Pendragon boss U-turns on scrappage

Pendragon, Britain's biggest motor dealer, said the Government's scrappage scheme looked set to bolster sales this year just months after criticising it as ungenerous.


Source: Latest Business News from Times Online | 18 Aug 2009 | 5:25 am

GM agrees sale of Saab to Sweden's Koenigsegg

General Motors has agreed the terms of a sale of its loss-making Saab division to Koenigsegg, a Swedish sports-car maker employing just 45 people.


Source: Latest Business News from Times Online | 18 Aug 2009 | 5:09 am

Vestas profits plunge after British job cuts

Vestas, the Danish wind turbine company which last week shut two British plants with the loss of 425 jobs, unveiled a worst-than-expected drop in profits of more than a third.


Source: Latest Business News from Times Online | 18 Aug 2009 | 4:55 am

Movers & Shakers: Tuesday's biggest moving stocks

Among the stocks expected to see active trading on Tuesday are HSBC, Rio Tinto and Agilent.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 4:39 am

Rupert Murdoch's News Corp overhauls Asia unit

HONG KONG, Aug 18 (Reuters) - Star TV, the Asia flagship of Rupert Murdoch's News Corp , on Tuesday announced a restructuring that will see it cut around 30 percent of its Hong Kong headquarters staff...
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 4:24 am

Europe Markets: European shares regain some poise

European shares advance, with banks and miners among the best performers as firms take back a portion of the previous session’s sharp losses.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 4:24 am

Economic Report: British CPI growth of 1.8% runs above expectations

British consumer prices grow at a 1.8% annualized rate in July, unchanged from the June rate but above expectations for 1.6% growth, government data show. Still, retail-level inflation is running below the Bank of England’s 2% target rate.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 4:24 am

GM unloads SAAB on Swedes

Source: Business and financial news - CNNMoney.com | 18 Aug 2009 | 4:23 am

Home Depot 2Q profit drops on Expo closings (AP)

AP - Home Depot says its fiscal second-quarter profit fell 7 percent, as the nation's biggest home improvement retailer shuttered its Expo business.
Source: Yahoo! News: Business | 18 Aug 2009 | 4:20 am

Global stocks, commods rebound as volatility eases

LONDON (Reuters) - World stocks and commodity prices recovered on Tuesday from the previous session's sell-off, which was prompted by concerns over the pace of global recovery, while the Japanese yen and safe-haven U.S. government bonds eased.
Source: Reuters: Business News | 18 Aug 2009 | 4:17 am

Exxon, China ink $41 billion Australian gas deal

PERTH/BEIJING (Reuters) - U.S. major ExxonMobil Corp has inked a deal to sell liquefied natural gas (LNG) from its share of gas from the Gorgon LNG project to PetroChina in a deal worth about A$50 billion ($41.3 billion), the Australian government said on Tuesday.
Source: Reuters: Business News | 18 Aug 2009 | 4:14 am

US man 'stole 130m card numbers'

US prosecutors charge a man with carrying out what they say is the largest case of identity theft in American history.
Source: BBC News | Business | World Edition | 18 Aug 2009 | 4:14 am

North Sea Britannia gas field online after outage

LONDON, Aug 18 (Reuters) - The Britannia gas field in the North Sea is back in production after planned maintenance, operator ConocoPhillips said on Tuesday.
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 4:12 am

Asian stocks mostly up, mirroring Shanghai rebound

Chinese shares claw back some lost ground Tuesday as investors look for bargains in metals stocks following the previous session’s steep declines.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 4:10 am

Oil rises towards $68 as equities recover

LONDON (Reuters) - Oil rose toward $68 a barrel on Tuesday in line with a broad recovery on Asian and European stock markets after falling the previous day to a two week-low.
Source: Reuters: Business News | 18 Aug 2009 | 4:09 am

Exxon, China ink $41 billion Australian gas deal (Reuters)

Reuters - U.S. major ExxonMobil Corp has inked a deal to sell liquefied natural gas (LNG) from its share of gas from the Gorgon LNG project to PetroChina in a deal worth about A$50 billion ($41.3 billion), the Australian government said on Tuesday.

Source: Yahoo! News: Business | 18 Aug 2009 | 4:07 am

Head Of AIG (AIG) To Be Overpaid At $7 Million

AIG has already taken in $180 billion of taxpayer money and there is absolutely no reason to believe that most of it will be returned. The insurance company is still losing money and its efforts to sell off units to raise capital have been pathetic. Ed Liddy, former CEO of Allstate (ALL), was the firm’s CEO [...]

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Source: 24/7 Wall St. | 18 Aug 2009 | 4:06 am

Indications: U.S. stock futures higher after Monday's losses

U.S. stock futures nudge higher, as markets await more economic data and earnings.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 4:04 am

Can Protalix's David take on Genzyme's Goliath?

Investors are betting heavily on a fledgling Israeli biotech company called Protalix BioTherapeutics Inc., which is developing a rival to Genzyme Corp.’s lucrative flagship product, Cerezyme.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 4:00 am

News Corp announces Star TV shake-up

News Corp unveiled details of a wide ranging shake-up of its Star Asian television arm as James Murdoch looks to cut costs and consolidate businesses in the region
Source: Financial Times - US homepage | 18 Aug 2009 | 3:59 am

World markets recover poise after big sell-off

European stock markets bounced back Monday, helped by some upbeat German economic data, a day after a deep sell-off around the world sent major indexes back down to levels from the...
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 3:57 am

World markets recover poise after big sell-off (AP)

AP - European stock markets bounced back Monday, helped by some upbeat German economic data, a day after a deep sell-off around the world sent major indexes back down to levels from the beginning of August.

Source: Yahoo! News: Stock Markets News | 18 Aug 2009 | 3:57 am

UPDATE 2-Genmab slumps as Glaxo-partnered drug hits setback

* Arzerra fails to show hoped-for benefit in lymphoma study
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 3:57 am

Another Options Backdating Scandal Brewing

The Wall Street Journal has taken an exclusive look at academic reseach documents that show many companies have backdated options. The last scandal about the practice should have taught public company boards and executives something, but the educations was clearly incomplete. The figures from the University of Houston’s C.T. Bauer College of Business show that 141 companies [...]

