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.
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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.”
U.S. stocks rallied Friday, as investors cheered a much stronger-than-expected jobs report.
The Dow Jones industrial average () gained 157 points, or 1.2%, the S&P 500 () added 19 points, or 1.5%, and the Nasdaq composite () increased 46 points, or 1.6%.
The rally pushed pushed the Dow, up more than 5% in 2012, to its highest level since May 2008. The Nasdaq, up more than 11% for the year, climbed to its highest level since December 2000. The S&P 500 has gained almost 7% this year, and finished at a six-month high.
The rally was sparked by the Labor Department’s monthly jobs report, which showed that the U.S. economy added 243,000 jobs in January, far exceeding expectations. The unemployment rate dropped to 8.3%, the lowest since February 2009.
Economists surveyed by CNNMoney had expected the government to report an increase of just 130,000 jobs in January. The unemployment rate was expected to rise to 8.6%.
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Economists had expected a slowdown in post-holiday hiring, considering that about 40,000 temporary couriers were hired for the holidays alone..
"The jobs data blew away market expectations," noted Marc Chandler, global head of currency strategy at Brown Brothers Harriman, calling it a "monster" jobs report. "This coupled with other recent reports for January, show the year has begun off on a firm note," he added.
Meanwhile, investors were also on the lookout for an official agreement on a debt-reduction plan and a second bailout for Greece. The deal is expected to be near, but negotiations are likely to continue thorough the weekend.
U.S. stocks ended mixed Thursday as investors digested a cautious economic outlook from the chairman of the Federal Reserve.
Economy: Factory orders for December rose 1.1%, slightly below expectations. The January installment of the ISM Services Index hit 56.8, surpassing economists’ expectations for 53.1, and up sharply from the prior month.
Companies: Financial stocks were big gainers in Friday’s rally, with Bank of America’s (, Fortune 500) 5% spike leading the Dow’s gains. Morgan Stanley (, Fortune 500), Citigroup (, Fortune 500) and Goldman Sachs (, Fortune 500) were all up between 3% and 5%.
Shares of Genworth Financial (, Fortune 500) soared 14% after the mortgage insurer swung to a fourth-quarter profit.
Tyson Foods (, Fortune 500) shares rose after the company reported better-than-expected earnings and issued slightly upbeat guidance.
Estee Lauder (, Fortune 500) reported a 15% profit increase for its fiscal second quarter to $597 million, but its stock tumbled as the company’s guidance for the current quarter came in short of analyst expectations.
Shares of Gilead Sciences (, Fortune 500) spiked after the company posted fourth-quarter earnings that rose almost 6% from a year ago.
Edwards Lifesciences’ () stock dropped as earnings fell and the company gave a lackluster forecast for the current quarter.
Zynga () shares continue to rise, after Facebook’s IPO revealed the gamemaker accounted for 12% of its revenue in 2011.
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Research in Motion () shares dipped after the BlackBerry-maker said it will give its tablet, the BlackBerry PlayBook, out to Android developers in exchange for their apps.
Trading in shares of Micron Technology (, Fortune 500) was halted after the company announced that its CEO and chairman Steve Appleton died Friday morning in a small-plane crash in Boise.
Currencies and commodities: The dollar slipped against the euro and the British pound, but rose versus the Japanese yen.
Oil for March delivery rose $1.48 to settle at $97.84 a barrel.
Gold futures for April delivery fell $19 to settle at $1,736.80 an ounce.
Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 1.95% from 1.82% late Thursday.
World markets: European stocks ended sharply higher. Britain’s FTSE 100 () rose 1.8%, while the DAX () in Germany jumped 1.7% and France’s CAC 40 () rose 1.5%.
Asian markets ended mixed. The Shanghai Composite () rose 0.8%, while the Hang Seng () in Hong Kong was flat and Japan’s Nikkei () slipped 0.5%.
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Australian house prices plunged by the most on record in 2011 as global economic uncertainty and concerns about its impact at home kept a lid on demand.
An index measuring the weighted average of prices for established houses in eight major cities slid 4.8 percent from a year earlier, according to the Australian Bureau of Statistics, the biggest calendar-year drop since the data began in March 2002. They fell 1 percent in the three months to December from the previous quarter, when they retreated a revised 1.9 percent. The median estimate of 15 economists surveyed by Bloomberg News was a 0.6 percent quarterly fall.
Reserve Bank of Australia Governor Glenn Stevens lowered the benchmark rate by a quarter percentage point on Nov. 1 and again on Dec. 6 as inflation pressures eased and global growth risks increased. Australia recorded its worst annual job growth in 19 years in 2011, as consumers boosted savings, and traders are pricing in a 60 percent chance of another cut next week.
