Complex Financing

It is time to turn our focus to non-farm payrolls. The leading indicators for NFPs are beginning to come out and so far, they are looking ugly. According to payroll provider ADP, the number of workers on U.S. payrolls fell by 23k in the month of March. With economists expecting job growth of 185k, the ADP report is certainly not in line with the blowout forecasts. Although the dollar has sold off in response, the impact has been limited. 

With census hiring and the addition of jobs lost after the snowstorm expected to create a temporary upside distortion to payrolls, most traders realize that the real NFP number will be only half of what is reported on Friday and the ADP report simply brings everyone’s expectations back down to reality. It is also unclear how reliable the ADP report really is. Over the past 3 months, it has undershot NFPs by an average of 10k per month but if you recall, last year ADP missed NFPs by 150k. We will publish our NFP preview later today but in the meantime, the key takeaway from the ADP number is that it creates suspicion about the strength of NFPs and indicates that the risk is to the downside. 

Mixed Bag of Manufacturing Indicators

Meanwhile manufacturing activity in the Chicago region slowed materially this month as the Chicago PMI index fell from 62.6 to 58.8. A sharp reduction in the backlog of orders, supplier deliveries, and production suggest that demand is slowing. Along w

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President Obama signed the Health Care “fixit” bill yesterday, which contained several new laws relating to student loans. Critics contend the new laws consist of another government takeover. Proponents of student loan legislation say that it doesn’t do enough to address current and former students who are wrestling with education debt.

The reforms contained in the bill:

• Banks can no longer offer loans to students – students must borrow directly from the U.S. government. Democrats say the new legislation will cut costs. Banks had previously received US subsidies to make student loans.
• Parents taking out student loans will pay an annual interest rate of 7.9% under the direct program, compared with 8.5% under the old program.
• Student borrowing rates for federal loans aren’t affected: 4.5% for students with financial need and 6.8% for everybody else.
• The income-based repayment limit payments to 10% of discretionary income, down from 15% and forgive debt after 20 years instead of 25.
• Provides more funding for Pell Grants, available to students from families making $50,000 a year or less. The maxim

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(Updated, 4:40 p.m.)

PROVIDENCE – The Pawtuxet River crested this morning but will continue to flood for several days, forecasters said Wednesday afternoon as officials assessed the damage and worked to provide relief to businesses and residents.

A flood emergency was still in effect along the Pawtuxet in Cranston at 1:42 p.m., according to the National Weather Service. The river crested this morning at a record level of 20.7 feet, more than double the flood-stage level of 9 feet, and is expected to continue to flood for several days.

The weather service also kept a flood warning in place along the Blackstone River in Woonsocket.

Rhode Island’s state government reopened at 3 p.m. under an “adverse weather conditions” policy for employees with afternoon and evening shifts, Gov. Donald L. Carcieri’s office said. The adverse-weather policy will remain in effect at least through Thursday. The court

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BERN (Dow Jones) – The Federal Council in Switzerland on Wednesday Application of assistance agreement with the U.S. in the dispute over the customer data Bank UBS agreed. Whether the UBS client data to the United States actually be handed to decide, but in the end, the Parliament, it said, according to AWP news agency on Wednesday. The provisional application allows not the release of customer information, only the assessment the individual cases of U.S. customers.
Switzerland had the so-called mutual assistance agreements in the past Summer signed with the United States. It should allow Switzerland not only for fraud but also for tax evasion to provide assistance. In order to apply the Agreement provisionally, can Now, the Federal Council on Wednesday a change log signed, which makes the agreement a treaty. The protocol was signed the same day in Washington. <

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