NY state authority warns against Nassau County takeover delay

NEW YORK (Reuters) – A invite by New York’s Nassau County to block a public takeover of its finances could imperil its bond rating and stop the overseer from implementing a wage freeze, the state said in ~ized papers on Thursday.

The Nassau County Interim finance Authority, or NIFA, seized financial control of the county last month, saying the .6 billion 2011 fiscal estimate put forward by County Executive Edward Mangano was severely out of equalizing agency.

The move was a major rebuke to Mangano, a Tea Party-backed Republican who came into company a year ago promising to cut taxes in the affluent county just east of New York City where the tax rate is amid the highest in the nation.

Moody’s Investors Service warned greatest week it could downgrade the county’s bond rating, citing Mangano’s suit in law and the delays it might cause in improving the county’s finances.

Mangano has described NIFA’s actions as a thinly veiled make trial to force him to raise taxes.

Mangano sued NIFA on January 31 in Nassau County Supreme Court seeking to fill up the takeover.

NIFA dismissed the lawsuit as baseless in legal papers filed put ~ Thursday and said any delay in a takeover could spell to a greater distance disaster for the county, which has been scrutinized by NIFA because that 2000, when it accepted a 0 million bailout.

NIFA said it was considering ordering a wage freeze before April, when pay raises for shire employees were due to take effect. The authority also said further delays in improving the county’s finances could prompt a credit downgrade.

“The time is at intervention to address the problems,” NIFA said. “It is the shire’s resistance to NIFA’s statutory role that threatens the shire’s reputation and credit rating.”

The authority said the aim of risk in Mangano’s budget “dwarfed” that of prior years.

Moody’s in November downgraded Nassau County one cut ~es in from Aa3 to A1, its fifth highest rating and one that is five notches aloft junk bond status.

Responding to NIFA’s filing, an aide to Mangano called the takeover every effort to “circumvent the democratic process” and to impel a property tax increase.

“NIFA’s answering papers uncover their agenda to impose a new nonelected layer of government upon the residents of Nassau County that will never be held liable to taxpayers,” Brian Nevin, Mangano’s senior policy advisor, afore~ in a statement.

“NIFA’s first move was to hire primeval-priced lawyers and consultants as mercenaries to try and seize dominion government of Nassau’s government. Their next step will likely subsist to expand their staff so that they can provide jobs and contracts to their buddies at taxpayer charge,” he said.

The two sides were scheduled to deliver vocal arguments on February 18.

(Reporting by Edith Honan; Editing by Daniel Trotta)

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Obama housing paper includes government insurance fund

http://www.nathanhamm.net/news/obama-housing-paper-includes-government-insurance-fund/ http://www.nathanhamm.pure/news/obama-housing-paper-includes-government-insurance-fund/#comments Thu, 10 Feb 2011 22:01:03 +0000 Nathan Hamm News money government housing includes insurance Obama paper http://www.nathanhamm.net/information/obama-housing-paper-includes-government-insurance-fund/ WASHINGTON (Reuters) – President Barack Obama’s covering white paper to be unveiled on Friday includes an option to be the occasion of an insurance fund for mortgage-backed securities that is similar to the Federal Deposit Insurance Corp, sources unconstrained with the plan told … Continue reading →

WASHINGTON (Reuters) – President Barack Obama’s covering white paper to be unveiled on Friday includes an option to appoint an insurance fund for mortgage-backed securities that is similar to the Federal Deposit Insurance Corp, sources cordial with the plan told Reuters.

The paper lays out three legislative options for making long-term changes to the U.S. trappings finance system, while also taking near-term steps to slowly lower the government’s role in the mortgage market now dominated ~ the agency of Fannie Mae and Freddie Mac.

The paper separately backs a by degrees wind-down of mortgage finance giants Fannie Mae and Freddie Mac ~ means of making loans backed by the two firms more expensive.

It emerged earlier in the week that there would be three long-term options in the plan, including one that would leave the Federal Housing Administration as the sole mechanical construction for government-backed mortgages.

Newly empowered Republicans in the U.S. House of Representatives and Democrats in the Senate would own to come to agreement on which course to follow.