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Source: 24/7 Wall St. | 18 Aug 2009 | 3:53 am

Economic Report: German investor expectations jump in August

German investors grew significantly more upbeat about future prospects in August, pushing the ZEW economic sentiment index up much more sharply than expected.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 3:50 am

Inflation bucks forecasts to hold steady at 1.8%

Inflation remained unchanged at 1.8 per cent in July, new figures revealed today, bucking expectations of another drop in consumer prices.


Source: Latest Business News from Times Online | 18 Aug 2009 | 3:45 am

US Car Quality Getting Better As Sales Disintegrate

The New York Times got ahold of an early version of the 2009 new vehicle study done by The University of Michigan Customer Satisfaction Index. The paper reports that “in the rankings by brand, G.M.’s Cadillac tied for first place with its chief competitor, Lexus, while Buick and Lincoln-Mercury placed third and fourth, meaning that domestic brands [...]

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Source: 24/7 Wall St. | 18 Aug 2009 | 3:40 am

Stock index futures point to gains; housing data eyed

(Reuters) - Stock index futures pointed to a higher open on Tuesday, a bounce from Monday's decline, as investors braced for data on new housing starts.
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 3:38 am

Stock index futures point to gains; housing data eyed

(Reuters) - Stock index futures pointed to a higher open on Tuesday, a bounce from Monday's decline, as investors braced for data on new housing starts.
Source: Reuters: Business News | 18 Aug 2009 | 3:38 am

Stock index futures point to gains; housing data eyed (Reuters)

Reuters - Stock index futures pointed to a higher open on Tuesday, a bounce from Monday's decline, as investors braced for data on new housing starts.

Source: Yahoo! News: Stock Markets News | 18 Aug 2009 | 3:38 am

Stock index futures point to gains; housing data eyed (Reuters)

Reuters - Stock index futures pointed to a higher open on Tuesday, a bounce from Monday's decline, as investors braced for data on new housing starts.

Source: Yahoo! News: Business | 18 Aug 2009 | 3:38 am

UK inflation: key points

Key points of inflation figures for July from the Office of National Statistics.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 18 Aug 2009 | 3:35 am

Health care lessons from Massachusetts

How big of a deal is cutting the rising cost of health care? Ask Massachusetts.
Source: Business and financial news - CNNMoney.com | 18 Aug 2009 | 3:33 am

100 Fastest-growing companies

Even amid the worst economic slump since the Great Depression, some companies keep growing. BlackBerry maker Research in Motion tops the list.
Source: Business and financial news - CNNMoney.com | 18 Aug 2009 | 3:32 am

UK inflation: economists' reaction to surprise stickiness in prices

Annual inflation in Britain held at 1.8pc in July confounding expectations of another fall. This is how economists reacted to the latest official figures.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 18 Aug 2009 | 3:29 am

UPDATE 1-Thailand's PTT sees H2 net profit close to H1

* H2 revenue seen up from H1, oil rises to $70/bbl from $40
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 3:28 am

UPDATE 1-Dominion Petroleum gets $10 mln funding, shares jump

Aug 18 (Reuters) - Dominion Petroleum Ltd said it would get $10 million funding from London-based hedge fund manager BlueGold Capital Management LLP to meet its financing needs for the rest of 2009.
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 3:23 am

SOHO buys M.Stanley China property for $359 mln-sources

HONG KONG, Aug 18 (Reuters) - Developer SOHO China has agreed to acquire a top Shanghai office building owned by the real estate investment arm of Morgan Stanley for 2.45 billion yuan ($359 million),...
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 3:21 am

SOHO buys M.Stanley China property for $359 mln-sources

HONG KONG, Aug 18 (Reuters) - Developer SOHO China has agreed to acquire a top Shanghai office building owned by the real estate investment arm of Morgan Stanley for 2.45 billion yuan ($359 million),...
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 3:21 am

The Fed Has No Leverage: Bank Lending Remains Moribund

The Fed made hundreds of billions of dollars in short term loans to banks. It was necessary, in the opinion of the agency, to do that to preserve the financial system as we have known it for decades. It is unlikely that the more permanent TARP facility would have been approved by Congress if the [...]

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Source: 24/7 Wall St. | 18 Aug 2009 | 3:15 am

UK inflation rate stays at 1.8%

A key measure of inflation in the UK, the Consumer Prices Index, has unexpectedly remained at 1.8% in July.
Source: BBC News | Business | World Edition | 18 Aug 2009 | 3:11 am

UK inflation steadies unexpectedly in July

Inflation held steady in July confounding expectations for another fall due to an increase in the price of computer games DVDs and furniture.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 18 Aug 2009 | 3:09 am

UK annual inflation stable at 1.8% in July

Britain's 12-month inflation was unchanged at 1.8 percent in July, holding underneath the Bank of England's 2.0-percent target, official data showed on Tuesday. "Consumer Prices Index...
Source: RSS feed - channel BNewsBusiness | 18 Aug 2009 | 3:09 am

London Markets: Banks, miners help U.K. shares retake some ground

Stocks advance in London, with companies linked to commodity prices as well as financials taking back some ground lost in the previous session.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 3:05 am

Funeral plans find favour as savers lose faith in banks

The number of people taking out funeral savings plans has risen by almost a third a funeral director has said.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 18 Aug 2009 | 3:03 am

Profits fall at protest-hit Vestas

Danish wind turbine firm Vestas, which experienced a protest at its Isle of Wight factory, sees profits decline on falling orders.
Source: BBC News | Business | World Edition | 18 Aug 2009 | 3:03 am

Stocks ready to rebound

U.S. stocks were poised for early gains Tuesday, as investors pondered whether the previous session's selloff was overdone.
Source: Business and financial news - CNNMoney.com | 18 Aug 2009 | 3:01 am

British Land loss narrows as portfolio drop slows

U.K. real estate group British Land's fiscal first-quarter loss narrows to 273 million pounds ($447 million).

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 2:58 am

Reader’s Digest Goes Into Hospice

The US business of Readers Digest is going into Chapter 11. The immediate cause is the company’s need to restructure $1.6 billion in debt and to move ownership of the company to its lenders. The story is more complex than that. Two-and-half years ago, private equity firm, Rpplewood, led a buyout of Reader’s Digest for [...]

