Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-63676 Sat, 24 Feb 2018 15:31:50 GMT Fed Already Floats Idea of Resumed QE http://implode-explode.com/viewnews/2018-02-24_FedAlreadyFloatsIdeaofResumedQE.html iehi-feed-63675 Sat, 24 Feb 2018 15:29:20 GMT VIX Funds Face Fresh Scrutiny From U.S. Regulators http://implode-explode.com/viewnews/2018-02-24_VIXFundsFaceFreshScrutinyFromUSRegulators.html iehi-feed-63674 Sat, 24 Feb 2018 15:28:37 GMT Brexit to end London house price boom http://implode-explode.com/viewnews/2018-02-24_BrexittoendLondonhousepriceboom.html iehi-feed-63672 Sat, 24 Feb 2018 01:00:01 GMT Citigroup will refund $330 million to credit card customers it overcharged http://implode-explode.com/viewnews/2018-02-23_Citigroupwillrefund330milliontocreditcardcustomersitovercharged.html Citigroup Inc. (CPRS) said on Friday that it would refund about $330 million to consumers after discovering it had overcharged 1.75 million credit card accounts on their annual interest rates.

The company reports the average refund will amount to about $190 per account -- including interest.

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If you have been late on two consecutive credit card payments, an issuer can increase your interest rate. When you've made your minimum payment on time for the next six months, according to the CARD act, your interest rate is eligible for an interest rate reduction.

Half of the impacted Citi accounts did not receive that reduction at all. The other half received a reduction, but it should have been larger, according to Citi.

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iehi-feed-63669 Fri, 23 Feb 2018 21:55:30 GMT Prime-Age Men May Never Return to U.S. Workforce, Fed Paper Says http://implode-explode.com/viewnews/2018-02-23_PrimeAgeMenMayNeverReturntoUSWorkforceFedPaperSays.html Men in their prime working years have left the labor force at an astonishing rate and they may never return if the state of the U.S. job market holds, according to a new report from the Federal Reserve Bank of Kansas City.

A decline in demand for middle-skilled work -- a phenomenon dubbed "job polarization," because more positions are concentrated at the higher and lower ends -- has played a role in keeping prime-age men out of the job market, Didem Tuzemen, an economist at the Kansas City Fed, wrote in the paper released this week. Without job polarization, Tuzemen estimated that 1.9 million more prime-age men would have been employed in 2016.

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The participation rate of prime-age men -- those 25 to 54 years old -- has steadily decreased in the last half century. As of January, 89 percent of prime-age men were in the labor force, down from around 97 percent following World War II, according to the Bureau of Labor Statistics. That includes people who are working, or are unemployed and actively looking for a job.

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iehi-feed-63667 Fri, 23 Feb 2018 15:21:33 GMT Venezuela's New Cryptocurrency: Just Another Form of Control Fraud http://implode-explode.com/viewnews/2018-02-23_VenezuelasNewCryptocurrencyJustAnotherFormofControlFraud.html The gee-whiz component of the petro is that it is supposedly "backed by oil."In other words, unlike other cryptocurrencies/ tokens, the petro has intrinsic value because it's backed by oil...

The only way any currency, fiat or crypto, is "backed" by any real-world commodity is if the currency is convertible into the commodity on demand, that is, the currency can be exchanged for the commodity at a transparent published conversion rate.

If Venezuela's petro cannot be converted directly into deliverable-upon-demand oil contracts, it's not backed by anything. It's important to understand that any currency that claims to be "backed" by gold, oil, rice, bat guano, etc. must be convertible to the underlying commodity at a transparent conversion rate.

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iehi-feed-63664 Fri, 23 Feb 2018 00:46:22 GMT Head of world's largest hedge fund says U.S. in a ‘pre-bubble phase' with a 70% chance of recession http://implode-explode.com/viewnews/2018-02-22_HeadofworldslargesthedgefundsaysUSinaprebubblephasewitha70chance.html in a bubble phase, and it's already deflating...]]> iehi-feed-63663 Thu, 22 Feb 2018 23:41:18 GMT Michael Dell purchased $100 million penthouse that broke Manhattan records http://implode-explode.com/viewnews/2018-02-22_MichaelDellpurchased100millionpenthousethatbrokeManhattanrecords.html iehi-feed-63662 Thu, 22 Feb 2018 23:36:12 GMT Why the most-recent selloff was just the beginning http://implode-explode.com/viewnews/2018-02-22_Whythemostrecentselloffwasjustthebeginning.html iehi-feed-63660 Thu, 22 Feb 2018 15:37:20 GMT Citigroup Drove Puerto Rico Into Debt. Now It Will Profit From Privatization on the Island. http://implode-explode.com/viewnews/2018-02-22_CitigroupDrovePuertoRicoIntoDebtNowItWillProfitFromPrivatization.html iehi-feed-63659 Thu, 22 Feb 2018 15:28:26 GMT H&M's Fast-Fashion Empire Is Crumbling http://implode-explode.com/viewnews/2018-02-22_HMsFastFashionEmpireIsCrumbling.html H&M Hennes & Mauritz AB all but admitted it was a disaster this week, saying that same-store sales would likely only see growth in 2019. The Swedish retailer at its first ever capital markets day said that 2018 was "expected to remain challenging," but "that there are good opportunities for a somewhat better result for the full year compared with the previous year."

