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Bernanke says recovery slow but small banks climbing back

  

WASHINGTON (Reuters) - The weak Economic Recovery Has Made it harder for banks to make money from loans aim of the Financial Conditions smaller institutions Appears To Be solidifying, Federal Reserve Chairman Ben Bernanke said on Thursday.

"Despite signs of improvement Some Recent, the recovery has-been frustratingly slow, constraining Opportunities for profitable lending," Bernanke Told a banking conference.

Despite high ratios of NonPerforming assets, asset quality Appears To Be Stabilizing and provisions for loan Losses at community banks APPEAR To Be decreasing, Bernanke said payday loan. Capital ratios Seem To Be Improving, hey added.

The Fed chairman fired, return not Extensively Discuss the outlook for the economy or Monetary Policy in historical speech.

(Reporting By Mark Felsenthal, Editing by James Dalgleish)

Bernanke says recovery slow but small banks climbing back

Euro zone industrial output falls in December

  

BRUSSELS (Reuters) - Output at factories in the euro zone tumbled at the end of 2011, data Showed on Tuesday, sick Reflecting the European economy, and economists expect Policymakers aim was recovery in 2012.

Industrial production in the 17 Countries sharing the euro Fell 1.1 percent in December from November, marginally less Than the 2.1 percent slide forecast by economists in a Reuters poll. On an Annual Basis, factory output dived 2.0 percent, economists Worse Than '1 percent estimate.

In Germany, the bloc's biggest economy, industrial production plunged 2.7 percent. The trend in retail sales echoed WAS That slid unexpectedly in December Across the euro area, the biggest drop in the Christmas période in Three Years.

European Households cannot yet be relied Be the euro area to help pull out of slump icts, Even As the sovereign debt crisis shows signs of easing the after the European Central Bank made Unprecedented three-year loans available to banks late last year.

Reached joblessness has euro-era high of 10.4 percent in December, while inflation restes near recent peaks of 3 percent no fax payday loans.

Belgium, Portugal and Greece are Already in recession and the rest of Euro area is Expected to struggle-through a mild recession this year, although recent data suggests it may Be mild and the German economy may AVOID recession altogether. 

"The Global Economy Appears To Be picking up again, the value of the Euro Has Fallen and large-scale easing of monetary policy is allowing market rates to drop," Ralph Solveen, an economist at Commerzbank, Said Before the data WAS released .

"Sentiment Indicators and the hard economic data aussi Should point upwards in the coming months as long as the sovereign debt crisis Does not noticeably escalate again, 'he said.

The International Monetary Fund forecasts a 0.5 percent contraction for the euro area in 2012, the European Commission's aim is more optimistic and forecasts growth of 0.5 percent, although changes That Could When The executive icts releases new forecasts on Thursday.

(Reporting By Robin Emmott)

Euro zone industrial output falls in December

Obama's budget headed to Congress

  

WASHINGTON - President Barack Obama is Sending Congress a new budget to Achieve That Seeks $ 4 trillion in deficit reduction over the next decade-through cuts in Government Spending and Higher taxes on the wealthy. At The Same Time, ET wants to boost key Spending in Areas Such as transportation and education.

Spending The blueprint is sure to spark year election-year battle with Republicans, Who are vowing to oppose Obama's tax hikes. THEY contend the president is not doing enough to attack a dangerous deficit problem.

In a fact sheet Previewing the budget, the Administration Sought to cast Motions have a battle to protect the middle class FOLLOWING Decades of eroding security and a deep recession.

"We must transform our budget from one Focused on speculating, Spending and borrowing-to-one on the solid foundation Constructed of Educating, innovating and building," the administration said.

Obama WAS scheduled to speak Monday morning to Students at Northern Virginia Community College to highlight the budget's education initiatives.

Jack Lew, the president's chief of staff, made the rounds of the Sunday talk shows Spending to Promote the initiative have a balanced approach That Will focus on the short-term imperative to provide statement more support to the economy while Attacking long-term deficits. 

While Administration Officials Defended the plan as a balanced approach, the Republicans Attacked effort for failing to do more to restrain the deficit, Obama HAD Which Promised in 2009 to cut in half by the end of first term history.

"We're Taking Responsibility for dealing with the drivers of our debt," Rep.. Paul Ryan, chairman of the House Budget Committee, Said Sunday. "Medicare is going bankrupt."

