KeNo's Housing and Economic Portal: Wednesday February 1 2017 Housing and Economic stories

Tuesday, January 31, 2017

Wednesday February 1 2017 Housing and Economic stories

Condo Speculation Collapses in Miami-Dade’s Condo Glut - (www.wolfstreet.com) The lure: Buy a preconstruction condo from a developer in the early stages of development. The initial deposit is small, and in a booming market, the payoff big. Additional payments need to be made as the building progresses, but lenders are eager to lend as condo prices soar. Everyone is in nirvana. This bet has been hot in the condo construction boom around the country. But in Miami, the bet is now collapsing. And preconstruction condo flippers, the lucky ones that could sell their units at all, are bathing in a sea of red ink. First things first: The overall condo market in Miami-Dade has gotten tough, with the inventory of condos for sale ballooning and with sales plunging.

Martin Armstrong Warns EU Just Declared US Is The New Enemy – (www.zerohedge.com) The European Union’s chief BREXIT negotiator, Guy Verhofstadt, told Reuters that Donald Trump is part of a three-pronged attempt to undermine the European Union. The other two threats were from radicalized Islam and from Russian President Vladimir Putin, who Verhofstadt said was also working against the progress of the EU project. "We have a third front, for the moment, undermining the European Union, and it is Donald Trump," Verhofstadt said in a speech at the Chatham House think-tank.

"Trump spoke very favorably of the fact that also other countries will want to break away from the European Union, and that he hoped for a disintegration of the European Union." Verhofstadt served for nine years as prime minister of Belgium, and has served in the European Parliament since 2009. He said that the European Union had severe problems, saying it was in a "poly-crisis", but nevertheless argued that the solution was for greater co-operation between states. "A disintegration of the Union would be a disaster ... not only for Europe but also I think for our allies and for the world."

Le Pen’s Main Rival Hit by Fresh Scandal in French Election - (www.bloomberg.com) Francois Fillon’s French presidential campaign plunged deeper into trouble on Tuesday after further revelations about his use of public funds to employ members of his family. The Republican candidate’s daughter and son allegedly earned 84,000 euros ($91,000) from 2005 to 2007 while working for him when he was a Senator, Le Canard Enchaine said. His wife, Penelope Fillon, earned more than 900,000 euros during over a decade as a parliamentary assistant and a contributor to a magazine, according to Le Canard. The newspaper’s initial report on Penelope’s job last week triggered a prosecutor to open a preliminary probe into the family’s affairs. The candidate says he’s innocent.

IMF Warns Eurogroup Loan Measures Not Enough for Greek Debt - (www.bloomberg.com) Greece’s public debt and financing needs will prove “explosive” in decades to come unless Europe overhauls its bailout program to ease the load, the International Monetary Fund says in a draft report as the country seeks a fresh loan payout. In the IMF’s baseline scenario, Greece’s government debt will reach 275 percent of its gross domestic product by 2060, when its financing needs will represent 62 percent of GDP, the report obtained by Bloomberg says. The government estimates public debt around 180 percent of GDP at present. The European Union’s view of the evolution of Greek debt is “more benign” and based on “significantly more optimistic assumptions,” the IMF notes. The document also says some Greek debt proposals by euro-area finance ministers “are not specific enough to enable a full assessment” of how they would affect sustainability.

Fed Grapples With Massive Portfolio - (www.wsj.com) While Federal Reserve officials ponder when to raise short-term interest rates again, they are beginning to wrestle with another big policy decision—whether this is the year to start shrinking their immense portfolio of mortgage and Treasury securities. The Fed has boosted its portfolio of long-term bonds and other assets to $4.45 trillion from less than $1 trillion in 2007, just ahead of the financial crisis. Officials believe the large portfolio has helped to spur economic growth by holding down long-term interest rates. With the economy closer to healed from the financial crisis and recession, the central bank has already begun raising short-term rates.

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