Monday, December 10, 2012

Today's links

1---Atheists around world suffer persecution, discrimination: report, Reuters

Atheists and other religious skeptics suffer persecution or discrimination in many parts of the world and in at least seven nations can be executed if their beliefs become known, according to a report issued on Monday.

The study, from the International Humanist and Ethical Union (IHEU), showed that "unbelievers" in Islamic countries face the most severe - sometimes brutal - treatment at the hands of the state and adherents of the official religion.

But it also points to policies in some European countries and the United States which favor the religious and their organizations and treat atheists and humanists as outsiders.

The report, "Freedom of Thought 2012", said "there are laws that deny atheists' right to exist, curtail their freedom of belief and expression, revoke their right to citizenship, restrict their right to marry."
Other laws "obstruct their access to public education, prohibit them from holding public office, prevent them from working for the state, criminalize their criticism of religion, and execute them for leaving the religion of their parents

2--Upper-income spending sees worst November on record, Gallup

Upper-income Americans' (defined as those making at least $90,000 per year) self-reported daily spending was lower this November -- an average of $113 -- than in any November dating back to 2008. Upper-income spending has been trending downward since September, although the decline has not been large enough to drag down the overall spending figures.
Lower-income Americans' spending in November -- an average of $61 -- is on par with the $60 they spent last November. Lower-income spending is generally quite stable from month to month and has been holding steady since March.

3---QE creates Homebuilders windfall on interest rate spreads, Bloomberg

Construction is taking a back seat to lending for some U.S. homebuilders, turning the uneven housing recovery into an earnings boom....

Homebuilders are getting extra help right now from mortgages,” said Jack Micenko, a homebuilding analyst at Susquehanna International Group in New York. “They’re over-earning in those areas because lending margins are so wide, but they can’t depend on that going forward.”
A Federal Reserve program aimed at lowering borrowing costs by purchasing home-loan bonds has widened margins across the lending industry, with JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimon in October describing his bank’s mortgage production margins as “very high.” The average gain-on-sale, which measures the difference between the rate homeowners pay and the rate paid by investors, has doubled this year on increased demand for the securities, Micenko said.

Lender Windfall

“The Fed might have preferred that its interventions created less of a windfall for homebuilders and more for their buyers in the form of lower rates, but that’s something it can’t control,” said Stephen Stanley, chief economist of Pierpont Securities in Stamford, Connecticut.

4--Housing sales tumble in Las Vegas, Cal Risk

From the GLVAR: GLVAR November 2012 Housing Statistics
GLVAR said the total number of local homes, condominiums and townhomes sold in November was 3,293. That’s down from 3,651 in October and down from 3,883 total sales in November 2011. Compared to October, single-family home sales during November decreased by 10.1 percent, while sales of condos and townhomes decreased by 8.5 percent. Compared to one year ago, home sales were down 15.1 percent, while condo and townhome sales were down 15.6 percent.

Short sales are almost four times foreclosures now.
5--Q3 2012: Mortgage Equity Withdrawal strongly negative, cal risk

For Q3 2012, the Net Equity Extraction was minus $112 billion, or a negative 3.8% of Disposable Personal Income (DPI). This is not seasonally adjusted....

The Fed's Flow of Funds report showed that the amount of mortgage debt outstanding declined sharply in Q3. Mortgage debt has declined by $1.15 trillion since the peak. This decline is mostly because of debt cancellation per foreclosures and short sales, and some from modifications. There has also been some reduction in mortgage debt as homeowners paid down their mortgages so they could refinance.
6---Europe clings to scorched-earth ideology as depression deepens, Telegraph

Evans-Pritchard: "The failure of EMU policy is now undeniable. Whole societies have been broken on the wheel. Yet there has not been any substantive shift in strategy. The EU authorities remain adamant that the next bayonet charge will deliver victory."

Like the generals of the First World War, Europe’s leaders seem determined to send wave after wave of their youth into the barbed wire of tight money, bank deleveraging, and fiscal austerity a l’outrance

The eurozone has crashed back into double-dip recession. It will contract a further 0.3pc next year, according to a chastened European Central Bank. The ECB omitted mention of its own role in this fiasco by allowing all key measures of the money supply to stall in mid-2012, with the time-honoured consequences six months to a year later. ...

The International Monetary Fund’s latest work on the `fiscal multipilier’ has largely demolished the credibility of EMU fiscal policy. Austerity takes a greater toll on GDP during a deleveraging crisis than orginally thought, doubly or triply so in countries that cannot devalue or cushion the blow with monetary stimulus.

As constructed so far, the policy has been largely self-defeating even on its own terms. Debt dynamics are deteriorating at a frightening pace across half Europe. The IMF’s Fiscal Monitor says Italy’s public debt (128pc). It will be 4pc of GDP higher next year than estimated as recently as April. It will be 8.4pc for higher in Portugal (124pc), and 12.9pc higher in Spain (97pc).