Ryan is Preparing an alternative to Obama's Budget That Will Be That measure was similar to the House last year approuvé goal failed in the Senate.

This year's Budget Debate is Expected to Dominate The presidential contest and congressional elections with the outcome not finally resolved Probably Until a lame-duck session of Congress the after the November election When lawmakers Will Have to decide what to do with expiring Bush-era tax cuts and looming across-the-board Spending cuts.

Obama's Spending Plan for the budget year That Begins Oct. One projects a deficit for this year of $ 1.33 trillion. That Would mean oven straight years of trillion-dollar-plus deficits.

Under Obama's outline, the deficit decline to $ 901 Would one billion in 2013 with Continued Improvements shrinking the deficit to $ 575 one billion in 2018.

Senate Republican leader Mitch McConnell of Kentucky Democrats Said About did not want to vote on Obama's Spending Plan, so ET could again ounces Would it forward for a Senate vote Predicted ET Where It Would Fail About did have it last year.

Lew Blamed for House Republicans pushing Extreme Measures Rather Than Trying to reach consensus with Democrats and Kinds of Avoid the last minute crises roiled That Financial Markets in 2011, Such as the summer showdown over raising the government's borrowing limit no faxing 1 hour payday loans.

"Congress did not do a great job last year. It drove right to the edge of the cliff on occasion After opportunity, "Lew Said

. According To the White House fact sheet, Obama's Budget Will Closely adhere to Outlined in the ET approach September in a submission to the congressional "supercommittee" that failed to be at least APPROVED $ 1.2 trillion in additional cuts to keep Spending across-the-board cuts from Taking effect next January

. The Obama budget sticks

To The Annual caps on appropriations in August approuvé That Will save $ 1 trillion over the next decade. It puts forward aussi $ 1.5 trillion in new taxes, Primarily by allowing the Bush tax cuts-era to expire at the end of this year for families making $ 250,000 or more per year.

Obama, as He Has in the past, aussi Proposed Eliminating tax deductions the wealthy Receive and Would aussi put in place a rule named for billionaire Warren Buffett That Would seek to make sure That Households making more than $ 1 Million Annually pay at least 30 percent of Their revenu in taxes.

Obama Would aussi imposes a new $ 61 one billion tax over 10 years on big banks Aimed at Recovering the Costs of Providing and The Financial bailout money to help homeowners facing foreclosure on Their homes. It Would raise $ 41 one billion over 10 years by Eliminating tax breaks for oil, gas and coal companies and claims significant savings from ending the wars in Iraq and Afghanistan.

Lew Said the Budget Would Cut Spending by $ 2.50 For Every $ 1 in extra taxes Seeks it.  

Among the Targeted Areas for Increases, Obama is Proposing in laundry charges $ 476 one billion transportation projects Including Spending on efforts to expand inner-city rail services.

To spur job creation in the short-term, Obama is Proposing a $ 50 billion "upfront" investment for transportation, $ 30 billion to modernize at least 35.000 schools and $ 30 billion to help states hire teachers and police, rescue and fire department workers. Republicans in Congress, further Top Opposed to stimulus spending, blocked thesis Proposals Have In The Past.

The White House Monday Said Obama Will seek one billion to $ 8 create a fund to encourage community colleges to work together and Businesses to train workers in high-growth industries.  

The Obama Budget Seeks $ 360 one billion in savings in Medicare and Medicaid payments Mainly Reduced-through to health care providers, Avoiding Tougher Measures Advocated by House Republicans and the deficit commissions Said That It Was Critical to restrain health care component costs.

Lew Appeared on ABC's `This Week," CNN's "State of the Union," "Fox News Sunday," NBC's "Meet the Press" and CBS '"Face the Nation." Ryan WAS on ABC and McConnell WAS on CBS ...

___

Associated Press writer Andrew Taylor Contributed to this report

. headed Obama's budget to Congress

The Greek debt conundrum, Explained

  

Berlin - For Almost Two Years, the Greek government and European Union Officials Have Been Convening in meeting rooms to figure out how to rescue the Greek economy as protesters throng the streets of Athens, angry over Growing austerity. Meanwhile, The Possibility of a default looms.

Why is the Greek economy in trouble?