This promise comes despite the fact H&M continues to battle through high levels of inventory and sub-par styles on sales floors around the world, which will weigh on profits this year. In short, the promise by management to return to growth is unlikely to be met.

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it is Zara that has been the rival that H&M cannot shake. The Spanish retailer has seen double-digit sales growth while competitors have languished. It has an advantage in following the whims of fashion as it's able to move the latest designs to the rack within two weeks.

It has also highly integrated its online and physical stores, this year debuting a popup store in London designed primarily for ordering and collecting of online orders.

Hedge funds are accordingly shorting the heck out of H&M.

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iehi-feed-63658 Thu, 22 Feb 2018 03:46:16 GMT The House That Dimon Built: JPMorgan Plans Soaring HQ in Midtown http://implode-explode.com/viewnews/2018-02-21_TheHouseThatDimonBuiltJPMorganPlansSoaringHQinMidtown.html JPMorgan announced on Wednesday it will tear down its Park Avenue headquarters and construct a modern tower that will mark a new era for both midtown Manhattan and the lender. The monument to the success of the largest U.S. bank will set in motion a years-long logistical feat that in all likelihood will culminate just about the time that Chief Executive Officer Dimon, 61, hits retirement.

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The headquarters will house 15,000 of the bank's employees and could be between 70 and 75 stories, depending on how wide its footprint is, said a person with knowledge of the company's plans. The current structure is 52 stories. The new building, which has yet to be designed, could be as much as 500 feet (150 meters) taller than the current headquarters, said the person, who asked not to be identified because details of the plans haven't been publicly disclosed.

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The 2.5 million-square-foot (232,000-square-meter) building would be the first major project under New York City's Midtown East rezoning plan, which encourages new office construction in the area, the bank and Mayor Bill de Blasio said in the statement. JPMorgan's current headquarters is an "outdated facility" that was designed in the late 1950s for about 3,500 employees, the company said.

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iehi-feed-63657 Thu, 22 Feb 2018 02:16:36 GMT Homeownership is increasingly for the wealthy http://implode-explode.com/viewnews/2018-02-21_Homeownershipisincreasinglyforthewealthy.html iehi-feed-63656 Thu, 22 Feb 2018 02:14:49 GMT Existing home sales in January see biggest drop in 3 years http://implode-explode.com/viewnews/2018-02-21_ExistinghomesalesinJanuaryseebiggestdropin3years.html U.S. home sales unexpectedly fell in January, leading to the biggest year-on-year decline in more than three years, as a chronic shortage of houses lifted prices and kept first-time buyers out of the market.

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The supply squeeze and rising mortgage interest rates are stoking fears of a lackluster spring selling season. The second straight monthly drop in home sales reported by National Association of Realtors on Wednesday added to weak retail sales and industrial production in January in suggesting slower economic growth in the first quarter.

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Existing home sales dropped 3.2 percent to a seasonally adjusted annual rate of 5.38 million units last month, with purchases declining in all four regions. Economists polled by Reuters had forecast home sales rising 0.9 percent to a rate of 5.60 million units in January.

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The shortage of properties is concentrated at the lower end of the market. While the number of previously-owned homes on the market rose 4.1 percent to 1.52 million units in January, housing inventory was down 9.5 percent from a year ago.

