03.12.10
Posted in business, economic, money, shortly, world of money tagged marketing, opinion, personal, politics, reviews at 3:18 pm by carydalton
NEW YORK (MarketWatch) — Weighing in at 2,200 pages, the court-appointed examiner in the Lehman Brothers Holdings Inc. bankruptcy case performed the kind of due diligence that was sorely lacking at the failed firm.
No one, it seems, escaped the gaze of Anton Valukas, the chairman of the law firm Jenner & Block, who spent $30 million on the post mortem. Valukas states Lehman executives manipulated the balance sheet, withheld information from the board, and inflated the value of toxic real estate assets. See report on possible legal claims from the case.
The voluminous detail of the report vindicates some and castigates others. Here are the major verdicts:
Guilty: Dick Fuld, Erin Callan.
The CEO and chief financial officer of Lehman, respectively, are painted by the report as either dubious or overmatched by the complex nature of Lehman’s holdings. Callan, is alleged to have ignored warnings from the firm’s financial controller about the use of Repo 105s, the internal term used to move assets off the balance sheet and hide debt.
WSJ’s Deal Journal received this response from Fuld’s attorneys: “Mr inferred heaters. Fuld did not know what those transactions were — he didn’t structure or negotiate them, nor was he aware of the accounting treatment.”
As if that looks any better.
Not guilty: David Einhorn, short sellers, counterparties, Matthew Lee.
David Einhorn, the head of the hedge fund Greenlight Capital, argued that Lehman was hiding its balance sheet problems for months and took a lot of heat from Lehman as a result. Likewise, Fuld liked to blame the firm’s sagging fortunes in the summer of 2008 on short-sellers such as Einhorn.
The Valukas report shows they made the right bet. Counterparties including as J.P. Morgan Chase & Co. soon followed, and as the report suggests, rightfully so.
History also would look favorably on Matthew Lee, a senior vice president, who in June 2008 warned management and auditors. Only to be ignored.
— David Weidner
MarketWatch First Take: Lehman’s guilty and not guilty
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03.05.10
Posted in .com, business, economic, news, online tagged events, finance, newsreports, personal, politics at 7:12 am by carydalton
NEW YORK – Shoppers returned to the nation’s malls last month, buying a surprising amount of spring clothing and other items and helping stores post the strongest retail sales since November 2007, a month before the recession began.
The better-than-expected 3.7 percent gain reported Thursday showed that Americans are still thrifty, but they are letting go of some of the frugality brought on by the economic downturn. And many are willing to spend for certain higher-end goods.
Consumers “are now starting to go back to where they had typically shopped” before the recession, said Michael Niemira, chief economist at the International Council of Shopping Centers, who expected a 2 percent gain. “I’m surprised by the broad strength.”
But, he added, there’s still uncertainty about whether such a robust pace can be sustained, particularly later this year when the sales figures are being compared with more stabilized spending patterns.
The February sales report was the third consecutive monthly increase, according to the ICSC. The monthly index excludes Wal-Mart Stores Inc., which stopped reporting monthly sales last year.
Shoppers shrugged off snowstorms and worries about the economy to visit a broad array of merchants, from luxury retailer Nordstrom to middlebrow Macy’s Inc. to discounter Target Corp., which all reported solid sales increases that beat Wall Street analysts’ estimates.
The figures are based on sales at stores open at least a year and are considered a key indicator of a retailer’s health.
Stores in malls, which had seen sales plunge as their customers traded down to cheaper options, are starting to bring shoppers back by offering lower-priced or exclusive items.
Saks Fifth Avenue, for example, is expanding its exclusive merchandise offerings, putting more emphasis on lower prices and expanding its discount Off Fifth chain.
Selia Black, 26, was at the Manhattan Mall in New York on Thursday to find a birthday gift for her sister. She splurged on a $178 jacket at full price at Bebe. A year ago, she would have been scouring for a present that was deeply discounted, she said.
“I’m easing up a little bit, but not totally,” said the Brooklyn woman. She does not work, but her husband is a security guard.
Black says the recession has made her switch from Macy’s to discounters such as Marshall’s, and she planned to keep shopping at discount stores even when the economy recovers.
“You always get the deals,” she said. “But this is something special.”
Dennis Jacobe, chief economist at Gallup, believes shoppers’ thriftiness may have thawed a bit, as shoppers who have jobs are buying a little more. But, he said, frugality has not gone away, based on Gallup’s polls.
“We are in a new normal of spending,” he said low fee payday advance. He cited Gallup surveys taken Feb. 1 to Feb. 3 in which 57 percent of consumers polled said they are spending less. One-third of those surveyed said curtailed spending will be their normal pattern.
Another factor that helped the monthly sales figures look so strong was that February 2009 figures were so awful. Jacobe says spending levels are still well below 2008.
February, sandwiched between post-holiday clearance and spring, is the second-least important month of the year for retailers after January. Analysts see combined data for March and April as a more accurate measure of consumer behavior.
Still, the fact that shoppers were buying full-priced spring clothing was a pleasant surprise in the face of a sharp drop in the monthly Consumer Confidence Index.
Economists pointed to factors that depressed shoppers’ mood last month but did not seem to affect spending: gridlock in Congress over the jobs bill and a dive in the stock market related to worries about Greece’s national debt — not to mention repeated winter storms that buried much of the country in heavy snow.
Most economists say companies need to start hiring significantly in order for spending to keep improving. Unemployment stood at 9.7 percent in January and was expected to increase to 9.8 percent in February. The Labor Department was to report new job figures Friday.
In other encouraging signs for the economy, the Labor Department reported Thursday that new claims for jobless benefits fell last week, reflecting that layoffs may be easing as the economy slowly recovers. Factory orders also rose in January, according to the Commerce Department.
Shoppers are buying food at Wal-Mart and picking up discounted designer clothing at TJ Maxx, but trading up to stores such as Macy’s and Kohl’s for exclusive merchandise, said Craig Johnson, president of retail consultancy Customer Growth Partners.
Target, the nation’s second-largest discounter behind Wal-Mart Stores Inc., said February sales in stores open at least a year rose 2.4 percent as it attracted more customers and more spending per customer. But food and household essentials remained the biggest sellers, with furniture and clothing sales about flat with last year.
