Tuesday December 6 2016 Housing and Economic stories

TOP STORIES:

Some 6 million Americans are delinquent with auto loans and it's going to get worse – (www.marketwatch.com) The number of subprime auto loans sinking into delinquency hit their highest level since 2010 in the third quarter, with roughly 6 million individuals at least 90 days late on their car-loan payments. It's behavior much like that seen in the months heading into the 2007-2009 recession, according to data from Federal Reserve Bank of New York researchers. ... Credit officials have stressed that the contagion risk to the financial system from poor auto loans isn't like the risk posed when subprime mortgage lending pushed the U.S. into the Great Recession. That's in large part because repossessed cars are easier to resell than bank-owned homes. Cars can't sink whole neighborhoods with foreclosure blight.

Crunch Time for “Zombie Bank… on Brink of Collapse” - (www.wolfstreet.com) Things have gotten so serious at Spain’s sixth biggest bank, Banco Popular, that The Wall Street Journal just christened it “Spain’s most Italian bank.” It wasn’t meant as a compliment. These days the bank’s second biggest block of shareholders are short-sellers. They include some of the biggest hedge funds on the planet, from UK-based Oxford Asset Management, which holds a short position of 0.53% of the banks’ total shares, and Marshall Wace (2.23%) to Connecticut-based behemoth AQR Capital Management (2.92%). As of Nov 25, short-sellers held 8.6% of the bank’s capital. It was enough to attract the unwelcome attention of Spain’s market regulator, CNMV, which has so far refused to ban shorting of the stock but has launched an investigation into whether a group of insiders led by Mexican billionaire Antonio Del Valle is using underhand tactics to cheapen the stock in preparation for a takeover bid.

Indiana Gives $7 Million in Tax Breaks to Keep Carrier Jobs - (www.wsj.com) Indiana officials agreed to give United Technologies Corp. $7 million worth of tax breaks over 10 years to encourage the company’s Carrier Corp. unit to keep about 1,000 jobs in the state, according to people familiar with the matter, a deal struck after intense criticism of Carrier by President-elect Donald Trump on the campaign trail. The heating and air conditioning company will invest about $16 million to keep its operations in the state, including a furnace plant in Indianapolis that it had previously planned to close and shift the work to Mexico, the people said. Mr. Trump and Vice President-elect Mike Pence were expected to speak about the deal in Indiana on Thursday.

U.S. municipal bond yields up sharply - (www.reuters.com)  Benchmark U.S. municipal bond prices fell on Wednesday, lifting yields as much as 10 basis points, following an announcement by OPEC to limit crude production. Yields on AAA-rated muni bonds in the 2036-2046 maturity rose 8-10 basis points, according to a preliminary scale read from Municipal Market Data (MMD), a unit of Thomson Reuters. OPEC agreed on Wednesday to the first oil output cuts since 2008 after Saudi Arabia accepted "a big hit" on its production and dropped its demand on arch-rival Iran to slash output, sending oil prices soaring more than 10 percent. Greg Saulnier, muni research analyst at MMD, said the oil deal triggered a Treasuries selloff, which weakened municipals.

Italy’s populist party wants to renegotiate euro membership - (www.cnbc.com) As political uncertainty looms in Italy, the populist Five Star Movement said it would renegotiate the country's membership of the euro if it came into power. Luigi Di Maio, a member of the Five Star Movement, wants to "re-discuss the EU and euro parameters" to address poverty and investment issues in Italy. If such negotiations failed, Italy would have a referendum on a new kind of relationship with the euro area. "If (the EU) won't listen to us, we will propose a referendum on the euro to ask the Italian citizens what they want to do," Maio told CNBC on Thursday.

OTHER STORIES:

Asian Shares Set for Gains Amid Oil Deal as Bond Selloff Deepens - (www.bloomberg.com)
Oil jumps over 8 percent as OPEC finalizes output cut deal - (www.reuters.com)  
Treasuries -Yields rise as oil deal boosts inflation expectations  - (www.reuters.com)  
OPEC in first joint oil cut with Russia since 2001, Saudis take "big hit" - (www.reuters.com)  

Korea Household Debt Evokes 1997 Crisis, Says Ex-BOK Member - (www.bloomberg.com)
Trump Treasury pick vows to curtail Wall Street regulations - (www.washingtonpost.com)
Steven Mnuchin Is More Pragmatist Than Ideologue - (www.nytimes.com)