07.30.09
Posted in business, hot news, shortly, top, world of money tagged campaign, economics, events, people, reviews at 7:41 pm by carydalton
HONG KONG — Sumitomo Trust and Banking on Thursday agreed to acquire Citigroup’s Japanese asset management unit, a move that marks another step in Citi’s exit from various noncore assets in the wake of crippling losses last year.
Sumitomo Trust, one of Japan’s biggest lenders, is paying ¥112.4 billion, or $1.18 billion, for Nikko Asset Management, which will give it considerably more weight in the lucrative but hotly contested Japanese wealth management business.
The acquisition adds ¥8.8 trillion to the group’s assets under management, for a total of ¥34.5 trillion, making it one of the largest Japanese groups in the sector, Sumitomo Trust said in a statement on Thursday.
Japan’s economy is mired in recession, dampening bank profits. But the business of managing assets for Japanese individuals and institutional investors like pension funds continues to hold growth potential, analysts believe. Japan has a strong tradition of saving, and with the population rapidly aging, cash-rich investors are increasingly looking for sophisticated investment advice payday loans.
The transaction is also the latest example of a Japanese lender capitalizing on the shake-up in the global banking industry, which has forced a number of overseas players to shrink their presence in the Japanese market.
Nomura last year bought the Asian assets of the collapsed U.S. banking giant Lehman Brothers; Citi, the recipient of about $45 billion in U.S. bailout money, has effectively reversed its push into Japan by selling Nikko Asset and, earlier this year, its brokerage and investment banking units in the country.
Citi, which owns 64 percent of Nikko Asset Management, said it would receive ¥75.6 billion after various costs related to the deal. Sumitomo Trust, which specializes in managing pension funds, is also acquiring stakes held by various minority investors, taking its total stake to 98.5 percent.
Sumitomo Trust to Acquire Citigroup Asset Management Unit
Hot News: Fed Sees Signs That the Economy Is Stabilizing
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07.29.09
Posted in All, hot news, online, top, world of money tagged campaign, life, people, political, writing at 3:06 pm by carydalton
Shares on Wall Street fell on Wednesday as investors grow increasingly wary about the economic recovery.
A new report on American factory orders was the latest sign that the economy may not rebound as fast as hoped.
The stock market’s two-week market rally is on hold after earnings reports and the Conference Board’s reading on consumer confidence fell short of expectations.
Amid investors’ growing caution, the markets appeared unmoved by the Internet search deal announced Wednesday between Microsoft and Yahoo.
The Dow Jones industrial average was down 25 points, or 0.3 percent . The Standard & Poor’s 500-stock index declined 4.6 points, or 0.48 percent, while the Nasdaq was down 10 points, or 0.55 percent.
European stock markets rose Wednesday after generally positive corporate earnings from leading industrial companies, although a sharp drop in Chinese stocks and an expected retreat at the open on Wall Street capped the gains.
The FTSE 100 in London was up 38 points, or about 0.8 percent, while the DAX in Frankfurt rose 91 points, or 1.7 percent. The CAC-40 in Paris was 49 points, or 1.7 percent, higher .
The early gains have more or less erased the losses posted Tuesday, when modest profit-taking drove trading after a two-week run that sent many of the world’s major indexes to their highest levels this year.
“We are now in an important transition period for these markets and the next few days will be pivotal to see if we can continue the recent strength,” said Jimmy Yates, the head of equities at CMC Markets.
So far Wednesday, prospects don’t look so bad, especially after a string of encouraging results in Europe and Asia.
In Asia, carmakers were in the spotlight. Nissan Motor reported a smaller-than-expected loss for its first-quarter and unveiled plans to build more cars in China, one of the few auto markets where sales are still growing. Meanwhile, Honda Motor bucked expectations and remained in profit online payday loans.
In Europe, France’s PSA Peugeot-Citroen a reported a big first-half loss but generated strong cash flow from cost-cutting measures and an inventory drawdown. In Germany, Daimler reported a second-quarter loss but said it expected improved profitability in the second half.
The pharmaceutical and chemical company Bayer topped the German DAX index despite sagging second-quarter sales and a 7 percent fall in net profit. The company’s share price rose 4.2 percent to 41.74 euros after the company showed good growth at its health care unit, which makes Bayer Aspirin, Alka-Seltzer, Yasmin and the multiple sclerosis treatment Betaseron.
Earlier in Asia, most markets dropped in the wake of the modest retreat in Europe and on Wall Street.
Japan’s Nikkei 225 stock average closed up 25.98 points, or 0.3 percent, at 10,113.24 following a seesaw session, but Hong Kong’s Hang Seng retreated 489.04, or 2.4 percent, to 20,135.50.
The main Shanghai index dived nearly 8 percent at one stage before clawing back some losses, ending down 171.94 points, or 5 percent, at 3,266.43. Even so, the drop was the biggest since last November but followed seven straight gains and arose after reports suggested that China’s two state-owned banks have been asked to limit their lending — another sign that the Chinese authorities are beginning to worry that the country may be growing too fast.
