Tuesday November 29 2016 Housing and Economic stories

TOP STORIES:

Oil Industry Anticipates Day of Reckoning - (www.wsj.com) This month, European oil company MOL Group delivered a stark message to investors: Demand for fuel in its key markets is bound to fall. So-called peak oil demand is a mind-bending scenario that global producers such as Royal Dutch Shell PLC and state-owned Saudi Aramco are beginning to quietly anticipate. But MOL has a transformation plan that is among the most explicit responses to the trend, indicating how the landscape may change for big energy providers over the next decade. The Hungarian company is rethinking its traditional focus on fuel supply and shifting investment to petrochemicals, the key ingredient of everyday plastic products and a sector where MOL believes growth will continue even when its fuel business falters.

Shipbuilding in Japan, Korea, China Collapses in Death Spiral of Orders - (www.wolfstreet.com) New orders received by Chinese shipyards – now infamous for undercutting competitors and sinking into bankruptcy – have plunged 58.5% so far this year through October, compared to last year, according to shipping industry data provider BIMCO, cited by the Nikkei. At South Korean shipyards, which include the three largest in the world, orders have plunged 84.2%; at Japanese shipyards, 90%. They all focused on large dry-bulk vessels, tankers, and containerships. But this year, orders for tankers globally plunged 80% and for container ships 84%. Global trade, which collapsed during the Financial Crisis but then recovered in a V-shaped manner, was expected to continue soaring. 

Indian lenders forced to deposit cash deluge at central bank - (www.ft.com) Indian banks will have to deposit as cash all the extra money they have been given as a result of demonetisation with the Reserve Bank of India, the central bank announced this weekend.  The RBI made its sudden move after the country’s banks, flush with cash, went on a bond-buying spree, bringing down interest rates and triggering fears of both inflation and even a shortage of bonds. The central bank said on Saturday evening it was putting in place the temporary restrictions on bond buying to tackle “large excess liquidity in the system”. Since Narendra Modi, India’s prime minister, announced the withdrawal of 86 per cent of the country’s banknotes on November 8, Indians have rushed to their banks to deposit the old notes. In that time, around 6tn rupees have been put into the banks. 

Fears mount of multiple bank failures if Renzi loses referendum - (www.ft.com) Up to eight lenders risk being wound up if No vote triggers prolonged market mayhem. Up to eight of Italy’s troubled banks risk failing if prime minister Matteo Renzi loses a constitutional referendum next weekend and ensuing market turbulence deters investors from recapitalising them, officials and senior bankers say. Mr Renzi, who says he will quit if he loses the referendum, had championed a market solution to solve the problems of Italy’s €4tn banking system and avoid a vote-losing “resolution” of Italian banks under new EU rules. Resolution, a new regulatory mechanism, restructures and, if necessary, winds up a bank by imposing losses on both equity and debt investors, particularly controversial in Italy, where millions of individual investors have bought bank bonds.

U.S. shoppers spend less over holiday weekend amid discounting - (www.reuters.com) Early holiday promotions and a belief that deals will always be available took a toll on consumer spending over the Thanksgiving weekend as shoppers spent an average of 3.5 percent less than a year ago, the National Retail Federation said on Sunday. The NRF said its survey of 4,330 consumers, conducted on Friday and Saturday by research firm Prosper Insights & Analytics, showed that shoppers spent $289.19 over the four-day weekend through Sunday compared to $299.60 over the same period a year earlier. The survey found that 154 million people made purchases over the four days, up from 151 million a year ago. However, there was a 4.2 percent rise in consumers who shopped online and a 3.7 percent drop in shoppers who purchased in a store.

OTHER STORIES:

India central bank takes surprise action to soak up liquidity  - (www.reuters.com)
Germany Prepares for Trade Conflict with Trump - (www.spiegel.de)
South Korea Protesters Hold Mass Rally Demanding Ouster of Park - (www.bloomberg.com)

Castro's Death a Reminder in China of Changed Communist Axis - (www.bloomberg.com)

China’s Ball of Money Is Rolling Back to Commodities - (www.bloomberg.com)
China Has Quietly Hiked Borrowing Costs Through PBOC Operations - (www.bloomberg.com)