Tuesday, April 29, 2014

Wednesday April 30 Housing and Economic stories


The looming bankruptcy that could paralyze transit - (www.cnbc.com) A real budget crisis is festering that could make the fiscal cliff seem like a molehill. It will paralyze the nation's bridge, highway and mass transit construction this summer and potentially set back many state economies. Yet, it has received scant attention from Congress, at least until now. The federal highway trust fund that finances more than $50 billion annually in highway and bridge construction is running out of cash and will be bankrupt by late July or early August, at the height of the construction season, according to Department of Transportation (DOT) projections. Coming off one of the worst winters in memory, some state and local governments have already begun pulling back on plans for filling potholes and paving highways. Things could get much worse if Congress and the Obama administration allow a four-year transportation funding authorization law to expire this fall without a replacement.

Coldwater Creek Files Bankruptcy After Apparel Sales Fall - (www.bloomberg.com) Coldwater Creek Inc. (CWTR), a women’s clothing retailer that hasn’t posted an annual profit since 2007, filed for bankruptcy protection with a plan to start going-out-of-business sales in time for Mother’s Day. Coldwater, founded as a catalog business 30 years ago, said it intends to start liquidating inventory just before the May 11 holiday, a peak sales period for the retailer. The company listed assets of $278.5 million and debt of $361.3 million in Chapter 11 papers filed today in U.S. Bankruptcy Court in Wilmington, Delaware. The chain said revenue peaked at $1.1 billion in 2006. It expanded from 198 stores in 2005 to 336 locations in 2007 before the global economic downturn stunted its financial success and triggered a series of management changes, according to court filings. Sales at stores open at least a year plunged 17 percent in the quarter ended Nov. 2. The company joins women’s clothing chains Dots LLC and Ashley Stewart Holdings Inc. in bankruptcy. Dots, with 400 stores, shut down after filing in January. Ashley Stewart, with 168 stores in 24 states, sought Chapter 11 protection on March 10. A drop in mall traffic also has helped to drive pizza seller Sbarro LLC, toasted-sandwich chain Quiznos and the owner of Hot Dog on a Stick to seek court protection since February

7 doctors got more than $10M from Medicare in 2012 - (www.usatoday.com) hey are the $10 million men of Medicare. In 2012, seven physicians in the country received more than $10 million in reimbursements for services billed to Medicare, according to newly released federal data. They range from ophthalmologists who submitted claims for specialized, high-cost drug treatments to pathologists who billed the program for thousands of clinical tests performed by their labs. Some built large, successful practices; others face investigations for fraudulent billing. The doctor with the highest reimbursement total is enmeshed in a criminal inquiry involving a U.S. senator. It's the first time since the 1970s that Medicare, the public insurance program for seniors, has provided claims and payment figures for individual providers. Among the 880,644 health care practitioners who billed Medicare for services in 2012, the average reimbursement for the year was $87,883. Yet more than 2,000 of those providers broke $2 million in Medicare receipts.

US 'hostile' environment for business: Langone - (www.cnbc.com) Excessive regulation has created a "hostile" environment for business owners in the United States, curbing liquidity and putting a drag on the economy, billionaire investment banker and business magnate Ken Langone said Friday on CNBC. "We are in a period of intense and unreasonable regulation and we're seeing the fruits of that environment," said Langone, co-founder of Home Depot, on "Squawk on the Street." "We have to accept the fact that what's going on today doesn't come without cost and the cost is economic growth." To Langone, heavy regulation has spooked business owners from investing in their companies. So instead of spending excess cash or taking out a loan to hire more employees or update equipment, Langone said many CEOs are choosing to return that capital to shareholders by way of a stock re-purchase or dividend increase.

Detroit settlement approved—at what cost? - (www.cnbc.com) Detroit, like many other cities, was sold the swaps as a way to guard against rising interest rates. At the time, in 2005 and 2006, a fixed rate of 6 percent seemed like a good bet. The deals also allowed the city to skirt state borrowing caps and shore up its pension funds. Then, interest rates plunged and the city was stuck paying the higher rate. In 2009, already teetering on the brink of default, the city pledged revenue from its casinos as collateral. Without those funds for city services, Detroit hurtled toward the largest municipal bankruptcy in U.S. history last year. In rejecting the previous settlements, Rhodes suggested the city could have sued the banks to declare the swaps illegal. That gave Detroit Emergency Manager Kevyn Orr the leverage to push the banks for a better deal. The city will pay the banks in monthly installments. In return, the banks will eventually give up their claims to the casino revenue.





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