The losses in China came despite a stellar opening by China State Construction Engineering Corporation, which built the Water Cube swimming center for the Beijing Olympics. On its first day of trading, the company’s stock ended 56 percent higher. The company’s initial public offering was the biggest this year, raising $7.3 billion.
Wall Street Falls on Worries About Economy
Hot News: Stock futures signal losses; eyes on Yahoo
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Posted in All, economic, hot news, money, online tagged finance, financial, markets, news, writing at 7:06 am by carydalton
THE California wine industry encompasses many with little in common. It includes small grape growers and brokers, family producers, négociants, big corporations, major distributors and many different types of retail outlets.
Still, as diverse as this group is, one word seems to sum up the effect of the recession on their businesses: brutal.
The reason is simple. Wine is a cash-flow business, and all along the pipeline, from farm to production to sales, cash is not flowing. Growers are behind on sales of grapes, which are fetching much lower prices than last year. Sales are sluggish for wines retailing at $15 a bottle and higher. Meanwhile, distributors, restaurants and retail shops are reluctant to buy more wine, preferring to sell through what they already have.
Cash may be trickling, but anxiety is gushing forth.
“People are drinking out of their cellars, the big distributors are throwing their weight around, and you add these things up, and from the winery perspective, the cash flow is brutal,” said Steve Matthiason, a vineyard consultant who also grows grapes and makes small quantities of wine. “Everybody figures this is kind of a temporary thing, that when restaurants burn through their inventory they’re going to have to start buying again, and distributors, too. But everybody is wondering when the levee is going to break, and you have harvest coming up.”
The harvest is what makes selling wine so different from, say, selling computer chips. When production of chips outpaces sales, executives adjust production. But nature is relentless in its annual rhythm. The grapes must be harvested each fall, whatever the need. If grapes are scarce, it may take 10 years from the time a new vineyard is planted to when wines from its grapes can be enjoyed. In a glut, the spigot can’t be switched off immediately.
Consumer preference, though, can turn on a whim. Even in the recession, people continue to buy wine. Consumption and sales are actually up, industry analysts agree. But people have turned away from expensive wines, buying two $8 bottles instead of one $20 bottle. As a result, growers in high-status areas who don’t already have contracts for their grapes are having trouble selling them, and prices are way down.
Russian River pinot noir grapes, for example, which sold in 2008 for $2,800 to $4,500 a ton, are now going for $1,800 to $2,800 a ton, said Bill Turrentine, president of Turrentine Brokerage, a leading California broker of wine grapes. Napa Valley cabernet sauvignon is selling for $2,000 to $3,000 a ton, he said, down from $3,500 to $5,500 in 2008.
Times are barely easier for wineries that rely on purchased grapes. At Siduri, which specializes in making pinot noirs from top vineyards up and down the West Coast, sales are down 11 percent from last year, “not great, but I don’t think it’s awful, either,” said Adam Lee, the proprietor with his wife, Dianna.
“We are certainly seeing a real slowdown in single-vineyard pinots,” Mr. Lee said, “but our appellation series, at $30 or less on the shelf, are flying.”
Such a diversity of offerings is crucial as even those consumers who continue to want top wines have nonetheless traded down. When times were good a few years ago, Brewer-Clifton, which makes small amounts of pinot noir and chardonnay in the Santa Rita Hills of Santa Barbara County, began planting vineyards so it could farm its own grapes cheap payday advance.
As it waited for these vineyards to become productive, Brewer-Clifton shifted its own sales focus. Instead of selling only wines from single vineyards for $60 to $80 a bottle, it started to offer wines with a regional appellation, for about $40 a bottle. These wines now make up half its production, which Greg Brewer, the proprietor with Steve Clifton, says is a lucky thing.
“Brewer-Clifton may have lost some people at $60 to $80, but we’ll catch them at $40,” Mr. Brewer said.
Some top wineries, while acknowledging a wholesale slump through distributors to retail shops and restaurants, say their direct sales, either at the winery or through the Internet, are still strong. At Cain Vineyard and Winery in Napa Valley, retail sales of Cain Five, for $125 a bottle, is down the most, while Cain Cuvée, for $34 a bottle, is selling well. But sales at the winery are up, even for Cain Five, said Christopher Howell, the general manager and winemaker. Hanzell Vineyards in Sonoma County reports similar strength in direct sales.
“It is a Catch-22 in some ways,” said Jean Arnold Sessions, president of Hanzell. “Distributors say the high end is not selling well, so they don’t present the wines.”
So what’s the good news?
The wine industry can take some comfort, no matter how small, in knowing that the situation could be a lot worse. Ten years or so ago, California was making too much wine, and so began paring production and trimming back on new vineyards.
“If this had hit a few years ago, when there was a basic structural excess, this would have been catastrophic,” Mr. Turrentine said.
The industry is also seeing some small acts of preemptive kindness. Peter Cargasacchi, a grower in the Santa Rita Hills who sells pinot noir grapes to Brewer-Clifton and Siduri, among others, recently cut his price by 10 percent, even though he already had contracts with producers.
“It just seemed like the right thing to do given the economy and the sluggish premium wine market,” he said. “Part of the concession also is motivated by the recognition that this symbiosis between vineyard and winery really is a team effort.”
