Real Estate Daily News Buzz is designed to give news snippets to readers that our (yet to be award winning) editors thought you could use to start your day. They come from various business perspectives, real estate, government, the Fed, local news, and the stock markets to save you time. Here you will find the headlines and what the news buzz for the day will be.
The Dow Jones industrial average dropped 106.38 points, or 0.6%, to 17,320.71. The Standard & Poor’s 500 index fell 18.60, or 0.9%, to close at 1,992.67. The NASADQ composite fell 68.50, or 1.5%, to 4,570.82.
Benchmark U.S. crude fell $2.23 to close at $46.25 a barrel in New York. Brent crude, a benchmark for international oils used by many U.S. refineries, fell $1.02 to close at $47.67 in London. Wholesale gasoline fell 5.2 cents to close at $1.299 a gallon. Heating oil fell 3.2 cents to close at $1.623 a gallon. Natural gas fell 7.5 cents to close at $3.158 per 1,000 cubic feet.
LITANY OF PROBLEMS PUSHES TARGET INTO GIVING UP ON CANADA
MINNEAPOLIS (AP) — Target is giving up on its money-losing foray into Canada after just two years, closing 133 stores and cutting loose more than 17,000 employees. Target said it didn’t see how it could stop losing money before at least 2021 on its first international expansion. The closing links Target with a series of other retailers who have learned the hard way that the northern border is tough to cross. During a call with investors Thursday, CEO Brian Cornell described the decision as “very tough.” What went wrong? Cracking the Canadian retail market, about one-tenth the size of the U.S. and right next door, looks simple. Target’s difficulties show it’s not. There are costly regulations. In addition, most Canadians live near the U.S. border, compare prices religiously and are willing to shop in the U.S. to save money. There’s also increasing competition. Canadian standbys like Dollarama and Canadian Tire are formidable rivals. And Wal-Mart Stores Inc., already the biggest retailer in Canada, cut prices to fend off Target.
SWITZERLAND STUNS MARKETS BY GIVING UP CURRENCY PEG
LONDON (AP) — Rarely has one statement prompted such a dramatic move in currency markets. The Swiss franc achieved a turbo-charged lift Thursday after the Swiss National Bank, or SNB, ditched an increasingly expensive policy to limit the export-sapping rise of the currency. Within minutes of the early morning announcement, the currency spiked around a third against the euro and the dollar while Swiss shares tanked, prompting confusion and a fair degree of anger across trading room floors. The decision by the SNB to call time on its efforts to prevent the euro from trading below 1.20 francs was a huge surprise and came amid mounting speculation that the European Central Bank will next week back a big stimulus program that will put more euros in circulation which would further dilute their value. That expectation has pushed the euro down to near-decade lows against the dollar.
Q&A: US GOVERNMENT EASES CUBA TRAVEL RESTRICTIONS
NEW YORK (AP) — Americans are one step closer to being able to vacation in Cuba, but don’t pack your bathing suit and sunscreen just yet. A new set of government regulations takes effect Friday, severely loosening travel and trade restrictions that have been in place for 54 years. The rules follow President Barack Obama’s announcement last month of a reestablishment of diplomatic relations with the communist island. Only Congress can fully remove the embargo but it is up to the administration to enforce — or turn a blind eye — to the travel ban. Travel and hospitality companies are salivating at the chance to set up shop in Cuba. Delta Air Lines, JetBlue Airways, Hilton Worldwide, Marriott International and the Carnival Corp. have all expressed interest.
CHINA’S XIAOMI TAKES AIM AT APPLE WITH NEW PHONE
BEIJING (AP) — Rising smartphone star Xiaomi is moving upmarket and taking aim at Apple’s iPhone. The Chinese manufacturer known for ultra-low-priced handsets on Thursday unveiled a new model that Chairman Jun Lei said is comparable to Apple’s iPhone 6 but thinner, lighter and much cheaper. The phone starts at 2,299 yuan ($375), less than half the 5,288 yuan ($865) price of an iPhone 6 in China. Xiaomi, founded in 2010, passed South Korea’s Samsung Electronics Co. in the second quarter of last year as the bestselling smartphone brand in China by number of handsets sold. The company is expanding into India and other developing markets but has yet to announce plans to enter the United States or Europe.
COURT FILINGS SHOW CAESARS UNIT OWES CHEF GORDON RAMSAY
Caesars Entertainment Operating Co.’s bankruptcy reveals a few people, places and companies owed money including celebrity chef Gordon Ramsay, Clark County where the Las Vegas Strip sits and the Nobu restaurant chain co-founded by actor Robert De Niro. The debt-heavy unit of the casino giant filed for Chapter 11 bankruptcy early Thursday and listed 50 entities it owes the most money to behind others owed billions on secured debt. Ramsay is owed $307,479. Nobu is owed $459,963. Clark County spokesman Erik Pappa says the company mistakenly listed the agency as an unsecured creditor owed $46.9 million for a bond issued in 2008 to move power lines underground on Caesars’ land on Flamingo Road. He says the county is a secured creditor, bumping it up in line to be paid back.
LAGARDE: HIGH DEBT AND UNEMPLOYMENT THREATEN GLOBAL GROWTH
WASHINGTON (AP) — Two problems stemming from the 2008 financial crisis — heavy government borrowing and high unemployment — still pose challenges to the global economy and require bold action, the head of the International Monetary Fund said. Christine Lagarde, IMF managing director, said Thursday that cheaper oil and strong U.S. growth aren’t enough to counter those threats. Europe and Japan potentially face years of slow growth and ultra-low inflation, she said, while the United States “is the only major economy that is likely to buck that trend this year.” Her warnings came after the IMF’s sister organization, the World Bank, on Tuesday lowered its forecast for international growth. The World Bank now expects the global economy to expand 3% in 2015, down from a 3.4% estimate in June. The bank cuts its forecast because of stagnation in Europe and Japan and slower growth in China.
