Monday August 1 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Realtors overreported Chicago house prices - (www.chicagotribune.com) The Illinois Association of Realtors said Monday that the median price it reported for home sales within the city of Chicago was inflated in May and mistakes in its reports may go back more than three years. Errors in the reports can wrongly inflate consumer confidence in a housing market that has been struggling to recover for the past 4 1/2 years. It also can undermine the credibility of the real estate organizations that compile and disseminate the statistics. The Tribune and other media outlets report that data as part of regular coverage of the housing industry because it provides a pulse of the market. The state Realtors' group acknowledged the errors after the Tribune, acting on a tip, questioned the accuracy of the May report. The group believes median prices for both condos and detached single-family homes sold within the city contain errors. "It's not just May," said Mary Schaefer, a spokeswoman for the Illinois Association of Realtors adding that the mistakes appear to go back at least through January. "We're trying to figure out where the bug occurred. We should have caught it. We pride ourselves on having accurate data. We want to make sure there is 100 percent clean data." The size of the Realtors' errors is statistically significant, at least based on the May median price for condo sales wtihin the city. In its official report that has now been discredited, the trade group previously said that the median price of an existing condo sold in Chicago in May was $299,000, compared with $271,150 recorded in May 2010. In fact, the median price was $243,000, compared to a year-ago price of $265,000, according to data from Midwest Real Estate Data LLC, the multiple listing service for the Chicago area.

Real estate investors behind many foreclosures - (www.jacksonville.com) While only 25% of Duval homes are owned by investors, they are responsible for 75% of foreclosures. The four-bedroom house on the bank of the St. Johns River was nice. Built in 1990, the two-story, 3,200-square-foot home at 3782 Wayland St. was on a well-kept University Park street. In its backyard a raised boardwalk led to a boat slip. Previous owners could watch dazzling sunsets over the river from the balcony deck on its gazebo. It sold for $715,000 at the height of the real estate bubble in 2006. Since then, the home was partially burned in a mysterious fire, a next-door neighbor said. Then it was abandoned and subsequently condemned, according to city records. On April 6, a city-contracted crew tore it down as an unsafe structure, while it was listed for sale by a bank for $295,900. Now nothing remains but the boardwalk, gazebo and an empty dirt lot crisscrossed by tire tracks. The house's story is one of more than 10,200 Duval County single-family home foreclosures in 2008, 2009 and 2010. Of those foreclosures, most — possibly more than two-thirds — were investor-owned when the bank took them, a Times-Union review has found. Only about 29 percent were owner-occupied as evidenced by the fact they were homesteaded at the time foreclosure became final, according to Duval County Property Appraiser's Office and Tax Collector's Office property records.

Newest Line of Business for Big Banks: Slumlording - (www.dailyfinance.com) The nation's biggest bailed-out banks have unintentionally entered a new line of work: slumlording. In some cases, major banks have created whole neighborhoods of abandoned and deteriorating foreclosure properties -- and a blight on local municipalities. Now, Los Angeles has decided to do something about it, by naming the German banking giant Deutsche Bank(DB) the city's biggest slumlord. L.A. is suing the lender, claiming that it has illegally evicted tenants and allowed foreclosed homes to deteriorate. The city's also considering suingUS Bancorp(USB), BNY Mellon (BK), and HSBC(HBC) for not keeping up their own foreclosed properties.

Myth of the Texas "Miracle" - (www.bloomberg.com) The June jobs report released today shows how hard it is for the U.S. to shake free of persistently high unemployment. The meager numbers -- only 18,000 new jobs, far less than forecast, were created and the unemployment rate rose to 9.2 percent from 9.1 percent -- should intensify the search for pockets of growth. That search will inevitably lead to Texas, one of the few spots in the country where people are finding work. It’s easy to be charmed by Texas, but it would be a mistake to think the state might serve as a national model. Texas created almost 250,000 jobs in the past two years, nearly as many as the other 49 states combined. Texas leaders, including Republican Governor Rick Perry, credit that success to low taxes and a business-friendly regulatory approach. Yes and no. Those factors played a role. To a sizable degree, however, the state’s booming payrolls are the result of hard-to-duplicate factors, such as a fast-growing population, and unusually low wages.

