KeNo's Housing and Economic Portal: Friday May 15 Housing and Economic stories

TOP STORIES:

Global Bond Selloff Adds to Pressure on Gilts as Election Looms - (www.bloomberg.com) Puerto Rico is trying to revive a law allowing its public agencies and utilities to restructure their mounting debt as Detroit and other U.S. cities have done. Creditors won the first fight in the case by persuading a federal judge in San Juan to throw out bankruptcy protections similar to those allotted municipal entities in the 50 U.S. states. Puerto Rico on Wednesday is asking the U.S. Court of Appeals in Boston to reverse that ruling as the commonwealth struggles with $73 billion in debt. By blocking enforcement of the restructuring law, the lower court relegated Puerto Rico “to an anomalous legislative no man’s land,” lawyers for Governor Alejandro Garcia Padilla and Secretary of Justice Cesar R. Miranda Rodriguez said in a court filing. “If Congress had intended to leave utilities, and the people they serve, at the mercy of their creditors, it surely could and would have so indicated.”

Greece Attacks Creditors as ECB Considers Next Step - (www.bloomberg.com) European Central Bank officials will debate tighter rules for the liquidity that Greek lenders rely on for survival, two people familiar with the matter said, a move that underscores the fragility of the country’s financial system. The Governing Council will discuss Wednesday whether to raise discounts on the collateral Greek banks pledge in exchange for emergency funding, said the people, who are familiar with the agenda and asked not to be identified. Governors will also review how much more Emergency Liquidity Assistance to offer Greek banks. With access to capital markets shut and deposits flowing out of their vaults, Greek banks depend on ELA to stay afloat. While economists say the ECB is unlikely to demand higher haircuts without a green light from Europe’s politicians, the debate shows how concerned some central bankers are about Greece’s solvency 100 days after Prime Minister Alexis Tsipras came to power.

Bernanke Inc.: Lucrative Life of a Former Fed Chairman - (www.bloomberg.com) Between Boyz II Men at The Mirage and Celine Dion at Caesars Palace, a hot new act is playing Vegas: Ben Bernanke. One day only, live from Sin City -- the economist formerly known as chairman of the Federal Reserve. Fifteen months after leaving the Fed and its trappings of mystery and power, Bernanke, 61, is settling into the peripatetic and highly lucrative life of a Washington former. Beyond the dancing fountains of the Bellagio, in the gilded splendor of the Grand Ballroom, Bernanke will play to a full house at the SkyBridge Alternatives Conference on Wednesday: 1,800 hedge fund types who used to hang on his every word. Bernanke is, in a sense, one of them now -- a well-paid investment consultant who can fete clients, open doors and add a gloss of Fed luster to conferences and meetings.

Obama's Real Motive Behind The Iran Deal: A Backdoor Channel To Sell Weapons To Saudi Arabia - (www.zerohedge.com) For a long time there was confusion about the "quo" to the Saudi Arabian "quid" over its agreement to side with the US on the Iranian "nuclear deal" (which incidentally looks like it will never happen simply due to the Russian and Chinese UN vetoes). Then over the weekend we finally got the answer thanks to the the WSJ, which reported that "Gulf States want U.S. assurances and weapons in exchange for supporting Iran nuclear deal." The details are quite familiar to anyone who has seen the US Military-Industrial Complex in action: the US pretends to wage an aggressive diplomatic campaign of peace while behind the scenes it is just as actively selling weapons of war. Leading Persian Gulf states want major new weapons systems and security guarantees from the White House in exchange for backing a nuclear agreement with Iran, according to U.S. and Arab officials. The leaders of the six-nation Gulf Cooperation Council, including Saudi Arabia, the United Arab Emirates and Qatar, plan to use a high-stakes meeting with President Barack Obama next week to request additional fighter jets, missile batteries and surveillance equipment.

NOVOGRATZ: 'We've already seen the beginning of the quake that could be coming' - (www.zerohedge.com) On Wall Street, you want to stop dancing before the music stops. You want to get off the train before it gets to the station. You want to get out of bad assets — mortgage bonds, tech stocks, whatever the bubble is — before they collapse. You want a warning signal. At SALT Las Vegas, the biggest hedge fund conference of the year, we're hearing delegate after delegate talk about the bubble bursting. "I'm going to argue that I think something has fundamentally changed," said Michael Novogratz, the CEO of Fortress Investments, an investment firm with $67.5 billion assets under management at the end of last year. This is the kind of thing that people have waiting to hear — at cocktail parties, at private lunches. They want the signal for when the music could stop.

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