TOP NEWS: Economy: October 12th, 2012
Top Five News and Analysis Links (Excerpts Below)
- U.S. to Grow Slowly, Economists Think
- Why Jobless Claims May Not Be as Good as Market Thinks
- Banks See Home Loans as Gateway to Big Gains
- Safeguards Against Speculative Banking
- Energy Propels Producer Prices
Excerpts and More Top News and Analysis:
ECONOMIC RECOVERY: U.S. to Grow Slowly, Economists Think – WSJ
The unemployment rate registered a dramatic 0.5 percentage-point drop over the past two months, but economists in the latest Wall Street Journal forecasting survey don’t expect that pace of decline to continue.
ECONOMIC RECOVERY: Triumph of the Wrong? – NYT, PAUL KRUGMAN
Politically good things may be about to happen to very bad ideas.
JOBS: Why Jobless Claims May Not Be as Good as Market Thinks – CNBC, KELLY EVANS
For the second time in a week, a government unemployment report is sowing confusion—and may not be as positive as the markets think.
JOBS: US jobless claims drop sharply to 339,000 - FT
The number of Americans claiming unemployment insurance fell to a four-year low last week, a likely reflection of the difficulty in adjusting the data for seasonal swings, while the US trade deficit widened in August as exports dropped.
JOBS: Keep up the pressure – US jobs crisis is not over – FT, MOHAMED EL-ERIAN
This brighter picture must be sustained if America is safely to deleverage segments of the economy that remain over-indebted
JOBS: Jack Welch Tries His Hand at Data Analysis, Sort Of - BLOOMBERG, CAROLINE BAUM
After tweeting his way to derision last week, Jack Welch has decided to drop the conspiracy-theory angle and play statistician instead.
BANKING: Banks See Home Loans as Gateway to Big Gains – NYT
Federal stimulus has ignited a boom in mortgage refinancing, benefiting both homeowners and banks.
BANKING: Earnings at Wells Fargo Jump 22% – NYT
Wells Fargo reported $4.9 billion of profit in the third quarter, on the back of a booming mortgage business. The bank grew revenues as well, sidestepping a sore spot that has plagued most of the nation’s biggest banks.
BANKING: J.P. Morgan Profit Beats Expectations - WSJ
J.P. Morgan’s third-quarter earnings rose 34% as the bank saw revenue rise and its provision for credit losses fall. The results beat analyst expectations.
BANKING: JPMorgan Quarterly Profit Rises 34% - NYT
JPMorgan Chase posted earnings of $5.7 billion, up from $4.3 billion, as the bank showed signs of strength in consumer and corporate lending.
REGULATION/BANKING: Safeguards Against Speculative Banking – NYT, EDITORIAL
Reform proposals in Europe, Britain and the United States could make banks safer. The banks will resist them, but policy makers should respond by making them tougher, not weaker.
WHOLESALE PRICES: Energy Propels Producer Prices – WSJ
U.S. wholesale prices rose for the second consecutive month in September led by energy and food costs.
WHOLESALE PRICES: US wholesale prices rise on fuel costs – FT
Underlying inflation pressures muted
WALL STREET: JPMorgan prepares to move finance chief - FT
JPMorgan Chase’s chief financial officer, sidelined in the aftermath of the bank’s$5.8bn trading debacle, is expected to shift to another role, according to people familiar with the matter.
WALL STREET: Behind the Fall of Crisis-Era Whiz - WSJ
Math whiz Alexander Rekeda was once in demand on Wall Street. Now, he’s taken a fine and suspension as part of his second regulatory rebuke this year.
WALL STREET: Goldman Ex-Programmer Asks Court to Throw Out Charges - WSJ
A former computer programmer at Goldman Sachs has asked a state judge to throw out criminal charges against him, saying he shouldn’t be prosecuted a second time over the alleged theft of the investment bank’s secret computer code.
PAYROLL TAX CUT: Summers Calls for Extending Payroll Tax Cut - WSJ
“This is not the right moment to repeal the payroll tax cut,” Mr. Summers said in a speech to the liberal Center for American Progress. “$120 billion put in the hands of middle-income families is $120 billion injected into the economy.”
TAX POLICY: What Schumer Gets Right and Wrong on Taxes – BLOOMBERG, JOSH BARRO
Senator Charles Schumer of New York gave a speech yesterday criticizing two pillars of the bipartisan tax reform framework that has emerged in recent years: That the top income tax rate should be cut, and that reform should be revenue neutral.
COMMODITIES: USDA Sees Tightening Corn, Soy Supplies - WSJ
For both corn and soybeans, the Agriculture Department forecast tighter domestic supplies a year from now than analysts were expecting.
COMMODITIES: U.S. Increases Estimate for the Soybean Crop - NYT
The changed estimate came after months of drought and heat. But the agency lowered its estimates for corn.