Low downpayment directly related to higher mortgage delinquency rates - (www.doctorhousingbubble.com) I’m a bit perplexed why so many people think that a low down-payment has very little to do with mortgage delinquencies. Aside from the actual facts that show a low down-payment does correlate with significantly higher defaults rates, it also makes logical sense. I believe part of this mentality stems first from not knowing the facts, but also believing that this shifts blame from the financial industry or government backed system we currently have for purchasing mortgages. On this front I do agree that the financial industry is the prima causa of the financial crisis and there is plenty of blame to go around.

OTHER STORIES:

Pacifica Riptide: Pacifica Real Estate Continues to Decline in Value - (www.pacificariptide.com)

Pasadena property falls over 50 percent in 7 years - (www.doctorhousingbubble.com)

Malibu Prices Plunging - (westsideremeltdown.blogspot.com)

A House Is a Lousy Investment - (online.wsj.com)

Underwater mortgages still a drag on housing - (www.centralvalleybusinesstimes.com)

Strategic default is moral imperative to prevent future housing bubbles - (www.irvinehousingblog.com)

Overtime, Not Wage Increases, Drive Income Growth - (blogs.wsj.com)

Sheila Bair's Exit Interview from the FDIC - (www.nytimes.com)

Fed Rates on Hold Longest Since 1940s - (www.bloomberg.com)

Swiss Parliament to discuss gold franc - (www.marketwatch.com)

Real Estate Commercial Parody - (www.youtube.com)

Sunday July 31 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

On debt, credit rating firms flex muscle with downgrade warnings despite U.S. pleas - (www.washingtonpost.com) The Obama administration has mounted an intense behind-the-scenes campaign to keep the nation’s major credit rating companies from issuing threats that they might downgrade the United States over the swelling size of the federal debt. Senior administration officials have been trying for months to convince analysts at the credit rating companies — all part of publicly traded firms — that political leaders in Washington can come to an agreement to tame the debt. At one key moment, worried that news of a potential downgrade could wreak havoc on the markets, officials summoned four Standard & Poor’s analysts to a meeting with nearly every senior member of President Obama’s economic team at which Treasury Secretary Timothy F. Geithnermade an impassioned plea against any action raising doubts about U.S. credit. But S&P didn’t buy the argument — and one of the two other credit rating firms, Moody’s Investor Services, has expressed concern, too.

Germany wants major private contribution to Greece - (www.reuters.com) German Chancellor Angela Merkel said on Sunday she was not aiming for a forced restructuring of Greek sovereign debt, but wanted private sector investors to make a major contribution to a voluntary scheme to rescue Greece. "What we want is as few measures as possible, and a restructuring, as is constantly being mentioned now, also has the negative effect that countries possibly will not make as much of an effort anymore," German Chancellor Angela Merkel told ARD public broadcaster. "I am not working toward it. We are trying everything we can to avoid something that is even tougher. "But I'm saying clearly that the involvement of private creditors shows that we have a special problem in Greece due to the very, very high debts." Germany wants private creditors of Greece -- banks, insurance funds and other investors -- to shoulder some of the burden, preferably as much as 30 billion euros, in bailing out the country for a second time.

Banks, Regulators Stopped Tougher Stress Tests, Telegraph Says - (www.bloomberg.com) National regulators and lenders stopped the European Banking Authority from setting tougher stress tests by making it difficult to obtain accurate data, the EBA told analysts, according to the Sunday Telegraph. EBA Chairman Andrea Enria outlined the difficulties and the regulator said it would have liked to make the tests on 91 of the region’s banks more strenuous, the newspaper reported.