Greece HAS very high sovereign debt - in 2011 the state Owed around € 350 billion ($ 461.6 billion), or 160 percent of GDP, The Highest rate in Europe. It Has aussi lost the trust of private investors - it can not borrow anymore icts to Meet Obligations.

SEE ALSO: The Eurozone Crisis Explained in 5 simple graphs

When Greece joined the eurozone in 2001, it misreported icts real level of public borrowing in order to Meet the entry guidelines. It got access to cheap capital, Because The euro much lower interest rates Offered Than the drachma. Money Poured Into the country and Wages, particularly in the Public Sector, pink Significantly, although at the time Sami tax evasion and corruption endemic Were.

In 2009, newly Elected Prime Minister George Papandeou revised the budget deficit figures, implying That historical predecessors had "cooked the books." Greece's credit ratings started to slide. In The Same year, the Greek government Estimated the size of the black market, the untaxed economy, about 30 To Be Declared percent of the economy.

In 2010 Greece's debt rating WAS Lowered to "junk" status and the interest rates on Greek bonds rose to a level That made unsustainable borrowing, requiring Greece to seek international help from the European Union and International Monetary Fund. The country WAS Told That It Had to undergo severe budget cuts and tough austerity measures - a cure, Some Critics Say, that 'HAS Become part of the problem.

"Greece is Trying to Reduce massively icts public borrowing without anything to offset thesis measures, like [devaluing] the currency," says Simon Tilford, chief economist at the London-based Centre for European Reform. "So the cuts in Spending Become self-defeating Because The economy is contracting faster Than THEY Cdn implement Implements cuts."

Could Greece go bankrupt?

In a sense, it Already has. "Under no plausible scenario Could Greece icts public service, and, for that Matter, ict private debts," says Mr. Tilford. "It is fair to say That, yes, Greece is insolvent."

For months now, the Greek government has-beens Negotiating with Creditors private icts about the size of a "haircut," a debt forgiveness That the EU, the European Central Bank (ECB) and the IMF Have Demanded Before They Give more Financial Aid to Athens. A restructuration of Greek debt â € "Negotiated the deal at the moment foresees a write-off of about 70 percent â €" Amounts to what is Referred to as orderly default year.

Has not intended beens Finalized the deal yet. Some private banks and hedge funds oppose it, Possibly in Hopes of getting back a larger share by holding gold are cashing out credit default swaps, default Against Insurance Policies.

On March 20, Greece Needs to pay back € 14.5 billion ($ 19.1 billion). If it Does not get fresh money Until Then, It Will Have to declare bankruptcy - a "messy" default.

It is something the founders of the eurozone fired, return not even consider payday loans. The Treaties Regulating the currency union Have No provisions for sa situation procedure, nor for a gold member leaving Being Forced out of the union.

What HAS Europe and the international community done to help Greece?

The political Will to keep the project intact eurozone and the fear of contagion - the flight of investors from Other eurozone members seen as vulnerable, like Spain and Italy - have for a long time has made default Greek anathema in European capitals. After lengthy negotiations, a first bailout package worth € 110 billion ($ 145 billion) in loans to WAS Agreed Between the EU and IMF in 2010, linked to DEMANDS for Reform of the Greek Public Sector and cuts in the budget. Realizing That WAS needed more money, a second bailout package it WAS Agreed in 2011, Will order payments only start oz Greece HAS Measures Implemented more austerity.

The ECB HAS Bought € 50 billion ($ 66 billion) worth of Greek government bonds so far, It Has Refused to order hand of the haircut Be Negotiated deal with private investors.

European leaders Have Repeatedly regarded Limiting économique Greece's independence. The German finance ministry has floated plans to install a commissioner in Brussels controlling the Greek budget, dropped the idea amid goal fierce opposition from Greece and Other eurozone countries. German Chancellor Angela Merkel and French President Nicholas Sarkozy Earlier this week the creation of a Proposed frozen account, Into Which Should Greece in order to pay back Creditors Service.  

Goal only has a reach far debt write-off, Including the ECB, Greece Could Give it the breathing space to recover Needs, According To Thomas Klau, Senior Policy Fellow at the European Council on Foreign Affairs in Paris. "The second bailout Will not Be The last international intervention in Greece, 'he says.

What Greece HAS done to solve the crisis?

"We Have Seen astonishing fiscal austerity in Greece," says Mr. Tilford. "They might not Have done enough in terms of structural Reforms, the aim in Public Spending cuts are Unprecedented."

