KeNo's Housing and Economic Portal: Monday October 6 Housing and Economic stories

TOP STORIES:

FDA tweaks food and safety rules due next year - (www.cnbc.com) The government is rewriting sweeping new food safety rules after farmers complained that they could hurt business. The Food and Drug Administration is proposing the revised rules Friday. The FDA is tweaking earlier proposals that included water and soil quality standards that farms big and small say are too burdensome. Final rules are due next fall. FDA Deputy Commissioner Michael Taylor says the agency is trying to "achieve the goal of food safety in a practical way." Congress passed the food safety law in 2010. The rules come after major foodborne outbreaks in spinach, peanuts, eggs and cantaloupe. There are an estimated 3,000 deaths a year from foodborne illnesses.

Venezuela Default Naysayers Undermined by S&P Downgrade - (www.bloomberg.com) Standard & Poor’s is undoing the efforts of banks from Goldman Sachs Group Inc. to BNP Paribas SA to quell concern that Venezuela will default. The South American nation’s $4 billion of notes due 2027 have plunged almost 8 cents on the dollar to a seven-month low of 65.3 cents in the two days since S&P cut Venezuela to CCC+, a grade the bond rater says reflects at least a 50 percent chance of non-payment in the next two years. This quarter, Venezuela’s bonds have been the worst-performing sovereign securities among developing nations, losing 11.7 percent through yesterday. After Harvard University economist Ricardo Hausmann questioned Venezuela’s decision to pay bondholders in the face of shortages of everything from basic medicine to toilet paper, Goldman Sachs’s Mauro Roca said Sept. 9 the nation has the money to pay its debt and that defaulting would make matters worse. The downgrade adds concern Venezuela will struggle to meet debt payments as foreign reserves tumble, oil exports fall and the economy heads for its biggest contraction since 2009.

Alibaba Open Indication Puts Its Market Cap Greater Than Facebook, Verizon, JPMorgan, Just Under Wal-Mart - (www.zerohedge.com) Moments ago, the NYSE revealed that the latest indication for the Alibaba open, due sometime in the next hour, is in the $82-$85, $84-87, $86-88, $87-89, $88-90, 90-91, 91-92, 92-93 range. So assuming a mid-range price (which will surely be overtaken now that the market is in full on dot com bubble euphoria mode as even the Fed's Fisher admitted moments ago) , this means that Alibaba's market cap will be $227 billion, putting it among the 15 highest valued companies trading on US markets, above both Facebook and Verizon, and... JPMorgan. And as we await the final price, Alibaba has surpassed the market cap of JPMorgan and, should it continue, it may even eclipse Walmart's $245 billion.

Biggest Bond Glut of ’14 Imperils Record Debt Rally: Muni Credit - (www.bloomberg.com) It takes a nationwide effort to halt the $3.7 trillion municipal-bond market’s record winning streak. Benchmark yields are rising from a 15-month low as issuers from California to New York schedule about $12 billion of debt offerings in the next 30 days, amid the biggest wave since December, according to data compiled by Bloomberg. Munis have lost 0.3 percent this month, part of a sell-off across fixed-income assets, Bank of America Merrill Lynch data show. A decline would end an unprecedented streak in which the market gained the first eight months of 2014. The supply slam is interrupting a sales slowdown that has the market on pace to shrink for a fourth straight year, and may cheapen local-government securities relative to Treasuries. “The supply, with the other rate pressures, it’s going to have an effect,” said Adam Buchanan, vice president of sales and trading at Ziegler, a broker-dealer in Chicago. “People on the buy-side are going to try to take advantage of the other factors to try to get some better rates.”

Caterpillar Posts Record 21 Consecutive Months Of Declining Global Retail Sales, Worse Than Financial Crisis - (www.zerohedge.com) Once upon a time, when such things as industrial production, machinery sales and construction, trade and commercial interactions mattered, today's Caterpillar retail sales, which painted a gruesome picture for global manufacturing and industrial production, may have gotten more than a casual comment on page... well, nowhere really. However, since everyone is hypnotized by a "recovery" on the back of "smart-beta" aka $10 trillion in liquidity injections by central banks, and a global "service" economy in which all that matters is shuffling every greater numbers of pieces of paper from point A to point B and collecting commissions while clicking on Facebook ads, it obviously doesn't matter to anyone that according to CAT the mini industrial recovery in the US has plateaued and after retail sales rose 14% Y/Y two months ago, dropped to 11% in July and to 8% most recently (blue bar on chart below), and coupled with a double digit collapse in Asia, EAME and Latin America sales (by -24%, -17% and -29% respectively), the industrial bellwether has now seen a mind-blowing 21 consecutive months of declining Y/Y global retail sales.

OTHER STORIES:

Precious Metals Liquidated To Make Room For Alibaba, Silver At Four-Year Lows - (www.zerohedge.com)

'Bubble in everything, everywhere': Marc Faber - (www.cnbc.com)

Three quarters of Japanese firms prefer a stronger yen: Reuters poll - (www.reuters.com)

Scottish nationalist leader quits after losing vote - (www.cnbc.com)

Lead indicators rise in August, but not by much - (www.cnbc.com)