This is what a depression will do to you, and is in fact what happened to Britain in the 1920’s when combined fiscal and monetary tightening pushed public debt to 190pc. The cure was emancipation from the dollar peg (Gold Standard) in 1931, an emancipation that Britain’s status quo elites ruled out as too dangerous to contemplate.

7---Spinning your wheels--foreclosure division, palm beach post

foreclosure courts have made almost no progress in clearing an overwhelming backlog of cases from their dockets despite a $4 million stipend awarded by lawmakers this year.

As of Oct. 31, there were 377,272 pending foreclosures in Florida’s 20 circuit courts, a net reduction of just 435 cases since the money became available in July, according to the state courts administrator.

Judges say new foreclosure filings have nearly outpaced the number of cases they’ve been able to close as banks work on clearing defaulted loans on hold since the robo-signing freezes and pending the National Mortgage settlement, which was finalized in March.
While the $4 million has helped courts statewide close 69,513 cases in four months, 69,078 new cases were added during the same time period.

8---Mortgage Crisis Presents a New Reckoning to Banks, NYT

Lawsuit deluge

9---Jonathan Miller shows us the above chart (via RealtyTrak) and ask the question: How does flat to falling incomes, high unemployment, rising taxes and tight credit = housing recovery? Big Picture
The short answer is a combination of record low mortgage rates and held back distressed activity. Following a weak 2011, year-over-year comparisons also look good.

10-Krugman Ponders the Fallen State of US Labor, naked capitalism

Paul Krugman is troubled by this chart from the Bureau of Labor Statistics and is looking for explanations:

It’s another way to illustrate that corporations are producing record profits while unemployment is still high and workers get an unprecedented small share of GDP growth.

11---The US military said it has captured more than 200 Afghan juveniles, whose average age is 16, and held them prisoner for about one year without charging them for any crimes., RT

A report to the UN Committee on the Rights of the Child said that more than 200 detainees under the age of 18 were held at a military prison at the Detention Facility in Parwan for being characterized as “enemy combatants”.
The teens had not been charged with any crimes, but were each held for an average of one year for the sole purpose of preventing “a combatant from returning to the battlefield”, the report said. Since they were not charged for any crimes, the detainees were not provided any legal assistance and could only defend themselves at open hearings.
Most of the teens were captured while they were not in uniform – and many were seized from their homes.
“We’re not talking about battlefield captures, we’re talking about people who are living at home, and four or five brothers might be taken together,” Tina M. Foster, executive director of the International Justice Network, told the Associated Press.

12---Israeli Election Committee Nears Mass Bans on Arab Candidates, Parties, antiwar

13--Number of the Week: As Companies Borrow More, Where Is Money Going?, WSJ

$8.4 trillion: The amount of debt owed by U.S. corporations at the end of September.
When policymakers at the Federal Reserve meet next week, one of their main agenda items will be assessing the effectiveness of their latest bond-buying program, known as “quantitative easing” or QE. A key goal of the program is to stimulate the economy by driving down interest rates, making it cheaper for companies and individuals to borrow. More borrowing, the Fed hopes, will lead to more spending, more investing and, crucially, more hiring.
New data this week suggests low interest rates are indeed leading to more borrowing. But what happens with the money after that is less clear

According to the Fed’s Flow of Funds report, released Thursday, U.S. nonfinancial corporations had $8.4 trillion in outstanding debts at the end of the third quarter, up $136 billion from the second quarter and nearly half a trillion dollars more than a year earlier. The vast majority of that new borrowing came in the form of corporate bonds.
The third-quarter data capture only the earliest days of the Fed’s latest bond-buying program, known as QE3, which has further driven down already low corporate borrowing rates. Borrowing, in other words, has likely only increased in the fourth quarter.
The trouble for the economy is that increased corporate borrowing doesn’t seem to be translating into increased investment. Companies spent $304 billion on capital expenditures in the third quarter, only a bit better than the $295 billion in the second. Separate data from the Commerce Department shows that after adjusting for inflation, business investment actually fell at a 2.2% annual rate in the third quarter.
Nor is the money going to workers. Private employers have added less than 2 million new jobs over the past year, a decent figure by recent standards, but hardly enough to soak up all the new borrowing. Even before inflation, the wages and salaries paid to all private-sector employees rose at a rate of less than 0.5% in the third quarter — an increase of just $27 billion over a full year.
So where’s the money going? Cash, for one. Companies had a record $1.74 trillion in cash and other liquid assets on their balance sheets at the end of the third quarter, up $44 billion from three months earlier. Companies added another $215 billion in financial assets that don’t qualify as liquid such as overseas investments and holdings of financial subsidiaries.
Another big use of cash: dividends. Companies paid out $482 billion in net dividends in the third quarter, $27 billion more than in the second and the most since mid-2008, before the financial crisis took hold. Dividends have likely surged in the fourth quarter as companies return money to shareholders ahead of the fiscal cliff.
Dividends, of course, go to shareholders, who can then use the money to spend or invest. And lower interest rates may be boosting the economy in other ways, such as by boosting the housing market and allowing homeowners to refinance their mortgages. But so far, the corporate borrowing

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