KeNo's Housing and Economic Portal: Monday October 17 20916 Housing and Economic stories

Sunday, October 16, 2016

Monday October 17 20916 Housing and Economic stories

A $7 Trillion Moment of Truth in Markets is Just Three Days Away - (www.bloomberg.com) Not since the financial crisis of 2008 has Libor, to which almost $7 trillion of debt including mortgages, student loans and corporate borrowings, is pegged — experienced such a surge. The three-month U.S. dollar Libor rate has jumped from 0.61 percent at the start of the year to 0.87 percent currently — a 42 percent rise — ahead of money market reform that's due to come into effect on Oct. 14. The new rules require prime money market funds — an important source of short-term funding for banks and companies — to build up liquidity buffers, install redemption gates, and use 'floating' net asset values instead of a fixed $1-per-share price. While the changes are aimed at reinforcing a $2.7 trillion industry that exacerbated the financial crisis, they are also causing turmoil in money markets as big banks adjust to the new reality of a shrinking pool of available funding.

U.S. must stop judicial 'extortion' of corporate Europe, French lawmakers say - (www.reuters.com) Europe should challenge the United States over its increasingly aggressive use of extraterritorial laws that have cost European companies - especially banks - billions in fines and other settlements, a French parliamentary report said. Still reeling from the $9 billion fine its biggest bank, BNP Paribas, had to pay U.S. authorities over violations of American sanctions against other countries, the French government has criticized in recent years what it considers the over-reach of the U.S. legal system. Paris's main objections center on the U.S. Department of Justice's broad interpretation of what it considers its jurisdiction. This sphere of influence can include transactions between non-Americans outside the U.S. where the U.S. dollar currency is involved. It can also cover deals and other actions taking place via the Internet using U.S. computer servers.

Texans Are Cutting Back, Wheels Come off Houston Economy - (www.wolfstreet.com) But people in Dallas, Austin, and some other places are looking at this incredulously. The economy is hopping. So retail sales may not be all that strong either, but the exuberance for the booming housing market hasn’t cooled off. Home prices are still soaring. Job markets in those cities are still growing with only a few dark clouds in sight. But then there’s the Houston metro, with a population of about 6.6 million, just slightly less huge than the Dallas metro. And there, the wheels are coming off the economy (below data via Houston.org, and the Bureau of Labor Statistics).

Deutsche Bank Stock Slides As Short-Term Funding Cost Rises - (www.zerohedge.com) As the powers-that-be play whack-a-mole with various systemic risk indicators, desperately tamping down contagion concerns, amid no progress in strengthening the world's most systemically dangerous bank; we warned two weeks ago of yet another canary in the coalmine of Deutsche Bank's demise (that no one was looking at). This week, that canary... died. But, despite all of this 'help' Deutsche credit risk remains at or near record highs...

Many car brands emit more pollution than Volkswagen, report finds - (www.theguardian.com) Diesel cars by Fiat, Suzuki and Renault among makers emitting up to fifteen times European standard for nitrogen oxide. The car industry has faced fierce scrutiny since the US government ordered Volkswagen to recall almost 500,000 cars in 2015 after discovering it had installed illegal software on its diesel vehicles to cheat emissions tests. But a new in-depth study by campaign group Transport & Environment (T&E) found not one brand complies with the latest “Euro 6” air pollution limits when driven on the road and that Volkswagen is far from being the worst offender. “We’ve had this focus on Volkswagen as a ‘dirty carmaker’ but when you look at the emissions of other manufacturers you find there are no really clean carmakers,” says Greg Archer, clean vehicles director at T&E. “Volkswagen is not the carmaker producing the diesel cars with highest nitrogen oxides emissions and the failure to investigate other companies brings disgrace on the European regulatory system.”

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