Consumers still interested in high-end wines may find great discounts now as everyone is trying to move inventory. Those who don’t want to spend a lot on wine may also be drinking better in the near future. Premium producers who need to make room for the new vintage may sell their wines on the bulk market, even at a loss. These premium wines in turn will be repackaged and sold inexpensively, though it will be difficult for consumers to identify which bottles benefit from a premium wine infusion.
Meanwhile, people in the industry wait, and hope, especially those who expanded or invested in new vineyards before the downturn.
“People who made smart, conscientious decisions three years ago I think will be glad they did when the market stabilizes in 2012 or 2013,” Mr. Brewer said. “I think we have to be positive. God help us if it’s still like this in 2012.”
The Pour: Where Anxiety Is All That’s Flowing
Hot News: French Regulator Urges Hefty Fine for Former EADS Chief
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Posted in All, business, money, online, shortly tagged blogs, events, financial, newsreports, writing at 12:17 am by carydalton
Sprint Nextel said on Tuesday that it had agreed to buy out Virgin Mobile USA for $420 million, as it tries to recover from losses and customer defections.
The mobile phone company agreed to pay $5.50 a share to public shareholders of Virgin Mobile, whose biggest investor is the billionaire Richard Branson’s Virgin Group. Sprint gains 5.25 million users, expanding a prepaid unit that has added customers while its contract unit has lost them.
Sprint had 4.3 million prepaid subscribers, most of which were on the network obtained from Nextel, at the end of the first quarter. Its average monthly bill for contract customers was almost double the $31 the company got from prepaid subscribers. The company is set to report second-quarter earnings on Wednesday.
Sprint is taking a risk by increasing its exposure to the low prices and higher customer turnover of the prepaid market, said Chris King, an analyst at Stifel Nicolaus & Company. The company is still recovering from the Nextel acquisition, which led to almost $30 billion in losses from write-downs.
Sprint, which already owns 13 percent of the company, will retire Virgin Mobile’s outstanding debt, which it expects to be no more than $205 million net of cash by the end of September fast cash loans. Sprint, based in Overland Park, Kan., plans to complete the acquisition as soon as the fourth quarter.
Sprint lost 4.6 million customers last year after the $36 billion Nextel purchase led to complaints about call quality as the company struggled to integrate the Nextel network into its operations. The company wrote down most of the acquisition in 2007. The purchase also increased Sprint’s debt, which stood at $20 billion at the end of the first quarter.
Virgin Mobile, which sells Sprint service under its own brand, gives Sprint more customers that buy mobile phone service without a contract, a business that is growing amid the worst economic slump in a half-century.
In May, Virgin Mobile it raised its forecast for 2009 earnings before interest, taxes, amortization and depreciation and some other items to $127 million to $142 million, from a March projection of $117 million to $132 million.
Sprint Nextel in $420 Million Deal for Virgin Mobile USA
Hot News: Job woes sap U.S. consumer confidence in July
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07.28.09
Posted in .com, All, hot news, shortly, top tagged All, economics, markets, people, reviews at 12:00 pm by carydalton
NEW YORK (Reuters) – Stock futures slipped on Tuesday due to caution ahead of key reports on home prices and consumer confidence.
Although the primary focus remains on second-quarter earnings, investors are eager to see if economic data will provide further evidence of a U.S. economy recovery to justify a further run-up in stocks.
The benchmark S&P 500 (.SPX) has rallied 45 percent from the 12-year closing low of March 9 as investor bet on an economic rebound.
Standard & Poor's releases its S&P Case/Shiller Home Price Index for May at 9 a.m. EST. Economists in a Reuters survey expect a decrease of 0.5 percent versus a 0.6 percent all in April.
The Conference Board releases July consumer confidence, 10 a.m. EST. Economists in a Reuters survey expect a reading of 49.0 compared with 49.3 in June.
S&P 500 futures were 4.10 points lower and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures shed 29 points, and Nasdaq 100 futures slipped 5 points.
Bank of America Corp (BAC.N) shares dropped 1.5 percent to $12.90 before the bell after the Wall Street Journal reported that the U.S. bank was planning to cut its 6,100-branch network by about 10 percent. The newspaper cited the bank's chief executive Kenneth Lewis as telling investors easy payday loans.
General Electric (GE.N) holds its second big investor briefing of the year on its GE Capital finance arm. Wall Street is on the watch for more details on how the restructuring is going.
China Unicom (0762.HK), one of China's top three mobile carriers, has reached a preliminary agreement with Apple (AAPL.O) for the exclusive sale of its iPhone handset in China for three years, the official Shanghai Securities News reported on Tuesday, however a China Unicom official said a formal deal had not been reached.
Among companies reporting results today Viacom Inc (VIAb.N) reported a steep fall in quarterly earnings, hit by poor advertising revenue and a dropoff in sales of its "Rock Band" video game.
Office Depot Inc (ODP.N), the No. 2 U.S. office supply retailer, reported a bigger-than-expected quarterly loss on Tuesday as the recession hurt demand from corporate customers
U.S. stocks rose slightly on Monday in a late rally as investors rotated into financial shares, which had lagged in the recent two-week run-up.
