Hundreds of people rushed on Tuesday to withdraw money from branches of two small Chinese banks after rumours spread about solvency at one of them, reflecting growing anxiety among investors as regulators signal greater tolerance for credit defaults.
The case highlights the urgency of plans to put in place a deposit insurance system to protect investors against bank insolvency, as Chinese grow increasingly nervous about the impact of slowing economic growth on financial institutions.
Regulators have said they will roll out deposit insurance as soon as possible, without giving a firm deadline.
2---U.S. home sales fall, but consumer confidence hits six-year high, Reuters
New home sales fell 3.3 percent to a seasonally adjusted annual rate of 440,000 units, the lowest level since last September, the Commerce Department said. January's sales were revised down to a 455,000-unit pace from a 468,000-unit rate.
Last month's drop brought new home sales in line with other data such as home resales and building activity that have offered a downbeat picture of the housing market.
3---Interview with Ex-CIA Collaborator: “The CIA’s Plans in Venezuela Are Far Advanced, venezuelanlysis
4---Senate banking leaders reach deal on Fannie, Freddie bill outline, Reuters
The leaders of the U.S. Senate Banking Committee on Tuesday outlined plans for legislation to wind down government-owned mortgage financiers Fannie Mae and Freddie Mac that they said would continue to provide access to long-term, fixed-rate mortgages.
Committee Chairman Tim Johnson, a Democrat, and Senator Mike Crapo, the panel's top Republican, announced the agreement after working for months to bridge a partisan divide with the hope of moving legislation this year. They said they were putting finishing touches on a draft bill they planned to release "in the coming days."
5---Mind the spending gap, (abysmal retail spending continues), house of debt
We all know that households cut back on spending dramatically during the Great Recession. Are they spending now? Has spending caught up to the trend the United States was on before?
The red line in the chart below plots retail spending in real terms in the United States from 1992 to 2013. We want to get a sense of the trend in spending so we plot spending on a logarithmic scale, and we subtract off the 1992 level to start the line at zero. A logarithmic scale is informative because a straight line in the chart would imply that spending was growing at a constant rate in real terms.
Prior to 2007, spending was growing at a constant rate of about 3% real growth per year. The black dots show the pre-2007 trend and where we would be if we had continued on that trend through 2013. The Great Recession is plainly evident in the chart: see the sharp decline in retail spending in 2008 and 2009 that took us well below trend.
So are we catching back up to our previous trend? Absolutely not. In fact, in 2013, it looks like the gap may be getting even larger. The gray arrow shows that we are not even close to the trend we were on before the Great Recession hit. This is unusual. In most recessions, strong growth takes us back to the trend we were on before the recession hit. Something about the Great Recession is different.
Why aren’t we getting back to trend? One answer often given is that the housing boom artificially boosted spending from 2002 to 2006, and so the trend we were on was an unrealistic benchmark that could not be sustained.
But the data contradict that story. There is no evidence that spending was above trend from 2002 to 2006. In the chart above, the red line doesn’t go above the black dots during the housing boom. Further, there is no evidence that the economy was overheating in terms of capacity from 2002 to 2006. House prices were booming, but other measures of inflation were steady.
Instead, the chart above may be evidence corroborating the worrisome “secular stagnation” view. The housing boom fueled household spending, but that spending only kept us on the same path we were on before – and it was done by enticing debtors to borrow and spend out of ephemeral housing wealth. When the housing boom disappeared, the permanent adjustment downward in the chart above suggests that we were already on a secular decline in household spending that the housing boom masked temporarily.
6---Murderous Ukrainian ultra-nationalist dead – after 2 decades of violent thuggery, RT
7---US-backed military junta in Egypt sentences 529 Brotherhood members to death, wsws
8--What accounts for the electoral victories of France’s neo-fascist National Front?, wsws-
The central question in France and throughout Europe is the construction of revolutionary parties as sections of the ICFI. This is the key to preventing the pseudo-left forces from subordinating the working class to the bourgeoisie, paving the way for greater social defeats and attacks on democratic rights, either directly at the hands of FN or through the adoption by the entire political establishment of its policies.
9---Notes Housing: oc housing