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Housing: Promising signs of a rebound
The housing market is finally bouncing back, said Daniel Gross in TheDailyBeast.com. Sales of existing homes rose 2.3 percent in July, buoyed by record-low mortgage rates. The overall number of sales was an impressive 10.4 percent higher than in July 2011, and new-home sales in July were up 25 percent from the year before. There are also more first-time buyers and less surplus inventory than last year, “undeniable signs that a sustainable recovery is underway.” If these trends continue, “2012 is likely to be the first year since 2005 in which the number of homes sold and the price they typically sell for rise.”
A closely watched barometer of home prices signaled more good news this week, said Les Christie in CNNMoney.com. The S&P/Case-Shiller home price index, which covers more than 80 percent of the housing market in the U.S., showed that prices rose nationally by 6.9 percent between the first and second quarters of the year. The 20 biggest cities tracked by the index saw home prices rise in June from May for the second straight month. “We seem to be witnessing exactly what we needed for a sustained recovery,” said S&P spokesman David Blitzer. “The market may have finally turned around.”
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Autos: Hertz strikes deal for Dollar Thrifty
After years of talks, car rental giant Hertz struck a $2.6 billion takeover deal with rival Dollar Thrifty this week, said Megha Mandavia and Soyoung Kim in Reuters.com. Hertz, the second-largest U.S. car rental company, has long been eager to acquire No. 4 Dollar Thrifty in order to cement its market position, with on-off takeover talks stretching back to 2007. If the deal passes muster with antitrust regulators, Hertz, market leader Enterprise, and No. 3 Avis will control about 95 percent of the U.S. car rental market.
Markets: Regulators rethink IPO chatter rules
Rules on what companies can and can’t say ahead of an initial public offering may soon be eased, said Jean Eaglesham and Telis Demos in The Wall Street Journal. The Securities and Exchange Commission is reviewing whether rules governing the presale “quiet period,” during which remarks by executives are barred, should be changed. The rules are meant to prevent the hyping of a stock, but lawmakers have complained that they led, for example, to small investors being kept in the dark about Facebook’s true prospects before its IPO debacle this spring.
Euro crisis: Greek leaders near deal for cuts
Greece’s coalition government said it was close to agreement this week on new austerity measures, said Marcus Bensasson and Maria Petrakis in Bloomberg.com. The government is under pressure to make $17 billion worth of new cuts for 2013 and 2014, no easy task since public-sector pay and pensions have already been deeply slashed. Inspectors for the country’s international creditors will arrive in Athens next week to gauge the country’s fiscal progress. During a visit to Germany last month, Greek Prime Minister Antonis Samaras said that his country did not want more money from creditors, just “more time.”
Investing: Buffett sours on municipal bonds
Famed investor Warren Buffett sent a shudder through the municipal bond market last week, said Nin-Hai Tseng in Fortune.com. Berkshire Hathaway, Buffett’s investment company, recently ended a big bet on debt issued by cities and states by terminating more than $8 billion of credit-default swaps it held on municipal bonds. Many market watchers interpreted the move as a signal that more local governments risk defaulting on debts, as three California cities have this year. Berkshire still holds another $8 billion in swaps on muni bonds.
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