(Reporting by Ellis Mnyandu; Editing by Theodore d'Afflisio)
Futures dip before home prices data
Hot News: Deutsche Bank Quarterly Net Profit Up 67 Percent
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07.27.09
Posted in .com, All, news, shortly, world of money tagged news, opinion, people, politics, world at 7:36 pm by carydalton
WASHINGTON — Saying that the ties between the United States and China are as “important as any bilateral relationship in the world,” President Obama welcomed senior Chinese leaders on Monday to begin high-level consultations on issues like the global economic downturn and North Korea.
“The United States and China share mutual interests,” Mr. Obama declared at the opening ceremony for the two days of talks, which will be led by both the secretary of state, Hillary Rodham Clinton, and the Treasury secretary, Timothy F. Geithner, and their Chinese counterparts.
“If we advance those interests through cooperation,” he said, “our people will be better off — because our ability to partner with each other is a prerequisite for progress on many of the most pressing global challenges.”
Ticking off those challenges, he said the two countries would discuss how to work together on economic policy, climate change, clean energy technology, nuclear nonproliferation, cracking down on terrorism and other threats, and tackling humanitarian crises like that in Darfur.
“All of these issues are rooted in the fact that no one nation can meet the challenges of the 21st century on its own,” Mr. Obama said. “It is this fundamental truth that compels us to cooperate.”
Mr. Obama referred to disagreements between the United States and China over human rights, saying the “religion and culture of all peoples must be respected, and that all peoples should be free to speak their minds — and that includes ethnic and religious minorities in China.”
But he said the two countries could narrow their differences with a wide range of exchanges between their governments and growing connections between individuals. The United States, Mr. Obama said, is enriched by its ties with China, a society he described as “at once ancient and dynamic.”
“Let’s be honest,” the president said, “Some in China think that America will try to contain China’s ambitions; some in America that think there is something to fear in a rising China. I take a different view.”
Mr. Obama said he wanted to see China be a “strong, prosperous, and successful member of the community of nations unsecure cash loans.”
The so-called Strategic and Economic Dialogue is a successor to a wide-ranging consultation begun during the Bush administration by the former Treasury secretary, Henry M. Paulson Jr.
Mrs. Clinton had pushed for the State Department to take an equal role in the talks, which had been dominated by economic issues, like currency exchange rates, under Mr. Paulson.
While strategic issues like North Korea will loom large this week, much of the discussion is likely to revolve around the economic ties between China and the United States, including currency issues.
While there are tentative signs of recovery in both economies, Mr. Obama highlighted the need for Americans to save more and Chinese consumers to spend more, to put growth on a more “sustainable foundation.” He also called for completion of the global trade talks known as the Doha Round.
Mr. Obama also took a firm line toward North Korea and Iran, saying that North Korea must be persuaded to abandon its nuclear weapons program and that Iran must be prevented from obtaining a bomb.
“Neither China nor America has an interest in a terrorist acquiring a bomb or a nuclear arms race breaking out in East Asia,” he said.
The Chinese officials — Vice Premier Wang Qishan, who oversees economic policy, and State Councilor Dai Binguo, who oversees foreign policy — will meet with Mr. Geithner and Mrs. Clinton, respectively.
Mr. Dai, like Mr. Obama, alluded to differences between the United States and China, saying “the United States will never become China, and China will never become the United States.” But he noted that global upheaval, like the recent economic crisis, united the two countries.
“We’re actually in the same big boat that has been hit by fierce wind and huge waves,” he said. China and the United States, he said, needed “to cross the stormy water as passengers in this same boat.”
Obama Opens Economic and Policy Talks With China
Hot News: Wall St drops as outlooks, profit-taking weigh
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Posted in All, Free blog Tips, money, news, world of money tagged All, blogs, campaign, news, reviews at 6:48 pm by carydalton
Sales of new homes in the United States posted their largest monthly gain in eight years in June, the government reported on Monday, a sign that the housing market is bottoming as buyers take advantage of lower prices.
The Commerce Department reported that new single-family home sales rose 11 percent in June, an increase that dwarfed economists’ expectations of a 3 percent increase. The pace of home sales rose to a seasonally adjusted rate of 384,000 a year, the highest level since November.
Despite the monthly increase, sales of new homes were still down 21 percent from June 2008, and the market is still swamped by a glut of for-sale houses and foreclosed properties.
“These are still really bad numbers,” an economist at IHS Global Insight, Patrick Newport, said. “The market just couldn’t have dropped much further.”
As sales rose, median prices of new homes continued to fall, slipping to $206,200 from $232,100 in June a year ago.
The figures were the latest evidence that a three-year slump in the country’s housing market was leveling off as prices fell back and some builders and buyers began to step tentatively back into the market. Earlier this month, the government reported that housing starts rose 3 cash till payday advance.6 percent in June from a month earlier, and a trade group reported that sales of previously owned homes also rose for another month.
“Sales are picking up a little,” a senior economist at 4Cast, David Sloan, said. “Whether it’s going to pick up any momentum is really the key. I think we have to be doubtful about that.”