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Source: 24/7 Wall St. | 18 Aug 2009 | 2:53 am

Property stocks help Footsie recover poise

London equities bounced on Tuesday after improving newsflow in the property sector helped support gains driven by demand for mining and financial stocks. The FTSE 100 rose 36 points to 4,680.09 in opening...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 2:51 am

Rock delays bond payments

Loss-making nationalised bank Northern Rock says it will be deferring interest payments on some of its bonds.
Source: BBC News | Business | World Edition | 18 Aug 2009 | 2:50 am

British Land in talks to sell Broadgate

British Land confirmed on Tuesday it had received a number of approaches for Broadgate, the landmark London office development, as the commercial property group said it had begun to see signs of the slowdown...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 2:45 am

Everbright surges in Shanghai debut

China Everbright Securities surged as much as 48 per cent on its Shanghai debut on Tuesday in spite of a global equities sell-off a day earlier, a sign that domestic investors continued to feel bullish...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 2:41 am

Global stocks, commods rebound as volatility eases (Reuters)

Reuters - World stocks and commodity prices recovered on Tuesday from the previous session's sell-off, which was prompted by concerns over the pace of global recovery, while the Japanese yen and safe-haven U.S. government bonds eased.

Source: Yahoo! News: Stock Markets News | 18 Aug 2009 | 2:36 am

British Land losses narrow

Property group gives renewed hope that the UK property sector has already suffered its worst losses.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 18 Aug 2009 | 2:34 am

GM, Koenigsegg ink stock purchase deal on Saab

STOCKHOLM (Reuters) - Sweden's Koenigsegg and U.S.-based General Motors said on Tuesday they had inked a deal for the niche sports car maker to buy loss-making Saab Automobile.
Source: Reuters: Business News | 18 Aug 2009 | 2:30 am

GM, Koenigsegg ink stock purchase deal on Saab (Reuters)

Reuters - Sweden's Koenigsegg and U.S.-based General Motors said on Tuesday they had inked a deal for the niche sports car maker to buy loss-making Saab Automobile.

Source: Yahoo! News: Business | 18 Aug 2009 | 2:30 am

British Land upbeat on property recovery hopes

Interest from investors and signs of better returns from commercial property have helped to stem losses at British Land, the UK's second biggest commercial property company said today.


Source: Latest Business News from Times Online | 18 Aug 2009 | 2:27 am

Clunkers: Toyota jumps GM as top seller

More customers trading in vehicles under the Cash for Clunkers program bought cars from Toyota than any other manufacturer, according to new government statistics. In previous reports, General Motors has topped that list.
Source: Business and financial news - CNNMoney.com | 18 Aug 2009 | 2:08 am

Struggling lender CIT buys time

Read full story for latest details.
Source: Business and financial news - CNNMoney.com | 18 Aug 2009 | 2:01 am

Media Digest 6/18/2009

Reuters:   China’s expansion is leading to charges is it stripping asset from other under-developed countries. Reuters:   UBS (UBS) will reveal the names of 5,000 clients in a deal with US tax authorities. Reuters:   Schwab (SCHW) was sued by NYS over auction rate securities. Reuters:   Greenspan sees a strong end to 2009 but worries about next year. Reuters:   An SEC [...]

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Source: 24/7 Wall St. | 18 Aug 2009 | 2:00 am

Rio Tinto nets $2bn for Alcan packaging arm$

Rio Tinto, the Anglo-Australian mining group, today took the next step in reducing its debts by setting up the sale of its Alcan packaging business to Amcor, an Australian packaging group, for $2 billion.$


Source: Latest Business News from Times Online | 18 Aug 2009 | 2:00 am

Rio to sell packaging unit for $2 billion, trim debt (Reuters)

Reuters - Global miner Rio Tinto agreed to sell its Alcan packaging unit for about $2 billion to Australia's Amcor Ltd , easing its debt burden after an ill-timed acquisition two years ago.
Source: Yahoo! News: Business | 18 Aug 2009 | 1:54 am

Rio to sell packaging unit for $2 billion, trim debt

SYDNEY (Reuters) - Global miner Rio Tinto agreed to sell its Alcan packaging unit for about $2 billion to Australia's Amcor Ltd , easing its debt burden after an ill-timed acquisition two years ago.
Source: Reuters: Business News | 18 Aug 2009 | 1:54 am

AIG awards new CEO $7 million annual salary

NEW YORK (Reuters) - American International Group Inc , the insurer that received billions of dollars in a U.S. bailout, said on Monday that it will pay newly-appointed Chief Executive Robert Benmosche an annual salary of $7 million.
Source: Reuters: Business News | 18 Aug 2009 | 1:52 am

US banker found guilty of fraud

A former Credit Suisse banker is found guilty of fraud after deceiving investors into buying risky investments.
Source: BBC News | Business | World Edition | 18 Aug 2009 | 1:52 am

Lazard hires ex-Goldman banker Tuft: report

(Reuters) - Eyeing a fresh wave of public offerings, Lazard Ltd has hired former Goldman Sachs Group Inc equity-markets banker Tom Tuft, the Wall Street Journal said on Tuesday.
Source: Reuters: Business News | 18 Aug 2009 | 1:49 am

Lazard hires ex-Goldman banker Tuft: report (Reuters)

Reuters - Eyeing a fresh wave of public offerings, Lazard Ltd has hired former Goldman Sachs Group Inc equity-markets banker Tom Tuft, the Wall Street Journal said on Tuesday.
Source: Yahoo! News: Business | 18 Aug 2009 | 1:49 am

GDF Suez seeks foothold in LNG project

GDF Suez has joined a growing list of global energy groups seeking a foothold in Australia's natural gas industry after striking a deal to develop one of the world's first floating liquefied natural gas...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 1:47 am

Futures Movers: Crude-oil futures reclaim $67 a barrel in Asia

Crude-oil futures rise moderately in Asia trade to reclaim the $67-a-barrel level, undoing some of Monday’s sell-off in New York.

Source: MarketWatch.com - Top Stories | 18 Aug 2009 | 1:44 am

UK prices falling at record rate new figures are expected to show

New figures are expected to underline that pricing power has been ripped away from businesses.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 18 Aug 2009 | 1:34 am

Asia Markets And Europe Open 8/18/2009

Markets in Asia were mixed. The Nikkei rose .2% to 10,385. The Hang Seng rose 1% to 20,333. The Shanghai Composite rose 1.4% to 2,911. At the open in Europe, the FTSE rose .9% to 4,676. HSBC (HBC) was higher on an upgrade. The Dax rose .7% to 5,235. The CAC was higher by .5% to 3,437. Data from Reuters [...]