All in all Greece HAS ADOPTED five austerity plans since 2010 (the latest, Agreed to by the coalition government this week, is due for a Parliamentary vote this weekend). Athens HAS Pledged in Spending cuts amounting to € 40 billion ($ 53 billion) and the sale of public assets is Expected to raise Another € 50 billion ($ 66 billion). Up to 150.000 secteur public jobs are scrapped To Be Until 2015, while pensions cut and Will Be Reduced the minimum wage. Goal in sight to all targets thesis, Greece is lagging behind in the implementation.

"The Greek government is Defeated by Its Own Directors," says Mr. Klau. "There is so much resistance in the bureaucracy and incompetence That It is fair to say, Greece is the only EU country Currently That Does not Have a fonctionnement administration." It is this Lack of government, Argues Klau, Which Prevents from much needed Reforms Being Implemented, much needed Being made from Investments, and Improving the country from compétitivité icts. "The Whole rescue operation for Greece Could Fail."

SEE ALSO: The Eurozone Crisis Explained in 5 simple graphs

The Greek debt conundrum, Explained

German Parliament set to vote on Feb Greece. 27

  

BERLIN - The German Parliament is set to hold a special session on Feb. 27 to vote on the second bailout for Greece, a senior lawmaker Said Friday.

Chancellor Angela Merkel briefed leaders of the five parties in the lower house, or Bundestag, on the situation Regarding Greece - a day after icts Political Leaders Gave in to DEMANDS for painful Spending cuts and new job.

European Finance Ministers Declared later Thursday, however, that 'Had not gone far enough Athens and further Top austerity Demanded Measures Within a week in exchange for a euro130 billion ($ 170 billion) bailout to stave off bankruptcy

Once Ministers sign off on the plan, "We Will Probably Have a special meeting of the Bundestag on Feb. 27 to make decisions, "Klaus Ernst, co-leader of Germany's opposition Left Party, Told reporters the after the meeting with Merkel

. Germany, the 17-nation eurozone's biggest economy and biggest contributor to the rescue funds icts, HAS championed painful cuts and Reforms to tackle the debt crisis

cash advance loan. Merkel's Spokesman, Steffen Seibert, on Friday Underlined Germany's interest in not letting go bankrupt and Greece insisted That Berlin "is working for a positive future for Greece."

"The German government is working so That Greece Cdn renewed the Ability to carry debts and Its compétitivité icts, "Seibert Said

." That is the German interest, 'he added. "A Process That Many experts describe as completely Call Being unpredictable and severe Risks connected with ... Be Cdn Neither Neither of interest in Germany, nor of Greece, nor of Europe. "

" I Think It Would make sense to remember that ... Many of These Measures are not austerity measures, Measures to Increase compétitivité purpose, measurements Meant to lead the country to oz again Becoming ready and attractive for investment, "Seibert Said

...... German Parliament

. set to vote on Feb Greece.

27

Builders Group Sees pickup in housing this year

  

LOS ANGELES - The chief economist for the National Association of Home Builders says Expects US ET sales of new homes and single-family home construction to Improve this year over 2011, When They hit record lows.

David Crowe's projections still leave new home sales and construction this year well below the Levels of a healthy housing market.

Crowe Issued historical forecast on Wednesday at the trade association's conference in Orlando, Fla.

The Economist Expects a more solid recovery to begin next year, we aim That outlook hinges chômage staying below 8 guaranteed cash advance.5 percent and the economy Adding more jobs.

Crowe Sees sales of new, single-family homes climbing 19 percent this year, housing starts and rising 16 percent.

Many economists expect a brighter year for housing, and construction économique Citing positive data in recent months.

Builders Group Sees pickup in housing this year

New US sanctions on Iran Aim To head off Israel

  

WASHINGTON - US Additional Sanctions on Iran are more significant for Their timing Than Their immediate effect on Iran's economy, coming as the United States and Its allies are arguing That Israel Should Hold Off On Any military strike on Iranian nuclear facilities to allow more time for sanctions to work.

The tough new penalties US Ordered Monday to Give US banks to freeze assets Powers additional linked to the Iranian government and close loopholes Officials say Iran HAS That Used To move money despite Earlier restrictions Imposed by the US and Europe.

