dangerous outside… Businesses are failing, wealth is being destroyed," Hendry told "Squawk Box Europe." "The people who tell you they know what's going to happen in the next 12 months are either foolish or liars. I'm going to be flexible in my mind and flexible with my portfolio," he added. Many analysts said corporate debt was cheap and investors would be better off in company bonds than in shares, but Hendry said that the big difference could be justified by the fact that the cheaper debt is the one that reflects the grim reality of falling earnings because of the economic slowdown. "We took savings to zero in the Western world" and now that savings are retracing, they will most likely go into bonds, he said.

Capitalism Freezes in Worldwide Winter of Discontent - (www.bloomberg.com) As capitalism staggers through its first globalized economic crisis, the costs won’t be measured only in dollars and cents. From newly rich Russia to eternally impoverished sub- Saharan Africa, social strains are threatening the established political order, putting some countries’ very survival at risk. In the past month, Nigerian rebels threatened renewed warfare against foreign oil producers, Russia sent riot police from Moscow to quell an anti-tax protest in Siberia and China’s communist leadership warned of social agitation as the 20th anniversary of the Tiananmen Square massacre looms. The disillusionment and spillover effects of the global recession “are not only likely to spark existing conflicts in the world and fuel terrorism, but also jeopardize global security in general,” says Louis Michel, 61, the European Union’s development aid commissioner in Brussels. Somewhere in the wreckage may lurk an unexpected test for U.S. President-elect Barack Obama, 47, one that upstages his international agenda just as Afghanistan’s backwardness and radicalism led to the Sept. 11 attacks that defined the era of George W. Bush only eight months into his term.

Once mighty PC makers succumb to slowdown - (www.reuters.com) The global PC industry stood tall for most of last year as other technology sectors foundered, but it too has caught the bug of a deepening economic downturn that has hit demand from both consumers and corporate buyers. As recently as November, J.T. Wang, chairman of Acer, the world's No. 3 PC seller, was confident PCs were immune to global downturns due to the growing importance of computers in everyday life. "Children will still need to go to school. They will need computers! Businesses will continue running. They too will need computers!" Wang had said. Fast forward two months, when a slew of recent sales warnings and cuts in business forecasts signal the sudden downturn will last through most of 2009, if not longer. "Demand is weak, and I don't think we're


OTHER STORIES:

Wall Street: It's payback time - (www.ml-implode.com) - "An angry mob of investors and taxpayers is assembling, and they want to see some executives' heads on pikes. The question for t...
NYC judge allows Madoff to remain free - (www.ml-implode.com)- A judge has allowed Bernard Madoff to remain free on bail, rejecting a bid by prosecutors to send the disgraced investor to jail...
Bush agrees to ask for financial bailout fund - (www.ml-implode.com)- "President-elect Barack Obama advised President George W. Bush on Monday that he intends to tap the remaining $350 billion in fi...
OTTI Rules Tweaked or Sharpened? - (www.ml-implode.com) - "It appears a cranky FASB, responding to a flood of comments — some ill-informed, a bunch form letters — added a few teeth to wh...

Obama Seeks Rest of TARP But Democrats May Resist - (www.cnbc.com)
Democrats Recasting TARP - (www.cnbc.com)
Confidence is the Key for Automakers: CEOs - (www.cnbc.com)
Citi Could See $3 Billion From Smith Barney Deal - (www.cnbc.com)
Alcoa Downgraded As it Prepares to Report Earnings - (www.cnbc.com)
Aetna Sees Lower '09 Profit with Bigger Pension Hit - (www.cnbc.com)

Satyam Shares Surge After New Board Appointed - (www.cnbc.com)
Stocks open lower ahead of earnings reports - (finance.yahoo.com)
Crude Oil Tumbles Below $40 as Demand Drops Faster Than Supply - (www.bloomberg.com)
Treasurys down as riskier debt gains in appeal - (www.marketwatch.com)
Gold Drops in London Trading as Stronger Dollar Erodes Demand - (www.bloomberg.com)
Economic downturn pounds commercial real estate market - (www.usatoday.com)
Downturn hits rates of debt recovery - (www.ft.com)
Harbinger Capital imposes limits on withdrawals - (www.ft.com)
Big names wait in wings for end to IPO drought - (www.ft.com)
China to Tolerate More Bad Loans, Relax Credit Rules - (www.bloomberg.com)
Ruble Falls to 6-Year Low as Russia Devalues 2nd Time in 2 Days - (www.bloomberg.com)
Satyam to Restate Earnings, May Be Broken Up, Executives Say - (www.bloomberg.com)
Germany set to extend fund for rescue - (www.ft.com)
China Auto Sales to Grow Least in 11 Years, Industry Group Says - (www.bloomberg.com)
Obama promises to overhaul Tarp - (www.ft.com)
Consumers find it harder to get, keep credit - (www.chicagotribune.com)
Hollywood Finds Headaches in Its Big Bet on 3-D - (www.nytimes.com)