Gap, where sales had been led by low-price Old Navy, is starting to see a recovery across all its brands, including upscale Banana Republic, where sales were hurt when the financial meltdown escalated. Sales at namesake Gap stores were flat, but Banana Republic posted a 6 percent gain and Old Navy’s business improved by 5 percent.
Retail sales post strongest gains since late 2007
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03.02.10
Posted in .com, All, Free blog Tips, business, top tagged campaign, finance, markets, personal, reviews at 6:00 am by carydalton
FORT WORTH, Texas – Natural gas and oil producer Quicksilver Resources Inc. posted a fourth-quarter profit of $32.5 million, or 19 cents per share, Monday as revenue grew, compared with a loss a year earlier, when it recorded several charges.
A year earlier, the company lost $467 million, or $2.79 per share.
The results, which beat Wall Street’s expectations, sent Quicksilver’s shares up 50 cents, or 3.4 percent, to $15.42. The stock has traded the past 52 weeks at $3.98 to $16.59.
Excluding one-time items, the company earned $47.3 million, or 27 cents per share, up from an adjusted profit of $39.3 million, or 23 cents per share, a year earlier home kerosene heaters.
Revenue rose 12 percent to $234.1 million from $208.9 million.
Analysts, on average, were expecting a profit of 25 cents per share on sales of $217.4 million, according to a poll by Thomson Reuters.
For the full year, Quicksilver posted a loss of $557.5 million, or $3.30 per share, compared with a loss of $378.3 million, or $2.33 per share, a year earlier.
Adjusted earnings were 86 cents per share for 2009.
Revenue rose to $832.7 million from $800.6 million.
Quicksilver reports profitable 4Q, shares climb
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02.13.10
Posted in All, economic, hot news, news, top tagged All, campaign, life, opinion, personal at 11:12 pm by carydalton
The global coal industry is in the midst of a permanent structural shift in the form of the emerging dominance of the Asia-Pacific region.
China and India are at the heart of the transformation, firmly placed as the world's No. 1 and No. 3 biggest coal producing nations, respectively. (The U.S. is No. 2.)
And demand in the world's two most populous nations is growing rapidly.
India's imports of thermal coal, used in power generation, rose 60% in 2009 to 57 million tons. China shifted to a net importer last year to the tune of 70 million tons of thermal coal, despite large domestic resources of the black rock.
Both countries are also experiencing a spike in demand for metallurgical coal, a main ingredient of steel, as their economies continue to mushroom.
At the end of January, Peabody Energy (NYSE:BTU - News) said it is expanding a mine in Australia at a cost of $70 million to boost capacity by 1 million tons within several years to meet growing demand for metallurgical, or met coal, used by steel companies in China, India and other Asian nations.
"China and India have permanently changed the seaborne metallurgical and thermal coal market landscape," CEO Gregory Boyce said. Peabody enjoyed a 37% increase in Australian coal shipments in the second half of 2009.
Alpha Natural Resources (NYSE:ANR - News) said it sees much strength in the metallurgical markets in 2010. It raised its metallurgical shipment guidance by about 1 million tons, to 11 million to 13 million tons for this year.
Meanwhile back in the U.S., the enormous stockpiles of coal racked up by utilities during the depths of the recession are starting to shrink after extremely cold weather in December and January.
According to U.S. utilities, which use coal to generate nearly half of America's electricity, roughly 50 to 60 gigawatts of coal will go offline over the next 10 years or so.
The U.S. will need to replace that energy, and renewables such as solar, wind, small hydro, modern biomass, geothermal and biofuels are one of the paths to take to fill that void.
1. Business
IBD's Energy-Other group includes any energy source that is not oil or natural gas. The group's 800-pound gorilla is coal.
Coal mining, especially underground, is a capital- and labor-intensive business. It is also a very high fixed-cost business.
Electricity demand has been the primary value driver for thermal and steam coal for a long time, with steel being the other big driving force.
In 2009, the U.S. produced 1.08 billion tons of coal, mined primarily from four major coal basins with smaller ones spread across the country. The four are the northern and central Appalachian basins, the Illinois basin and northern Wyoming's Powder River Basin.
Peabody is the largest U.S. coal miner, producing 215 million tons last year. It is the only U.S.-based company in the group with international mining operations, in this case Australia.
Arch Coal (NYSE:ACI - News) is the second-largest company in the group; Alpha Natural Resources moved into the No. 3 slot with last year's acquisition of Foundation Coal for $1.4 billion in stock. Consol Energy (NYSE:CNX - News) and Massey Energy (NYSE:MEE - News) are fourth and fifth, respectively.
The U.S. is capable of generating roughly 1,000 gigawatts of electricity per year. Coal generates some 325 gigawatts, natural gas kicks in 400 and nuclear makes up another 100, according to Brian Gamble, an analyst at Simmons & Co. The rest, he says, is split between hydropower, solar, wind, geothermal and biomass.
"The segment of the U.S. power grid that is made up of renewables is quite small," Gamble said. "It is a growing market, albeit from a small base, but we don't expect solar, wind or any other renewable to gain significant market share for some time."
The group includes several solar companies, including Chinese firms like Trina Solar (NYSE:TSL - News) and Suntech Power (NYSE:STP - News).
First Solar (NMS:FSLR) is the largest U.S.-based solar company by market share. Other American firms include Real Goods Solar (NMS:RSOL), GT Solar International (NMS:SOLR) and SunPower (NMS:SPWRA).
While multinationals such as GE (NYSE:GE - News) and Siemens (NYSE:SI - News) have made a strong push into wind power, those diversified industrial giants are listed in other stock groups. In the Energy-Other group, Danish company Vestas Wind Systems (OTCBB:VWDRY.ob - News) is the largest wind-power company.
Ormat Technologies (NYSE:ORA - News) and U.S. Geothermal (AMEX:HTM.a - News) operate plants of geothermal energy, power generated from heat stored in the Earth payday advance.
Name Of The Game: It's simple: produce and supply coal, wind, solar, hydropower and other renewables to fulfill the world's energy needs, which are expected to grow rapidly over the next 20 to 30 years, says Michael Dudas, an analyst with Jefferies & Co.