Gannett Co. reported a 33 percent drop in its fourth-quarter net income Monday. The media company, which publishes USA Today and owns a network of broadcast, digital and other publishing properties, said profits were weighed down by restructuring costs and other charges, as well as a revenue decline.
The company earned $116.9 million, or 49 cents per share, in the three months that ended Dec. 25. That’s down from earnings of $174.1 million, or 72 cents per share, in the same period a year earlier.
Gannett’s stock fell 7 percent, or $1.07 to $14.15 in midday trading on Monday. It has traded in between $8.28 and $18.93 in the past 52 weeks.
Excluding special items such as restructuring charges, Gannett earned 72 cents per share in the latest quarter. Analysts, on average, were expecting earnings of 68 cents per share, according to a poll by FactSet.
The company said its results reflected $63.6 million in charges related to workforce restructuring and facility consolidations at properties in the U.S. and the U.K. The largest charge was associated with the transfer of production of The Cincinnati Enquirer to a newspaper printer in Columbus, Ohio.
Revenue fell 5 percent to $1.39 billion from $1.46 billion in the same period a year earlier.
Analysts were expecting revenue of $1.39 billion, according to a poll by FactSet.
“We are positioning for growth in print and digital media through new subscription models delivered across platforms, capturing opportunities in adjacent businesses, and continuing to focus on operational efficiencies,” said Gracia Martore, president and CEO, in a statement business cards design.
Revenue at Gannett’s publishing division fell 5 percent to $1.01 billion, a decline the company attributed to lower advertising amid the economic softness in the U.S. and the U.K.
Broadcasting revenue fell 14 percent to $199.8 million, due mainly to sharply lower political advertising than a year earlier.
Revenue at the company’s digital division, which includes the website CareerBuilder, rose 9 percent to $181.5 million.
Company-wide digital revenue, which consists of the digital division and revenue generated by newspaper websites, rose nearly 7 percent to $290.3 million.
For the full year, Gannett earned $458.7 million, or $1.89 per share, down 22 percent from $588.2 million, or $2.43 per share, in the previous year.
Adjusted earnings were $2.13 per share.
Revenue slid 4 percent to $5.24 billion from $5.44 billion.
Analysts were expecting full-year adjusted earnings of $2.10 per share on revenue of $5.25 billion.
Cyprus’ banks will be able to recapitalize on their own and won’t need state support thanks to fiscal measures buttressing the island’s financial system, the government said on Saturday.
Cyprus’ Finance Ministry said in a statement that the economy has “strong foundations” and added that it will soon unveil a growth-oriented package of measures that it’s preparing in partnership with the private sector.
The ministry made its remarks a day after international ratings agency Fitch downgraded the eurozone member by a notch to BBB-, a step above junk status.
Fitch said the downgrade was mainly due to the large Cypriot banking system’s heavy exposure to Greek debt and its greater capital needs in light of the higher likelihood that banks will take a hit on Greek government bonds that exceeds 50 percent.
Fitch said Cypriot banks would need to almost double the euro900 million ($1.18 billion) _ or 9.9 percent of gross domestic product _ to build an adequate buffer against losses on their Greek exposure if the “haircut” on Greek government bonds reaches 70 percent.
Standard & Poor’s became the first ratings agency to push Cyprus into junk territory with a two-notch downgrade earlier this month. Moody’s also rates the island just above junk.
Cyprus government spokesman Stefanos Stefanou on Saturday called the downgrades unfair.
“We consider that the downgrades don’t reflect the real state of the Cyprus economy, which is in better shape than many other economies, either in the eurozone or in the European Union in general,” he told reporters.
According to the European Commission, the island’s deficit is projected to shrink from 6.7 percent of gross domestic product in 2011 to 2.7 percent this year following a string of fiscal consolidation measures including a 2 percent sales tax hike and a two-year public sector wage freeze.
The island’s debt is projected to reach 68.4 percent of GDP this year, well below the eurozone average of nearly 87 percent.
But high borrowing costs have effectively locked Cyprus out of the international markets. The island is relying on a euro2.5 billion ($3.29 billion) low-interest loan to meet its financing needs for this year.
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.
The average U.S. price of a gallon of gasoline has jumped three-and-a-half cents over the past two weeks.
That’s according to the Lundberg Survey of fuel prices, released Sunday, which puts the price of a gallon of regular at $3.39.
Midgrade costs an average of $3.54 a gallon, and premium is at $3.66.
Diesel was up about two cents, at $3.91 a gallon.
Of the cities surveyed, Salt Lake City, Utah, has the nation’s lowest average price for gas at $2.94. Los Angeles has the highest at $3.71.
In California, the lowest average price was $3.59 in Fresno. The average statewide for a gallon of regular was $3.67, up about three cents.
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