Friday March 10 2017 Housing and Economic stories

TOP STORIES:            

Why No One’s Going to Drain this Swamp - (www.wolfstreet.com) The Financial Sector – whose products, risk-taking, and shenanigans blew up the sector and everything around it during the Financial Crisis – has finally gotten the memo in a serious way: During the past election cycle (2015-2016), it doused the members of the US Congress with a record amount of money to “influence decision making” and get what they want: deregulation, handouts, and subsidies. So how much? Over $2 billion. That’s over $3.7 million per sitting member of Congress, according to a report released today by Americans for Financial Reform. The $2 billion tab fell into two categories:

·         Campaign contributions by companies, trade associations, and individuals associated with the financial sector: $1.104 billion. This was “almost twice that of any other specific business sector.”

·         Lobbying expenses by 460 financial sector entities: $898 million

Brazil tumbles deeper into its worst ever depression - (www.cnbc.com) Brazil's economy has fallen further into its worst ever recession, contracting by 3.6 percent in 2016 and pressure is mounting on policymakers to stimulate growth. The former Latin American powerhouse recorded a steeper-than-expected decline of 0.9 percent gross domestic product (GDP) in the final quarter of last year, intensifying the economic contraction that has imbued Brazil for eight consecutive quarters – the longest period of decline on record for the country. Brazil's economy is now 8 percent smaller than it was in December 2014. The two-year slump has hit almost all economic sectors, causing unemployment to rise 12.6 percent, according to the data released Tuesday by IBGE, the agency responsible for recording Brazil's economic figures.

It's 1994 Again: Why Albert Edwards Expects An Imminent "Bond Market Bloodbath" - (www.zerohedge.com) "Accelerated Fed rate hikes will cause tremors in the Treasury bond markets, forcing rates up, most especially in the 2 year – just like 1994. But as yet another central bank-inspired global recession unfolds, I  believe US 10y bond yields will ultimately converge with Japanese and European yields well below zero".   Make no mistake. Unlike most in the markets, I remain a secular bond bull and do not think this 35 year long bull bond market is over. I believe the US Fed has created another massive credit bubble that will, when it bursts, lay the global economy very low indeed. Combine this with the problems of a Chinese economy dependent on increasingly ineffective injections of credit to produce increasingly pedestrian GDP growth and you have a right global mess. The 2007/8 Global Financial Crisis will look like a soft-landing when the Fed blows this sucker sky high. 

WikiLeaks Reignites Tensions Between Silicon Valley and Spy Agencies - (www.nytimes.com) Four years ago, Edward J. Snowden’s disclosures that the federal government was hacking America’s leading technology companies threw the industry into turmoil. Now WikiLeaks has shaken the tech world again by releasing documents Tuesday that appear to show that the Central Intelligence Agency had acquired an array of cyberweapons that could be used to break into Apple and Android smartphones, Windows computers, automotive computer systems, and even smart televisions to conduct surveillance on unwitting users. Major technology companies, including Apple, Google and Microsoft, were trying to assess how badly their core products had been compromised. But one thing clearly had been ruptured yet again: trust between intelligence agencies and Silicon Valley.

China tries cure by committee for corporate debt hangover - (www.reuters.com) A $1.44 billion restructuring deal at an insolvent coal mining company in eastern Shandong province offers a glimpse into how China is preparing to tackle a corporate debt burden that has ballooned to $17.9 trillion. Loss-making Feicheng Mining Group struck the deal last December with 10 banks, led by Agricultural Bank of China Ltd (AgBank), which agreed to extend the group's loans at concessionary interest rates. Bankers say the settlement, which required 10 months and 41 rounds of negotiations to complete, only advanced after the formation of a creditors' committee, a mechanism the China Banking Regulatory Commission (CBRC) officially endorsed last year to manage "troubled firms with a large volume of debt".

OTHER STORIES:

French Insurgents Thrust Establishment Aside in Crucial Vote - (www.bloomberg.com)
WikiLeaks Reignites Tensions Between Silicon Valley and Spy Agencies - (www.nytimes.com)
Stocks Have Tripled Since Crisis, but Low Rates Are Still Squeezing Savers - (www.wsj.com)

Republicans Disagree on How—and Whether—to Pay for Tax Cuts - (www.wsj.com)
Central Banks Ratchet Up Reserves - (www.wsj.com)
Going Dutch: What Elections in the Netherlands Could Mean for Markets - (www.wsj.com)