Gloomy consumers cast dark cloud over economy - (www.reuters.com) U.S. consumer confidence hit a near 2-1/2 year low in early July and manufacturing output stalled in June, further frustrating expectations of a quick economic growth rebound in the second half of the year. Worries about stubbornly high unemployment pushed the Thomson Reuters/University of Michigan's index of consumer sentiment to 63.8, the lowest since March 2009, a report showed on Friday. Economists had expected the index to climb to 72.5 from 71.5 in June. Separate data from the Federal Reserve showed manufacturing output stagnated last month partly due to supply disruptions in the auto sector related to the earthquake in Japan.

Italian, Spanish, Irish, Portuguese Bonds Decline as Debt Crisis Spreads - (www.bloomberg.com) Italian two-year note yields surged the most in over a year, as the nation’s borrowing costs rose at a debt sale and contagion from Greece’s debt crisis spread across the 17-nation euro region. Yields on notes from Ireland, Portugal and Greece soared to euro-era records, while German bunds advanced for the fifth time in six weeks as Europe’s politicians clashed over how to craft a new rescue plan for Greece involving private bondholders. Spanish and Italian 10-year bonds slumped, sending yields to the most since the euro’s inception in 1999, as borrowing costs rose to a three-year high at a sale of five-year Italian securities. France, Spain and Germany plan to sell debt next week. “The market isn’t looking at fundamentals, it is just worried about contagion,” said Huw Worthington, a fixed-income strategist at Barclays Capital in London. “There’s been growing infection across most of the euro-region issuers and it’s hard to see what the catalyst is going to be to get confidence back into the markets with all the issuance next week.”

OTHER STORIES:

Trichet Says Europe Can Surmount Debt Crisis - (www.bloomberg.com)

Stress Tests Pressure 24 Banks to Raise Capital - (www.bloomberg.com)

Stocks stymied without a debt deal - (www.reuters.com)

Gold Futures Cap Longest Rally Since 2009 on U.S. Debt Concerns - (www.bloomberg.com)

U.S. Stocks Fall Most in Five Weeks on European Crisis, Debt-Limit Talks - (www.bloomberg.com)

Ireland seeks euro bonds as part of crisis solution - (www.reuters.com)

SEC's Aguilar seeks investor alert on retail forex - (www.reuters.com)

Markets teeter on US default cliff - (www.ft.com)

Eurozone talks focus on Greek debt - (www.ft.com)

Eurozone exit could restore Greek competitiveness - (www.ft.com)

Ditching Euro No Option for Greeks Who Endured History of Drachma Hardship - (www.bloomberg.com)

Greek debt cut won't solve problem: ECB's Weidmann - (www.reuters.com)

Trichet, Banks Jostle Ahead of Greece Summit - (online.wsj.com)

Top lawmakers target ‘grand bargain’ for debt plan - (www.washingtonpost.com)

Obama presses for debt deal as clock runs out - (www.washingtonpost.com)

Congress seeks debt result, Obama goes to public - (finance.yahoo.com)

Regulators shut 2 banks in Georgia, 1 in Florida - (www.bloomberg.com)

Citigroup Estimates It Has $22 Billion at Risk in Five European Countries - (www.bloomberg.com)

What happens to markets if the US defaults? - (finance.yahoo.com)

Worst heatwave in years grips Midwest, moving east - (www.reuters.com)

Saturday July 30 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Minnesota Man In Foreclosure Prosecuted For Stripping Building - (www.housingdoom.com) "We've been talking about foreclosure-stripping for years around here-- that practice of homeowners in foreclosure removing everything that's not nailed down and selling it, as well most of the stuff that IS nailed down. While mortgage contracts generally spell out that this is not allowed, the practice has been widespread, and homeowners have little fear of prosecution." With his building under foreclosure, Donald Mordal decided to take some items that he says belonged to him. Now, he’s facing criminal prosecution, only the second person charged in Anoka County in the past 25 years under a 1963 state law. The law makes it a felony to remove or damage property subject to a mortgage with intent to hurt the property’s value. It is so rarely used that officials in the Hennepin and Ramsey county attorney’s offices couldn’t recall prosecuting anybody under it. Mordal, a businessman in Nowthen, was one of many Minnesotans caught in the foreclosure crisis. After years of building his business, he couldn’t make his mortgage payments in June 2009, and the bank foreclosed on the 7,600-square-foot building he’d helped construct. With it sitting empty, the charges say, he removed some doors and windows, plumbing, cabinets and landscape boulders he had bought and installed.