On Tuesday, a closely watched measure of home prices will be released, offering some hints about whether the long plunge in housing values is abating. Economists are expecting a 17.9 percent year-over-year decline in prices in the Standard & Poor’s Case-Shiller Home Price Index.
Although new-home sales have risen for three months, many economists worry that rising unemployment, stagnant wages and continued tightness in lending markets will weigh down the housing market for the rest of the year.
“There’s still worries that the lack of employment growth and lack of wage growth is restraining consumer income, and that’s going to ensure that the recovery is quite modest,” Mr. Sloan said.
New U.S. Home Sales Rise Sharply as Prices Fall
Hot News: Nikkei rises 1.75% to top 10,000 line
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07.26.09
Posted in .com, economic, news, online, world of money tagged economics, finance, life, markets, people at 4:00 pm by carydalton
Chinese officials will hold their first round of high-level strategic and economic talks with the Obama administration this week in Washington, a two-day event U.S. officials say they hope will lead to greater economic, environmental and security cooperation between the two countries. U.S. officials say the Obama administration’s first annual Strategic and Economic Dialogue with China comes at an important time for the two countries as they work to recover from the global financial crisis and seek opportunities to work together on issues such as climate change, trade and terrorism.Secretary of State Hillary ClintonThe meeting on Monday and Tuesday will be co-chaired by Secretary of State Hillary Clinton and Treasury Secretary Timothy Geithner. China is sending a massive delegation of 150 officials, the largest it has ever sent to the United States.Beijing’s official entourage will be led by State Councilor Dai Bingguo and Vice Premier Wang Qishan.U.S. President Barack Obama will deliver an address at the beginning of the discussions on Monday.The two-track talks - economic and strategic - are a broader extension of economic talks that began under the previous U.S. administration of George W. Bush.In April, Mr. Obama and Chinese President Hu Jintao agreed to begin holding the annual meeting this year and alternate the venue between Washington and Beijing each year.Obama officials say that one of the most important messages they will take to the meeting is that while the U.S. economy is going to recover, its economy will not driven by Americans buying foreign goods.They also say they will urge China to rely less on exports and more on expanding its domestic markets to fuel its economic growth.Qin Gang, Chinese Foreign Ministry spokesmanBusiness representatives and industry analysts say they are hopeful the meeting will see progress, but do not expect earth-shattering results direct payday loans.Erin Ennis, vice-president of The U.S.-China Business Council in Washington says that much of the time during the meetings is likely to be spent getting used to their new structure.It has the potential I think to make a great deal of progress, but we also need to keep in mind that there is a lot on this agenda and having discussions, even over two days on this number of issues, is really only going to begin to scratch the surface.Ennis says she is very hopeful the two sides may find some common ground in addressing the issue of climate change. She says Energy Secretary Steven Chu’s recent trip to China and various meetings between the Obama administration’s chief climate negotiator, Todd Stern, and Chinese officials have laid a good foundation for the meeting.Louis B. Schwartz, an international trade attorney and president of China Strategies agrees.He notes that China is rapidly embracing a clean energy policy, much faster than many realize, and that there is great potential for cooperation between the two sides.At this point, at least, there is boundless opportunity and I really believe that we really should open up each others markets to the other.Opening up markets - be it in the field of clean energy technology or projects linked to China’s massive $586-billion government stimulus is a key message U.S. officials say they will take to the meetings this week.China says that during the talks its officials will urge Washington to adopt policies that protect the value of Chinese investments in the United States.China is Washington’s biggest creditor and holds more than $800 billion worth of U.S. Treasury securities.
US, China to Tackle Economy, Environment and Security in High-Level Talks
Hot News: Stocks and Bonds: Latest Earnings Cause Wall Street to Pause
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07.25.09
Posted in Free blog Tips, economic, money, news, top tagged blogs, economics, money, newsreports, personal at 11:06 pm by carydalton
LIKE many teenagers, Josh Wilson, the 13-year-old son of the New York venture capitalist Fred Wilson, has on occasion visited the Internet’s peer-to-peer file-sharing services to download music and television shows.
But recently, as Mr. Wilson recounted last week on his popular blog, A VC, Josh has started streaming television shows from Netflix under the family’s $24-a-month subscription plan and listening to licensed, ad-supported music videos from YouTube on his iPhone. Asked by his father why he was not using file-sharing services like BitTorrent to download shows like “Friday Night Lights,” Josh replied, “BitTorrent takes too long.”
The answer neatly encapsulates the remaining hope of beleaguered media executives everywhere, especially those in the rapidly deteriorating music business. After a decade of rampant digital piracy that has helped to gut album sales, a raft of new streaming music sites is making the experience of legally finding and listening to music just as seductive as downloading it free.
Many music industry observers now believe that there is a fundamental shift under way: from illegal downloads to licensed streaming services like MySpace Music, imeem and Spotify, where users can play any song, anytime and — coming soon — on any device. These sites are free, supported by ads, and with an expanding catalog of songs, they are finally ready to overshadow the more cumbersome, unauthorized services that can be hard for newcomers to navigate.
