Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-61982 Wed, 29 Mar 2017 21:40:19 GMT Wells Fargo Settles Fake-Account Lawsuit for $110 Million http://implode-explode.com/viewnews/2017-03-29_WellsFargoSettlesFakeAccountLawsuitfor110Million.html On Tuesday, San Francisco based bank Wells Fargo announced a $110 million settlement for a class-action lawsuit brought by customers. Still requiring court approval, the settlement covers anyone who claims to be touched by Wells Fargo's employees opening more than 2 million accounts without customer consent.

Wells Fargo paid their first private settlement late last year. In September, the bank was penalized $185 million by federal and California authorities to cover their poor sales practices.

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Unfortunately for investors, Wells Fargo's complications might still be far ahead of them. The bank is subject to criminal investigations, further reviews which may reveal more impacted customers, and lawsuits from previous employees.

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iehi-feed-61976 Wed, 29 Mar 2017 20:39:31 GMT 'No turning back' on Brexit as Article 50 triggered; Merkel Rejects Post-Breakup Relationship Talks http://implode-explode.com/viewnews/2017-03-29_NoturningbackonBrexitasArticle50triggeredMerkelRejectsPostBreaku.html Angela Merkel rejects one of Theresa May's key Brexit demands.]]> iehi-feed-61974 Wed, 29 Mar 2017 15:28:59 GMT Three Reasons Why Bitcoin Could Reach $10,000 (Or More) http://implode-explode.com/viewnews/2017-03-29_ThreeReasonsWhyBitcoinCouldReach10000OrMore.html iehi-feed-61973 Wed, 29 Mar 2017 14:30:33 GMT Tax Reform Failure Could Trigger Market Downturn - The Wall Street Examiner http://implode-explode.com/viewnews/2017-03-29_TaxReformFailureCouldTriggerMarketDownturnTheWallStreetExaminer.html iehi-feed-61971 Tue, 28 Mar 2017 22:35:21 GMT In Another Blow, Wells Fargo Faulted for `Extensive' Discrimination in Review http://implode-explode.com/viewnews/2017-03-28_InAnotherBlowWellsFargoFaultedforExtensiveDiscriminationinReview.html Wells Fargo & Co. engaged in an "extensive and pervasive pattern" of discriminatory and illegal lending practices for years, a U.S. regulator said in slashing a key rating of how the bank serves communities, triggering restrictions that may hamper its growth.

While examiners credited Wells Fargo for "excellent responsiveness" in meeting customers' credit needs, 10 government inquiries over the past decade prompted the Office of the Comptroller of the Currency to lower its overall score of the company's compliance with community banking laws to "needs to improve." Enforcement cases cited by the OCC faulted the bank's treatment of minority neighborhoods, military personnel and women who had recently given birth.

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The findings risk further damage to Wells Fargo's reputation as executives try to rebuild customer and investor trust in the wake of an account scandal that rocked the company and its stock price last year. Yet, many of the cases cited by the OCC already were announced years ago in settlements, including some misconduct that predated the 2008 financial crisis.

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iehi-feed-61966 Tue, 28 Mar 2017 18:50:18 GMT Manhattan Landlords Are Offering Massive Giveaways to Lure Retail Clients (IN LIEU OF MUCH-NEEDED PRICE CUTS) http://implode-explode.com/viewnews/2017-03-28_ManhattanLandlordsAreOfferingMassiveGiveawaystoLureRetailClients.html Tenant-improvement allowances haven't been typical in the Manhattan retail market. But now the concessions, which can pay for anything from lighting and displays to a complete overhaul, are becoming a key component in some new leases, particularly for large, flagship stores in high-profile areas, such as Madison Avenue and Fifth Avenue, according to Steve Soutendijk, an executive director at brokerage Cushman & Wakefield Inc. 

"We're seeing tenant-improvement and concession packages that retail landlords never, ever contemplated before," he said.

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The details of leases in Manhattan are often closely guarded secrets, making it difficult to quantify the incentives retailers are receiving. Landlords have a lot of ways to cut a deal without lowering asking rents, such as paying the construction contractor, offering an extended period of free rent or simply writing a check for the tenant to use at their discretion.

... Tepid demand for luxury goods and a stronger U.S. dollar that's crimped spending by tourists have particularly hurt Fifth Avenue, where the space-availability rate was at a record 15.9 percent in fourth quarter, up from 10.1 percent a year earlier, Cushman data show. The average rent on the stretch from 49th to 60th streets reached a record $3,213 a square foot in the third quarter before dropping in the last three months of the year to $2,985.

