TOP NEWS: Economy: August 29th, 2012
- U.S. Firms Move Abroad to Cut Taxes
- U.S. Home Prices Ticking Upward
- Second-Quarter Growth Revised Up to 1.7 Percent Rate
- Banks’ earnings up
- State of the States Municipal Bonds
Excerpts and More Top Stories
TAXES/OFFSHORING: U.S. Firms Move Abroad to Cut Taxes - WSJ
Despite a 2004 law, U.S. companies are reincorporating overseas and saving on their taxeS.
HOUSING: U.S. Home Prices Ticking Upward – WSJ
U.S. home prices ended the second quarter with the first positive annual growth rates since the summer of 2010, according to Standard & Poor’s Case-Shiller indexes.
HOUSING: Hard-Hit Cities Show a Housing Rebound - NYT
SHAILA DEWAN: The latest housing data showed a year-over-year increase in prices nationally, with a recovery apparent even in places like Miami, Atlanta and Detroit.
HOUSING: Home prices post annual gain – WP
Michael A. Fletcher: Home prices are headed up, providing fresh evidence of a nascent recovery in the housing market.
FED QE3/HOUSING: Stimulus hopes track US housing data – FT
The global guessing game about the Federal Reserve’s QE3 intentions continues after positive new housing data.
ECONOMIC GROWTH: Second-Quarter Growth Revised Up to 1.7 Percent Rate - NYT
The economy grew at a slightly faster pace in the second quarter than initially estimated, according to Commerce Department data released Wednesday, increasing at an annual rate of 1.7 percent.
BANKING: Banks’ earnings up – WP
Borrowers are doing a better job of managing loan payments, helping banks improve their asset quality and boost earnings 21 percent, to $34.5 billion in the second quarter.
BANKING: Loan Growth Boosts U.S. Banks’ Profits - WSJ
Loans at U.S. banks rose in the second quarter, after falling earlier this year, but revenue sank with the multibillion dollar trading loss at J.P. Morgan Chase.
BANKING/BofA: Paulson Assures BofA in Call – WSJ
John Paulson acknowledged during a conference call with Bank of America wealth advisers and their clients that his flagship hedge fund had posted disappointing returns, while assuring them his firm hadn’t faced an exodus of investors.
MUNICIPAL BONDS: State of the States Municipal Bonds - BARRON’S
ANDREW BARR: Long considered the best issuers in the municipal bond market, states are under a lot of strain. Mounting pension shortfalls and high debt are upping the risk for state muni-bond investors.
MARKETS/SEC REGULATION: A reasonable reform for money market funds – WP, EDITORIAL
The SEC Chairwoman Mary Schapiro has been trying to toughen regulations. In 2010, those efforts bore fruit. But last week she was forced to run up a white flag, at least for now, acknowledging she was one vote shy of a three-vote SEC majority.
MARKETS/KNIGHT: NYSE Conflict Rules Dent Knight’s Market-Making Role – WSJ
Blackstone and several other companies have replaced Knight Capital as the designated market maker for certain securities on the NYSE, because of potential conflicts of interest arising from the trading firm taking on new backers.
MARKETS/KNIGHT: Knight Ponders Path Forward – WSJ
Weeks after a near-catastrophic trading lapse, brokerage considers whether to jettison or expand some of its operations.
MARKETS/GOLD: Finding New Gleam for Gold Miners - WSJ
Gold-mining stocks are starting to shine again as battered prices and vows of corporate discipline have given new life to gold miners, which have recently outpaced the metal itself.
MARKETS/SEC INVESTIGATION: SEC Probes ResCap for Possible Mortgage Fraud - WSJ
The SEC is investigating the failed mortgage subsidiary of Ally Financial as part of a probe into possible fraud related to the unit’s loan-origination and underwriting practices.
FED/BERNANKE: Bernanke should show some humility - FT OP-ED, Bob Corker
Mr Bernanke’s comfort with managing long-term interest rates and his unwillingness to stand up and say that there are limits to what monetary policy can accomplish is disturbing, to say the least. We need to do better.
ROMNEY TAX PLAN: Martin Feldstein: Romney’s Tax Plan Can Raise Revenue – WSJ, OP-ED
IRS data show that limiting deductions for high earners would more than cover the dollars lost by reducing income-tax rates 20% across the board.
ROMNEY ECONOMIC PLAN: A Grand Old Growth Party - WSJ, OP-ED
Inside the GOP’s Tampa convention hall this week, one prominent feature is a debt clock ticking toward $16 trillion. With due respect to that horrifying number, it’s the wrong figure to watch. What Mitt Romney and the GOP need above all is a growth clock and a persuasive case for economic revival.
GOLD STANDARD/GOP: GOP’s golden oldie: A call to study a return to the gold standard - LAT OP-ED
The Republican platform calls for a look at restoring the link between the dollar and gold. Returning to the gold standard would destabilize the money system while tying the hands of policymakers.