2. Market
U.S. utilities are the biggest customers for coal producers and renewable energy alike.
Steel makers are the next biggest consumers of coal.
The entire coal market, which is dominated by the publicly traded miners and small mom-and-pops, is estimated at roughly north of $52 billion. The U.S. is expected to produce 1.07 billion tons of coal this year, with public coal companies churning out more than half that output.
The renewables market is a bit tougher to size as the adoption of these alternative energies is still in early phases. But rough estimates for the global wind and solar market is roughly $100 billion, with 70% of that produced by wind. The U.S. wind market is roughly $20 billion, according to Simmons' estimates.
3. Climate
The biggest issue facing the coal industry is permits being held up by the Environmental Protection Agency that are needed to continue producing coal. Environmentalists contend coal mining is destroying landscapes where these basins are located.
"The problem here is that we are going to experience energy usage growth of 50% over the next 25 years, and we can't do it without coal, which is one of the cheapest forms of energy," Dudas said.
Coal stockpiles rose last year as demand fell. Businesses were forced to close and shutter production, while consumers used less heat to save on their energy bills, Dudas says.
"Coal producers will have to manage their output and in some cases shut mining operations down until the stockpiles begin to decline, which has already begun," he said.
Last week, U.S. industry executives from the wind, solar, hydropower, geothermal and biomass sectors pushed for a federal renewable energy standard, which would set a percentage of how much energy must come from renewable sources in the U.S.
The group wants an extension of tax incentives and said stimulus funds powered most renewable expansion last year. President Barack Obama has urged Congress to set a national standard that would require 25% renewable power by 2025.
A federal standard, which they say will foster economic growth and create jobs, could spur these industries at a time when China is moving swiftly into alternative energy production.
4. Technology
Most technological advances in this industry group have occurred in renewables.
For example, ethanol producers, such as BioFuel Energy (NMS:BIOF) and Pacific Ethanol (NMS:PEIX), use corn oil extraction technologies to produce the biofuel.
Companies such as Hy-Drive Technologies provide natural gas or hydrogen-generating systems for diesel and commercial fleets.
And FuelCell Energy (NMS:FCEL) makes stationary fuel cells, which electrochemically produce electricity directly from hydrocarbon fuels for commercial, industrial, utility and government customers.
Solar power companies have to be tech-savvy to generate electricity from sunlight. This can be direct as with photovoltaics, or indirect as with concentrating solar power, where the sun's energy is focused to boil water, then used to generate power.
5. Outlook
Over the next decade, coal plant retirements will take roughly 50 to 60 gigawatts of coal generation offline.
The U.S. will need to replace that lost energy, and renewables are the answer, Gamble says.
"It will take a mix to fill the void, and there will be a shift, but renewables won't fill that need overnight," he said. "In order to make this happen, there will have to be additional infrastructure built, which becomes an expensive proposition no matter how you slice it."
Nuclear, natural gas and renewable energy can each fill part of that role, but additional coal assets must be built in the meantime.
Upside: The world has unquenchable thirst for energy as emerging economies continue their rapid growth and populations in developed nations continue to swell. That demand should fuel business for traditional sources like coal as well as renewables.
Risks: Another recession could further sap demand for coal, which could increase stockpiles and restrain mining operations. Also, tougher regulation in the U.S. would make starting new projects difficult.
A Renewed Sense Of Energy
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02.07.10
Posted in Free blog Tips, money, online, shortly, top tagged All, life, money, opinion, personal at 3:00 am by carydalton
SHORTLY after Sept. 11, 2001, a soon-to-be familiar figure appeared in the news media. He was a young Muslim who wanted nothing more than to strap on a belt laden with explosives and blow himself up in an area crowded with infidels. He thought his reward would be eternity in paradise with 72 virgins.
But was he truly the face of Islamic terrorism? Eli Berman, a professor of economics at the University of California, San Diego, says otherwise in “Radical, Religious, and Violent: The New Economics of Terrorism” (M.I.T. Press, 300 pages).
“The pious Jihadist, programmed with an ideology of hate to be a human guided missile, or dreaming of virgins in heaven, makes for compelling news broadcasts and emotional sound bites, but in concept does not stand up to scrutiny,” he says.
Professor Berman has written an engaging book that brings new insight to an extremely polarizing subject. He argues that many terrorists are actually more rational than we might like to think. And that, of course, is a chilling notion.
The author is neither a pacifist nor an apologist for terrorists. He says, however, that if we stop looking at them as cartoon characters, we may do a better job of deterring them. In his view, we need to understand the economic forces that govern their behavior.
Professor Berman says that some of the most effective and resilient groups with terrorist links are in some ways economic clubs, run by “radical altruists.” He puts Hamas, Hezbollah and the Taliban (the United States has tied all three to terrorism) in this category. Some of these militant soldiers of Islam may sometimes commit atrocities. But Professor Berman contends that they genuinely want to help their members. They raise money from foreign governments — or, in the case of the Taliban, by selling opium — and provide social services and jobs to adherents.
The author notes that in South Lebanon, Hezbollah operates two private hospitals and a number of schools. It collects garbage, provides water and even manages an electricity grid. He says the Taliban operate 13 “guerilla law courts” in Afghanistan where locals can have disputes resolved.
Granted, the Taliban’s underground judicial system may not be as expensive to operate as a hospital or a garbage pickup service, but it has the same effect of forging a tighter bond of between the operation and its constituents.
However, Professor Berman writes, radical Islamic groups extract sacrifices from their members that have economic consequences. Families are encouraged to have lots of children, and the women are less likely to get jobs and have money to spend.
Professor Berman says that these organizations also prefer that their members send their children to Islamic schools, whose graduates are less likely to obtain jobs that pay them enough money to explore the market and its temptations cashadvance. Indeed, he says, these are some of the ways that radical believers ensure that their followers remain loyal.
Now there have been many so-called terrorist groups. But most of them don’t last because the authorities find someone who will give them information, which short-circuits the activities of the groups.