Stress Tests Compromised by Greek Non-Default - (www.bloomberg.com) European regulators’ attempts to bolster confidence in the region’s banking industry today are being undermined by their unwillingness to test for a Greek default and a mutiny by Germany’s Landesbank Hessen-Thueringen. The European Banking Authority will release the results of the stress tests for 91 banks as part of an effort to reassure investors the region’s banks have sufficient capital. Helaba, as the landesbank is known, refused to allow the EBA to publish its results in full, saying the EBA’s data “would lead to a halving of the core capital without legal grounds.” German regulator Bafin has also attacked the London-based EBA. Bafin Chairman Jochen Sanio said last month the watchdog lacks “legitimacy.”

Muni Default Plunge Belies Whitney as Borrowers Shun Insolvency - (www.bloomberg.com) Time is running out on the credibility of Meredith Whitney, who has yet to acknowledge that her eight-month-old prediction of widespread defaults this year in the market for state and local government debt is proving unfounded. Defaults fell 60 percent in the first half of 2011 compared with the same period last year, including a $12.5 million Austin, Texas, apartment project that made a late payment in June, according to Distressed Debt Securities Newsletter. Whitney, the analyst who rose to prominence by predicting Citigroup Inc.’s 2008 dividend cut, predicted “hundreds of billions of dollars” of municipal defaults within 12 months in a Dec. 19 “60 Minutes” broadcast, fueling a wave of selling in the $2.9 trillion market. Instead, the number has fallen as cities slashed spending to balance budgets and state lawmakers stepped in to guard against insolvency and local bankruptcies. “The data is not helping Meredith,” said Matt Fabian, a managing director at Municipal Market Advisors, a financial- research company based in Concord, Massachusetts. “It’s always been a possibility there would be a wave of defaults. You can’t say that it’s zero but it’s given no sign of starting.”

Weiss Ratings Downgrades United States Debt to C-Minus – (www.weissratings.com) Weiss Ratings, an independent rating agency of U.S. financial institutions and sovereign debts, has downgraded the debt of the United States government from C to C-minus. The C-minus rating for the U.S. reflects a continued deterioration in the weaknesses cited in the Weiss Ratings release of April 28, 2011, including heavy debt burdens, shaky international stability, and poor economic health. Weiss Ratings senior financial analyst Gavin Magor commented: "Our downgrade today is not contingent on the outcome of the debt ceiling debate in Washington. It is driven exclusively by the numbers, which indicate that, in addition to a decline in the long-standing weaknesses we noted three months ago, the U.S. has already lost the golden halo that helped guarantee liquidity and acceptance of its government securities in global markets."

Ambac $1 billion subprime lawsuit vs JPMorgan revived - (www.reuters.com) A New York state appeals court revived Ambac Financial Group Inc's $1 billion lawsuit against JPMorgan Chase & Co over an investment vehicle that in 2007 and 2008 suffered heavy losses from toxic subprime debt. The court said Ambac "has sufficiently alleged gross negligence" by JPMorgan, whose Chief Executive Jamie Dimon was said to have concluded as early as October 2006 that subprime mortgages "could go up in smoke." Ambac accused JPMorgan of breach of contract over losses that its Ambac Assurance unit suffered on notes it guaranteed for Ballantyne, a special purpose vehicle established to reinsure term life insurance policies.