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Source: 24/7 Wall St. | 18 Aug 2009 | 1:25 am

Solon Q2 loss disappoints, still no '09 outlook

FRANKFURT, Aug 18 - German solar module maker Solon said on Tuesday it still could not give a profit outlook for 2009 after posting a wider-than-expected operating loss for the second quarter. Solon's...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 1:08 am

UK dealer urges scrappage renewal

UK car dealer Pendragon wants the UK government's car scrappage scheme to be extended into next year.
Source: BBC News | Business | World Edition | 18 Aug 2009 | 1:06 am

Deadly citrus disease reaches Mexico, threatens California

Citrus greening disease, described by one expert as 'a citrus grower's worst nightmare,' is spread by an infestation of the Asian citrus psyllid. ...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 1:00 am

Financing your firm with a credit card? Bad idea

For every $1,000 in unpaid credit card debt, a start-up business increases the probability that it will close by 2.2% on average compared with having no such debt, a study shows. ...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 1:00 am

Sears and Kmart introduce Christmas Club cards

The cards, reminiscent of banks' Christmas accounts, are meant to encourage savings for holiday purchases. Shoppers who put money in regularly can get a 3% reward, up to $100. ...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 1:00 am

'Terminator Salvation' producers sue hedge fund Pacificor

Derek Anderson and Victor Kubicek allege a plot by Pacificor to get control of 'Terminator' rights.

The legally embattled owners of "Terminator" are back -- in court, that is.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

DreamWorks gets go-ahead for action

The company relaunched by Steven Spielberg as an independent studio finally has financing in place and plans to make about six movies a year.

Nearly a year after embarking on plans to relaunch DreamWorks as an independent studio, Steven Spielberg finally has the financial means to greenlight his own movies.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

Stocks tumble as investors worry about consumers

Dow drops 186 points on fears that weak consumer spending will stall a recovery. Major U.S. stock indexes fell...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 1:00 am

Fewer banks tightened credit standards, Fed reports

But credit availability probably won't return to normal before mid-2010, report says. Also, the Fed and Treasury extend the TALF emergency financing program aimed at boosting lending.

Fewer banks are tightening their lending standards, but credit constraints on U.S. businesses and consumers aren't likely to let up before the middle of next year.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

New York's Cuomo sues Charles Schwab over auction-rate securities

Atty. Gen. Andrew Cuomo claims the firm's brokerage unit misled customers about the safety of auction-rate securities. He wants Schwab to repurchase them from investors at face value.

New York Atty. Gen. Andrew Cuomo filed a lawsuit Monday against the brokerage unit of Charles Schwab Corp., claiming that the firm misled customers about the safety of auction-rate securities.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

Stocks tumble as investors worry about consumers

Dow drops 186 points on fears that weak consumer spending will stall a recovery.

Major U.S. stock indexes fell by the biggest amount in six weeks Monday as investors grew worried that they had been too quick to bet on an economic rebound during the market's five-month rally.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

'Terminator Salvation' producers sue hedge fund Pacificor

Derek Anderson and Victor Kubicek allege a plot by Pacificor to get control of 'Terminator' rights. The legally...
Source: RSS feed - channel BNPaperBusiness | 18 Aug 2009 | 1:00 am

Deadly citrus disease reaches Mexico, threatens California

Citrus greening disease, described by one expert as 'a citrus grower's worst nightmare,' is spread by an infestation of the Asian citrus psyllid.

Leaders of California's $1.6-billion citrus industry said Monday that a disease that was killing orchards worldwide was now rooted in Mexico, and experts warned that it was headed toward the state.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

Ugly Dolls are a labor of love

The impish, cartoony monster toys, whose fans include Sasha Obama and Snoop Dogg, started with a doodle on creator David Horvath's letters to his college sweetheart.

To their legions of fans -- Sasha Obama and Snoop Dogg included -- the Ugly Dolls are anything but ugly. ¶ With names such as Babo, Big Toe and Puglee, the plush creatures look more like impish cartoon monsters than adorable Beanie Babies. ¶ Millions of these odd, squishy misfits have charmed their way into buyers' hands since David Horvath began doodling them eight years ago on letters to his college sweetheart, Sun-Min Kim. ¶ Manhattan Beach residents Horvath and Kim had dreamed about creating toys that could tell stories and make kids happy. But they eschewed the route normally followed by entrepreneurs: Make a toy that fits a trend, pitch it like crazy to all the big toy makers, pray they buy your idea and sell your toys at Wal-Mart. ¶ Instead, Horvath and Kim started small and tried to stay that way by selling only to independent stores. They began by making things they loved.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

Financing your firm with a credit card? Bad idea

For every $1,000 in unpaid credit card debt, a start-up business increases the probability that it will close by 2.2% on average compared with having no such debt, a study shows.

Think twice before slapping down that credit card to cover costs at your new business.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

'Ice Age: Dawn of the Dinosaurs' racking up record sales overseas

'Ice Age 3' has become an international phenomenon, taking in more than $600 million in overseas ticket sales.

When they release a big action movie starring Will Smith, Hollywood's studio chieftains can be pretty confident that it will sell a lot of tickets in London, Hong Kong and Sydney as well as in the United States.

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

How to start selling books over the Internet

Dear Karen: How would I start an Internet company that sells children's books?