Professor Berman points out that Israeli security forces had little trouble shutting down the Jewish Underground, a less tightly organized group linked to terrorist acts, because its members were more willing to become informants than many of their Islamic peers. Al Qaeda does not offer social services, he says, and it has had more trouble historically with disloyal members.
So what does Professor Berman think should be done to put terrorists out of business? He says we need to do more to stop their revenue streams. He recommends that we discourage gulf states from contributing money to Hamas and cut off the Taliban’s inflows of cash from illegal activities.
In Professor Berman’s opinion, the United States needs to compete by offering the same kind of social services in Iraq and Afghanistan, though he concedes that terrorist groups will do everything to stop such efforts. He says aid providers must be protected — and he concedes that this will be expensive. But he points out that we are already spending billions of dollars on domestic security.
“In the long run,” Professor Berman writes, “those constructive approaches may well be cost-effective for the United States and other developed countries that are subject to international terrorism, because they are potentially sustainable.” In other words, they could be good investments.
Professor Berman is shrewd enough not to repeat the left-wing fallacy that terrorism itself is a product of economic deprivation. He seems reluctant, however, to explore why Islam is such a breeding ground for these practices.
He says the rise of militant Islam is just another wave of religious extremism, the likes of which have occurred throughout history. As he points out, the peace-loving Mennonites belong to a branch of Christianity that was once considered radical and dangerous.
Then again, today’s terrorists may soon get their hands on a nuclear device. Would Mennonites of old have detonated it? We don’t know. But Professor Berman’s “radical altruists” might.
Off the Shelf: Terrorism and the Pocketbook
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02.02.10
Posted in .com, hot news, money, online, world of money tagged blogs, economy, events, life, personal at 9:47 pm by carydalton
NEW YORK – Shares of several staffing agencies ticked higher Tuesday after Manpower Inc. posted fourth-quarter results that beat analysts’ expectations, and its CEO said he is confident about the sustainability of an economic recovery.
Manpower said quarterly earnings plunged 62 percent as employers still feared taking on more workers and unemployment continued to hover around 10 percent. Still, the results topped estimates and CEO Jeffrey Joerres said revenue should start to grow in the first quarter for the first time since late 2008.
“(The) CEO’s commentary regarding the recovery was much stronger and more positive than his comments out of Davos last week,” Deutsche Bank analysts wrote in a note to investors Tuesday, referring to the annual World Economic Forum in Switzerland.
The Milwaukee-based company said it’s continuing to see improving trends across its businesses and is more confident that the global economic recovery is sustainable. It also announced it will acquire fellow staffing firm Comsys IT Partners Inc installment payday loans., which provides temporary employees for information technology jobs.
Shares of Manpower Inc. rose $2.08, or 3.9 percent, to $55.24 in afternoon trading.
Other staffing companies also advanced. Shares of Robert Half International Inc. gained 32 cents to $27.19. The owner of Accountemps and OfficeTeam last week reported a 65 percent drop in its fourth-quarter earnings as high unemployment persisted but also still beat Wall Street expectations. The company placed more temporary and more permanent workers in new jobs than it had in the third quarter, providing some evidence of a recovery.
Shares of blue-collar staffer True Blue Inc. added 28 cents, or 2 percent, to $14.47 and jobs Web site operator Monster Worldwide Inc. climbed 35 cents, or 2.3 percent, to $15.94. Kelly Services Inc. rose 24 cents to $13.80.
Shares of staffing cos. rise on Manpower results
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01.24.10
Posted in .com, All, business, economic, online tagged finance, life, personal, politics, world at 3:36 pm by carydalton
Wall Street tumbled for a third day on Friday as a three-day slide pushed the markets down almost 5 percent. For the Dow, Friday was the lowest close since early November.
For a second day, shares declined on concerns about President Obama’s proposal for tighter restrictions on the activity of banks as the markets finished the week with a three-day losing streak.
The president on Thursday proposed to ban banks with federally insured deposits from casting risky bets in the markets, and to resist further consolidation in the financial industry — moves the caught bankers and traders by surprise.
In response, the Dow Jones industrial average fell more than 200 points on Thursday. Declines in Asian and European markets followed and then carried over a second day Wall Street. Concerns of earnings sent shares lower on Wednesday.
At the close, the Dow Jones industrial average was down 216.90 points, or 2.1 percent, at 10,172.98. The broader Standard & Poor’s 500-stock index fell 24.73 points or 2.2 percent, to 1,091.75, while the technology-heavy Nasdaq composite fell 60.41 points or 2.67 percent, at 2,205.29. For the week, the Dow was down about 4.1 percent.
Quincy M. Krosby, a markets strategist at Prudential Financial, said investors were also weighing news that Ben S. Bernanke’s confirmation for a second term as chairman of the Federal Reserve faced growing opposition.
“What they’re sensing is this has taken on a political visceral momentum,” Ms. Krosby said. “They makes them hesitant about the future of the banking system.”
As they did on Thursday, financial shares led the decline. On Wall Street, shares of Morgan Stanley declined 6.3 percent; Goldman Sachs dropped 5.2 percent; Bank of America, 4.5 percent; and Citigroup, 1 percent. In Europe, Barclays lost 6 percent. UBS of Switzerland was off 5.1 percent, while Santander of Spain gave up 3 percent.
“There’s no doubt that there will be a significant amount of regulation in the banking industry in the next year,“ said Henk Potts, equity strategist at Barclays Wealth in London. “But there’s a long road to travel and lots of discussions and negotiations before we find out exactly what this will entail no fax payday loan.”
Questions about the banks, analysts said, could push the markets into another period of uncertainty.
Other analysts saw President Obama’s announcement of tighter banking rules was taken as a sign that government leaders are looking beyond the financial crisis.
“It’s clear that politicians are starting to have enough confidence that the global economy has been saved and are starting to try to find ways of paying the bills,” analysts at Deutsche Bank said Friday in a research note. “The risk is that they do this too early and the timing of this announcement is unfortunate given it coincides with the escalation of problems in peripheral Europe and in a week where China has effectively tightened policy.”
The comments about peripheral Europe were a reference to the budgetary problems in Greece that have rattled bond markets here.