END OF HOLIDAY SEASON BOOSTS APPLICATIONS FOR US JOBLESS AID
WASHINGTON (AP) — The end of the holiday shopping season led to more Americans seeking unemployment benefits last week, raising the number of applications to an 18-week high. Still, the number remains near historically low levels. The Labor Department said Thursday that applications for benefits jumped 19,000 to a seasonally adjusted 316,000. The four-week average, a less volatile measure, rose 6,750 to 298,000. That average has plunged 11.4% over the past 12 months and has remained near historically low 300,000 levels since September. The recent trend suggests that employers expect solid economic growth to continue, causing them to hold onto their workers and possibly increase their headcounts. However, economists are also weighing whether the increase primarily reflects a slight downshift in the pace of hiring or the regular difficulty in seasonally adjusting the impact of retailers and shipping firms letting go of holiday workers.
US WHOLESALE PRICED DROP 0.3% IN DECEMBER
WASHINGTON (AP) — U.S. wholesale prices fell in December by the largest amount in more than three years, reflecting the biggest monthly decline in the cost of gasoline in six years. The Labor Department said Thursday that its producer price index declined 0.3% last month, the biggest decline since a similar drop in October 2011. In November, wholesale prices dipped 0.2%. Over the past year, prices at the wholesale level have risen 1.1%, putting the 2014 rise in wholesale prices slightly below the 1.2% increase seen in 2013. Gas prices plunged 14.5% in December, the biggest decline since December 2008. Falling energy prices have pushed already low inflation even lower.
AVERAGE RATE ON 30-YEAR MORTGAGE FALLS TO 3.66%
WASHINGTON (AP) — Average long-term U.S. mortgage rates fell for the third straight week, with the benchmark 30-year rate again marking its lowest level since May 2013. The average for a 15-year mortgage, a popular choice for people who are refinancing, dipped below 3% for the first time since then. Mortgage company Freddie Mac said Thursday the nationwide average for a 30-year mortgage slid to 3.66% this week from 3.73% last week. The rate for the 15-year loan declined to 2.98% from 3.05% last week. The ongoing decline in rates lured a crop of prospective buyers, as applications for mortgages marked their biggest weekly gain last week in over six years. Applications jumped 49.1%, the biggest weekly increase since November 2008, according to the Mortgage Bankers Association.
GROUP OF ORO VALLEY RESIDENTS BLOCK PRUCHASE OF COUNTRY CLUB AND READY FOR REFERENDUM IN MAY
Oro Valley, AZ – A group of Oro Valley citizens opposed to the Town Council’s decision to purchase the Hilton El Conquistador Country Club, Golf and Tennis facilities on 300 acres of land for $1 million to create a community center, have turned in signatures to have the issue go to a vote of the people. Tee’d Off Over Tax Hike, (T.O.O.T.H in OV), collected a total of 3,158 signatures to deliver to the Town Clerk. Although they only needed 1,148 signatures for the referendum, turning in well over twice that amount indicated a larger amount of support than the Mayor had likely expected. Many residents already live in golf communities in Oro Valley and already pay dues for the upkeep, the half-cent sales tax is what the group and the Town Council find themselves at odds. The Oro Valley Town Council plans to vote at their January 21st meeting on whether or not to suspend the sales tax increase which was approved for the purchase of this property. Once verified by the town clerk, the group expects a special election on this issue sometime in May of this year.
TUCSON TO HOST 2015 INTERNATIONAL FESTIVALS & EVENTS ASSOCIATION CONVENTION
Tucson, Ariz. - Visit Tucson and the Festivals and Events Association of Tucson and Southern Arizona (FEATSAZ) are pleased to announce that Tucson, Ariz. has been selected to host the International Festivals and Events Association (IFEA) 60th Anniversary Convention & Expo at JW Marriott Tucson Starr Pass Resort & Spa on September 21-23, 2015. The IFEA defines itself as "the premiere association supporting and enabling festival and event professionals worldwide." The annual IFEA convention draws representatives from such major events as Macy’s Thanksgiving Day Parade, Kentucky Derby Festival, The Olympic Games, Tournament of Roses Parade and Bowl, and varied global peers and counterparts, to smaller, more localized community events, plus the cities, sponsors, tourism organizations, educational institutions and suppliers. "The IFEA convention represents a great opportunity for us to expose Tucson to festival and event operators throughout the United States and potentially around the world," Brent DeRaad, President/CEO of Visit Tucson, said. "The attendees are potential customers who could bring their festivals and events to our destination in the future. Of course, we are always looking for business that actualizes during our "shoulder" seasons, and a September convention will be a great benefit to our community." The 2015 IFEA Convention & Expo represents 865 room nights, close to a $250,000 in economic impact for Tucson, and it is expected to draw an estimated 500 attendees from across the globe for professional education and networking, including Certified Festival and Event Executive (CFEE) training sessions. “Festivals and events contribute hundreds of millions of dollars a year to Southern Arizona’s economy, and have played a major role in the revitalization of Downtown Tucson," Caitlin Jensen, Marketing and PR Manager at the Downtown Tucson Partnership, said. “This convention is a testament to Tucson’s commitment to supporting festivals, events, and the meetings industry.” For information on how tourism powers Southern Arizona, go to www.visitTucson.org. To learn more about FEATSAZ's mission and activities, visit featsaz.com.