OTHER STORIES:

Europe's banks brace for clutch of health test failures - (www.reuters.com)

Europe's banks brace for clutch of health test failures - (www.reuters.com)

Berlusconi Faces Final Budget Confidence Vote - (www.bloomberg.com)

China Foreign Investment Rises to $60.9 Billion as Companies Woo Consumers - (www.bloomberg.com)

Merkel Fails to Evoke Kohl as Boom Brings No Gain - (www.bloomberg.com)

Weakening U.S. Consumer Income Expectations Point to Slowdown in Spending - (www.bloomberg.com)

U.S. Consumer Prices Fall on Drop in Fuel Costs - (www.bloomberg.com)

N.Y. Area Manufacturing Contracted in July - (www.bloomberg.com)

Debt limit: U.S. outreach to banks, investors over possible default comes up empty - (www.washingtonpost.com)

Debt face-off shifts to Congress, bargain in play - (www.ap.com)

Bernanke Damps Additional Stimulus Prospects - (www.bloomberg.com)

Friday July 29 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Flash Mobs Thwart Foreclosures in Spain - (www.bloomberg.com) Luis Dominguez got up at dawn to take a 5 a.m. bus to join a human chain around a Madrid home threatened with foreclosure. Three weeks earlier, the crowd had come to him after he telephoned for help. “I was facing eviction and they saved me from losing my home,” said Dominguez, 74, a pensioner with a walking stick in one hand and a five-foot placard saying “Stop Evictions” in the other. “I came today to show my gratitude and support.” The 300 protesters, organized by a group called La Plataforma de los Afectados por la Hipoteca, or PAH, managed to win a reprieve for the property’s owner, a single mother with a disabled son. Rising unemployment in Spain may lead to 300,000 foreclosures this year and next, according to Adicae

, a rights group representing bank customers. Spain has become a battleground between banks hurt by a five-fold increase in residential mortgage arrears since 2007 and debt-laden homeowners who are appealing to the government to reduce the burden on those facing foreclosure.

Jefferson County Has A Plan To Avert Largest-Ever Muni Bankruptcy - (www.businessinsider.com) After hovering near the brink of insolvency for nearly three years, Alabama's Jefferson County finally has a plan to settle its $3.2 billion sewer debt and hopefully avoid the largest municipal bankruptcy in U.S. history. In an interview with Birmingham's WBRC TV station, Jefferson County Commission President David Carrington said county officials had finalized a plan to present to creditors that includes a fixed-rate repayment plan with a fixed term, and would be backed by the state of Alabama's good credit. Talks between the county and its sewer creditors have made substantial progress since the state stepped in last month with a "credit enhancement" offer, breaking an extended stalemate. The county has been battling bankruptcy since the sewer bond financing soured in 2008.

Italy Too Big to Bail Out as Crisis Enters ‘New Phase’: Chart of the Day - (www.bloomberg.com) The euro’s fate may lie in the hands of Italian bondholders as the region’s debt crisis threatens to envelop the Mediterranean nation, according to Credit Agricole Corporate & Investment Bank. The CHART OF THE DAY shows Italy’s government debt burden, the euro area’s largest at 1.8 trillion euros ($2.6 trillion), dwarfs those of Greece, Ireland and Portugal, which already received bailouts, and Spain, which has the next-highest borrowing costs. German Chancellor Angela Merkel is under pressure from coalition partners to limit its contribution to sovereign bailouts. The European Financial Stability Facility currently has a lending capacity of 250 billion euros. “If Italy gets to the point where its debt auctions start to fail and it loses access to the market, it becomes difficult to imagine who would have the kind of money that would be required to rescue it,” said Luca Jellinek, head of European interest-rate strategy at Credit Agricole CIB in London. “It’s undoubtedly bigger than the current scope of the EFSF.”

Dimon: ’Everybody Is Going to Sue’ Over Mortgages - (www.bloomberg.com) JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimonsaid clashes over faulty mortgages may drag on as investors and regulators demand compensation for soured loans issued at the peak of the housing market. “There have been so many flaws in mortgages that it’s been an unmitigated disaster,” Dimon said during a conference call today. “We just really need to clean it up for the sake of everybody. And everybody is going to sue everybody else, and it’s going to go on for a long time.” JPMorgan disclosed about $2.5 billion in second-quarter costs tied to faulty mortgages and foreclosures. The bank added $1.27 billion to litigation reserves, mostly for mortgage matters, and incurred $1 billion of expenses tied to foreclosures, according to a slide showaccompanying today’s earnings report. Repurchase losses were $223 million, according to the company, which ranks second by assets among U.S. banks.