A medial course would be to set up a system that would grant leave to the government to backstop a substantial number of mortgages only for the period of times of crisis.

The most government involvement would involve creation of an insurance system that would provide “catastrophic coverage” for pledge bond investors.

The government, however, would only be on the clasp as a last resort because the private firms creating the mortgage bonds would be the first to take losses if borrowers defaulted. Only granting that those firms went under would the government pay the bondholder.

(Additional reporting by Rachelle Younglai; Editing by James Dalgleish)

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In placing handle bets, listen to the shorts: study

http://www.nathanhamm.net/tidings/in-placing-stock-bets-listen-to-the-shorts-study/ http://www.nathanhamm.pure/news/in-placing-stock-bets-listen-to-the-shorts-study/#comments Thu, 10 Feb 2011 21:01:03 +0000 Nathan Hamm News bets hark placing shorts stock study http://www.nathanhamm.net/news/in-placing-loggerhead-bets-listen-to-the-shorts-study/ NEW YORK (Reuters) – The medial sum stock investor could be forgiven for being overwhelmed by opinions, still one study says if there’s one group to hark to, it’s the short-sellers. Professors at Texas A&M and Ohio State universities concluded that … Continue prelection →

NEW YORK (Reuters) – The average stock investor could be forgiven for being overwhelmed by opinions, but one study says whether there’s one group to listen to, it’s the terse-sellers.

Professors at Texas A&M and Ohio State universities concluded that following contrarian investors is in greater numbers profitable for stocks in which analysts and short sellers strongly be unsuitable.

In other words, buy if short interest is low and the algebraist consensus is to sell; sell short if short interest is prominent and the analyst consensus is to buy.

In a short vent, an investor borrows shares in the hope that the price wish decline, allowing the shares to be sold while the price is of great altitude and then bought back at a lower price to repay the loan.

The results showed a 1.11 percent average abnormal return by month over the course of 13 years, amounting to an mean proportion abnormal yearly return of more than 14 percent.

“You slip on’t really want to ignore the analyst recommendations, but you are verily sort of using them in not a very positive way,” said Edward Swanson of the Mays Business School at Texas A&M.

“Essentially, the destitute sellers are doing a tremendous job of using information with betokening value, and they really look like value investors.”

Some investors agreed by the results, as the increased risk taken by short sellers by their own capital makes them more active in rooting out possible problems in a company.

“For the most part Wall Street analysts are uncorrupt cheerleaders, so they kind of go with the flow and if the stock is trending higher they raise their price targets and ~ing good things,” said long-time short-seller Bill Fleckenstein, president of Fleckenstein Capital in Seattle, Washington.

“That is not to suppose that analysts are always wrong and the short sellers are to the end of time right. But at the margin if it gets pretty lopsided, I would turn out with the short sellers.”

But the point of analyst careful search isn’t to solely point out whether to buy or take a bribe for stocks, said Michael E. Hoffman, director of research at Wunderlich Securities in Baltimore.

“It’s exceedingly easy to take shots at the sell side isn’t in ~ degree good at picking stocks — I would suggest that isn’t that which the sell-side gets paid for,” he said.

“The exchange-side research value-add is to be an unequivocal expert in the subject substance, to have unrivaled access to information sources that you then arrange a high quality, relevant, thought-provoking filter to the buy-side.”

Swanson conducted the study with his Mays colleague Lynn Rees and Michael Drake of the Fisher School at Ohio State University.

(Reporting ~ means of Chuck Mikolajczak; Editing by Leslie Adler)

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House Republicans make more impressive spending cuts

http://www.nathanhamm.net/news/house-republicans-deepen-expenditure-cuts/ http://www.nathanhamm.net/news/house-republicans-deepen-spending-cuts/#comments Thu, 10 Feb 2011 20:01:02 +0000 Nathan Hamm News cuts make more impressive House Republicans spending http://www.nathanhamm.net/news/house-republicans-intensify-spending-cuts/ House Appropriations Committee Chairman Hal Rogers said in a relation he would cut nearly billion from current spending levels, as Tea Party-aligned conservatives be under the necessity sought, nearly double his original proposed cuts. The deeper spending cut package is unlikely to become … Continue reading →

House Appropriations Committee Chairman Hal Rogers before-mentioned in a statement he would cut nearly billion from current expenditure levels, as Tea Party-aligned conservatives have sought, nearly double his untranslated proposed cuts.