INVESTING/HEDGE FUND ADVERTISEMENT: Fund Managers Seek Their Inner Ad Men – WSJ
Hedge funds are beginning to explore marketing strategies ahead of a planned relaxation of a ban on advertising.
INVESTING/FIDELITY: Fidelity promotion cements family control - FT
The privately-held financial institution will remain in family control after the promotion of Abigail Johnson to president of the group’s main businesses
ENERGY/FUEL EFFICIENCY: Final Rules Set On Car Mileage - WSJ
The Obama administration released its final fuel-efficiency standards for cars and trucks, requiring each auto maker’s fleet to reach an average of 54.5 miles per gallon by 2025.
ENERGY/OFFSHORE DRILLING: Offshore-Rig Builders Thrive in New Era - WSJ
Just two years after offshore drilling was brought to a near-standstill in many parts of the world following BP’s Gulf of Mexico well blowout, the offshore-rig-construction sector is growing strongly.
ENERGY/OIL RESERVES: Strategic Oil Reserve Is for Emergencies and Not Elections - BLOOMBERG, EDITORIAL
There are few things a U.S. president hates more than gasoline at $4 a gallon, especially with an election little more than two months away.
FARMING: US farmers eye record profits - FT
Despite the worst drought in half a century, US farmers are on track for their most profitable year on record, thanks to high grain prices and federal crop insurance payments
JOBS: Mismatch Hurts Job Hunters – WSJ
Many places hard hit by the housing bust also appear to have some of the broadest gaps between the education level of their workers and the schooling required for jobs advertised there.
F.A.A/REGULATION: F.A.A. to Review Rules on Use of Electronic Devices - NYT
JAD MOUAWAD: The agency will appoint a group to study air travel rules and make recommendations on changes, but in-flight cellphone calls will continue to be banned.
FAMILY FINANCES: He gives, and sibling receives - WP
Mix finances and family, and the results are complicated and will often leave somebody angry or feeling taken advantage of.
BUSINESS/AUTOMOBILE: Toyota, Honda Post Higher Sales - WSJ
Toyota and Honda posted sharp increases in domestic output and sales in July, taking advantage of strong demand for fuel-efficient cars before the expected expiration of government buying incentives.
AUTOMOBILE: Cadillac Aims to Double U.S. Sales - WSJ
GM’s Cadillac division intends to double its U.S. sales volumes over the next two years in a push to re-take the No. 1 luxury-brand spot.
AIRLINES: United Airlines Hit by Outage - WSJ
United Airlines was hit by widespread computer-network problems that caused hundreds of flight delays at airports around the world, the latest in a series of glitches to affect the world’s largest carrier.
AIRLINES/INTERNET: Gogo Gets Canada License- WSJ
Gogo has been issued a license by Canada to use part of the country’s radio-frequency spectrum to provide cross-border in-flight Internet service.
MEDIA/ESPN DEAL: Baseball Strikes $5.6 Billion ESPN Deal - WSJ
Major League Baseball unveiled an eight-year, $5.6 billion media-rights deal with Walt Disney’s ESPN.
MEDIA: Liberty Media Raises Sirius Stake - WSJ
John Malone’s Liberty Media increased its stake in Sirius XM to 48.8% from 48.1%. The disclosure comes about a week after Liberty said it had asked the FCC for approval to take outright control of Sirius.
FOOD/RESTAURANT: Costlier Food Puts Restaurants in Bind - WSJ
Restaurant chains are in a pickle, caught between soaring ingredient costs and fears that raising prices will turn off their budget-conscious customers, who generally remain pessimistic about the economy.
PHARMACEUTICALS/FDA: FDA Panel Backs Wider Use of Abbott’s Humira - WSJ
A federal advisory panel backed the use of an Abbott Laboratories drug as a treatment for patients with inflammatory bowel disease.
PHARMACEUTICALS: AstraZeneca Taps Rival for CEO - WSJ
AstraZeneca named Pascal Soriot from Swiss rival Roche as CEO, ending months of uncertainty at the U.K. drug giant.
WEB/GOOGLE: Google Uses Its Home Page to Push Nexus 7 Tablet - NYT
CLAIRE CAIN MILLER: Google’s stark white home page is the most-viewed Web site on the Internet, and Google is taking advantage of that by advertising its Nexus 7 tablet there.
ACQUISITIONS: Japan’s Daikin to Buy U.S. Rival - WSJ
Japan’s Daikin Industries, the world’s biggest maker of air conditioners, said it has agreed to buy U.S. peer Goodman Global for $3.7 billion as it looks to solidify its position as global number one.
ACQUISITIONS: KKR Makes Offer for Japan’s Renesas - WSJ
U.S. private-equity firm KKR & Co. has approached struggling Japanese chip maker Renesas Electronics and its shareholders with an offer of investment
BUSINESS/CEO RESIGNATION: WellPoint CEO Braly Resigns - WSJ
WellPoint CEO Braly resigned amid pressure from investors unhappy with the health insurer’s performance and direction.
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