Thing One: Apocalypse A Little Later: It took less than a day for pundits to declare the Cyprus bailout debacle to not be a big deal. That may be premature.
Stocks fell a little bit yesterday, but not nearly as much as you'd expect if you thought the European Union was about to unravel. This led many, including Andrew Ross Sorkin, to declare the all-clear on the crisis, less than 24 hours after it began.
But Cyprus this morning seems headed toward a bad outcome, which could shake markets a bit more. The Cypriot parliament is due to vote on a bailout package that includes taking some money away from depositors -- including some Russian mobsters, yes, but also including a lot of innocent Cypriots that have been saving for disasters, only to find out that the disasters will involve their savings being taken away from them. The good news is that the Cypriot parliament does not appear likely to pass the bailout package. The bad news is that, if it does not pass the package, then Cyprus will not get a bailout, which means it could default on its debts and maybe leave the euro zone. And that could be a very bad thing indeed, raising fears about an unraveling of the whole dumb enterprise.
And how dumb it is proving to be! The evolution of this hare-brained bailout idea clearly demonstrates why it is so difficult to get anything done in Europe, why the continent just keeps rolling from one crisis to the next, the New York Times points out. Reuters explains that Germany came into bailout talks intent on making depositors feel the pain of the bailout, while Cyprus insisted that big depositors -- those Russian mobsters -- not feel too much pain, lest they pull all of their money out of Cyprus. The end result was a plan that made absolutely nobody happy, and that everybody is now scrambling to fix. The very latest plan involves exempting the smallest depositors from having to pay up, but then that might not raise all of the money that Germany & Co. wants, Reuters writes. In which case we're back to square one. Brace for turbulence ahead.
Thing Two: Never A Better Time To Buy My House: Speaking of crises being over, the housing market is just a-booming again. OK, not booming, exactly, but no longer collapsing, either. In fact, housing is so not-collapsing that government-backed mortgage giant Fannie Mae might be able to pay back $61.5 billion in bailout funds to the U.S. government, the Wall Street Journal writes. Meanwhile, the percentage of underwater mortgages has shrunk to a mere 21.5 percent of all mortgages, down from 25 percent (WSJ again). Of course, it helps that nearly a quarter of all home sales last year were "short sales," in which houses are sold for less than the amount owed on the mortgage, and the bank writes off the rest, notes the Washington Post.
Thing Three: Another Day, Another Settlement: Citigroup will pay $730 million to settle a lawsuit accusing it of misleading investors about the quality of bonds and preferred stock it sold ahead of the financial crisis. The investors charge that Citi was effectively insolvent at the time, but went ahead and sold bonds and stock anyway. Citi naturally denies any wrongdoing.
Thing Four: California Charging: Federal prosecutors filed criminal charges against Federico R. Buenrostro, the former head of the California Public Employees’ Retirement System, or Calpers. They accuse him of using his influence as head of the nation's biggest pension fund to enrich himself in a not-legal way.
Thing Five: Barnyard Brawl: Home prices may not be soaring yet, but farm prices apparently are. That is leading farmers and investors to scramble over each other to buy up land, The New York Times writes. The trouble is that the higher land prices are based on high crop prices. When crop prices fall, then so will land prices, leaving a barnload (see what I did there?) of bad debts.
Thing Five: BREAKING: You're Not Saving Enough: You have probably known for at least the past decade or two that you are not saving enough for retirement. And now here's more evidence: 57 percent of U.S. workers have less than $25,000 in savings and investments, according to a new survey by the Employee Benefit Research Institute, the Wall Street Journal writes. Yeah, that's not enough.
Thing Six: Drugs, One Percent Off: At least drug costs got a little cheaper last year: One percent, to be exact, the New York Times writes, citing the research firm IMS Health. That was the first drop in U.S. drug prices since at least 1957, and it was due to wider use of generics. But don't think this is a new thing: Drug costs are probably going to jump in the future, the NYT writes.
Thing Seven: Island Of Misfit Electronics: All of our fancy tablets and flat screens come at a price, beyond what we pay for them at the Apple Store. The New York Times points out that we are building huge, toxic mountains of unwanted computer monitors and televisions.
Thing Seven And One Half: So Long, And Thanks For All The Follows: Today's Seven And A Half Things will be the last Seven And A Half Things for the foreseeable future, or at least the last one written by me. After writing morning newsletters for the better part of the past two years, I'm going to dedicate more time to writing things after the sunrise and see how that goes. I'll still be writing for the Huffington Post, as will my brilliant colleagues, who will continue to give you many, many more than 7.5 things worth knowing each day. We are also working on a replacement email product for those of you who prefer your knowledge in email form. Thanks to Jillian Berman, Alexis Kleinman and Khadeeja Safdar for their help keeping this thing going as long as it did. And thanks especially to everybody who has signed up for and read this particular version of the newsletter over the past year.
Calendar Du Jour:
Economic Data:
8:30 a.m. ET: Housing Starts for February
Corporate Earnings:
Not much.
Heard On The Tweets:
Cop: do you know why I’ve been following you?Me: you like my tweets?Cop: excuse me?Me: sorry I didn’t follow back.*goes to jail*
— Tommy Go Blah! (@TommyKarate) March 14, 2013
A long time ago, in a galaxy far, far away...they could travel space at lightspeed, but had no phones & sent messages via carrier droid.
— John Solo (@Shock_Monster) March 18, 2013
-- Calendar and Tweets rounded up by Alexis Kleinman
And you can follow us on Twitter, too, if you want, no pressure: @AlexisKleinman and @MarkGongloff
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