Earnings from two companies helped to offset some of the declines. General Electric topped expectations despite a 19 percent drop in fourth-quarter income. For the quarter, G.E. posted net income of $2.94 billion, or 28 cents a share. That compared with $3.65 billion, or 35 cents, a year earlier.
And the fast-food restaurant chain, McDonald’s said fourth-quarter profit was $1.22 billion, or $1.11 a share, up from $985.3 million, or 87 cents a share, a year earlier. The company said sales overseas had helped to offset a weakness in American sales. G.E. shares were up 1 percent and McDonald’s rose 0.35 percent.
Markets in Europe were also lower. In London, the FTSE 100 was down 32.11 points or 0.6 percent, and the DAX shed 51.65 points, or 0.9 percent, in Frankfurt.
In Asia, the Nikkei 225 index, Japan’s leading market gauge, led the region’s declines with a drop of 2.56 percent. The Shanghai composite index in mainland China fell nearly 1 percent, while the Hang Seng index in Hong Kong dropped 0.6 percent, with the international banks Standard Chartered and HSBC both down.
Bettina Wassener reported from Hong Kong and Matthew Saltmarsh from Paris.
3-Day Slide Sends Markets Down About 5 Percent
Hot News: Report: Barclays to defer bonuses
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01.16.10
Posted in .com, All, Free blog Tips, hot news, online tagged economics, finance, markets, people, personal at 3:24 pm by carydalton
A veteran General Motors executive, Nick Reilly, left, will take over as Opel’s chief executive, Opel announced on Friday. The widely expected appointment of Mr. Reilly, who is already president of G.M. Europe, was part of a management shake-up. Mr. Reilly will be responsible both for Adam Opel and its British sister brand Vauxhall. Also on Friday, G.M. said in a regulatory filing that it lent Opel $900 million in November to maintain operations and to repay a loan from the German government payday loans. Also, G.M. on Jan. 4 accelerated $930 million in payments to Opel for engineering work. The accelerated payments will keep Opel going until more permanent financing is arranged, the filing said.
Business Briefing | Automobiles: Opel Names a G.M. Executive as Its New Chief
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01.11.10
Posted in All, Free blog Tips, business, news, top tagged business, events, life, personal, politics at 2:00 pm by carydalton
HONG KONG (Reuters) – Asian stocks hit a 17-month high on Monday as a strong rebound in China's exports raised investor optimism about Asia's economies while the dollar suffered its biggest loss in six weeks after poor U.S. jobs data.
European shares were expected to gain, financial spreadbetters said, as the dollar's weakness pushed the euro to a three-week high. U.S. stock futures were up 0.4 percent.
China's exports and imports last month blew past expectations, with exports surging 17.7 percent from a year earlier to break 13 months of declines. The trade data, released on Sunday, triggered a shift into Asian assets as investors shrugged off Friday's disappointing U.S. non-farm payrolls data.
Gold pushed up to a five-week high at $1,157.65 an ounce at one point as the data showed a sharp rise in China's commodities imports and sent the Australian dollar to a 26-month peak against the euro.
Chia-Liang Lian, a senior vice president at bond fund PIMCO, said Asia's fundamentals made it highly attractive.
"We have seen how Asia has navigated successfully through a tough year with a score card that is nothing short of spectacular," Lian told Reuters in an interview.
The MSCI index of Asia Pacific stocks traded outside Japan (.MIAPJ0000PUS) hit its highest level since July 2008, gaining 1.2 percent. The Thomson Reuters index of Asian shares (.TRXFLDAXPU) was 0.8 percent higher.
Japanese financial markets were closed for a public holiday.
Australia's leading share index (.AXJO) climbed 0.8 percent to a 15-month high as the China data lifted resource companies that benefit from Chinese demand.
"People are gradually getting more comfortable with the recovery story. You have seen some reasonably good data out of China, and there have been no disasters, no more Dubais," said Greg Goodsell, equity strategist at RBS Australia.
The Australian dollar soared to its highest in more than two years against the euro and to a five-week high against the dollar.
OIL TOPS $83
Resource-related shares gained in Hong Kong, including Aluminum Corp of China (Chalco) (2600.HK) (601600.SS), the country's top aluminum company, which surged 5 percent, and Jiangxi Copper (0358 allstate insurance company.HK)(600362.SS), China's top metals producer, which rose more than 3 percent.
Chinese brokerage shares gained in Shanghai after news late last week that Beijing had decided to allow stock index futures and margin trading.
The dollar, however, extended losses stemming from the jobs report, which dampened expectations of an early rise in U.S. interest rates.
A member of the U.S. Federal Reserve monetary policy committee, James Bullard, said on Monday that rates may remain low for quite some time, reiterating the central bank's long-standing position.
The dollar dropped 0.5 percent against a basket of currencies (.DXY) and was quoted at a three-week low at around $1.4533 against the euro.
The U.S. economy shed 85,000 jobs in December, confounding expectations that the job market was finally stabilizing. Still, analysts argued the outcome was consistent with economic recovery because the pace of job losses had dropped sharply since the height of recession.
Oil jumped more than 1 percent, topping $83 a barrel, on the back of the weak dollar, extremely cold weather in the northern hemisphere and a surge in China's crude oil imports last month.
China's export rebound fueled expectations China could soon let the yuan start rising again and helped push Asian currencies higher as a stronger yuan would benefit pricing for fellow Asian exporters.
The high-yielding Indonesian rupiah jumped 1 percent to 9,120 to the dollar, despite suspected intervention by the central bank. It has gained 3.3 percent so far this year as investors have sought out higher-yielding assets.
South Korean authorities were also seen intervening to curb the won which touched a 15-month high of 1,117.5 to the dollar.
PIMCO's Lian said Asian currencies were still undervalued on a trade-weighted basis and cited the yuan, the won and the Singapore dollar among his top currency picks. He also likes Indonesian debt which offers better yield than other Asian debt.
