Wednesday, June 11, 2014

Thursday June 12 Housing and Economic stories


Work in one state? Live in another? This may be big - (www.cnbc.com) The Supreme Court is taking up a dispute over how a state may tax income its residents earn in another state. The high court on Monday agreed to hear an appeal from Maryland officials who want to overturn a lower court ruling that found the state's tax law unconstitutional. Maryland law allows residents to deduct income taxes paid to other states from their Maryland state tax. But it does not apply that deduction when it comes to local "piggyback taxes" the state collects for county and city governments. Last year, the Maryland Court of Appeals said the tax violates theConstitution's Commerce Clause and discourages Maryland residents from earning money outside the state.

Obama sides with banks in Madoff dispute - (www.cnbc.com) The Obama administration is siding with big banks in a dispute over their alleged role in the Bernard Madoff Ponzi scheme. Solicitor General Donald Verrilli Jr., in a 22-page filing late Friday, urged the Supreme Court to let stand a lower court ruling that would bar Madoff Trustee Irving Picard from pursuing billions of dollars in claims against the likes ofHSBCUBS and Italy's UniCredit, which Picard alleges helped enable the scam to take place. Picard had also sued Madoff's primary banker, JPMorgan Chase, seeking some $19 billion in damages. Earlier this year, Chase agreed to pay $543 million to settle the case, but the appeals involving the remaining banks have continued. The banks have denied wrongdoing, and argue that Picard has no standing to sue them on behalf of Madoff's clients.

China Said to Push Banks to Remove IBM Servers for Security  - (www.bloomberg.com) The Chinese government is reviewing whether domestic banks’ reliance on high-end servers from International Business Machines Corp. (IBM) compromises the nation’s financial security, people familiar with the matter said, in an escalation of the dispute with the U.S. over spying claims. Government agencies, including the People’s Bank of China and the Ministry of Finance, are asking banks to remove the IBM servers and replace them with a local brand as part of a trial program, said the four people, who asked not to be identified because the review hasn’t been made public.

China clamps down on US consulting groups - (www.ft.com) China has ordered state-owned enterprises to cut ties with US consulting companies such as McKinsey and Boston Consulting Group because of fears they are spying on behalf of the US government, according to people close to senior Chinese leaders. The instruction comes days after the US Justice Department indicted five People’s Liberation Army officers on charges of cyber-espionage and stealing trade secrets from US corporations including AlcoaUS Steel and Westinghouse. Beijing’s response to the indictments was swift, with a propaganda campaign in Chinese state media describing the US as a “mincing rascal” and “high-level hooligan”. The decision to ban state enterprises from working with western consulting companies marks a further escalation in Beijing’s response.

Bad Credit No Problem as Balance-Sheet Bombs Rally 94%  - (www.bloomberg.com) In the U.S. equity market, the worse a company’s finances, the better it’s doing. Stocks with the weakest balance sheets have climbed more than 8 percent in 2014 and 94 percent since the end of 2011, generating almost twice the gain in the Standard & Poor’s 500 Index (SPX) over that period, according to data compiled by Bloomberg and Goldman Sachs Group Inc. Shares in the category this year are beating those that most investors consider the bull market’s leaders, such as small caps and biotechnology, which tumbled in March.





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