Treasuries erased losses as German and French finance ministers meet before a summit of regional leaders to discuss ways to contain the European debt crisis, stoking demand for government debt.
U.S. 10-year yields rose earlier on speculation record-low yields may limit demand as the government auctions $99 billion of coupon-bearing debt this week starting tomorrow. The U.S. will start this week
Japan
The British pound has become currency traders
Parts of the Canadian housing market, especially condominiums in some major cities, have seen prices jump to levels that warrant caution, the head of the country
Asian stock markets rose Monday, just hours after Greece’s parliament approved a new set of austerity measures that were required by international lenders in exchange for an emergency bailout.
Japan’s Nikkei 225 index rose 0.2 percent to 8,963.48. Hong Kong’s Hang Seng gained 0.3 percent to 20,837.46. South Korea’s Kospi added 0.5 percent to 2,002.72.
Drastic cuts in civil service jobs, minimum wages and pensions were among the measures approved by lawmakers in Athens in order to collect a second, urgently needed rescue loan.
Without the $170 billion (euro130 billion) financial lifeline, Greece will default on a mountain of national debt next month and likely be pressed into a disruptive exit from the euro common currency.
Investors in Asia greeted the Greek vote with relief. But Greeks, who have been struggling to cope with a 20 percent unemployment rate and five years of recession, took to the streets to protest the measures. Riots and fires continued all weekend.
Attention now shifts to a meeting Wednesday of European finance ministers, who will discuss additional bailout funds for Greece.
Analysts at Credit Agricole CIB in Hong Kong said in an email that the parliament vote “did not come without major cost in the form of escalating protests and violence within Greece.”
“At least for today the market tone will be a positive one as attention shifts to a meeting of EU finance ministers on Wednesday.”
Benchmark crude for March delivery was up 91 cents at $99.58 in electronic trading on the New York Mercantile Exchange. The contract fell $1.17 to settle at $98.67 on the Nymex on Friday.
In currency trading, the euro jumped to $1.3235 from $1.3170 late Friday in New York. The dollar rose to 77.62 yen from 77.60 Japanese yen.
The $26 billion mortgage settlement had a lot of support — as evidenced by the 49 out of 50 state attorneys general that signed on to it.
The deal, which was announced Thursday, also won praise from groups as diverse as the Mortgage Bankers Association, the industry trade group for lenders, and the Center for Responsible Lending, a public interest group advocating for borrowers.
But it also has its share of critics on both the left and the right.
Conservatives called it overreaching on the part of the Obama administration, and say it rewards homeowners who haven’t been paying their home loans.
What the foreclosure settlement means for you
Some liberal groups say it falls far short of providing the needed level of help to troubled homeowners hurt by the housing bubble, problems they blame on Wall Street banks and investors. They want more relief for homeowners who owe more than their home is now worth, also known as being underwater on a mortgage.
The settlement was reached with the five largest mortgage servicers — Bank of America (, Fortune 500), JPMorgan Chase (, Fortune 500), Citigroup (, Fortune 500), Wells Fargo (, Fortune 500) and Ally Financial.
The conservative case against the deal was voiced most clearly by Oklahoma Attorney General Scott Pruitt, the only state attorney general who didn’t sign onto the deal. He blamed President Obama for using the settlement to try to "fundamentally restructure the mortgage industry."
Pruitt argues that it’s unfair that those who are both underwater and delinquent on their loans can apply to reduce the amount they owe. Meanwhile, underwater homeowners who are current in their payments can only refinance their existing loan at a lower interest rate.
He said that could encourage more homeowners to default on their loans so they could benefit from the settlement.
Other critics of the Obama administration said the fact that the settlement will be able to help only a small percentage of troubled homeowners raises other questions about fairness.
"Certain favored borrowers will be receiving a bailout while everyone else’s home values will stay underwater," said Bill Wilson, president of Americans for Limited Government. "The impact will be minimal, so the question becomes, who’s getting a bailout and what makes them so special?"
There are an estimated 11 million underwater homeowners, according to CoreLogic, and nearly 3.5 million homeowners who are either 90 days or more late in making payments or are in foreclosure, according to the Mortgage Bankers.
According to the settlement, up to 1 million homeowners could see their principle reduced, while another 750,000 could refinance.
Many on the left are also dismayed by the fact that relatively few troubled homeowners will get help.