“We have been on this endless hunt for a decade trying to accumulate both our all-time favorites and the new hits,” said Bob Lefsetz, author of the Lefsetz Letter, a music industry newsletter, who believes that the future hope of the music industry lies in charging people monthly subscriptions for access to streaming sites on the Web and their phones. “Why are you going to steal if all of a sudden you can check it out quickly on a streaming service?”
Two recent studies of online behavior contribute to this optimistic view. In June, two British research agencies, MusicAlly and The Leading Question, generated a wave of headlines in the tech press after reporting that the percentage of 14- to 18-year-olds using file-sharing services at least once a month dropped to 26 percent in January 2009 from 42 percent in December 2007.
Similarly, a survey by the NPD Group in the United States this spring found that teenagers aged 13 to 17 illegally downloaded 6 percent fewer tracks in 2008 than in 2007, while more than half said they were now listening to legal online radio services like Pandora, up from 34 percent the year before.
There are some good reasons to keep a salt-shaker handy here — some teenagers may not be honest about downloading, for example. But there are also some indisputably positive factors at work. The streaming music services are providing not only an authorized but also in some cases a superior alternative, and may be the first obvious stop for a generation that is too young to remember when the original Napster revolutionized the music industry.
MySpace Music, introduced last September, now makes millions of songs available free, accompanied by ads and links to buy concert tickets and merchandise cash advance no fax. Nielsen recently reported that the number of visitors to the site grew to 12.1 million in June, from 4.2 million last September.
YouTube also streams millions of songs under agreements with three of the four major music labels in the form of music videos — Warner Music is a holdout — and is increasingly available free from mobile phones like the iPhone. In the weeks after Michael Jackson’s death, for example, 12 million people played his “Thriller” video from pages on the site with display ads and links to buy the songs.
But perhaps the most-discussed licensed service is Spotify, a two-year-old Swedish start-up that has amassed six million users in Europe — and a few hundred lucky media and music industry insiders in the United States who have been given early access.
Spotify users download a program to their computers that allows them to quickly search for a piece of music and play it instantly. Spotify’s innovation is subtle, embedded in its intuitive user interface and efficient design. Anyone familiar with iTunes can figure out how to navigate Spotify’s s five million songs and add them to playlists.
The free version comes with ads, or users can upgrade to a premium version for 10 euros monthly (about $14). Daniel Ek, a co-founder, was in New York this month, talking to the American music labels and preparing to introduce the service here later this year.
“Piracy is essentially the consumer’s wish to have everything on demand. It’s not like people want to necessarily have it for free,” Mr. Ek said. The problem is that there have not been commercial services “that allowed people to discover new music and easily share music with friends,” he said.
Even if people are abandoning free downloads for ad-supported services like Spotify, the industry will keep facing larger existential questions. Companies like MySpace Music, Pandora and even YouTube — though thick with ads and links to paid downloads — cannot yet (if ever) replace depleted revenue from physical CD sales.
They might even be exacerbating the problem. “The big question is, are we not just fighting piracy, but also taking away the industry’s most lucrative customers, the ones that were buying 30 or 40 CDs a year?” Mr. Ek asks. “If so, the music industry is in worse shape than it was before.”
Mr. Lefsetz believes that the answer is for the music industry to nourish the streaming sites and then push users toward subscribing to them for a monthly fee. “The key is to just get $10 from everybody,” he said.
That, he said, might finally vanquish the demons of music piracy. Mr. Lefsetz uses himself as an example of this salvaged future. He used to turn to file-sharing sites to quickly sample new music he wanted to write about. Now he just streams songs free from Spotify.
Slipstream: The Music Streams That Soothe an Industry
Hot News: Antitrust Chief Hits Resistance in Crackdown
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Posted in All, Free blog Tips, economic, online, top tagged marketing, money, opinion, political, writing at 1:12 pm by carydalton
NEW YORK (Reuters) – CIT Group Inc (CIT.N) amended a debt restructuring on Friday to lure more bondholders to tender their notes early, but the lender to 1 million companies said it could file for bankruptcy if the plan failed.
The 101-year-old lender said it did not intend to file for bankruptcy if the debt restructuring succeeded. Its shares jumped 26.6 percent to 93.7 cents in trading before the market opened.
However, CIT reiterated that it could seek bankruptcy protection if the offer failed and it did not get additional financing.
On Monday, CIT launched a tender offer for $1 billion of notes due in August in the first step of a restructuring plan after the collapse of rescue talks with the U.S. government.
The lender to small and middle-size companies said on Friday that it had increased to $50 per $1,000 of principal amount a premium for bondholders who enter before July 31 in the restructuring plan payday advance loans.
The bonds tendered before July 31 will be bought back for $825 per $1,000 face amount, while those tendered later will be bought for $775.
CIT said its estimated funding needs for the year ending June 30 include $7 billion of unsecured debt. The company has about $40 billion of long-term debt, according to independent research firm CreditSights.
(Reporting by Juan Lagorio; Editing by Lisa Von Ahn)
CIT amends debt offer to attract creditors
Hot News: Stocks and Bonds: Dow Closes Over 9,000; First Time Since January
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07.24.09
Posted in .com, Free blog Tips, news, online, shortly tagged business, finance, newsreports, personal, political at 11:59 pm by carydalton
NEW YORK (Reuters) – Guaranty Financial Group Inc (GFG.N), the second-largest publicly traded bank in Texas, said it will probably fail after loan losses and write-downs
left it "critically" short of capital.
