Tuesday March 29 2016 Housing and Economic stories

TOP STORIES:

SunEdison May Face $1.4 Billion Default If Earnings Delayed More - (www.bloomberg.com) The clock is ticking for SunEdison Inc. The world’s biggest clean-energy developer has already postponed the release of its 2015 annual report, twice. If SunEdison fails to file the report by March 30, it must reach accommodations with lenders on at least $1.4 billion in loans and credit facilities or face a potential technical default. SunEdison reported total debt of $11.7 billion at the end of September, more than double the amount a year earlier, as it bought up wind and solar developers and projects on six continents. That’s prompted questions about whether it borrowed too much, too fast, and has helped make it the worst-performer on the 104-member WilderHill New Energy Global Innovation Index in the past year.

Fed Chair Yellen has a mini revolt on her hands - (www.cnbc.com) Fed Chair Janet Yellen has something of a mini revolt on her hands. Four of the 17 members of the Federal Open Market Committee have now publicly indicated their disagreement with the dovish guidance in last week's policy statement and in comments from Fed Chair Janet Yellen at her press conference. The latest dissenter is Patrick Harker, the new president of the Philadelphia Fed, who said in a speech Tuesday night that the Fed should "get on with" rate hikes and consider another move in April.

The Big Unwind Hits Investment Banking - (www.wolfstreet.com)  The meme has been that central-bank-imposed low interest rates and negative interest rates are killing bank earnings, and that oil-and-gas loan loss reserves maul what’s left of these earnings. But it’s tough for banking all around, as the global QE bonanza is bumping into real-world limits. And the Big Unwind has started. For investment banking revenues, a key income source for “systemically important” banks, it has been one heck of a terrible first quarter, according to Dealogic’s preliminary Global IB Strategy Review. And the damage will show up in earnings reports soon. If, in the list of fee mayhem below, you frequently stumble across phrases like “plunged,” “plummeted,” “lowest since Q1 2009” when the bond market imploded during the Financial Crisis, or “lowest since Q1 2001” when the dotcom and IPO bubble imploded, it’s because that’s the kind of quarter it has been for investment banks and their lifeblood: extracting big-fat fees coming and going.

Thanks Obamacare: This Is What Americans Spent Most Money On In 2015 – (www.zerohedge.com) We have been covering the consumption tax, pardon, endless spending black hole that is Obamacare for over a year, so we doubt it will come as a surprise to anyone that in 2015 healthcare was the second biggest use of US consumer funds, soaking up a record $1.9 trillion in real dollars, and more importantly for US economic "growth", the single biggest source of incremental spending by nearly a factor of two. Incidentally, with spending on healthcare (courtesy of the Supreme Court's Obamacare tax) soaring, while outlays on the traditionally most consumption-intensive category, housing and utilities, going nowhere for the past several years, it is only a matter of 2-3 quarters before Healthcare surpasses Housing as the biggest use of American cash. Putting this in context, a recent report from Freedom Partners Health found that health insurance premiums have increased faster than wages and inflation in recent years, rising an average of 28 percent from 2009 to 2014 despite the enactment of Obamacare, or rather "because of." Obama signed the Affordable Care Act into law on March 23, 2010, and Wednesday is the law’s sixth anniversary.

Negative Rates Make Corporate America's Bonds Only Game in Town - (www.bloomberg.com) Mario Draghi and Haruhiko Kuroda have handed a big gift to U.S. companies like Coca-Cola Co. and General Electric Co.: piles of money from European and Japanese investors. Nearly $8 trillion of bonds globally have negative yields now, which has spurred fund managers from around the world to buy corporate debt in the U.S., where interest rates are positive. “Draghi has forced me as a European investor to look at overseas holdings that aren’t euro-denominated,” said James Tomlins, a London-based high-yield money manager at M&G Investments, which oversees about 250 billion pounds ($352 billion) of assets. “The potential for returns is much better in the U.S.”

OTHER STORIES:

Orders for U.S. Durable Goods Decline in Broad-Based Slowdown - (www.bloomberg.com)
Hedge Funds Pull Back in Silicon Valley as IPO Market Atrophies - (www.bloomberg.com)
A Rough Midterm for College Funds - (www.bloomberg.com)
Credit Suisse Loss Forecast Revives Europe Bank Credit Concerns - (www.bloomberg.com)

Dutch central bank president says ECB monetary easing at its limit - (www.reuters.com)
Another U.S. rate hike may be around corner: Fed's Bullard - (www.reuters.com)
Dollar rise hits commodities as Fed talks of tightening - (www.reuters.com)
Chancellor: Lessons from the Mississippi Bubble - (www.reuters.com)