Wednesday January 16 Housing and Economic stories

TOP STORIES:

Zynga puts 'PetVille' out of its misery - (www.sfgate.com)  The loss of a pet can be traumatic, even when it's a virtual pet. Players of Zynga's "PetVille" have lamented this week's shutdown of their favorite Facebook game. The end itself wasn't news - the game was one of a dozen underperforming titles the struggling San Francisco company decided to ax as part of a strategy announced in November to cut costs and reallocate resources. But this month on Zynga's online community forums, "PetVille" players seemed to be holding out hope that the company would spare one of its oldest games and save the virtual pets they spent time and money raising. Non-players might view such games as a waste of time. But Zynga intentionally designed titles like "FarmVille" and "CityVille" as places players could enjoy daily as virtual extensions of themselves and their creativity.

Obama Issues Executive Order Granting Pay Raises to Congress, the Vice President, Judges; Any Raise is Too Much; Congress Approval Rating is 18% - (Mish at globaleconomicanalysis.blogspot.com) Congress has done such a beautiful job handling the fiscal cliff and debt ceiling that president Obama felt it mandatory to issue an Executive Order Giving Biden, Congress Pay Raises,  President Barack Obama issued an executive order to end the pay freeze on federal employees, in effect giving some federal workers a raise. One federal worker now to receive a pay increase is Vice President Joe Biden. According to disclosure forms, Biden made a cool $225,521 last year. After the pay increase, he'll now make $231,900 per year. Members of Congress, from the House and Senate, also will receive a little bump, as their annual salary will go from $174,000 to 174,900. Leadership in Congress, including the speaker of the House, will likewise get an increase.

Fiscal-cliff bill retains aid for struggling homeowners - (www.marketwatch.com) Congress’s fiscal-cliff deal extends a tax break for struggling homeowners that advocates say is key in supporting distressed communities and the housing market. The Mortgage Forgiveness Debt Relief Act of 2007, signed into law by President Bush, enables struggling homeowners to avoid paying taxes on forgiven mortgage debt from short sales or loan modifications. The tax break was scheduled to expire in the new year, but has been extended through 2013. Without the break, forgiven debt can be treated as taxable income, and already struggling homeowners would face taxes from a short sale or loan modification. For example, an underwater homeowner in the 25% tax bracket could pay $12,500 in taxes for a short sale in which his house sold for $150,000, but he previously owed $200,000. With the tax break, the homeowner would not have to pay taxes on the $50,000 of forgiven debt.

Mutual Guarantee Society: Spain Proposes State Guarantee of Bank Loans to Small and Medium Businesses - (Mish at globaleconomicanalysis.blogspot.com) Lending in Spain has all but dried up. Banks don't want to (or cannot) lend because they are capital impaired and there are too few creditworthy risks. In such an environment, lending is not wise. It will lead to more losses. But that is not how government bureaucrats think. Prime minister, Mariano Rajoy is preparing measures to 'desbancarizar' save the economy and SMEs…The Government is considering the creation of new instruments for SMEs operate with the State guarantee, which is considered key to boost economic activity. At the same time, they want to boost mutual guarantee societies, an instrument in the hands of the regions that did not just start with all its potential. In parallel, the Ministry of Economy is betting big on the credits of the ICO for SMEs, about 22,000 million euros in 2013 for self-employed and SMEs.

Former Icelandic bank executives jailed for fraud – (www.indepdendent.ie) A Reykjavik court sentenced Glitnir's former chief executive, Larus Welding, and former head of corporate finance, Gudmundur Hjaltason, each to nine months in jail, of which six months were suspended for two years. They had denied the charges. Prosecutors said the two approved a loan to a company which owned shares in Glitnir so that the company could in turn repay a debt to Morgan Stanley. The decision, taken outside the regular decision-making process, meant Glitnir was too exposed to the company and cost the bank at least 53.7 million euros ($71 million), the prosecution said.

OTHER STORIES:

Foreclosure Review Scrapped On Eve Of Critical Watchdog Report, Congressman Says - (www.huffingtonpost.com)

Big Hedge Fund Whacked - Bruce Krasting – (www.zerohedge.com)

Sarasota author suing biggest U.S. bank over foreclosure - (www.heraldtribune.com)

Michigan Homeowners Face Stealth Tax Increase Thanks To A DINO And The GOP - (www.mfi-miami.com)

Euro Zone Factory Downturn Deepens in December - (www.cnbc.com)

Bearish Hedge Funds Outfoxed by Euro Zone in 2012 - (www.cnbc.com)

Top Goldman Sachs Execs Get Shares on New Year's Eve - (www.cnbc.com)

Latvia Accepts Austerity, and Its Pain Eases - (www.cnbc.com)  

Armed Robbers Hit Paris Apple Store - (www.cnbc.com)