The bank, whose investors include Carl Icahn and Robert Rowling, is in talks with at least one investor group for a possible recapitalization, said a source familiar with the situation. The source requested anonymity because the talks are not public.
"The company believes that it is probable that it will not be able to continue as a going concern," Guaranty said in a regulatory filing.
The Austin-based lender has about $16 billion of assets and more than 150 branches in Texas and California, according to its website.
On that basis, if it were to fail, Guaranty would be the largest U.S. bank to collapse in 2009. Guaranty is about half the size of IndyMac Bancorp Inc (IDMCQ.PK), which failed last July.
So far 64 banks have failed this year, including seven on Friday, according to the Federal Deposit Insurance Corp. Friday's failures include six bank subsidiaries of Security Bank Corp of Macon, Georgia.
In a regulatory filing late on Thursday, Guaranty said it has been unable to obtain new capital from shareholders, and believes it will be ineligible for help from U.S. regulators.
Its largest investors include companies run by billionaire Carl Icahn and by Rowling, whose investment firm owns the Omni Hotels chain.
Guaranty said it does not expect to raise enough capital to comply with an April cease-and-desist order from the federal Office of Thrift Supervision (OTS).
It said losses and write-downs have left it "critically undercapitalized," with negative capital ratios credit report.
Guaranty also said it has agreed to an OTS demand for the appointment of the Federal Deposit Insurance Corp as a receiver or conservator. That appointment has not yet happened, but the OTS is exercising "a significant degree of control" over what had been functions of the board of directors, Guaranty said.
The company has not filed official results since the third quarter of 2008. It has estimated it lost $444 million in all of 2008 and another $256 million in the first quarter of 2009.
Chief Marketing Officer John Wessman said in a statement that Guaranty is still working with regulators, and believes it can avoid disruptions to customers.
Guaranty's largest investors include Rowling's investment firm TRT Holdings Inc, which has a 19.9 percent stake according to a regulatory filing. A company run by Icahn has a 17 percent stake, Reuters data shows.
Icahn and Rowling did not immediately return calls for comment.
Guaranty began operations in 1988, according to its website. It was spun off in December 2007 by Temple-Inland Inc (TIN.N), a corrugated packaging and building products company.
The largest publicly traded bank based in Texas is Dallas-based Comerica Inc (CMA.N).
Guaranty shares closed down 7 cents, or 32 percent, at 15 cents on the New York Stock Exchange on Friday. Their 52-week high is $6.75, set last September 18.
(Reporting by Jonathan Stempel and Paritosh Bansal; Editing by Matthew Lewis, Gary Hill, Tim Dobbyn and Richard Chang)
Guaranty Financial, No.2 Texas bank, says may fail
Hot News: Ray Shaw, Head of Business Newspapers, Dies at 75
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Posted in business, economic, hot news, online, top tagged business, campaign, economics, marketing, writing at 8:48 am by carydalton
Taking a new hard line that news articles should not turn up on search engines and Web sites without permission, The Associated Press said Thursday that it would add software to each article that shows what limits apply to the rights to use it, and that notifies The A.P. about how the article is used.
Tom Curley, The A.P.’s president and chief executive, said the company’s position was that even minimal use of a news article online required a licensing agreement with the news organization that produced it. In an interview, he specifically cited references that include a headline and a link to an article, a standard practice of search engines like Google, Bing and Yahoo, news aggregators and blogs.
Asked if that stance went further than The A.P. had gone before, he said, “That’s right.” The company envisions a campaign that goes far beyond The A.P., a nonprofit corporation. It wants the 1,400 American newspapers that own the company to join the effort and use its software.
“If someone can build multibillion-dollar businesses out of keywords, we can build multihundred-million businesses out of headlines, and we’re going to do that,” Mr. Curley said. The goal, he said, was not to have less use of the news articles, but to be paid for any use.
Search engines and news aggregators contend that their brief article citations fall under the legal principle of fair use. Executives at some news organizations have said they are reluctant to test the Internet boundaries of fair use, for fear that the courts would rule against them.
Mr. Curley declined to address the fair use question, or to say what action The A.P. would take against sites that use articles without licensing.
“We’re not picking the legal remedy today,” he said. “Let’s define the scope of the problem.”
News organizations already have the ability to prevent their work from turning up in search engines — but doing so would shrink their Web audience, and with it, their advertising revenues. What The A.P. seeks is not that articles should appear less often in search results, but that such use would become a new source of revenue.
Gabriel Stricker, a spokesman for Google, said, “We believe search engines are of real benefit to news publishers, driving valuable traffic to their Web sites and connecting them with readers around the world paydayloan.” Some news executives agree and contend that a confrontation with search engines is misguided.
The new program, approved Thursday by The A.P. board, is being introduced in stages that reach into next year. It follows through on a statement the company made in April vowing to take on digital piracy not only on its own behalf, but also as the agent for the embattled newspaper industry.
