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Fannie and Freddie, Still the Socialites - (www.nytimes.com) THE mortgage business is moribund. New loans are down. New foreclosures are up. But why let a little sorry news get in the way of a good party? Last week, almost 3,000 people descended on the Hyatt Regency in Chicago for the 98th annual convention of the Mortgage Bankers Association. The price of admission: about $1,000 a head. But for that grand, you got to hear the band Chicago play hits from the ’70s. And David Axelrod and Jeb Bush give speeches. And experts discuss things like demographics, the politics of housing and the future of the mortgage industry, according to a flier for the event. “Gather the information you need to help your business and our industry drive change,” the pitch went. The city of Chicago was no doubt grateful for the conventioneers’ dollars. Besides, Mayor Rahm Emanuel knows something about this industry: he used to be a director at the mortgage giant Freddie Mac. Nothing wrong with a bit of schmoozing. But it might seem jarring that Freddie, which was rescued by Washington and today exists at the pleasure of taxpayers, paid $80,000 to become a “platinum” sponsor of this shindig. Fannie Mae, that other ward of the state, paid $60,000 to become a “gold” sponsor.
Investor threat to second Greek bail-out - (www.ft.com) The lead negotiator for private holders of Greek debt has said that investors are unwilling to accept greater losses on their bonds than the 21 per cent agreed in July, jeopardising eurozone plans to finalise a second Greek bail-out by the end of next week. Charles Dallara, managing director of the Institute of International Finance, criticised European leaders on Friday for failing to allow the July deal to proceed. He said any greater losses imposed on Greek bondholders could prompt investors to sell the sovereign debt of other eurozone countries, destabilising the single currency. “We do not see that a compelling case has been made to reopen the deal,” Mr Dallara told the FT. “A deal is a deal.”
German private banks call Greece bankrupt: magazine - (www.reuters.com) Germany's private banks called for euro zone policymakers to finally accept that Greece is insolvent and also pressed for rules that would force lenders to set aside capital on their balance sheets for government bonds, a magazine reported. "Greece is not able to pay back its current debts even over the course of generations," said Andreas Schmitz, the head of German bank lobbying group BdB, in an interview with the WirtschaftsWoche. Schmitz called for a change in Basel III regulations, which spell out the amount of capital reserves that banks must set aside for so-called risk-weighted assets. Under the current Basel II rules and EU guidelines, all euro zone sovereign debt can be assigned zero risk, which has provided a strong incentive for banks to buy and hold government bonds. "The current situation shows that zero (risk weighting) accounting doesn't accurately reflect reality," Schmitz said. "Politicians are not tackling this issue, since it concerns them," he added, explaining that this exemption has helped sovereign borrowers market their debt to banks.
U.S. budget gap widens, tops $1 trillion for third year - (www.reuters.com) The U.S. budget gap widened slightly in fiscal 2011, staying above $1 trillion for a third straight year and providing fodder for a political battle over taxes and spending ahead of next year's presidential election. The Treasury Department report on Friday comes just over two months after an epic showdown over the nation's debt ceiling that pushed the United States close to a debt default and led to a downgrade of America's prized AAA credit rating. The shortfall in September, the final month of the fiscal year, widened to $64.57 billion compared to the same month a year earlier, although it came in at a few billion dollars less than economists had projected. The annual deficit was $1.299 trillion, up from 1.294 trillion in fiscal 2010.
Now If You Ditch Your State Taxes, You'll Lose Your California Driver's License - (www.businessinsider.com) California Gov. Jerry Brown is sick of celebrities flaking out on their state tax returns. Brown signed a bill on Oct. 4 requiring the motor vehicle department to suspend the driver's licenses of its worst delinquents, many of whom you already know, reports the Journal. Now they'll be publicly outed: "The California driver's license suspensions will affect the state's top 1,000 tax debtors, whose names will be published online in two lists of 500 each. One list will be drawn from the income-tax rolls, with those on the second drawn from sales and other tax rolls. The new law expands an existing program by doubling the number of names on the published lists and adding the license suspensions."
The TRUTH About How Housing Has Destroyed This Recovery - (www.businessinsider.com)
Merkel Says Won’t Accept U.S. Balking at Finance Transaction Tax - (www.bloomberg.com)
Europeans Struggle Toward Debt Solution - (www.nytimes.com)
Wall Street Protests Spread to Asia-Pacific Region - (www.bloomberg.com)
China Will Keep Yuan ‘Basically Stable,’ Premier Wen Says - (www.bloomberg.com)
G-20 Said to Press Europe to Deliver Solution to Debt Crisis Within Days - (www.bloomberg.com)
G20 to ensure banks adequately capitalized - (www.reuters.com)
G-20 finance leaders gather in Paris in crisis mode as Europe’s economy teeters - (www.washingtonpost.com)
US-UK rule out wider IMF powers - (www.ft.com)
G-20 Seeks Broader Solution for Europe Debt Crisis - (www.nytimes.com)
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