KeNosHousingPortal.blogspot.com
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Collateral damage: Tenants of foreclosed properties – (www.miamiherald.com) Whenever Michel Joseph wants to shower, cook or use the bathroom, he has to leave his Little Haiti apartment and drop in on a neighbor who has running water. Water has not run in Joseph’s derelict apartment since his landlord abandoned the four-unit building to foreclosure, and skipped town in November. The landlord’s absence led to a water shutoff, and for the past four months, Joseph has not been able to turn it back on because of a long-standing rule at the Miami-Dade Water & Sewer Department. That rule — which restricts renters from re-opening a closed account — has come under increased scrutiny as more landlords have fallen prey to the foreclosure crisis, some leaving tenants without basic utilities. “The tenants have become the hidden victims of the foreclosure crisis,” said Purvi Shah, a Florida Legal Services attorney who defends tenants of foreclosed properties. “There are hundreds of tenants in Miami-Dade County living in really serious conditions.” Earlier this month, the Miami-Dade County Infrastructure and Land Use Committee voted to create a bridge account program that would allow tenants to open a temporary Water & Sewer account. The full county commission is set to vote on the bridge account next month.
ECB’s Stark Says Debt Restructuring Risks Starting Crisis Exceeding Lehman - (www.bloomberg.com) European Central Bank Chief Economist Juergen Stark said a debt restructuring by a euro country risked triggering a banking crisis that could “worst case” exceed the effects of the failure of Lehman Brothers Holdings Inc., according to the transcript of an interview posted by German television station ZDF on its website. There is “no painless way” for countries that sought aid to reduce debt, while a restructuring may cut off the respective country from the financial markets for an unforeseeable time, Stark was quoted as saying. The only viable path for such countries is to “strictly push through reform programs and repay debt in full,” the central banker was quoted as saying. Stark did not refer to a specific country. The interview did not contain commentary on interest rates or inflation. A call to the ECB press office in Frankfurt during non- business hours seeking confirmation of the comments wasn’t answered.
Labor Board Tells Boeing New Factory Breaks Law – (www.nytimes.com) In what may be the strongest signal yet of the new pro-labor orientation of the National Labor Relations Board under President Obama, the agency filed a complaint Wednesday seeking to force Boeing to bring an airplane production line back to its unionized facilities in Washington State instead of moving the work to a nonunion plant in South Carolina. In its complaint, the labor board said that Boeing’s decision to transfer a second production line for its new 787 Dreamliner passenger plane to South Carolina was motivated by an unlawful desire to retaliate against union workers for their past strikes in Washington and to discourage future strikes. The agency’s acting general counsel, Lafe Solomon, said it was illegal for companies to take actions in retaliation against workers for exercising the right to strike. It is highly unusual for the federal government to seek to reverse a corporate decision as important as the location of plant. But ever since a Democratic majority took control of the five-member board after Mr. Obama’s election, the board has signaled that it would seek to adopt a more liberal, pro-union tilt after years of pro-employer decisions under President Bush.
As Clock Ticks on Effort, Some See a Round 3 - (online.wsj.com) "QE2" is not even in drydock, yet some money managers are preparing for the christening of "QE3." Investors appear to expect the Federal Reserve to wind down in June its extraordinary efforts to support the economy known as quantitative easing—currently in its second installment and therefore referred to as QE2. But a handful say the financial markets and the economy still aren't strong enough to stand on their own. They argue that, soon after QE2 ends, the economy, the jobs market and asset prices will stumble. The housing market, they say, is still struggling and may founder further without the Fed support. That, in turn, will force the Fed—which is on track to spend $600 billion in newly created dollars to buy Treasurys through QE2—to come back in to again prop up markets: Enter QE3. John Burbank, founder of Passport Capital, a San Francisco-based hedge-fund firm that manages $4.4 billion, argues that the role of QE2 in inflating the prices of stocks, commodities and other riskier investments has been "enormous." The current Fed buying spree comes on the heels of its first big binge, when the central bank bought $1.7 trillion worth of Treasurys and mortgage-backed securities. That, Mr. Burbank says, has resulted in asset prices that don't reflect the economic fundamentals. "It's not the real world," he says. "But people draw conclusions from prices that, if they're up, then the world must be good."
PepsiCo questions Fed inflation guide - (www.ft.com) PepsiCo’s chief financial officer has criticised US policymakers’ focus on “core” inflation, arguing that it overlooks the impact of rising prices on consumer spending power. The Federal Reserve’s preference for the core price measure that excludes food and energy has stirred controversy as commodity price rises have accelerated and companies have had to judge how much they can pass on costs to hard-pressed consumers. “It’s a big exclusion,” Hugh Johnston, PepsiCo’s chief financial officer, said in an interview with the Financial Times. “The reality right now is that food and fuel are quite inflationary.” Food prices have climbed nearly 3 per cent in the past year and petrol prices have increased nearly 30 per cent, according to the labour department’s latest consumer price index. During the same period, “core prices” rose 1.2 per cent. PepsiCo, with its $60bn snacks and drinks portfolio, has a privileged insight into the state of consumer sentiment around the world. According to Mr Johnston, consumers who earn less than $70,000 per year are continuing to struggle and face the greatest threat from inflation.
OTHER STORIES:
Corporate Taxes Enter Debt Debate - (www.nytimes.com)
China Stocks Drop to 3-Week Low as Rising Oil Prices Boost Inflation Risk - (www.bloomberg.com)
Draghi Said to Be Seen by Sarkozy as Next European Central Bank President - (www.bloomberg.com)
Chinese inflation to ease: government - (www.reuters.com)
Dudley Seeing Interest on Reserves as Tool of Choice Sparks New Fed Debate - (www.bloomberg.com)
Fed Searches for Next Step - (online.wsj.com)
That $4 Trillion Isn't Enough to Build Future: William Pesek - (www.bloomberg.com)