One liberal public interest group, The New Bottom Line, said it wanted a $300 billion settlement that significantly reduced what homeowners owed. It called Thursday’s deal a "paltry down payment."
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It also criticized the payments of up to $2,000 that will be made to many who lost their homes in the foreclosure process in the last three years.
"For homeowners who were defrauded and lost their homes, $2,000 is too little, too late," said the group’s statement.
Still, the settlement is a step in the right direction, said Tim Lilienthal, the lead organizer for PICO National Network, one of the groups that makes up The New Bottom Line.
"The true measure of this deal is what happens next," he said. "We need to keep the pressure on."
The federal and state officials that announced the deal Thursday vowed this will not be the end of the process.
Iowa Attorney General Tom Miller, who helped lead negotiations with the banks, said he believes once this program is up and running, it will prompt banks to start making principal reductions on their own beyond the terms of the settlement. He says banks will discover that they can recoup more money this way than they have through the foreclosure process.
"All the things they’re worried about — the sky is falling arguments about principal reduction — guess what, it won’t happen. At that point, principal reduction will become a regular, common tool," he said. "Principal reduction is an effective way for everybody to win."
For anyone who loves a good steak, a juicy burger or a nice Sunday roast, these are anxious times.
Prices for beef, which have been climbing for months, hit a record high in December - an average of $5 a pound — and analysts predict they could climb 5 to 8 percent higher this year.
“Prices have gone up quite a bit. That usually happens around the holidays, but we expect them to come down,” said Pam Neal, owner of Al’s Steakhouse, north of Laclede’s Landing. “Not this time. They’re going to be jumping even higher. It’s hard to handle.”
Beef prices are soaring for a number of reasons. Producers, who struggled with high feed costs and diminishing profits, began shrinking their herds roughly five years ago. Since then demand from overseas markets has shot up - roughly 11 percent of American beef went overseas last year, another record — claiming more American beef.
In July of last year, the US beef herd had dropped to its lowest point since1958. Also last year, a drought in Texas and Oklahoma, the top two cattle-producing states, forced producers to cull herds. That means that the 2012 cattle numbers, due out this week, will be even lower. Some estimates predict the country’s cattle herd could shrink by 600,000 head this year. Last year’s cow inventory was 30.9 million, while the total number of cattle was 92.6 million.
“There’s not enough beef out there,” said Ron Plain, an agricultural economist with the University of Missouri. “This year, there’s going to be less beef, more people, the supply is going to be tighter, and that means more records.”
Compounding matters for beef lovers are soaring feed, fuel and production costs, which are forcing price increases all along the production chain.
“Look at our fertilizer costs, our grain costs. Any piece of machinery we buy has just gone up,” said Tom Sachs, who raises cattle in St. Charles County. “Our input costs are just really high..”
For Missouri’s $3 to $4-billion cattle industry, which currently raises the third-highest number of calves in the nation, and for the nation’s cattle industry in general, the numbers come as good news. Prices, per pound for a steer, were $1.75 on Tuesday, compared to about 95 cents 5 years ago. For the average 1,300-pound steer, that adds up.
“Times are good,” said Mike Miller, of Cattlefax, a Colorado-based cattle industry research firm. “Our expectation is it’s going to be good for some time.”
But the good times for the industry have not come without effort.
Since 1980, according to the U.S. Department of Agriculture, per capita beef consumption has plummeted 25 percent. In 2011, the average American consumed 57.6 pounds of beef, down 13 percent from a decade prior. This year the number is predicted to decline again to 54.1 pounds.
The reasons for the decline are difficult to isolate. But they include health concerns over the higher fat content in red meat, worries about humane treatment and links to environmental problems, including greenhouse gasses, all of which have gotten a lot of attention in recent years. Some people point to public health campaigns, such as “Meatless Mondays,” for the shrinking numbers.
The industry insists the American appetite for beef is still strong, while some analysts and researchers suggest the decline, at least in recent years, is simply due to the recession.
“These non-economic factors are really tough to talk about,” said Scott Brown, a livestock economist with the Food and Agricultural Policy Research Center at the University of Missouri. “Frankly, when the consumer goes to the store or restaurant, it’s the relative price that’s driving their decision.”
Whatever the reason for the decline, the country’s cattle producers have helped compensated for it by making inroads into overseas markets, particularly in Asia.
