TOP NEWS: Economy: June 29, 2012
- Blame Fear, Not Greed, as Firms Hoard Cash
- BOE’s King Urges Libor Overhaul
- Public pension funds earn record returns
- A manifesto for economic sense
- Housing Crisis May Last Until 2015
Excerpts and more top stories
John Bussey, WSJ – Here’s one way to explain the record stacks of cash that companies have amassed: Just as courage imperils life, fear protects it. The billions in cash they’ve socked away is a good measure of what global business thinks about our times. It isn’t pretty. And, despite what some suggest, it doesn’t appear to be guided by greed or complacency.
Jason Douglas, Paul Hannon and Marietta Cauchi, WSJ – Bank of England Governor Mervyn King called for a major overhaul of the way in which one of the world’s most important interest rates is set after it emerged that Barclays paid $450 million to settle charges it manipulated a key interbank rate.
PENSION FUNDS US: Public pension funds earn record returns
Hal Weitzman, Financial Times – US state and local government public pension funds earned record returns on their investments in the first quarter of the year, according to official data that may ease fears about whether they will be able to pay retirees in future.
AUSTERITY: A manifesto for economic sense
Paul Krugman and Richard Layard, Financial Times – More than four years after the financial crisis began, the world’s major advanced economies remain deeply depressed, in a scene all too reminiscent of the 1930s. The reason is simple: we are relying on the same ideas that governed policy during that decade. These ideas, long since disproved, involve profound errors both about the causes of the crisis, its nature and the appropriate response.
HOUSING: Housing Crisis May Last Until 2015
Matt Schifrin, Forbes Staff – From A Gary Shilling’s Insight: A key reason why median single-family home prices are likely to fall another 20% is that it will take years to work through the excess house inventory.
CONSUMER SPENDING: U.S. Consumer Spending Flat
Eric Morath and Sarah Portlock, WSJ – Consumer spending held flat for the first time in six months in May, even as incomes grew, suggesting sluggish job growth and concerns over Europe are causing shoppers to pull back.
Jenny Strasburg and Jacob Bunge - Nasdaq OMX Group may be forced by securities regulators to upgrade its trading systems in the wake of last month’s glitch-ridden stock sale by Facebook Inc.
MANUFACTURING: Ford Warns of Troubles Abroad
Neal E. Boudette and Mike Ramsey, WSJ – Ford warned it expects to lose roughly $570 million in its overseas operations in the second quarter, largely as a result of the slumping economy in Europe.
CURRENCY: Chinese Exporters Now Cling to Dollars
Lingling Wei, WSJ - Many Chinese exporters are starting to hoard the dollars they earn, betting that the yuan is unlikely to appreciate much more, a change in strategy that is having a ripple effect throughout the country’s financial system.
HEALTH CARE: ObamaCare and the Power to Tax
Opinion, WSJ – One would expect this Court to demand more than fly-by-night briefing and argument before deciding a difficult constitutional question of first impression.
CORPORATE PROFITS: Corporate Profits Fall for First Time Since Recession
Catherine Rampell, NY Times – Dollars to doughnuts. For years, unemployed Americans have complained that even as companies have done so well, workers’ own fortunes have stagnated.
Dimitra Defotis, Barrons – Recently troubled financial companies will see large sector-profit gains while energy names will show declines on falling commodity prices.
ARMS SALES: UTC Fined for Arms Sale to China
Kate Linebaugh, WSJ – United Technologies pleaded guilty to illegally helping China develop its first military attack helicopter and agreed to pay more than $75 million in penalties.