Source: L.A. Times - Business | 18 Aug 2009 | 1:00 am

Rio Tinto agrees $2bn asset sale

Rio Tinto agrees to sell four packaging units of its Alcan aluminium subsidiary for $2bn, as it seeks to trim its debt burden.
Source: BBC News | Business | World Edition | 18 Aug 2009 | 12:28 am

Amcor offers 2bn for Rio Tinto's Alcan packaging business

Australia's Amcor has offered to buy Rio Tinto's Alcan packaging operations for 2bn.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 18 Aug 2009 | 12:21 am

NZ market weakened but still resilient

The New Zealand sharemarket weakened today but brokers said it was a resilient performance after sharp falls by global stocks. The benchmark NZSX-50 index closed down 14.503 points, or 0.47 per cent, at 3071.582 after initially...
Source: New Zealand Herald - Business | 18 Aug 2009 | 12:19 am

Dollar stable around US67c

The New Zealand dollar traded near the US67c figure today as concerns about the global economy continued to dampen demand for risky currencies. By 5pm the NZ dollar was buying US66.96c, similar to its US66.89c level at 5pm yesterday. The...
Source: New Zealand Herald - Business | 17 Aug 2009 | 11:25 pm

Japan opposition ahead as campaign starts

Japan’s Democratic party holds a wide lead over the long-ruling Liberal Democratic party in voter polls as official campaigning kicks off for an August 30 election
Source: Financial Times - US homepage | 17 Aug 2009 | 10:55 pm

NZ Refining unveils interim profit, but no dividend

The New Zealand Refining Company will not be paying an interim dividend because of the high New Zealand dollar and other factors. The operator of the Marsden Point oil refinery today reported a $52.5 million profit after tax in...
Source: New Zealand Herald - Business | 17 Aug 2009 | 10:45 pm

Why Some Fund Managers Missed the Rally

Few people have ever accused money manager C.K. Lawson of being scared. He stares down crocodiles, hippos and other big game on wild safaris all over the world. And when it comes to investing, Lawson has bucked conventional wisdom for 40 years. Back in 1974, when few people wanted anything to do with stocks, he bought shares in coal companies, oil refineries and uranium miners, and he made investors a small fortune.

But for a bold, brave Texan, Lawson has been awfully hesitant lately. Ever since the crash, he says, he’s been adding more names to the list of stocks he’d like to buy for the $13 million Armstrong Associates fund he manages. Yet instead of buying them, Lawson has pushed 30 percent of the fund’s assets into cash, the most he’s held since the early 1970s. He says he’s not scared, just worried the market will tank again. “You don’t need to hit the home run, but you don’t want to strike out,” he says, noting that the strategy limited the pain of the crash last year. But in 2009 all the cash hoarding also turned Lawson’s shareholders into mere spectators to the fiercest stock rally in decades. In all, Armstrong Associates investors saw their fund rally barely half as much as the broader market. Those stocks he was interested in? One of them zoomed up almost 50 percent—without him.

The mutual fund industry is built on the idea that professional investors, unlike ordinary folks, won’t let fear get in the way of rationally investing in stocks. The pros, we’re told, will thoroughly analyze stocks and buy them with conviction, even when individual investors want to panic-sell and stash money in their mattress. But it turns out that in the wake of the greatest crash since the Great Depression, many fund managers have been acting like, well, the average investor, hoarding cash, running from risk and costing shareholders billions in missed opportunities. In what amounts to a race to the middle of the pack, many large-company stock funds are paring back investments to make their funds look safe compared with their competitors’ and their benchmark indexes. From modest-sized funds like Lawson’s to bigger players like the $2.5 billion Brandywine Blue, funds that traditionally put almost all their money in stocks have stayed on the sidelines, collectively sitting on billions of dollars in cash.

Of course, some of these managers would have looked like geniuses had the market kept falling. And some have recently stormed back into stocks. But by staying in cash for so long, many managers were, in effect, telling investors one thing—describing a market full of must-buy bargains—and doing something else. And the timing couldn’t have been worse: Just before the market rallied this spring, 41 percent of professional money managers admitted they were “overweight” in cash, according to the Bank of America Merrill Lynch Fund Manager Survey. That’s the second-highest level of playing it safe in the survey’s nine-year history. “They were talking the talk but not walking the walk,” says Michael Penn, the firm’s global emerging-market equity strategist.

For their part, fund managers say some of this was beyond their control—they needed extra cash on hand to pay off nervous investors who wanted their money back. And clearly, no fund manager wants to do worse than the market as a whole. But the price of skittishness can be heavy in the fund business, something investors may discover as they probe their most recent quarterly statements. At a time when they could have jump-started their recovery from last fall’s devastating losses, some enjoyed only a fraction of Wall Street’s windfall. Now they must wait for another rally. “You can’t risk missing the upside,” says Jeff Keil, a consultant for the mutual fund industry.

“That’s a worse fate than avoiding risk.”

To some degree, playing it safe has always been ingrained in the mind-sets of fund managers, who invest $4.0 trillion in stock fund assets. Funds have traditionally been measured against an index of stocks in their sectors, and to make sure they don’t trail that benchmark, many managers wind up owning the same stocks in nearly the same proportions. Although some funds attract investors with short-term returns that blow their competitors away, those same funds tend to lose far more when they have poor years. Many fund managers, particularly ones who oversee huge pools of money, don’t want to be seen as “eccentric,” says Jeremy Grantham, chief investment officer of asset management firm GMO and a longtime critic of the industry.

Playing it safe also reduces the odds of getting fired. In what was once an uncommon event, hundreds of fund managers have been replaced in the past year, including many who made—and lost—big money veering from the safe course. Case in point: As the manager of Fidelity Growth & Income, Tim Cohen ran one of the nation’s largest funds, loading up on financial stocks, including Wachovia and Bank of America. When the sector tanked, the fund took a spectacular nosedive, from $31 billion in assets to just $6 billion last January. Fidelity replaced Cohen in January, and the fund has shifted gears. The fund now spreads out risks (it now has 200 stocks) and makes sure its largest holdings resemble the S&P 500’s. The fund’s investors want “steady, gradual outperformance, not blowouts,” says James Catudal, the new manager. Fidelity and Cohen declined further comment.

But critics of fund managers say investors today also want something else: a chance to regain some of that money they lost, which even some of the industry giants haven’t been able to do yet. In all, the Brandywine Blue fund, which invests primarily in large U.S. stocks, has lost about $1 billion in assets since last September. (A spokesperson said the fund’s managers were “frustrated” that their assets rebounded only 17 percent during the spring rally.) With few exceptions, by clinging to the mimic-the-index approach, most funds rode the market to its very bottom last fall. It was, after all, a rational move, since selling stocks during a decline essentially seals in losses before any stocks go back up. But many managers eventually wound up selling shares anyway. And according to a review of hundreds of stock funds by Smart-Money, many of them parked the proceeds in cash instead of following the textbook investment strategy of buying stocks at low prices. In fact, mutual funds as a group were holding 20 percent more cash this spring than they did a year ago.

