KeNo's Housing and Economic Portal: Thursday February 9 2017 Housing and Economic stories

Wednesday, February 8, 2017

Thursday February 9 2017 Housing and Economic stories

The Mortgage-Bond Whale That Everyone Is Suddenly Worried About - (www.bloomberg.com) Almost a decade after it all began, the Federal Reserve is finally talking about unwinding its grand experiment in monetary policy. And when it happens, the knock-on effects in the bond market could pose a threat to the U.S. housing recovery. Just how big is hard to quantify. But over the past month, a number of Fed officials have openly discussed the need for the central bank to reduce its bond holdings, which it amassed as part of its unprecedented quantitative easing during and after the financial crisis. The talk has prompted some on Wall Street to suggest the Fed will start its drawdown as soon as this year, which has refocused attention on its $1.75 trillion stash of mortgage-backed securities.

World’s Largest Container Carrier “Unexpectedly” Has Big Loss in Crushed Industry. Now Trade War with China Looms - (www.wolfstreet.com) A.P. Moller-Maersk – a conglomerate that includes the largest container carrier in the world, transporting about 19% of all seaborne containerized cargo, plus large port operations, an oil driller, and other units – got caught in two industries that saw prices collapse: seaborne container freight and oil. So it reported a doozie of a “surprise” today: a loss of $2.67 billion in the fourth quarter, and a loss of $1.9 billion for the year 2016, its first annual loss since 2009, when shipping had come to a near standstill during the Global Financial Crisis, and its second loss since World War II.

Is Italy’s financial future resting on UniCredit? - (www.ft.com) Having sold the bank’s private jet as part of a cost-cutting drive to boost its lean capital base, the wiry 56-year-old, and Mirko Bianchi, his finance chief, sent a strong signal that UniCredit was watching every cent. They turned up at meetings in London straight off the Tube with Mr Mustier carrying a small backpack, say people who met him. In the US, they shunned pricey restaurants as they zigzagged from coast to coast, instead eating on planes to save time and money. This lean and hungry image conveyed by Italy’s top banker, whether accidentally or by design, contrasts starkly with that of the country’s lenders. Over the past year, the banking sector has flirted with systemic crisis, bloated with bad loans and weighed down by too many financial institutions supporting a gravy train of bankers and board posts.

San Francisco Becomes First City To Offer Free College For All - "Even Facebook Founder's Kids" - (www.zerohedge.com) "Even the children of the founders of Facebook" will now receive free community college education in San Francisco, Supervisor Jane Kim proudly commented as city leaders agreed to become the first city in the nation to offer its citizenry this 'basic human right'. As SFGate.com reports, City College of San Francisco will be free of charge to all city residents under a deal announced Monday by Mayor Ed Lee and Supervisor Jane Kim that college trustees hope will lead to an enrollment jolt and more state funding for the school. Under the agreement, which is expected to take effect in the fall, the city will pay $5.4 million a year to buy out the $46-a-credit fee usually paid by students.

France Yield Spread Nears Four-Year High as Political Risk Grows - (www.bloomberg.com) The spread between France and Germany’s bonds approached the widest since 2013 as the political plot thickened amid the most unpredictable election campaign in decades. The difference widened for a second day as French citizens prepare for the first round of presidential polls due on April 23. Francois Fillon, the Republican candidate, is due to hold a press conference later Monday. His party is divided on whether Fillon should be replaced following reports that his wife and two of his children allegedly earned more than 900,000 euros ($967,000) in public funds as parliamentary aides without actually doing a commensurate amount of work.

Mexico Teeters Between Its Recent U.S. Friendship and 170 Years of Hostility - (www.wsj.com) Mexico had a closed and struggling economy in the mid-1980s, with little American investment, and most Mexicans viewed the U.S. as their historic enemy. After Mexican drug lords tortured and murdered a U.S. Drug Enforcement Administration agent, President Ronald Reagan temporarily closed the border.

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