The deeper spending cut package is unlikely to get to be law, as President Barack Obama and Democrats who control the Senate are indisputable to oppose it.

Rogers’ committee had nearly completed a not so much dramatic plan that would immediately impose spending cuts averaging 15 percent in c~tinuance a wide range of domestic programs, from scientific research to principle enforcement.

But conservatives said it did not go far enough, imperiling its opportunity of winning passage in the House at a time when Republican leaders be the subject of failed to round up votes for other measures that had been expected to ticket easily.

Congress must agree on a spending plan to avoid a polity shutdown when current funding runs out on March 4.

(Reporting ~ the agency of Andy Sullivan; editing by Vicki Allen)

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Analysis: Ignoring the Fed forward inflation seen a winning bet

http://www.nathanhamm.net/news/dissection-ignoring-the-fed-on-inflation-seen-a-winning-bet/ http://www.nathanhamm.net/news/analysis-ignoring-the-fed-on-inflation-seen-a-winning-wager/#comments Thu, 10 Feb 2011 19:01:03 +0000 Nathan Hamm News Analysis Ignoring over-enlargement seen winning http://www.nathanhamm.net/news/analysis-ignoring-the-fed-steady-inflation-seen-a-winning-bet/ NEW YORK (Reuters) – Investors are ofttimes told not to fight the Fed, but in the U.S. Treasuries market taking the opposite stance to the Fed has been a pleasing strategy in the past six months. While Fed Chairman Ben … Continue delineation →

NEW YORK (Reuters) – Investors are often told not to unsheathe the sword the Fed, but in the U.S. Treasuries market taking the opposed stance to the Fed has been a winning strategy in the by six months.

While Fed Chairman Ben Bernanke sees no inflation question , bond investors who expect an economic recovery will lead to prices resurrection faster have been outperforming their peers.

Mutual funds investing primarily in concise-duration Treasury Inflation-Protected Securities (TIPS) have outperformed those who possess stuck to longer-term Treasuries, data from Thomson Reuters’ Lipper gain shows.

“I would argue that in a strange, even ironic habitude, that Ben Bernanke is doing a good job selling my government bonds for me these days,” said Tom Luster, portfolio manager and mentor of investment grade fixed income at Eaton Vance in Boston.

“The more the Fed thinks that inflation is not a problem today the other thing likely it is that inflation becomes a problem in the coming time,” he said.

The average maturity for TIPS is 8.70 years, nevertheless six-month returns for TIPS maturing in the 0-5 years rove over are up 1.198 percent while those maturing in 10 greater quantity years are down 2.688 percent, according to Barclays Capital.

Returns ~ the sake of U.S. Treasuries are down 2.186 percent over the same conclusion.

The Eaton Vance short-term real return fund, while less than a year of long date, is among the top three performers in the last six months, returning 3.37 percent to investors.

But it is not sincerely that the fund has inflation-protected Treasuries in the portfolio however that the duration is very short, roughly two years. They use arguments against extending duration as this opens them up, along with everyone besides, to interest rate risk from the Fed.

‘IT IS ALL ABOUT EXPECTATIONS’

No person expects the Fed to raise rates from their current zero to 0.25 percent row anytime soon given the bigger focus on generating jobs. However, its quantitative easing programs possess caused inflation expectations to rise.

“It is all about expectations. The Treasury mart has been fading under the rapid rise of stocks. I judge people are looking ahead and expecting inflation to be a greater importance, said Jeff Tjornehoj, interim head of Lipper Americas Research.

While benchmark 10-year U.S. Treasuries obtain suffered an epic drubbing, causing yields to rise 125 basis points in the span of less than five months, the Standard & Poor’s 500 hand is up 17 percent in the same time.

The latest conceit data shows overall consumer prices rose 0.5 percent in December, nevertheless excluding food and energy costs, consumer prices rose just 0.1 percent.

Overall prices are up 1.5 percent in January from a year ~ne, while core consumer prices gained 0.8 percent in 2010, the slowest ephemeris year pace since the department started keeping records in 1958.