Italian Banks Face Funding Squeeze - (www.bloomberg.com) Italian banks, saddled with the nation’s record borrowing costs, may struggle to reverse a drop in profitability that’s already turned UniCredit SpA (UCG) and Intesa Sanpaolo SpA (ISP) into European laggards. Italy’s two biggest lenders have about 55.4 billion euros ($78.4 billion) of debt maturing in 2012, according to the banks. Investor concern that the sovereign debt crisis is spilling over to Italy, which has the region’s largest debt, pushed the country’s 10-year bond yields to their highest relative to German bunds since the introduction of the euro, adding about 1 percentage point to funding costs this month. The crisis has entered a new phase and higher financing costs for some European nations are here to stay, Bank of Italy Governor Mario Draghi said yesterday. For the banks, that translates into pressure on earnings and may force cost cutting, greater competition for deposits and a contraction in lending, mirroring the challenges Spanish lenders are also facing.

OTHER STORIES:

Bernanke: No Plans Now for Bond Purchases - (www.bloomberg.com)

Retail Sales in U.S. Stagnate as Unemployment Hurts Consumers - (www.bloomberg.com)

Wholesale Prices in U.S. Fell 0.4% in June - (www.bloomberg.com)

Initial Jobless Claims in U.S. Fall by 22,000 - (www.bloomberg.com)

Moody’s moves one step closer to downgrading U.S. debt - (www.washingtonpost.com)

Moody’s Downgrade Adds Pressure on U.S. Debt Deal - (www.bloomberg.com)

Tensions Escalate as Stakes Grow in Fiscal Clash - (www.nytimes.com)

Dimon: ’Everybody Is Going to Sue’ Over Mortgages - (www.bloomberg.com)

JPMorgan Beats Estimates as Net Rises 13% on Lower Credit Costs - (www.bloomberg.com)

Behind the increase: Why Netflix is raising prices – (finance.yahoo.com)

Reinhart and Rogoff: The Economy Can’t Grow - (www.bloomberg.com)

Thursday July 28 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Amazon sales tax battle centers on jobs - (www.latimes.com) Amazon says California's sales tax law has caused it to sever ties with local affiliates, hurting the state. Chain stores say they provide local jobs that the Internet retailer does not. A looming California electoral battle pitting powerful Internet retailer Amazon.com against the nation's largest chain stores is expected to be fought on the issue of jobs — with each side saying its position is better for the state's struggling economy. Officially, the fight is over the sales tax and Amazon's refusal to collect it under a new California law that requires the Seattle company and other Internet-only retailers to do so as long as they have operations in the state. The company said Monday that it would seek to qualify a referendum for the state ballot that would allow voters to overturn the new law. But beneath the sales tax dispute is an escalating rivalry between Amazon and bricks-and-mortar retailers, which have seen an increasing portion of their sales go to the Internet. Those conventional retailers say they are at a disadvantage because consumers perceive that they don't have to pay sales taxes on Internet purchases, in effect giving buyers a discount of nearly 10%. The stores also point out that they provide jobs — to salespeople, clerks, cashiers and more — and that California can ill afford to give a tax amnesty to Internet retailers that operate elsewhere.