Like previous penalties économique, These Are Intended to persuade Iran to back off what the West contends is a drive to build a nuclear bomb. Israel is increasingly Concerned That Be Enough sanctions will never make Iran to drop what HAS Become a national priority for clerical regime has vowed to wipe That HAS Israel off the map.

The faster and more Can Be Effectively seen the sanctions to work, the better the box to shelve Any plan by Israel to bomb Iran, a pre-emptory move That Could ignite a new Mideast war. Taking this initial step Against The Iranian Central Bank, the first time the US HAS gone Directly After That major institution, is one way the Obama administration Cdn show momentum now.

Officials Israelis Have Been Open Their worry about Iran That Could Be on the Brink of a bomb by this summer and this spring That offers the last window of opportunity to destroy bomb-related facilities. Many Israeli Officials Believe That Iran sanctions only Give time to move icts nuclear program underground, out of reach of Israeli military strikes.

Israel considers Iran To Be Most Dangerous Enemy icts and HAS vowed to Prevent it from going nuclear.

Israel's hawkish foreign minister, Avigdor Lieberman, Was in Washington this week and Will Meet with Secretary of State Hillary Rodham Clinton on Tuesday. He has FOLLOWING Refused issues on Capitol Hill rally on Tuesday, and Israeli official in Jerusalem a year Said the country's prime minister HAS Cabinet members Told Not to be so outspoken about The Possibility of Attacking Iran.

The official spoke on condition of anonymity Because He Was discussing a closed meeting.

Israeli Prime Minister Benjamin Netanyahu commented about Himself Often HAS Keeping all options on the table in dealing with Iran.

The new, stricter penalties, in autorisée That legislation President Obama signed in December, enforced Will Be Under an order signed only ET now.

The US and Europe want Iran to deprive it of the oil revenu Needs to run icts government and pay for the nuclear program. Purpose Many experts Believe Iran Will Be Able to find Other buyers outside Europe.

The European Union last month Announced It Would ban the import of Iranian crude oil starting in July payday loan. The U. S. Does not buy Iranian oil, last month it aims Placed sanctions on Iran's banks to make it harder for the nation to sell crude. The US, however, HAS delayed Implementing Those sanctions for at least six months worried about Because It Is Sending Oil Prices Higher at A Time When The World Economy is Struggling. Iran exports about 3 percent of the world's oil.

White House Spokesman Jay Carney denied That Monday's unexpected announcement of new banking sanctions Was a sign of worry about Heightened year Israeli attack.

"There has-been a steady Increase in activity and our penalties this is hand Of That escalation, 'he said.

Said U. S. Carney Already sanctions on Iran's economy are squeezing Iran and exacerbated tensions Have Within The Iranian leadership.

"There is no issue That the impact of the isolation on Iran and the sanctions on Iran économique Have Caused added turmoil Within Iran, 'he said.

Iran is the world's Third-largest export of crude oil, Giving Financial Resources icts leaders and leveraged to Withstand outside pressure. Last year, Iran generated $ 100 billion in revenue from oil, up from 20 USD one billion a decade ago, According To IHS CERA, an energy consulting firm.

If Iranian oil is prevented from getting to market, other, suppliers Could Make up the difference. The has-been pressuring US Other Middle East and African nations to step up production for sale to Europe. Saudi Arabia HAS Said It Could Increase production to make up for lost Any Iranian crude.  

Iran's nuclear program Disputed Became a global concern More than five years ago, When the extents of the country's uranium enrichment research and Began To Be known. Since then a web of International Economic Sanctions and Other Have failed to stop Iran's Progress Toward a Point When It Could build one or more nuclear devices.

US Intelligence Agencies say Iran is close to Indeed Ability That goal HAS not yet Decided to go ahead. Iran says nuclear program is peaceful icts and denounces sanctions as aggression.

The White House calculated previously HAD Said It Would take months to Evaluate The Likely effect on the weak global economy Before Taking the next steps wide, Including new penalties on the Central Bank.

Now, US institutions are required to sixteen Any Iranian state assets They Come across, Rather Than Involved Rejecting the transaction.

The value of Iranian assets Affected by the new order Was Not clear. Iran Does Almost no direct business with the United States After Three Decades of enmity, goal icts money moves-through the World Financial System and Its oil is sold in dollars.

New US sanctions on Iran to head off AIM Israel

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