(Additional reporting by Saikat Chatterjee in HONG KONG and Victoria Thieberger in MELBOURNE; Editing by Jan Dahinten)
Asia stocks hit 17-month high on China export surge
Hot News: Fed unlikely to be swayed by jobs data: Bullard
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01.10.10
Posted in .com, money, shortly, top, world of money tagged financial, opinion, people, personal, reviews at 12:06 am by carydalton
Don’t miss these top stories:
Your January tax to-do list
The IRS is too busy to talk
Estate-tax repeal affects spouses
Taxpayers got some good news this week: At long last, the IRS said it will regulate tax preparers, including the big companies like H&R Block and Jackson Hewitt and the small storefront shops that pop up this time of year. While certified public accountants, tax attorneys and enrolled agents already are subject to professional standards, hundreds of thousands of tax preparers haven’t been regulated at all, until now.
So, yes, overall that’s good news. But there are a few things that could stand improvement. For one, the new rules — including passing a competency exam and taking continuing-education classes — don’t go into effect until 2011. You’re on your own this year to make sure you find a competent professional.
Also, the new rules don’t cover online and store-bought software products — a huge and growing portion of the tax-preparation field.
And, as some commentators pointed out this week, regulating tax preparers is just a symptom of a very deep problem: the extreme complexity of the U.S. tax code. If the rules weren’t so complicated, we wouldn’t have to pay someone else to try to figure it out for us. And we wouldn’t have to hope and trust that they get it right. Keep in mind that no matter who does your taxes, the IRS considers you, the taxpayer, responsible for getting it right, not the preparer.
But hey, we’ll take what we can get. I for one am glad to hear that preparers will be required to update their education. Given lawmakers’ penchant for fiddling with the tax code, I’m not sure how you could be a tax practitioner without continuing classes.
Enough of that. It’s January, and MarketWatch is here to help you through the tax season ahead. Taxing Times goes back to its weekly schedule starting today, arriving in your inbox every Friday through tax season. Check out Eva Rosenberg’s story today on what you need to do this month to make sure you’re all set come April.
— Andrea Coombes, assistant personal finance editor
Tax moves to make in January
The tax laws are still in flux. We’re waiting for the estate-tax law to be written, and Form 5405 for the home-buyer’s credit isn’t ready yet. To top it off, IRS started the year by announcing a major step-up in enforcement of tax preparers. This is going to be an interesting tax season. Are you ready? See TaxWatch.
IRS too busy to talk, watchdog says
An expanding slate of duties is stretching the Internal Revenue Service too thin, leading to poor customer service and undermining its ability to collect taxes, a government watchdog said Wednesday. See full story.
Estate-tax repeal means some spouses are left out
Spouses of those wealthy who die this year might find themselves with nothing if the family will isn’t revised–a major wrinkle that could follow Friday’s repeal of the federal estate tax guaranteed payday loan. See full story.
Workers get lower mileage rate in 2010
Millions of workers who use their cars for work will get a smaller tax deduction next year. Under tax rules, they can choose to deduct their actual expenses, or they can use the Internal Revenue Service’s optional standard mileage rate. Using the IRS rate generally is simpler and saves recordkeeping hassles. See Tom Herman’s Tax Report.
CONVERTING TO A ROTH IRA Avoid these Roth IRA conversion mistakes
As years go, 2010 is on course to be a blockbuster for retirement-account owners. Starting in January, all Americans who own a traditional IRA — not just those who have modified adjusted gross income under $100,000 — will be able to convert their accounts to a Roth IRA. But don’t rush for the doors just yet. There’s plenty of slip between cup and lip waiting for those unaware of the conversion mistakes to avoid. See Robert Powell.
Tips for converting IRA assets to Roth
When considering converting investments to a Roth IRA from a traditional individual retirement account, past performance is less important than what you anticipate in the future. See full story.
POLITICS AND TAXES ‘Carried-interest’ tax gains traction
The “carried-interest” tax debate has re-emerged in Congress, threatening to more than double taxes on some of the country’s wealthiest individuals–private-equity and hedge-fund managers. See full story.
Biodiesel industry stunted as tax credit expires
The biodiesel industry is revving up efforts to reinstate the U.S. biodiesel tax credit, warning that as many as 23,000 jobs could be at risk if lawmakers don’t revive the program that expired on Jan. 1. See full story.
TAX TIPS FROM BANKRATE 10 astute tax moves in 2010
To put the struggling economy back on track, Congress has passed several new tax laws in recent years. The good news is some tax breaks will still be around in 2010 while new ones are in the works. Here are 10 tax laws that could help you lower your IRS bill in the New Year. See full story.
2009 exemption amounts
You can take an exemption deduction for yourself, your spouse and each dependent you claim. On 2009 returns, this exemption amount is $3,650 per person. Some taxpayers, however, will see their personal exemption amount reduced if they make over a certain limit that is adjusted annually for inflation. See full story.
10 key tax terms to know
One of the hardest things about taxes is learning the language. You’ve got all the forms and instructions, but it seems they’re harder to decipher than that first lesson in your high school Latin class! Here are 10 key tax terms to help you start talking taxes. See full story.
Taxing Times: Good news for taxpayers, but don’t celebrate yet
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01.08.10
Posted in .com, business, hot news, money, shortly tagged economy, marketing, news, personal, work at 5:06 pm by carydalton
The United States economy lost more jobs than expected in December, tempering hopes for a swift and sustained recovery from the Great Recession.
The Labor Department said on Friday that the economy shed another 85,000 jobs last month, but that the unemployment rate held steady at 10 percent.
In a surprise that highlighted the erratic nature of economic renewal, the government reported that 4,000 jobs were actually created in November — rather than a loss of 11,000 the government had originally projected — the first gain in nearly two years. Though jobs were lost in December, the unemployment rate did not rise, an indication that more jobless workers had given up their search for work.
“The report is certainly a disappointment and shows that there is going to be some difficulty in making the transition to move from the end of firing to actual hiring,” said Julia Coronado, senior United States economist at BNP Paribas. “Eventually we will see some job growth, but there are a lot of weak patches still in the economy.”
Those points of deficiency include construction and manufacturing, which showed the biggest losses in December amid a severe pullback in spending by consumers in the United States and abroad and a frail real estate market. The temporary employment sector — traditionally where businesses turn when they begin to ramp up hiring — showed increases for the fifth consecutive month.
