Headlines

The government of Socialist President François Hollande on Sunday said that it would consider other ways of imposing a top income-tax rate of 75 percent on high-wealth individuals after the country's top constitutional authority scrapped the plan, the Wall Street Journal reported today. The constitutional watchdog did not reject the principle of a more-stringent tax regime, but rather the way it would have been applied.

Japan's new finance minister upped the ante in the country's war of words against the strong yen, lashing out at the U.S. and Europe for letting their currencies weaken dramatically and calling on the U.S. to strengthen the dollar, the Wall Street Journal reported on Saturday. The tirade from Taro Aso, Prime Minister Shinzo Abe's point person on currency strategy, underscores the increasingly pugnacious stance of the fledgling Abe government against what it sees as a global trend of currency devaluations.

A year ago, many people seriously doubted whether the euro would still exist, but now the debate is more about how long it will take for the euro zone economy to recover and what must be changed to avoid future crises, the New York Times reported today. "At the moment the crisis seems to have calmed down somewhat," Jens Weidmann, president of the Bundesbank, the German central bank, said yesterday. “But the underlying causes have by no means been eliminated.” But consider some of the doomsday situations that did not occur in 2012.

The United Arab Emirates plans to restrict mortgages for foreigners to 50 percent of the property’s value, threatening to derail a nascent recovery in Dubai home prices after more than three years of declines, Bloomberg News reported today. U.A.E. citizens can get as much 70 percent of the value of a first house and 60 percent for a second, according to guidelines issued by the central bank and obtained by Bloomberg News. Foreigners can get mortgages of as much as 40 percent of the value of a second property, according to the document.

Investors who hold Argentina's restructured debt are seeking to have New York's highest court consider whether a bond provision requires the country to equally treat holders of defaulted and new bonds, Bloomberg News reported today. The bondholder group, which includes Brevan Howard Asset Management LLP and AllianceBernstein LP, said in a court filing that interpretation by the state Court of Appeals in Albany is needed to determine whether Argentina must make payments on defaulted bonds when it pays holders of restructured debt, as a federal court judge ordered it to do.

Royal Bank of Scotland Group Plc won dismissal of a lawsuit filed by Seoul-based Woori Bank over losses from investments in collateralized debt obligations (CDOs) tied to the housing market, Bloomberg News reported yesterday. A federal judge in New York ruled yesterday that the South Korean lender failed to present a strong enough case against RBS. Woori Bank had alleged that it was duped into investing $80 million in CDOs that were exposed to risk from the subprime housing market, according to the order filed today by U.S. District Judge Harold Baer.

Japan’s new finance minister, Taro Aso, sought yesterday to quell concern about the country's weak finances, saying that the government would not rely solely on debt to fund economic stimulus and would try to limit new debt issuance during the next fiscal year, Reuters reported yesterday. The government will compile spending requests for a stimulus package on January 7 and finalize the proposal shortly thereafter as Prime Minister Shinzo Abe tries to speed enactment of his agenda of increased public works spending to lift the economy.

Despite the economic gloom that has enshrouded it since the onset of the global financial crisis, Spain has at least one industrial bright spot: The country and its skilled, if underemployed, work force have once again become a beacon for European carmakers, the New York Times reported today.

Irish home values rose at the fastest pace in more than six years in November as the country recovered from Europe's worst real estate crash, Bloomberg News reported today. Residential property prices rose 1.1 percent from the previous month, the most since September 2006, the Central Statistics Office said in a statement today. Values fell 5.7 percent from a year earlier and are 49 percent below their 2007 peak, the statement showed. Read more.

Investors in Spain's embattled Bankia can take some comfort from the prior experience of shareholders at Ireland's largest retail bank, Allied Irish Banks, according to an Reuters analysis yesterday. Bankia now has a negative equity value of 4.2 billion euros ($5.6 billion), according to Spain's bank rescue vehicle. But the previous treatment of AIB's shareholders suggests Spain is likely to be successful in convincing the European Union to allow Bankia's existing shareholders to retain a tiny stake in the recapitalised, and newly valuable bank.