Each article — and, in the future, each picture and video — would go out with what The A.P. called a digital “wrapper,” data invisible to the ordinary consumer that is intended, among other things, to maximize its ranking in Internet searches. The software would also send signals back to The A.P., letting it track use of the article across the Web.
Newspaper executives have said that by taking the lead, The A.P. ensures a unified approach, saves publishers from having to design their own software and circumvents possible charges of collusion against the papers.
Some popular news aggregators like The Huffington Post and Google News have licensing agreements, paying The A.P. for the use of its material. But no comparable agreements cover general Internet searches that turn up news articles with a variety of other results.
Executives at newspapers and other traditional news organizations have long complained about how some sites make money from their work, putting ads on pages with excerpts from articles and links to the sources of the articles.
Another complaint is that a link to an article sometimes leads to another secondhand user, not the original source, which can deprive the creator of some of the audience for its own site and the ads on it. Some less-well-known sites reprint articles outright, or large parts of them, without permission, a clearer copyright violation. But there is little consensus on how extensive that problem is for news organizations.
A.P. Cracks Down on Unpaid Use of Articles on Web
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07.23.09
Posted in .com, Free blog Tips, business, online, top tagged All, campaign, financial, life, money at 8:12 pm by carydalton
FRANKFURT — Comfortably in control of his own company and angling for the much larger Volkswagen, Porsche’s chief executive, Wendelin Wiedeking, described the process before him in November 2007 as an intense chess match.
“Even now, none of the players involved knows how many moves will still be required and how long it will take until the game is finally over,” Mr. Wiedeking said during an interview at the time.
But Mr. Wiedeking’s metaphor proved far too playful for what transpired, as financial markets and feuding families took their toll on his attack plan. He had started a war, and ended up as its biggest casualty.
On Thursday, Porsche’s supervisory board fired Mr. Wiedeking and paved the way for a merger with Volkswagen, the company Porsche had dreamed of owning.
The departure of Mr. Wiedeking, 56, marked a tumultuous end for the best-paid chief executive in Germany, a hyper-aggressive manager who ruffled feathers for years but nonetheless showed considerable industrial prowess.
In an ironic twist, Mr. Wiedeking also anticipated a core problem of car companies worldwide — a lack of economies of scale — but his solution of Porsche taking over Volkswagen became his undoing.
He was constantly in the news in Germany, not the least because he earned €77.4 million, or $110 million, last year, a princely sum in a country that was skeptical of high pay packages even during good times. But his contract guaranteed him 0.9 percent of the company’s profit, and in the past few years it was greater than anyone could have anticipated. The provision was granted in the 1990s, when Porsche’s future was in doubt.
Porsche said Thursday that Mr. Wiedeking would walk away with a €50 million severance package, only days after rumors suggested that the figure might be four times that.
Mindful of the austere times, Mr. Wiedeking announced that he would put €25 million into a charitable trust that would promote “socially fair development” at Porsche facilities. He also planned to donate €500,000 each to three organizations that look after infirm journalists.
A mechanical engineer by training, he joined Porsche in 1983 at age 31. He left for an auto-parts maker in 1988 but returned to Porsche as head of production in 1991 and began whipping the nearly bankrupt company back into shape. At one point he made a show of destroying a bin for extra parts along its assembly line to make his point about the need for leaner, Japanese-style production processes online payday loans.
He became chief executive a year later and transformed the company into one of the world’s most profitable automakers, with annual production of around 100,000 vehicles. He dropped the money-losing 928 and 968 models, overhauled the iconic 911 and developed two new models, the Boxster convertible and the Cayenne sport utility vehicle.
Mr. Wiedeking’s protégés rose as well. Michael Macht, who will now succeed Mr. Wiedeking, ran the production lines and was the first head of Porsche Consulting, an enterprise that began by evangelizing Porsche suppliers on the need to cut costs.
In 2005, long before the industry’s current consolidation drive, Mr. Wiedeking had huddled in Salzburg, with members of the two families that control the sports car maker — the Porsches and the Piëchs — and floated the idea of buying VW, on the theory that only a large company could afford the huge investments in new technologies that environmental regulations and fuel-saving imperatives would demand.
Initially shocked at his audacity, the families eventually bought in.
But Mr. Wiedeking’s strategy looked rash rather than bold after financial market chaos last year transformed the landscape for heavily indebted companies.
Though the automaker that Mr. Wiedeking had so painstakingly rebuilt responded flexibly to the sharp drop-off in sales, a €9 billion debt load proved unbearable. Ferdinand Piëch, a member of Porsche’s founding family, a board member, and also chairman of Volkswagen, pounced on the opportunity to reverse the terms of Porsche’s audacious bid. But he insisted that Mr. Wiedeking would have to go, and that Porsche would have to bring in an outside investor. Along with his close confidant and chief financial officer, Holger Härter, the once mighty Mr. Wiedeking departed.
Mr. Wiedeking drew lengthy and thunderous applause before he said his farewell to about 5,000 Porsche workers Thursday.
“We should not look back, no matter what happens,” he said. “We should now work constructively on our future.”
Porsche Chief Was Biggest Casualty of His Battle for VW
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