KeNo's Housing and Economic Portal: Sunday January 9 Housing and Economic stories

Saturday, January 8, 2011

Sunday January 9 Housing and Economic stories

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TOP STORIES:

Companies Exempt From Derivatives Rules May Yet Get Hit - (www.nytimes.com) The new financial regulations coming out of Washington are packed with exemptions – perhaps none greater than the promise to excuse Shell Energy, United Airlines and thousands of other nonfinancial companies that use derivatives from complying with proposed rules for the shadowy $600 trillion market. But some corporations and even some lawmakers now say the so-called end-user exemption — the provision in the Dodd-Frank financial overhaul law protecting nonfinancial companies from new regulations — could be a fallacy. Although one section of the 2,300-page law exempted the companies from some new rules, another provision could expose them to tough new margin requirements. “The end-user exemption has never been the Holy Grail that other people have thought it was,” said Joel Telpner, a partner at the law firm Jones Day, which represents end users and banks that arrange derivative transactions.

Regulators are finding opportunities at firms looking for government experience - (www.washingtonpost.com) The president's recently departed budget director is joining Citigroup. The New York Federal Reserve Bank's derivatives expert is joining Goldman Sachs. And numerous investigators from the Justice Department and the Securities and Exchange Commission are joining Wall Street's top law firms. The vast overhaul of financial regulations and the renewed intensity of investigations into white-collar crime has been a boon for regulators, prosecutors and financial policymakers looking to cash in on their government experience and contacts. In recent months, prominent officials from the White House, Justice Department, SEC, banking regulators and other agencies, both federal and state, have been walking through the proverbial revolving door to join Goldman, Citi, other financial companies and top law firms in Washington and New York. Lawyers making the move, who often were in the private sector before joining the government, can reasonably expect their income to go from less than $200,000 to $400,000 or more, legal recruiters say.

Veterans of recent wars confront grim employment landscape - (www.washingtonpost.com) IN HAUPPAUGE, N.Y. During the seven months that he was stationed in Iraq, Joe Janssen served as an assaultman, a job that involved manning the turret gun in a Humvee and using shoulder-fired rockets and other explosives to support his fellow Marines. Those skills were invaluable in war. But they are of little use now that he is back home in Hauppauge, N.Y., a Long Island hamlet. He has applied for job after job since leaving active duty well over a year ago, but his efforts have proved futile. The Marine reservist used his veterans benefits to finish his bachelor's degree in criminal justice. Now he is scouring for a job in law enforcement while he waits for his name to rise to the top of the New York state police hiring list - which is unlikely to be anytime soon, given the state's severe budget problems. "I have a passion to be a cop," said Janssen, 23, a fitness buff who dabbles in mixed martial arts. "But no one is hiring."

Doctors Getting Rich With Fusion Surgery Debunked by Studies - (www.bloomberg.com) Suffering from an aching back, truck driver Mikel Hehn went to see surgeon Jeffrey Gerdes in 2008. The St. Cloud, Minnesota, doctor diagnosed spinal disc degeneration, commonly treated with physical therapy, and said surgery wasn’t called for. Unhappy with the answer, Hehn turned to Ensor Transfeldt, a surgeon at Twin Cities Spine Center in Minneapolis. Transfeldt performed fusion surgery on Hehn, screwing together three vertebrae in his lower spine. Fusion aims to limit painful spine movements. This one didn’t work out. Two years later, the pain in Hehn’s neck, lower back, buttocks and thighs is so bad that he can’t hold a job and seldom leaves home, he said in an interview. “There’s days when I just can’t take it and the tears run,” said Hehn, 52, who lives in Sartell, Minnesota. He said he takes oxycodone for pain, Soma to sleep, Lexapro for depression and Imitrex for headaches.

California Build Americas Outperform on 7% Yields: Muni Credit - (www.bloomberg.com) Build America Bonds from California, the biggest issuer of the taxable debt in 2010, outperformed the market in the last six weeks as the state’s 7.25 percent yield lured investors unfazed by the lowest state credit rating. The extra yield above U.S. Treasuries demanded by buyers of 30-year California Build Americas sold Nov. 19 fell to 2.8 percentage points on Dec. 28 from 3.3 points when issued, according to data compiled by Bloomberg. The average spread on Build Americas jumped to 1.95 percentage points from 1.9 points in the same period, according to a Wells Fargo index. After the program expires tomorrow, Build America investors may be less concerned with creditworthiness than liquidity, or how easily they can be sold, making secondary-market debt from the largest issuers more attractive. California will likely provide the most value to investors heading into 2011, said Bud Byrnes, chief executive officer at Encino, California-based RH Investment Corp., which specializes in the state’s securities.