ENERGY: IEA Sees Relief for Energy Consumers - WSJ
More oil supply and weaker demand over the next five years suggests oil prices will ease for consumers, the International Energy Agency said.
GREEN ENERGY: U.S. Struggles to Rescue Green Program Hit by Fraud - NYT
A federal program intended to promote biodiesel through renewable energy credits has attracted counterfeiters and is hurting the market for smaller biodiesel producers.
ENERGY: Why the U.S. needs a networked energy grid – WP, C. Boyden Gray
Wind subsidies aren’t enough.
ENERGY/BUSINESS: Oil Slick Complicates BP Liability Talks – WSJ
As U.S. officials and BP negotiate to resolve the company’s liability for the Deepwater Horizon spill, some local and state officials are citing a newly discovered oil slick as evidence that the full impact of the 2010 accident remains unclear.
ENERGY: Shell Seeks to Export U.S. Oil – WSJ
Shell has applied for a permit from the U.S. Department of Commerce to export crude oil in a sign of how a boom in U.S. oil production from shale rock is reshaping the country’s role in the global energy marketplace.
ENERGY/FOREIGN INVESTMENT: Tinker, Tailor, Soldier, Wind Farm - WSJ
Did Obama abuse a security process to kill a Chinese investment for political reasons?
HEDGE FUNDS: A Peek Into a Tycoon’s World – NYT
A legal battle with the billionaire hedge fund manager Paul E. Singer has focused a light on David Martinez, a Mexican financier who lives a rarefied but mysterious life in Manhattan.
HEDGE FUNDS: A Legal Brawl in Mexico as Bond Buyers Look On – NYT
The cross-border battle touches the foundations of international investing and law, some academics and investors say.
EXPORTS: Tribes Add Potent Voice Against Plan for Northwest Coal Terminals – NYT
American Indians, citing possible injury to fishing rights and religious and sacred sites, have joined environmental groups and politicians in opposing a plan for six export terminals.
MEDICAID: Assessing the Value of Medicaid to Its Enrollees – NYT
A change in the approach to valuing benefits as part of a family’s or individual’s income may have significant effects in defining who is impoverished.
SAVINGS RATES: Increasing Savings With Promotional C.D. Rates - NYT
While interest rates over all are meager, some institutions — typically credit unions or smaller community banks — may offer rates to attract deposits as part of their capital strategy.
REGULATION: U.S. Corporate Governance Grows Up – WSJ
Despite recent board missteps, governance in corporate America is getting better.
PROCESSING FEES: Many Retailers Balk at Card-Fee Settlement – WSJ
Retailers are mounting a last-ditch effort to block a proposed $6 billion deal that would be paid for by credit-card companies to settle their long-running feud with merchants over processing fees.
TAX RATES: Corporate Taxes, the Myths and Facts - WSJ, JOHN ENGLERr
U.S. companies don’t get a tax break for moving plants overseas. They are, however, socked with an extra bill for bringing home earnings.
EARNINGS: Approach US earnings with caution – FT, JAMES MACKINTOSH
One-year forecasts are a lot more pessimistic
HOUSING: A housing boom will lift the US economy – FT, ROGER ALTMAN
The depth of the fall since 2008 has laid the foundation for a surge, writes Roger Altman
FED: Fed’s bond buying to send US mortgage rates even lower - FT
Traders say rates could fall even further
BUSINESS NEWS & ANALYSIS
BUSINESS: Google Car Draws Political Star-Power – WSJ
Google is using the star-power of its self-driving cars to win support for the vehicles at U.S. state houses while developing lobbying skills that may become important to its Internet and TV plans.
BUSINESS/MARKETING: At New York Comic Con, Outfitting Female Fans – NYT
Efforts are growing to market to the fan-girls of the worlds of sci-fi, fantasy and other genres typically dominated by men.
BUSINESS/MARKETING: Slim Jim Gives Snackers Something to Play For – NYT
Slim Jim’s new commercials feature a partnership with Electronic Arts that offers special codes for video game extras.
BUSINESS: Executives’ Missteps Doomed Aerospace Merger – NYT
The planned joining of BAE Systems and EADS, which would have expressly limited the states’ power to a veto of hostile takeovers, was brought low by political interference.
BUSINESS: Political Haggling Thwarts Merger of Aerospace Giants – NYT
An effort to create a European behemoth in aerospace and military manufacturing to rival Boeing of the United States has collapsed amid political divisions involving Britain, France and Germany.
BUSINESS: One on One: Robin Sloan, Author and ‘Media Inventor’ - NYT
Robin Sloan, a former media manager at Twitter, is the author of the book “Mr. Penumbra’s 24-Hour Bookstore: A Novel.” He talks about how his work at Twitter influenced the book’s themes.
BUSINESS: Best Buy to Match Online Prices – WSJ
Best Buy is planning to match the prices of online rivals such as Amazon this holiday season, even as it plays down its concerns over shoppers using its stores as a showroom.
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