Still, large swaths of the population — 15.3 million — remained unemployed. And the number of Americans out of work for six months or more, and in many cases longer than a year, hit 39.8 percent in December, the highest level since records were first kept in 1948.
For those workers, the search continues.
Kumar G. Navile, 33, of Charlotte, N.C., has applied to 500 jobs across the country since he lost his job as an engineer a year ago. Each month, he finds himself about $600 short in his monthly expenses after the $1,680 he earns in unemployment benefits. He pays the difference from a savings account, but expects that money to dry up in the next two months.
“You get up every day and say today will be different, but it is mentally challenging when you don’t find opportunities,” Mr. Navile said. “I performed well in school. I got a job the day I graduated. It’s been a struggle, and it continues to be.”
To reduce his expenses, Mr. Navile is trying to sell his house. He pays $1,200 each month on his mortgage.
The magnitude of the losses in December was worse than many economists had predicted, and some had even forecast a return to job creation. A broad measure of unemployment — one that includes those forced to work only part time and those too discouraged to look for work — climbed slightly to 17.3 percent.
Many economists, however, believe the labor market is still on track for job creation. Nigel Gault, chief United States economist for IHS Global Insight, noted that an average of 199,000 jobs were lost in the third quarter of last year, followed by 69,000 in the fourth quarter. He projects the tide will turn toward job creation in the first part of 2010.
“On the day, it’s an anticlimax and a bit of damp squib,” Mr. Gault said. “We shouldn’t let the disappointment obscure that the trend is in place for improvement in the labor market and we’re going to be creating jobs in 2010 on a sustained basis instant credit report.”
In its report, the government also revised its October data to record a loss of 16,000 more jobs, bringing that month’s total losses to 111,000.
The monthly jobs report from the Labor Department has emerged as the crucial indicator of economic health after the longest, deepest downturn since the Great Depression. While the economy is still depressed, job losses have eased since earlier last year. For years, ordinary people spent in excess of their incomes by borrowing against the value of homes, using abundant credit cards and tapping stock portfolios.
But home prices have plummeted in much of the country. Stock holdings have been diminished. Nervous banks have sliced credit even for healthy borrowers. That has left the paycheck as the primary source of spending power.
Economists are now divided over the nation’s prospects. Some place emphasis on recent expansion on the American factory floor, arguing that this presages broader improvements that will continue to gather steam.
But skeptics argue that the factory expansion merely reflects a rebuilding of inventories after many businesses slashed stocks during the panic that accompanied the fall of prominent financial institutions such as Lehman Brothers in the fall of 2008. Expansion has also been aided by $787 billion in federal spending aimed at stimulating growth, and by tax credits for home buyers.
Once these factors fade in coming months, the skeptics argue, that will leave the economy confronting the same challenges that have dogged it for more than two years — strapped households saturated in debt and worried about layoffs, curtailing spending; banks still anxious about losses to come on mortgage holdings, reluctant to lend; businesses unwilling to hire until they are certain that the recovery is solid.
Those with the gloomiest outlooks fear a so-called double-dip recession, in which the economy resumes contracting. Others fear many years of stagnant growth much like Japan’s Lost Decade in the 1990s.
The one place of near-universal agreement is that the economy cannot fully recover until millions of jobs are created.
As workers at growing businesses take fresh wages and spend them at other businesses, that creates jobs for other workers — a virtuous cycle, in the parlance of economists.
Recent months have produced tentative signs that such a cycle might indeed be unfolding, even as economists debate its sustainability.
New claims for unemployment insurance have fallen. The holiday shopping season showed measured improvement over one a year ago. Businesses have added temporary workers in what some experts construe as the beginning stages of wider hiring, as companies recognize fresh growth opportunities.
Not least, the pace of job deterioration has slowed markedly, with a net loss of 11,000 jobs initially reported for November — hardly a happy number, but a dramatic improvement from the roughly 700,000 jobs that were disappearing each month early last year.
But the unexpectedly large decline in December challenged the view of steady improvement, heightening the prospect of a longer, more tentative recovery, or perhaps even a return to the grim days of contraction.
U.S. Job Losses in December Dim Hopes for Quick Upswing
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01.03.10
Posted in .com, hot news, online, shortly, world of money tagged economics, finance, opinion, personal, reviews at 6:35 pm by carydalton
NEW YORK – The stock market closed out a remarkable 2009 with a loss as investors bet the improving economy will lead the government to pull back on its stimulus measures. But stocks still managed their best year since 2003 as they recovered from the financial crisis and recession.
Thursday’s trading, which came on extremely light pre-holiday volume, was a fitting end to a tumultuous year. Stocks fell to 12-year lows by early March on investors’ increasing pessimism, then rallied on growing signs of recovery in what turned out to be Wall Street’s biggest comeback since the Great Depression. In the last day of the year, more signs of healing first pleased investors, then had them concerned about the economy’s ability to thrive without government help.
The thin volume exaggerated the market’s moves. The Dow Jones industrial average fell 120.46, or 1.1 percent, to 10,428.05. For the year, the Dow rose 1,651.66, or 18.8 percent.
The broader Standard & Poor’s 500 index, considered by professionals to be the market’s best barometer, fell 11.32, or 1 percent, to 1,115.10. The S&P ended the year with a gain of 211.85, or 23.5 percent.
Meanwhile, the Nasdaq composite index fell 22.13, or 1 percent, to 2,269.15. Powered by the recovery in high-tech stocks, the Nasdaq ended 2009 with a gain of 696.12, 43.9 percent.
The full-year stats are dwarfed by the indexes’ recovery from the depths of last March, when they hit bottom. The Dow rose 3,881.00, or 59.3 percent from its March 9 close, while the S&P 500 rose 438.57, or 64.8 percent, and the Nasdaq regained 1,000.51, or 78.9 percent.
News that weekly unemployment claims fell to the lowest level since July 2008 gave stocks an initial blip Thursday, but the market gave back the gains as traders took some profits to close out their books.
Joe Saluzzi, co-head of equity trading at Themis Trading LLC, said the light volume made it hard to read much into the day’s move. However, he said the improved jobs figures stirred speculation that the government would be forced to withdraw supports for the economy such as low interest rates, which could fan inflation.