French Banks Face Greatest Italian Risk - (www.bloomberg.com) French banks, including BNP Paribas SA and Credit Agricole SA (ACA), have the most at risk from the euro- region’s debt crisis infecting Europe’s largest borrower, Italy. At the end of 2010, French banks carried $392.6 billion in Italian government and private debt, according to data from Basel, Switzerland-based Bank for International Settlements. That’s the most for financial institutions from any foreign country and more than double held by German lenders. “They’re on the frontline,” said Julian Chillingworth, who helps manage about 16 billion pounds ($25 billion) at Rathbone Brothers Plc in London. “French banks like BNP Paribas have taken substantial positions in Italy when the market opened up to foreign players and now they face the downside.” Italian stocks and bonds have been roiled on concerns about the country’s ability to trim debt after warnings by Moody’s Investors Service and Standard & Poor’s and infighting in Silvio Berlusconi’s government over a budget-cutting plan. Italy’s woes may overshadow efforts to fix Greece’s finances, which have left European policy makers struggling to find a strategy that won’t spark a region-wide debt panic.

Italy’s Etruria, Santander Pull Asset-Backed Bonds Amid Crisis - (www.bloomberg.com) Banco Santander SA (SAN)’s German consumer-finance unit and Italy’s Banca Popolare dell’Etruria e del Lazio (PEL) pulled asset-backed bond sales as the euro-region crisis roiled markets. Santander Consumer Bank AG delayed an issue of 573 million euros ($802 million) of top-rated bonds backed by German car loans because of volatile markets, according to a banker involved in the deal. Arrezo, Italy-based Banca Etruria said it pulled a sale of bonds backed by 466 million euros of residential mortgages and that it’s keeping the notes itself. A Madrid-based spokeswoman at Santander, who declined to be identified citing bank policy, wouldn’t comment. Santander and Banca Etruria halted the deals as the sovereign debt crisis spread beyond Greece to infect Italy and Spain, sending yields on the nations’ 10-year bonds to euro-era highs earlier today. European Union finance ministers resumed meetings in an attempt to concoct a response to the bank stress tests due to be published later this week.

Everyone's Buzzing About Bernanke's Controversial Comments About Gold – (www.businessinsider.com) A line from Bernanke's testimony this morning is getting some folks all atwitter. First he was asked by Ron Paul whether he thinks gold is money: He said "no." Then he Ron Paul asked him why Central Banks hold so much: He answered "tradition." Now this is the classic gold bug argument: Because gold has been used as a store of wealth for eons, it still should have value. And yet Bernanke is taking flack for this comment. But if not tradition, what exactly is the argument for gold having value?

R. Kelly Hasn't Made Payments On His Multimillion Dollar Mansion In Over A Year - (www.businessinsider.com) R. Kelly is an incredible R&B Grammy award-winning artist known for everything from “I Believe I Can Fly,” which was featured in the hit movie Space Jam, to ”Ignition (Remix).” However, as he faces foreclosure on his Chicago mansion he himself may be rehearsing the lyrics “If I Could Turn Back the Hands of Time.” Kelly has reportedly avoided payments on this multimillion dollar mansion for over a year—a decision that may be catching up to him now. However, something just does not seem right about Kelly’s foreclosure—he is financially stable and just completed a very successful tour last year. R. Kelly’s situation seems to mimic that of other celebrity situation. The news and popular real estate blogs are filled with information on celebrity foreclosures. However, these foreclosures even include the successful celebrities that continue to bring in a surplus of income due to high-profile tours and lead roles in popular films. Clearly, they are receiving enough income to pay their mortgage payments—aren’t they? Why, exactly, are these hot celebrities refusing to pay their mortgage? Simple: Because they can.

OTHER STORIES:

Fed Prepared With Stimulus If Needed: Bernanke - (www.bloomberg.com)

Debt talks grind on, clock ticks toward default - (finance.yahoo.com)

Mortgage applications drop for the fourth week: MBA - (www.reuters.com)

Bernanke to face grilling on jobs, debt, Europe - (www.reuters.com)

Fed divided over more stimulus, meeting minutes show - (www.washingtonpost.com)

Netflix raising prices as much as 60% - (www.latimes.com)

JPMorgan, Citigroup Struggle to Boost Revenue - (www.bloomberg.com)

Bank contagion fear resurfaces in the Eurozone - (www.ft.com)

Europe Readies for the Worst - (online.wsj.com)

E.U. Vows to Back Banks That Fail Stress Tests - (www.nytimes.com)