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iehi-feed-63655 Thu, 22 Feb 2018 01:55:38 GMT Dow closes 166 points lower after 10-year yield hits 4-year high on Fed minutes http://implode-explode.com/viewnews/2018-02-21_Dowcloses166pointslowerafter10yearyieldhits4yearhighonFedminutes.html iehi-feed-63653 Wed, 21 Feb 2018 14:32:52 GMT Unknown Investor Buys a Billion Dollars Worth of Bitcoin During Last Downturn http://implode-explode.com/viewnews/2018-02-21_UnknownInvestorBuysaBillionDollarsWorthofBitcoinDuringLastDowntu.html iehi-feed-63651 Tue, 20 Feb 2018 22:36:05 GMT Walmart's online sales growth slips, rattling investors http://implode-explode.com/viewnews/2018-02-20_Walmartsonlinesalesgrowthslipsrattlinginvestors.html Walmart's e-commerce sales were up 23% in the final quarter of 2017. But the gains were interpreted as insufficient compared to the previous quarter, when they rose 50%.

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For the full year, profits plunged 27.7% to $9.86 billion, or $3.28 per share. That was down from $13.6 billion, or $4.38 in diluted earnings per share, or $4.42 when adjusted. Those full-year numbers also missed the expected $4.98 per share forecast by analysts with S&P Global Intelligence.

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iehi-feed-63650 Tue, 20 Feb 2018 22:33:19 GMT U.S. top court rejects investor appeals over Fannie Mae, Freddie Mac bailouts http://implode-explode.com/viewnews/2018-02-20_UStopcourtrejectsinvestorappealsoverFannieMaeFreddieMacbailouts.html The U.S. Supreme Court on Tuesday declined to revive litigation in which shareholders accused the federal government of overstepping its authority when it restructured mortgage finance firms Fannie Mae and Freddie Mac following the 2008 housing crisis. The justices left in place a lower court's 2017 ruling that the investors, led by hedge fund Perry Capital, could not pursue legal claims accusing the government of unlawfully channeling profits from Fannie Mae and Freddie Mac to the U.S. Treasury Department.

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Other shareholders that sued included Fairholme Funds Incand individual investors. Another hedge fund, Pershing Square Capital Management LP, the biggest common shareholder in both companies, filed a brief asking the justices to take the case.

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The appeals court said the government had the authority under a 2008 law that laid the groundwork for its seizure of the two companies.

Both companies are now under the conservatorship of the Federal Housing Finance Agency. Treasury Secretary Steven Mnuchin had said before taking office last year that the companies should be returned to private control but has since said that they should not be privatized.

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iehi-feed-63648 Tue, 20 Feb 2018 22:27:28 GMT US Treasury Posts Gigantic $1.16 Trillion Shortfall in Fiscal 2017, Media Coverage: Zilch http://implode-explode.com/viewnews/2018-02-20_USTreasuryPostsGigantic116TrillionShortfallinFiscal2017MediaCove.html That $1.156 trillion in Net Operating Cost occurred in fiscal 2017. But these are the good times, the boom years, if you will, when shortfalls should shrink into oblivion. So what will happen to the shortfall when the economy slows down or goes into a recession? That was a rhetorical question.

For fiscal 2018 and going forward, the tax cuts will lower revenues by about $150 billion per year on average over the next ten years. And for fiscal 2018 and 2019, Congress passed the two-year budget resolution that will add about $150 billion on average per year to the outlays. Both combined will drive up the deficit by about $300 billion a year on average.

Key fact that this article doesn't mention: the annual growth in the US debt more closely hews to the Net Operating Cost for the year, NOT the budget deficit (i.e., it is usually around 2x the fiscal deficit).

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iehi-feed-63647 Mon, 19 Feb 2018 18:00:13 GMT Goldman Sachs raises a red flag over U.S. government spending http://implode-explode.com/viewnews/2018-02-19_GoldmanSachsraisesaredflagoverUSgovernmentspending.html U.S. fiscal policy is headed for "uncharted territory."That's how a team of economists at Goldman Sachs, led by Jan Hatzius, have described the government's current spending and tax plans, as they also warned that the growth kick for the economy from those strategies will eventually fade.

"Congress has voted twice in the last two months to substantially expand the budget deficit despite an already elevated debt level and an economy that shows no need for additional fiscal stimulus," said the Goldman economists. Tax cuts signed into law by U.S. President Donald Trump in December will add $1.5 trillion to the deficit over a 10-year period.

Goldman economists expect the U.S. [deficit] level to hit 5.2% of gross domestic product by 2019, and keep climbing gradually from there. In the past, a strengthening economy and rising debt burden has prompted Congress to raise taxes and cut spending. But this time, the opposite has occurred, which will leave revenues low for a few years and push spending to its "highest point in decades," they said.

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