Sensing a rebound in the market, some managers did shift back into stocks, but trying to time a rally is hard even for the pros. According to Morningstar, while stocks rose 38 percent from mid-March to mid-June, nearly one-third of 2,000 domestic stock funds did worse than the S&P 500 over that stretch. “If they underperformed during both the bear market and the rally, you have to start wondering if the manager has the talent to manage your money,” says Jeff Tjornehoj, a senior research analyst at Lipper, a mutual fund research group.

In their defense, some managers say it was panicky shareholders, not their own fears, that forced them to build cash positions. Without sufficient cash, the funds couldn’t pay all those investors who pulled money out in the fall and were threatening to do so again. But such so-called redemptions were hardly an issue for Harvey and Daniel Neiman, the father-and-son investing team who run Neiman Large Cap Value. After getting a coveted five-star rating from Morningstar, the Rancho Santa Fe, Calif.–based fund attracted a flood of new money from investors in the winter. But they sat on much of it. With 30 percent of its assets parked in cash, the firm posted only a 14 percent gain during the three-month run in the spring, 24 points behind the market. “We couldn’t just take the money and invest it” while the market was falling apart, says Harvey Neiman.

To their credit, the Neimans have made no secret about their conservative style and their concerns about the market; it’s in their letters to shareholders. But other fund investors with huge cash holdings have been sending mixed messages. Financial radio personality Gabriel Wisdom encouraged shareholders to “buy fear” last summer because stocks were so cheap. But the Fallen Angels Value fund, which Wisdom manages, was holding 23 percent of its assets in cash at the time, and by the end of January it was sitting on 34 percent cash. Wisdom, who also is based in Rancho Santa Fe, says buying on fear and selling on euphoria is normally a good investing strategy, but last year’s crash—the sixth bear market he’s managed money through—made him pause. “We didn’t want to be heroes and guess the bottom,” says Wisdom. (He did later buy some stocks and captured some of the rally, but his fund still has a large cash hoard.)

The FCI Equity fund, based in Kansas City, Mo., also sensed bargains in the crash, and it told shareholders last fall it was “excited about the opportunities.” It did do some buying then, but by the eve of the spring rally, it still had about 7 percent of assets in cash, a seemingly small amount but still more than triple the fund’s normal cash position. By mid-June, the fund had missed out on about a quarter of the rally’s gains and trailed the broader market. “We missed on March. We should have been a buyer, and we weren’t,” says William Courtney, one of the fund’s managers. “The whole thing looked like it was collapsing.”

5 Cash-Filled Funds

Why they kept so much cash

GABELLI ABC (GABCX)
SIZE: $334 million
PERCENT IN CASH: 9/30/08: 26%  | 3/31/09: 76%
This fund focuses on takeover targets; manager Mario Gabelli sold off stock when the crash put a halt to mergers. The fund lost less than 3 percent in 2008
but missed almost all of this year’s rally.

WESTPORT FUND (WPFRX)
SIZE: $188 million
PERCENT IN CASH: 9/30/08: 18%  | 3/31/09: 23%
Normally holds 5 percent cash, but these aren’t normal times, says a fund spokesperson. Westport’s returns have lagged behind its midcap peers this year.

MARATHON VALUE PORTFOLIO (MVPFX)
SIZE: $30 million
PERCENT IN CASH: 10/30/08: 6% | 4/30/09: 13%
The fund lagged about 12 points behind the S&P 500 in the rally but lost less in the crash. Manager Mark Heilweil says the bear market isn’t over yet and that he wants a cash cushion.

FPA CAPITAL (FPPTX)
SIZE: $1 billion
PERCENT IN CASH: 9/30/08: 38% | 3/31/09: 31%
Last year the managers said they were observing a “buy halt.” This year they’ve bought energy stocks, but in midsummer the fund still had a huge cash hoard.

NEIMAN LARGE CAP VALUE (NEIMX)
SIZE: $14 million
PERCENT IN CASH: 9/30/08: 31% | 3/31/09: 41%
Typically holds no more than 20 percent cash, but has put that guideline aside. Comanager Harvey Neiman says today’s market merits being conservative.

SOURCES: SECURITIES AND EXCHANGE COMMISSION; FUND MANAGERS

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

Source: SmartMoney.com | 17 Aug 2009 | 10:00 pm

Coke's Fortunes Are Set to Pop

AFTER BESTING PEPSICO IN THE COLA WARS OF the 1990s to become the King of Pop, Coca-Cola has encountered a more formidable opponent -- the recession. A struggling economy, together with health concerns, has contributed to a further decline in soda consumption in the U.S., and depressed Coke's profits and shares. Earnings are expected to slip 3% this year, while Coke's stock has fallen 13% in the past 12 months, to a recent 48.

But this could be the pause that refreshes for the world's leading beverage maker, which commands a 10% share of the global market in all non-alcoholic beverages. As in prior economic downturns, Atlanta-based Coca-Cola (KO) is using its copious cash, marketing muscle and unmatched global distribution system to take market share from rivals and strengthen its core business. Among other things, it is cutting costs and launching new products. Coke also is expanding aggressively overseas, to offset sluggish domestic volume. Volume in the $73 billion U.S. carbonated-soft-drink market fell 3% in 2008, continuing a protracted slide.

Significantly, Coke management is working to bolster the company's sometimes-rocky relationship with Coca-Cola bottlers, who buy concentrate from the company and transform it into bottled soft drinks and juices. In a dramatic shift, the company is inking multi-year concentrate-price agreements with bottlers in the U.S., moving away from annual negotiations. Under these deals, Coke will charge bottlers a percentage of revenue generated, rather than a fixed rate per gallon bottled. Analysts say such agreements will give bottlers greater visibility and encourage them to make longer-term investments in growing the brand. "With these deals, the franchise model in the U.S. can be put on steroids," says Credit Suisse analyst Carlos Laboy.

Yet, for all its formidable strengths, including what may be the best brand name in the world, Coke sells for just 15 times analysts' 2009 earnings estimates and 15 times 2010 forecasts -- near its lowest valuation in 20 years. Given the company's significant exposure to fast-growing emerging markets, its strong balance sheet, a gold-plated brand and savvy management, Coke arguably deserves to trade at a multiple of at least 17 times forward earnings, which would imply a stock price of 56. Add a 3.4% dividend yield, and that's a potential total return of 20% based on today's stock price.

