It's A Matter Of Getting

(Reuters) - Permits for U.S. homebuilding neared a 3-1/2 year high in February, suggesting a budding recovery in the housing market was still on track even though groundbreaking activity slipped. New building permits surged 5.1 percent to a seasonally adjusted annual rate of 717,000 units last month, the highest since October 2008, the Commerce Department said on Tuesday. The jump in permits, which exceeded economists' expectations for an advance to a 690,000-unit pace, reinforced views the housing market was improving and that home building would add to economic growth this year for the first time since 2005. "The data provides further evidence of a rebound in housing activity. Housing is being nursed back to health, but getting out of rehab takes time," said Eric Green, chief ...

The Weekly Bottom Line : 16/03/2012 HIGHLIGHTS OF THE WEEK United States Market participants are clearly trading on what everyone else seems to be feeling: the recovery is back. But the Fed, for its part, is not yet willing to admit that the economy has entered a new, stronger phase. Though the quickening pace of job growth is a positive sign, disposable income growth is still stagnant, and the recent run-up in commodity prices threatens to erode consumer spending growth. Europe's troubles haven't gone away. If market sentiment get's too far ahead of itself, the Fed may be tempted to fight back with another round of asset purchases. But if rising borrowing costs are a product of a stronger recovery then the Fed should be less concerned. Increased spreads may actually be ...

(Reuters) - Gold fell 2 percent in heavy volume on Tuesday after breaching a key support, as renewed concerns about Greece's debt triggered economic fears, while some analysts say the metal looks oversold and poised for a rebound. Silver fell 3 percent, and platinum and palladium headed for their largest one-day falls this year after caution grew about global economic outlook a day after China cut its growth forecast and data showed the European Union is unlikely to avoid a recession. Bullion broke below its 200-day moving average for the first time since mid-January, tracking U.S. equities' slide on worries Greece could miss a deadline to complete a deal swap to avert a chaotic default. Gold investor sentiment was already cautious after a sudden 5 percent drop last Wednesday as ...

The Week Ahead Highlights Greek debt swap - It's on G-20 meeting, ECB LTRO, and month-end ahead EUR short squeeze continues; JPY reversal extends Greek debt swap - It's on On Friday, Greece issued the formal invitation to bondholders to exchange their Greek debt for new bonds and take an approximately 75% loss in the process. Without getting into all the nitty-gritty details, the key for us is the rate of creditor participation and what it implies for the risk of a credit default, which would trigger CDS (credit default swaps - insurance on Greek government debt) payouts, potentially rattling global markets' nerves. Beginning with the most benign scenario, if 90% of bondholders sign on, the exchange will be considered voluntary and CDS will not be triggered. In a darker ...

LONDON (Reuters)- No sooner are Europe's debt anxieties easing a touch than a sharp rise in oil prices threatens to impede the economy's tentative recovery from the euro's near-death experience with Greece. Brent oil has shot up about 20 percent since mid-December on concern over cuts in Iranian supply, and set an all-time high this week in euros. Oil has not reached a level that poses a grave danger to growth, economists say. In dollars, today's price around $123 is still below last April's $127 high, let alone the record peak of $147 scaled in 2008. But the risk is that consumers and companies, their confidence still fragile, will crawl back under the covers. "This comes at a difficult time for the euro area economy, which I would still characterize as being in a state of mild ...

Months of swinging between hope and despair over Greece is taking its toll on bond traders at the heart of the euro zone crisis, leaving bank trading teams stuck in an unprofitable funk. "We're sick of Greece and sick of Europe... It's getting very difficult now to try and make money," said one London-based government bonds trader. The threat of a Greek default has seen European Union leaders step up their efforts to lance Athens' painful debt boil, demanding tough austerity and heaping pressure on private creditors to take increased losses. Yet as deadline after deadline slips past without a clear resolution, traders have become weary of the inevitable cycle of optimism followed by disappointment. They are coping by taking short-term bets and standing ready to jump out of the market at ...

(Reuters) - The Federal Reserve should start raising interest rates next year, a top Fed official said on Monday, arguing that even if rates stay near zero for many years, U.S. economic output will not bounce back to pre-recession levels. Last month the Fed said it was likely to keep interest rates exceptionally low through late 2014 to bolster a recovery that was moving too slowly. St. Louis Fed President James Bullard said he disagreed with that decision, arguing that the housing collapse means unemployment is likely to stay high and labor markets will improve only slowly even if rates are kept low for many years. Bullard, who does not have a vote on the Fed's policy-setting Federal Open Market Committee this year, is seen as a policy centrist. "It's important to start to remove ...

With the Standard & Poor's 500 Index off to its best January in 15 years, it's getting tougher to find cheap stocks in the United States. But it's not much of a problem in Europe. Sovereign default worries have made the region's shares the cheapest they've been to American investors since 2004. Companies in the S&P Europe 350 are trading at around 10 times earnings for 2012, compared to 12.2 for the S&P 500. That means investors are getting a 20 percent-plus discount for looking across the pond. For good reason, of course. Investors are still nervous about the future for European equities, since no one yet knows how the debt crisis is going to play out. On any given day, fresh rumors abound regarding the dismal outlook of nations like Greece, Spain, or Italy. For speculators with ...

(Reuters) - A Republican bid to force President Barack Obama to speed up approval of the Keystone XL Pipeline project looked set to pass the House of Representatives on Tuesday but will likely stall in the Democratic-controlled Senate, aides said. Republicans have linked the proposed Canada-to-Texas oil pipeline to President Barack Obama's efforts to extend a payroll tax cut for workers. Some economists warn that allowing the tax cut to expire could damage a fragile U.S. economic recovery. The top Republican in Congress, Speaker John Boehner, said on Monday he was confident the House would pass a Republican measure that includes extending the tax cut beyond this year and sets a deadline for a decision on the fate of the delayed pipeline, which has drawn fire from environmentalists. ...