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iehi-feed-61963 Tue, 28 Mar 2017 16:21:59 GMT These Charts Show Alarm Bells Ringing on the Trump Trade http://implode-explode.com/viewnews/2017-03-28_TheseChartsShowAlarmBellsRingingontheTrumpTrade.html iehi-feed-61962 Tue, 28 Mar 2017 16:20:59 GMT Monte Paschi May Have Received Solvent-Status "Fudge" To Get Bailout http://implode-explode.com/viewnews/2017-03-28_MontePaschiMayHaveReceivedSolventStatusFudgeToGetBailout.html ``To make sense of the Monte Paschi debate, you have to start with a 2014 law known as the Bank Recovery and Resolution Directive, which sets out the EU's bank-failure rules. The law assumes that if a firm needs "extraordinary public financial support," this indicates that it's failing and should be wound down. In that process, investors including senior bondholders can be forced to take losses.

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An exception, known as a precautionary recapitalization, is allowed for solvent banks if a long list of conditions is met. As the name suggests, this tool isn't intended to clear up a bank's existing problems, such as Monte Paschi's mountain of soured loans. This temporary aid is allowed to address a capital shortfall identified in a stress test.

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"It is unclear if Monte Paschi meets the BRRD's exemption criteria, and their use has the appearance of promoting national political concerns over a stricter reading of the newly established European rules," said Simon Ainsworth, a senior vice president at Moody's Investors Service. "The plan could risk damaging the credibility of the resolution framework, especially given that it would mark its first major test case."

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In the view of some ECB Supervisory Board members, while Monte Paschi cleared the hurdles for aid, its viability was bolstered by unrealistic valuations of its bad loan portfolio, the people said. The board gave the all-clear even though the possibility that Monte Paschi sold junior bonds inappropriately to retail investors wasn't fully reflected in the solvency assessment, they said.

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iehi-feed-61961 Tue, 28 Mar 2017 16:15:22 GMT Pension Crisis Too Big for Markets to Ignore http://implode-explode.com/viewnews/2017-03-28_PensionCrisisTooBigforMarketstoIgnore.html The question is why haven't the headlines presaged pension implosions? As was the case with the subprime crisis, the writing appears to be on the wall. And yet calamity has yet to strike. How so? Call it the triumvirate of conspirators -- the actuaries, accountants and their accomplices in office. Throw in the law of big numbers, very big numbers, and you get to a disaster in a seemingly permanent state of making. Unfunded pension obligations have risen to $1.9 trillion from $292 billion since 2007.

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By some estimates, unfunded liabilities would triple to upwards of $6 trillion if the prevailing yields on Treasuries were used. That would translate into much steeper funding requirements at a time when budgets are already severely constrained. Pockets of the country would face essential public service budgets being slashed to dangerous levels.

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iehi-feed-61959 Mon, 27 Mar 2017 15:48:15 GMT Rich Chinese Race to Apply for a U.S. "Golden Visa" http://implode-explode.com/viewnews/2017-03-27_RichChineseRacetoApplyforaUSGoldenVisa.html As members of Congress in Washington debate raising the minimum required to obtain a U.S. immigrant investor visa from $500,000 to $1.35 million, concern about the hike has set off a scramble among wealthy would-be participants in China.

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At stake if the EB-5 is curtailed is a program estimated to have played a role in creating at least 200,000 U.S. jobs and drawing as much as $14 billion from Chinese investors alone, based on data provided by Rosen Consulting Group and the Asia Society. Past projects taking advantage of EB-5 include New York's Hudson Yards, Hunter's Point Shipyard in San Francisco, and a Trump-branded tower in Jersey City.

New projects recently doing the rounds in China's chat rooms, web forums and hotel-ballroom investor seminars include a 5-star hotel complex in Palm Springs, California, and what's touted as "the world's tallest residential building," on New York's 57th Street, known as Billionaires' Row.

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iehi-feed-61958 Mon, 27 Mar 2017 15:46:23 GMT Fading Trump rally threatened by rare contraction of US credit http://implode-explode.com/viewnews/2017-03-27_FadingTrumprallythreatenedbyrarecontractionofUScredit.html Data from the US Federal Reserve shows that the $2 trillion market for commercial and industrial loans peaked in December. The sector has weakened abruptly as lenders tighten credit, especially for non-residential property. Over the last three months it has dropped at a rate of 5.4pc on annual basis, a pace of decline not seen since December 2008.

The deterioration in the broader $9 trillion market for loans and leases has been less dramatic but it too is shrinking, falling at a 1.6pc rate on a three-month basis. "Corporate lending has ground to a halt and I am staggered that the Fed is raising rates. They have made a very big mistake," said Patrick Perret-Green from AdMacro.

... Credit has tended to pick up signs of trouble several weeks before equity markets in recent episodes of financial stress... Monetary tightening in the US so far this cycle has been equal to 13 rate rises under the Fed's Wu-Xia model, which includes the effects of withdrawing stimulus from quantitative easing. Nobody knows where the pain threshold lies in a global financial system that is more leveraged than at any time in history, including Fed officials themselves.

... Simon Ward from Henderson Global Investors said his early warning indicator - real six-month M1 money - turned negative in February. It has ticked up a little in March but not enough to prevent what would normally be an economic relapse later this year.

