Friday October 28 20916 Housing and Economic stories

TOP STORIES:

Venezuela Escapes Bankruptcy for Now… But Oil Production Continues To Plunge - (www.wolfstreet.com) Venezuela just dodged a bullet, pulling off a last minute bond swap with creditors. The deal only buys Venezuela a little bit of breathing room, and a default at some point next year or the year after is not out of the question. Either way, the South American OPEC nation’s oil production is falling and will only continue on a downward trajectory. Venezuela’s state-owned PDVSA avoided default at the eleventh hour, getting enough creditors onboard for a debt swap. The oil company had repeatedly offered creditors to exchange debt set to mature this year and in 2017 for payments spread out over the rest of the decade, a proposal that would allow the company – and the sovereign government – to technically avoid default.

Most Crowded Trade in Bonds Is a Powder Keg Ready to Blow - (www.bloomberg.com) The hottest craze in fixed income is at risk of overheating. A headlong rush into higher-yielding, long-term bonds in recent years has created one of the most crowded trades in financial markets. Investors seeking relief from central banks’ zero-interest-rate policies have poured into government debt due in a decade or more, swelling the amount worldwide by a record $733 billion this year. It’s more than doubled since 2009 to about $6 trillion, data compiled by Bloomberg and Bank of America Corp. show. Now money managers overseeing more than $1 trillion say the case for owning longer maturities -- stellar performers for most of 2016 -- is crumbling. 

US govt says benchmark 2017 Healthcare.gov premiums up 25 pct - (www.reuters.com) The average premium for benchmark 2017 Obamacare insurance plans sold on Healthcare.gov rose 25 percent compared with 2016, the U.S. government said on Monday, the biggest increase since the insurance first went on sale in 2013 for the following year. The average monthly premium for the benchmark plan is rising to $302 from $242 in 2016, the Department of Health and Human Services said. The agency attributed the large increase to insurers adjusting their premiums to reflect two years of cost data that became available. Large national insurers, including Aetna Inc, UnitedHealth Group Inc and Anthem Inc, have said they are losing money on the exchanges, created under President Barack Obama's national healthcare reform law, because patient costs are higher than anticipated. Both UnitedHealth and Aetna have pulled out of the exchanges for 2017.

More Bad News For Phiadelphia: Obamacare Premiums Set To Soar More Than 50% - (www.zerohedge.com) When the Affordable Care Act open enrollment period begins next week customers will see some changes, including fewer choices and higher prices. In Pennsylvania, the number of insurers in the marketplace has gone from 13 to eight. But the worst fate is set to befall the city that famously booed Santa Claus, Philadelphia, where CBS reports that just two insurers are left and premiums are expected to rise 53%.

China orders regulators to curb property lending - (www.ft.com) China is introducing a slew of new restrictions on property-related lending, as the central government takes the lead in efforts to head off a housing bubble. Property developers are facing curbs on their ability to raise financing by issuing debt or equity, after two government regulators were instructed to step in, it has emerged. The China Securities Regulatory Commission and the National Development and Reform Commission — China’s economic planner — have been instructed by high-level officials to restrict developers’ issuances in the Hong Kong stock market, in the Hong Kong bond market and in the Chinese interbank bond market, according to local news magazine Caixin. The news comes less than a week after the Shanghai Stock Exchange froze all bond issuances by property developers. Securities dealers told local media last Wednesday that they have been told to await tighter rules on which companies can issue debt. The exchange is drawing up the new rules under the supervision of the national securities regulator.

OTHER STORIES:

Asia shares track Wall St. higher, U.S. dollar firm - (www.reuters.com)
Stocks Advance Amid Takeover Deals, Earnings; Treasuries Decline - (www.bloomberg.com)
US govt says benchmark 2017 Healthcare.gov premiums up 25 pct - (www.reuters.com)
Fed’s Task Next Week: Signal December Rate Rise - (www.wsj.com)

As Europe and Asia Hoard Cash, Economists See Echoes of Crisis - (www.nytimes.com)
China’s Aggressive New Deal Makers: $199 Billion This Year and Counting - (www.wsj.com)

Euro Gripes Threaten Economic Recovery as Populism Advances - (www.bloomberg.com)