Steven Roge of the Roge Partners Fund says he went looking for "top-notch franchises selling for once-in-a-lifetime valuations" -- and reached for Coke in January. Using his discounted cash flow model, Roge estimates the company is worth 72.50 a share.

Roge is in good company. Coca-Cola is one of the largest equity holdings of Warren Buffett's Berkshire Hathaway (BRK.A), and Cherry Coke is Buffett's favorite drink. Buffett holds 200 million of Coke's 2.3 billion shares.

Citing declining soft-drink sales in the U.S., some critics say Coke's business is fizzling. But that ignores the company's aggressive move into markets such as China, where volume is growing by double digits. Today Coca-Cola, first served at soda fountains in 1886 for five cents a bottle, is a staple in more than 200 countries. Coke, the company, gets 80% of its sales, and more than 95% of operating profits, from abroad, and is a blue-chip play on the growth in emerging markets.

Still, the critics have a point: The growth rate of carbonated-soft-drink, or CSD, sales peaked in 1994, according to Beverage Digest. In the years since, consumers have embraced alternatives such as bottled water and sports and performance drinks. Last year, for instance, the energy drink Red Bull saw a 5% uptick in average case volume, while volume at Coke and Pepsi fell more than 3%. Coke has added numerous soda alternatives to its beverage line-up, including Dasani water, VitaminWater and Nestea. Carbonated soft drinks today account for 78% of unit volume, down from 90% ten years ago.

THIS YEAR'S SECOND QUARTER marked the eighth consecutive quarter in which Coke posted volume and market-share gains in non-alcoholic, ready-to-drink beverages. The company earned a better-than-expected 92 cents a share for the latest period, on a 9% drop in revenue to $8.3 billion, as currency translation punished reported results. Coke benefited from strong income from its bottling investments and a 4% uptick in its worldwide beverage volume, led by gains of 33% in India and 14% in China. North-American volume slipped 1% but improved from the first quarter.

The latest results support analysts' expectations for a rebound in earnings next year. The Street estimates 2010 net income of $7.6 billion, or $3.30 a share, on revenue of $32 billion, versus this year's projected profits of $7 billion, or $3.04, on sales of $31 billion. Coca-Cola earned $7.4 billion, or $3.15 a share, in 2008, on revenue of $32 billion.

Although it won't disclose exact figures, Coke is benefiting from price increases, in some markets, especially in Latin America, as well as volume growth and cost cutting. Management hopes to save an annualized $500 million by 2011, mainly in administrative costs. Share-buyback also will boost growth in earnings per share; the company is buying back $1 billion of stock this year. Long-term, Coke is looking to grow annual volume by 3% to 4%, revenue by 4% to 5%, operating income by 6% to 8% and earnings per share by high single digits.

IN AN INTERVIEW with Barron's, Chief Financial Officer Gary Fayard said year-to-date results are generally in line with management's long-term goals. "If we can hit guidance in this economic environment, that's the biggest reason why we think we'll be stronger," he said.

Coca-Cola and PepsiCo generally are linked in investors' minds, although Pepsi is a dominant snack-food player and generates more revenue, at $43 billion. It also has a smaller presence overseas. One big difference between the two is the approach each is taking with bottlers. PepsiCo paid $8 billion earlier this month to buy two of its largest bottlers, promising cost savings and growth. But Coke seems glued to its franchise model, in which it owns stakes in Coca-Cola bottlers. Chief Executive Muhtar Kent, a former bottler who joined the company in 1978, was named CEO in 2008. He is working closely with bottlers, especially Coke's largest, Coca-Cola Enterprises (CCE), on ways to strengthen the brands and leverage marketing and distribution investments. Coke owns 35% of CCE.

Some analysts and investors seem confident Coke's approach will pay off but note management could change course if Pepsi's strategy is more successful. "The franchise model is better from a return-on-capital and profitability standpoint," says Stephen Boland, an analyst at Odlum Brown. "I would prefer to see them stick with that model."

Having bottlers who are motivated is critical for Coca-Cola, since bottlers account for 89% of worldwide sales volume. The multi-year pricing deals, begun in Latin America, were instrumental in making that region a leading growth engine for Coke, says Credit Suisse's Laboy. He expects the company to sign more 50/50 profit agreements with bottlers for noncarbonated beverages, and thinks they will help Coke deliver "EPS growth rates of 12% to 14% over the next few years." Laboy has an Outperform rating on the stock and a price target of 57.

Coke reported better-than-expected equity income of $310 million in the second quarter from its bottling investments, including CCE and Femsa, or Fomento Economico Mexicano (FMX), in Latin America.

The beverage business isn't immune to a downturn, and a collapse in the nascent recovery could pinch Coca-Cola's growth. And even with a truce in the cola price wars, competition from PepsiCo, which has 31% of the U.S. carbonated-soft-drink market versus 43% for Coke, remains intense. Companies like Austria's Red Bull also are keeping the beverage giants on their toes.

"[Coke is] a China, India, Latin America story that had better work," says Joseph Tatusko of Westport Resources." Otherwise, the stock will likely be range-bound for years."

CFO Fayard says the biggest risk is in currency translations, as revenue from foreign operations is translated into dollars. Coke doesn't hedge in emerging markets, which hurt in recent quarters. Revenue in the latest quarter took a 9% hit from currency translation, and operating income was squeezed by 14%. Management is bracing for a 12% to 14% hit in the third quarter.

Yet, making soda isn't rocket science. If Kent & Co. can keep the three critical elements of Coke's organization -- products, bottlers and retailers -- working smoothly to satisfy consumers' shifting tastes, management will have gotten the formula for the company, and its shares, just right.

The Bottom Line
With its stock depressed on two years of domestic downtrends, Coca-Cola, one analyst says, may be worth 50% more than its current share price.

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

Source: SmartMoney.com | 17 Aug 2009 | 10:00 pm

Is an FHA-Insured Mortgage Right for You? (Consumer Action)

The days of putting little money down to buy a home aren’t over.