“How can they justify more stimulus if now you’re in a growing economy,” he said. “The question becomes can the U.S. economy really support itself without the assistance of the U.S. stimulus. My gut says no.”
The Labor Department said new claims for unemployment benefits fell by 22,000 to a seasonally adjusted 432,000 last week. Analysts had expected claims would rise. The number of workers continuing to seek unemployment benefits fell by 57,000 to 4 easy payday loans.9 million. Analysts predicted an increase.
Many investors believe that the stock market, which has had its best year since 2003, has seen the best of its gains for a while. So many of those working Thursday were moving money out of some stocks.
“Everyone is looking to put a ribbon on the year and wrap things up,” said Jack Ablin, chief investment officer at Harris Private Bank in Chicago.
Ablin said investors will be looking at upcoming corporate profit reports and jobs numbers to determine whether the market can hold its huge gains in 2010.
“I have a certain belief that the market can keep going, albeit at kind of a shallower pace, but that’s going to require some help from corporate America and the economy itself,” he said.
Two stocks fell for every one that rose on the New York Stock Exchange, where volume came to an extremely light 2.23 billion shares, down from Wednesday’s 2.37 billion.
Most bond prices fell, pushing yields higher. The yield on the benchmark 10-year Treasury note rose to 3.84 percent from 3.79 percent late Wednesday. The 10-year yield began 2009 at 2.22, a reflection of investors’ high anxiety and need for the safety of government debt.
The dollar, whose decline this year has helped feed the rally in stocks, was mostly lower against other major currencies Thursday. Gold, which has soared in response to the falling dollar and investors’ greater appetite for commodities in general, closed at $1,096.20 on the New York Mercantile Exchange after reaching a record high of $1,227.50 on Dec. 3.
Light, sweet crude rose 8 cents to settle at $79.36 per barrel on the New York Mercantile Exchange.
The Russell 2000 index of smaller companies fell 8.02, or 1.3 percent, to 625.39. It ended the year with a gain of 25.2 percent.
Overseas, Britain’s FTSE 100 rose 0.3 percent, while France’s CAC-40 rose less than 0.1 percent. Markets in Germany and Japan were closed.
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The Dow Jones industrial average closed the week down 92.05, or 0.9 percent, at 10,428.05. The Standard & Poor’s 500 index fell 11.38, or 1 percent, to 1,115.10. The Nasdaq composite index fell 16.54, or 0.7 percent, to 2,269.15.
The Russell 2000 index, which tracks the performance of small company stocks, fell 8.68, or 1.3 percent, for the week to 625.39.
The Dow Jones U.S. Total Stock Market Index — which measures nearly all U.S.-based companies — ended at 11,385.11, down 237.70, or 2 percent.
Stocks fall sharply as investors close out 2009
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12.28.09
Posted in .com, All, business, news, world of money tagged campaign, news, personal, politics, writing at 5:18 pm by carydalton
Shares on Wall Street crept higher Monday as investors returning from a long weekend were heartened by good news on retail sales. Wall Street exchanges are riding a five-day winning streak and are trading at highs for the year.
In early trading, the Dow Jones industrial average was 0.24 percent or 24.94 points higher, while the broader Standard & Poor’s 500-stock index rose 3.32 points or 0.29 percent.
The dollar weakened against other currencies, giving commodities prices a boost. Bond prices fell.
Monday’s gains were underpinned by optimism over improved holiday spending data in the United States as well as a jump in Japan’s factory production, suggesting an economic recovery is gathering pace.
In the United States, figures from MasterCard Advisors’ SpendingPulse, which track all forms of payment, showed that retail sales rose 3.6 percent from Nov. 1 through Dec. 24, compared with a 2.3 percent drop a year ago. Consumer spending is one of the biggest drivers of economic growth and is vital to a sustained recovery.
Investors will also be keeping a close eye on airline stocks after a failed attack on a Northwest flight on Christmas Day. Another incident on the same flight to Detroit from Amsterdam on Sunday raised further alarm.
European and Asian stock markets also moved higher Monday.
In Paris, the CAC 40 index rose 0.84 percent to 3,945.62, closing in on 4,000 points, a level it last saw in October 2008. The DAX in Frankfurt rose 0.72 percent to 6,000.17. London exchanges were closed for the Boxing Day holiday.
The French nuclear engineering giant Areva SA was among the big decliners in Paris after it was beat out for a $20 billion nuclear power contract in the United Arab Emirates by a South Korean consortium led by the Korea Electric Power Corporation.
Areva shares fell 2.7 percent. The loss was a blow to Areva, which is trying to export its nuclear technology around the world.
Earlier markets in Asia were the first to resume trading after the Christmas holiday and investors focused on regional developments in the absence of cues from the United States or Europe one hour payday loan.
Aiding sentiment in Asian stock markets was news that Japan’s factory output rose the most in six months in November as a recovery in export demand from Asia boosted production of cars, flat screen televisions and other products in the world’s second-biggest economy.
Japan’s recovery from the world economic crisis has been undermined by deflation and strong yen but an improvement in demand for exports has raised hopes it can avoid slipping back into recession next year. The figures also showed that China’s lavish stimulus spending is helping the region’s recovery.
“A recovery in exports, especially in Asia, supported growth in industrial output,” a senior economist at the Japan Research Institute, Hideki Matsumura, said.
Among the key sectors, November output for transportation machines, which include passenger cars, jumped 5.9 percent. Output for information technology equipment, which includes popular liquid crystal display televisions, gained 2.7 percent. Shipments in November edged up 0.9 percent month-on-month with inventories rising 0.2 percent.
While growth in Japan’s factory output was stronger than expected, the nation’s retail sales in November fell 1.0 percent from a year earlier, marking the 15th consecutive month of decline.
In Tokyo trade, the Nikkei 225 stock average closed up 139.52 points, or 1.3 percent, to 10,634.23 — the highest finish since late August. Hong Kong’s Hang Seng reversed course to end down 36.78, or 0.2 percent, at 21,480.22, while the Shanghai benchmark jumped 47.43 points, or 1.5 percent, to 3,188.78.
A Soft Start but Wall Street Moves Higher
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