By Dees Stribling, Contributing Editor<\/p>\n
Investors worldwide were jittery again about Spain on Monday, as the Spanish government banned the shorting of stocks on Madrid\u2019s exchange and the Italian government did the same for the Milan exchange. Stocks on those exchanges and around Europe had a bad day anyway, with the Euro Stoxx 50 index dropping 2.6 percent, the German DAX down 3.2 percent and the Spanish IBEX off 1.1. percent. Also, the euro hit a two-year low against the dollar.<\/p>\n
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More worrisome for investors was the cost of Spanish long-term debt, which was still above 7 percent on Monday. Talk of impossibly large bailouts for Spain, and not just its banks, was rife. As usual in such situations, investors bought U.S. debt, apparently unfazed by the \u201cfiscal cliff,\u201d which won\u2019t arise until next year. Yields on 10-Year Treasuries briefly hit a record low of 1.4 percent on Monday, before rising slightly at the end of the day.<\/p>\n
Wall Street continued to fret on Monday about the situation in Spain as well, and lost ground again. The Dow Jones Industrial Average was off 101.11 points, or 0.79 percent, while the S&P 500 dropped 0.89 percent and the Nasdaq declined 1.2 percent.<\/p>\n
California Residential Defaults Down<\/p>\n
DataQuick, a San Diego-based real estate data specialist, reported on Monday that the number of California homes suffering through the foreclosure process declined during the second quarter to its lowest level since early 2007, a notable figure considering that California has long been one of the epicenters of the housing crisis. According to the company, the drop was due to a generally improving housing market, but also because of the \u201cburning off\u201d of the worst of the mortgages originated at the mid-2000s peak of the housing bubble. The growing popularity of short sales was also a factor.<\/p>\n
A total of 54,615 Notices of Default were recorded on California residences during the second quarter, notes DataQuick. That\u2019s down 2.9 percent from the first quarter and 3.6 percent compared with the second quarter of 2011. Notices peaked in the first quarter of 2009 at more than 135,400.<\/p>\n
\u201cThe foreclosure process has always been the sanitation department of the housing sector,\u201d notes DataQuick president John Walsh. \u201cThe question is whether these lower\u2026 numbers mean that there\u2019s less distress to process, or if we\u2019re just seeing distress get processed at a slower pace.\u201d<\/p>\n
Economic Activity Still Below Trend, Chicago Fed Says<\/p>\n
The Chicago Federal Reserve reported on Monday that its national activity index showed that U.S. economic activity did in fact increase in June, but it\u2019s still below historic trend. The index increased to minus 0.15 in June from minus 0.48 in May, led by improvements in production-related indicators, the bank said.<\/p>\n
A zero value for the index indicates that the national economy is expanding at its historical trend rate of growth, by the Fed\u2019s reckoning. But the index rarely registers zero. Negative values indicate below-average growth, while positive values indicate above-average growth.<\/p>\n
The index\u2019s three-month moving average, elaborately named CFNAI-MA3, increased from minus 0.38 in May to minus 0.20 in June\u2014better, but still its fourth consecutive reading below zero. June\u2019s CFNAI-MA3 suggests that growth in national economic activity is below historical trend. On the other hand, the economic growth reflected in this level of the CFNAI-MA3 also means subdued inflationary pressure from economic activity over the coming year, according to the Fed.<\/p>\n
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Spain and Italy banned the shorting of stocks on key exchanges; home foreclosures in the Golden State declined to the lowest level since 2007. <\/p>\n","protected":false},"author":1023,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21742],"tags":[],"class_list":["post-1004043423","post","type-post","status-publish","format-standard","hentry","category-latest"],"acf":[],"yoast_head":"\n