... Kevin Gaynor from Nomura says his model of asset pricing suggests markets are in effect assuming global growth of 5pc and earnings increases of 30pc a year. These are heroic. "There is a time decay on this new temporary equilibrium," he notes acidly.

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iehi-feed-61957 Sun, 26 Mar 2017 16:07:58 GMT Condo Flippers in Miami-Dade Left Twisting in the Wind http://implode-explode.com/viewnews/2017-03-26_CondoFlippersinMiamiDadeLeftTwistingintheWind.html Miami-Dade's spectacular condo flipping mania is in turmoil, with sales plunging, inventory-for-sale soaring, and new supply flooding the market... In February, existing home sales of all types fell 10% year-over-year, to 1,835 homes. These sales "do not include Miami's multi-billion dollar new construction condo market," the Miami Association of Realtors clarified in its report on March 23.

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[The current high] inventory [which is 2x the level in 2013] understates the total number of condos for sale. It only includes units listed for sale on the Multiple Listing Service (MLS). But developers normally don't list their new units on the MLS, and thus they're not included in the above chart.

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iehi-feed-61955 Sun, 26 Mar 2017 15:49:20 GMT Bridgewater Releases Report on Populism http://implode-explode.com/viewnews/2017-03-26_BridgewaterReleasesReportonPopulism.html iehi-feed-61954 Sun, 26 Mar 2017 15:38:05 GMT The Swamp Drains Trump - KUNSTLER http://implode-explode.com/viewnews/2017-03-26_TheSwampDrainsTrumpKUNSTLER.html iehi-feed-61953 Sun, 26 Mar 2017 15:36:52 GMT Trump's path forward only gets tougher after health-care fiasco http://implode-explode.com/viewnews/2017-03-26_Trumpspathforwardonlygetstougherafterhealthcarefiasco.html ... others in the party acknowledged the political damage sustained by pulling the House bill, particularly for a president who had touted his own dealmaking prowess... While Republicans broadly share the goal of Trump's promised "big tax cuts," the president will have to bridge many of the same divides within his own party that sank the attempted overhaul of the Affordable Care Act. And without savings anticipated from the health-care bill, paying for the "massive" cuts Trump has promised for corporations and middle-class families becomes considerably more complicated.

Meanwhile, other marquee agenda items, including a $1 trillion investment in roads and other infrastructure and proposed crackdowns on both legal and illegal immigration, will require the support of Democrats, many of whom have been alienated by the highly partisan start to Trump's tenure.''

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iehi-feed-61952 Sun, 26 Mar 2017 15:28:48 GMT Week in Review: Stocks See Worst Week Since Election as Trump Dealt Setback With Health-Care Bill http://implode-explode.com/viewnews/2017-03-26_WeekinReviewStocksSeeWorstWeekSinceElectionasTrumpDealtSetbackWi.html iehi-feed-61951 Sat, 25 Mar 2017 15:25:26 GMT "It Was a Very Bad Earnings Season" (Again) http://implode-explode.com/viewnews/2017-03-25_ItWasaVeryBadEarningsSeasonAgain.html ``The recovery in earnings is as lackluster as the recovery in economy, a more constructed relationship where stocks are concerned. That leaves share prices, in general, operating on the far end of the probability spectrum; where everything has to go just right in the near future, including whatever may come out of Trump "stimulus" and economic policies. EPS, however, suggests, as the calculations for GDP potential, that that would be a very low probability outcome, including a high risk of "something" going wrong all over again just like it was in 2014.

For shareholders, that leaves them in a precarious position expecting something that just isn't very likely. Worse, any objective review of economic prospects for years before suggested the very same, meaning that nothing has really changed in terms of the long run except actual reported earnings which are supposed to matter more.''

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iehi-feed-61950 Sat, 25 Mar 2017 15:21:23 GMT Greece to Break Off Face-to-Face Talks as Issues Persist http://implode-explode.com/viewnews/2017-03-25_GreecetoBreakOffFacetoFaceTalksasIssuesPersist.html Greece and the institutions managing its bailout review will break off negotiations in Brussels without having cleared a path to conclude the deliberations that would release needed rescue funds.

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Greece is edging closer to a repeat of the 2015 drama that pushed Europe's most indebted state to the edge of economic collapse, as the government in Athens and its creditors disagree over reforms to the pension system and the labor and energy markets. Greece needs to complete the review in order to get the next portion of its aid payment before it has more than 7 billion euros ($7.6 billion) of bonds come due in July.

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iehi-feed-61947 Sat, 25 Mar 2017 15:10:42 GMT Death of the American Dream? Life In Post-Crisis America http://implode-explode.com/viewnews/2017-03-25_DeathoftheAmericanDreamLifeInPostCrisisAmerica.html iehi-feed-61946 Sat, 25 Mar 2017 15:03:10 GMT Why the Retail Apocalypse Has Only Just Begun... http://implode-explode.com/viewnews/2017-03-25_WhytheRetailApocalypseHasOnlyJustBegun.html