“Worldwide consumption of meat and demand has increased,” said Jeff Windett, who heads the Missouri Cattlemen’s Association. “I think it’s just good business sense to expand market opportunities for producers.”
Overseas markets also embrace pieces of the animal that American’s typically don’t consume, bringing more dollars to American beef producers.
“Tripe, ox tail, tongue — some of those kinds of meat sell for a lot of money,” Windett explained. “It’s really creating a market for some of those variety meats and adding value to the carcass overall.”
Japan, a major beef importer, restricted US beef in 2003 after an outbreak of Mad Cow disease, but has since eased the barriers. With Japan a major trade destination again, American beef exports are poised to hit another record this year - nearly $5 billion. China, which does not officially import US beef, could be on the horizon.
“It spells a very bright spot for the US beef industry,” Brown said. “There are just a lot of things on the trade front that look to be very positive.”.
That will, inevitably, put more pressure on prices in American supermarkets, at least in the short term. Because cattle herds take years to rebuild and require huge amounts of capital, it could be some time before the American cattle inventory can help even out costs to consumers.
In the meantime, retailers, restaurants, butchers and shoppers are all getting creative.
Recently, for example, Dierbergs gave away free potatoes, onions and carrots to customers who bought ground beef.
“Customers are almost by default moving toward value cuts,” said Michael Cornelius, the chain’s meat director. “We’re trying to make sure there are items out there that address the value-consciousness of the customers.”
At Kenrick’s Meat and Catering, in south city, the meat counter has seen more customers looking for sales.
“People are eating more pork, but overall they’re just being more economical,” said manager Steven Weinmann. “They’re buying on sale. When everything was cheaper, people just bought by taste.”
At Kreis Steakhouse, on TK, owner George Tompras has been keeping an eye out for good values, too, but says he’s just managing to cover his costs.
“When tenderloins started going up in November, I bought 50 cases at $8 a pound,” he said. “Now it’s 11. That’s the kind of thing you have to do.”
Al’s, which just celebrated it’s 87th year in business, recently made a change to a long-standing tradition. Responding to customers’ concerns, the restaurant decided that instead of just displaying the beef cuts to diners on a tray, it would offer paper menus, with prices.
“We wanted to keep the elegance, the tradition,” Neal explained. “But we wanted to make sure people knew how much something was going to cost.”
Spain
Asian stock markets were mostly higher Thursday after the U.S. central bank pledged to keep interest rates low for another three years to nurture the country’s stubbornly slow economic recovery.
Hong Kong’s Hang Seng Index jumped 1.1 percent to 20,322.51 on its first trading day since the Chinese New Year holiday. South Korea’s Kospi rose 0.2 percent to 1,956.14. Benchmarks in Singapore and New Zealand also rose.
Japan’s Nikkei was 0.4 percent lower at 8,846.96, following strong gains a day earlier. Markets in Taiwan and mainland Chinese remained closed for the Chinese New Year. The Australian market was closed for a public holiday.
On Wednesday, the U.S. Federal Open Market Committee said it was unlikely to raise interest rates before late 2014. It had previously said it expected to keep rates low into the middle of 2013.
The Fed cut rates to near zero in December 2008, during the financial crisis, and has held them there ever since. The announcement was a sign that the Fed expects the economy, which is improving, to need significant help for three more years.
Analysts said stock buyers rejoiced that the Fed was leaning toward promoting economic growth.
“With the FOMC sending out a strong signal that monetary policy is likely to remain accommodative for even longer than previously expected, risk assets are in a very good position,” said Stan Shamu of IG Markets in Melbourne guaranteed personal loan approval.
Wall Street welcomed the news, with the Dow Jones industrial average closing up 0.6 percent at 12,756.96 _ the highest close since May 10. The Standard & Poor’s 500 index rose 0.9 percent to 1,326.06. The Nasdaq composite index gained 1.1 percent to close at 2,818.31.
Benchmark crude for March delivery was up 39 cents to $99.79 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose by 45 cents to finish at $99.40 per barrel in New York on Wednesday. At one point it was as high as $100.40.
The prospect of low interest rates weighed on the dollar, since it reduces the returns that investors get from holding assets denominated in that currency. The euro rose to $1.3103 from $1.3084 late Wednesday in New York. The dollar fell to 77.75 yen from 77.81 yen.
Jim O
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