Friday September 16 20916 Housing and Economic stories

TOP STORIES:

Tsipras Repeats Call for Greek Debt Relief, Seeks Bonds in QE - (www.bloomberg.com) Prime Minister Alexis Tsipras said Greece will only be able to lure investors once a quarrel between creditors over how to lower the country’s debt burden is resolved, which he said should lead the European Central Bank to include Greek government bonds in its asset purchase program. “What is currently causing a delay in regaining the trust of markets and investors isn’t debt decisions in themselves, as what the Eurogroup decided was in the right direction, but the constant quarrel and clash between the International Monetary Fund and European institutions,” Tsipras said Sunday at the Thessaloniki International Fair. Greeks “deserve a fair debt arrangement, and this fair arrangement can’t be conditioned on elections taking place in other European countries,” he said, referring to polls set for next year in Germany.

Supervisor Of "Massive Fraud" At Wells Fargo Leaves Bank With $125 Million Bonus – (www.zerohedge.com) There was a burst of righteous populist anger anger last week, when it emerged that Wells Fargo had engaged in pervasive, "massive" fraud since at least 2011, including opening credit cards secretly without a customer’s consent, creating fake email accounts to sign up customers for online banking services, and forcing customers to accumulate late fees on accounts they never even knew they had. For this criminal conduct, Wells was fined $185 million (including a $100 million penalty from the CFPB, the largest penalty the agency has ever issued). In all, Wells opened 1.5 million bank accounts and "applied" for 565,000 credit cards that were not authorized by their customers. As "punishment" Wells Fargo told CNN that it had fired 5,300 employees related to the shady behavior over the last few years. The firings represent about 1% of its workforce and took place over several years.  The fired workers went to far as to create phony PIN numbers and fake email addresses to enroll customers in online banking services, the CFPB said. What was hushed away is that not a single employee will go to prison, and that ultimately it will be Wells Fargo's shareholders - such as Warren Buffett - who will end up footing the bill.

Woes at Italy's Biggest Bank Reverberate in Europe – (www.wsj.com) UniCredit, Italy's largest lender by assets, emerged as one of the weakest big banks in Europe in July's stress tests, showcasing the failure of its attempts to respond to rock-bottom interest rates and a huge pile of bad loans. Now, as Jean-Pierre Mustier, the bank's new chief executive, readies a big-bang plan to revive UniCredit's fortunes, he faces a series of unpalatable choices: Aggressive action to cut the bank's €80 billion ($89.9 billion) in bad loans--the largest of any European bank--would force the Milanese bank to raise billions in fresh capital, while an asset sale could help bolster its capital position but would hurt already thin profit. Meanwhile, the travails of Italy's No. 3 lender, Banca Monte dei Paschi di Siena SpA, promise to only complicate Mr. Mustier's job. On Thursday, Monte dei Paschi said its CEO, Fabrizio Viola, had agreed with the bank's board to resign, in a surprise move that came as that bank works on a plan to shed €28 billion in bad loans. Troubles at UniCredit, which has a vast business in Germany and Eastern Europe, could threaten not only Italy's ailing economy but also the continent's already fragile financial stability.

Unprecedented Treasury Sales Drive Yields to Highest Since June - (www.bloomberg.com) The bond market is signaling growing skepticism over the prospect of a Federal Reserve interest-rate increase before next week’s policy meeting. Traders reduced bets on a September hike after Fed Governor Lael Brainard, the final scheduled speaker before the Sept. 20-21 gathering, said prudence is warranted as boosting borrowing costs poses risks. The remarks surprised investors who’d been bracing for a sign that the central bank was set to raise rates. The market-implied chance of a September hike fell to 22 percent, based on the assumption that the effective fed funds rate will trade at the middle of the new target range. It was 28 percent before her remarks.

Emerging Market Selloff Deepens on Rate Concern as Peso Slides - (www.bloomberg.com) Emerging-market stocks and currencies tumbled in the biggest two-day drop since June as traders weighed the potential time-line for U.S. interest rate increases before the Federal Reserve’s policy meeting next week. The MSCI Emerging Markets Index slid from the highest level in more than a year, led by declines in technology stocks. Hong Kong’s Hang Seng China Enterprises Index slumped the most in seven months. South Korea’s won led currencies lower amid concern North Korea is planning an additional nuclear test after the latest detonation drew condemnation from governments including the U.S. and Japan.

OTHER STORIES:

Asian Stock Futures Tip More Pain as Policy Angst Ignites Swings - (www.bloomberg.com)
Oil Extends Decline Second Day as U.S. Drillers Add Crude Rigs - (www.bloomberg.com)
Japan's Central Bank May Be Giving Up on Surprising Markets - (www.bloomberg.com)
Oil Bears Dominate Market as Skepticism Grows Over Output Limits - (www.bloomberg.com)

Bridgewater Attracts $22.5 Billion, Financial Times Says - (www.bloomberg.com)
All Eyes on Last Fed Speech Before a Week of Silence - (www.wsj.com)
Federal Reserve risks markets shock with September move - (www.ft.com)
Markets Spotlight: why central bank power is waning - (www.ft.com)
Catalans rally in support of independence from Spain - (www.reuters.com)