After years of risky mortgages backed up by small down payments, most lenders aren’t underwriting mortgages without a significant sum up front and a high credit score. But a decades-old loophole can still put home buyers in a house for next to nothing. Mortgages insured by the Federal Housing Administration (FHA) allow borrowers to get approved with a down payment as small as 3.5% of the agreed selling price of the house and don’t require a high credit score.

As millions of Americans have come to realize, getting into a house for little money down has its disadvantages. Borrowers who’ve pumped little equity into their home are often more willing to walk away from it during lean times that keep them from making payments; this risk is further elevated when home values are in decline and troubled borrowers are unable to refinance or sell the home at a price that covers their losses.

Still, FHA-insured mortgages are far less risky than the subprime mortgages that lenders originated before the housing bust. FHA-insured mortgages require documentation and verifiable proof that the borrower is capable of making their monthly payments. (Most subprime mortgages didn’t require such proof.)

The looser terms of FHA-insured mortgages have helped make them more popular. Today, FHA-insured mortgages make up about 25% of the mortgage market, up from 3% in 2006, FHA commissioner David Stevens said in a speech earlier this month. In June, the FHA insured 194,000 loans – the highest monthly total in the agency’s history, according to Stevens. For fiscal year 2009, the dollar amount of FHA-insured mortgages is likely to reach 30% of mortgage originations, up from around 4% in 2005 and 2006, says Stu Feldstein, the president of SMR Research, a mortgage-data tracking firm.

“FHA-insured mortgages are one of the only games in town, especially if you can’t qualify for a traditional mortgage,” says Gibran Nicholas, the chairman of the Ann Arbor, Mich.-based CMPS Institute, which trains and certifies mortgage lenders and brokers. “Now that the subprime market is gone, FHA is filling the gap.”

Here’s how to determine if an FHA-insured mortgage is right for you.

Do you meet the qualifications?

Most borrowers of FHA-insured mortgages have stable sources of income and need more flexibility with their credit history and debt load than a conventional mortgage loan might allow, says Lemar Wooley, a spokesman for the Department of Housing and Urban Development (HUD), which FHA is part of.

“When analyzing the borrower’s credit, we expect lenders to examine the overall pattern of credit behavior rather than isolated occurrences of poor performance or relying solely on a credit score,” says Wooley. This includes a borrower’s rental or mortgage payment history, debts, collections, previous foreclosures and bankruptcies. Borrowers with a credit score less than 500 must make a 10% down payment to be eligible, he says.

Today, 78% of FHA-insured purchase-mortgages belong to first-time home buyers, thanks to looser requirements and the comparatively small 3.5% down payment, says Wooley. (Another perk is that borrowers are permitted gift assistance for the down payment from their family, employer or a government entity, but not the seller.)

Rigorous documentation requirements are designated to mitigate the risk associated with making a small down payment – a stark contrast from the glory days of subprime mortgages, when documentation was rarely required and verified, Nicholas says. FHA-insured mortgage borrowers will have to prove they have the cash to close the mortgage by presenting their most recent bank statements. They’ll also have to prove they can repay the mortgage by showing W2 statements and paystubs.

In addition, borrowers’ total mortgage payments (including principal, interest, taxes and insurance) debt-to-income ratio can’t exceed 31% of their gross monthly income, and total debt-to-income (total mortgage payment plus all other debts) ratio can’t exceed 43% of their gross monthly income.

Can you afford the costs?

Now, interest rates on FHA and non-FHA mortgages aren’t too different. A 30-year fixed-rate FHA-insured mortgage had an average rate of 5.44% for the week ending Aug. 7, compared to an average rate of 5.42% for a 30-year fixed rate non-FHA mortgage, according to Keith Gumbinger, a vice president at HSH Associates, a mortgage-data tracking firm.

However, there are unique fees that accompany an FHA-insured mortgage. A borrower is required to pay 1.75% of the loan amount upfront, or that fee can be financed into the mortgage. FHA-insured mortgages also require a 0.5% annual premium based on the outstanding loan balance and financed into the mortgage. These fees pay for the FHA insurance that makes the loan possible, Wooley says.

A borrower who has a high credit score – typically a minimum of 720 – and a 20% down payment is often better off with a traditional non-FHA mortgage, which includes fewer fees. However, the math gets tricky when a borrower has a high credit score but a down payment less than 20%; in those cases, the borrower will have to pay for private mortgage insurance (PMI). Depending on your situation, PMI can cost less, the same or more than FHA fees.

Crunch the numbers here to see how much you’ll pay in PMI.

What protections are in place for the lender?

Lenders are comfortable providing FHA-insured mortgages because they don’t bear the loss if a borrower defaults on their payments and goes into foreclosure – the FHA does.

In such a scenario, the FHA pays the lender an insurance claim equal to the sum of the unpaid principal balance of the loan, foregone interest and a portion of the foreclosure expenses, Wooley says. The FHA pays for these losses by dipping into its insurance fund, which holds the insurance fees borrowers pay, Nicholas says.

What about for the borrower?

When borrowers are unable to keep up with their mortgage payments, their lender is required to work with them to avoid foreclosure, Wooley says. This is part of FHA’s Loss Mitigation program.

As of Saturday, mortgage servicers can use this program to reduce monthly mortgage payments to 31% of the borrower's monthly gross income, Gumbinger says. To qualify, borrowers must be unable to keep up with their mortgage payments but cannot be more than 30 days delinquent.

Although this program can help prevent foreclosures, it doesn’t guarantee that the borrower ultimately will be able to hold onto their home, Gumbinger says.

Who is taking the biggest risk?

Under certain circumstances – primarily, rampant FHA-insured mortgage underwriting and declining home values – these mortgages present a significant risk to the economy. When home values decline, a borrower who has little equity in their home and is falling behind on payments is more likely to walk away from the property than a borrower who has more equity in the home and is more inclined to hold on to it, says Dean Baker, a co-director at the left-leaning Center for Economic and Policy Research in Washington, D.C.

If a significant portion of FHA-insured mortgage borrowers go into foreclosure, the FHA insurance fund could become depleted, and the government may have to bail it out, Nicholas says. Those losses may ultimately fall into the hands of the taxpayer or get added to the country’s debt, Baker says.

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

Source: SmartMoney.com | 17 Aug 2009 | 10:00 pm

10 Things Estate Planners Won't Tell You (10 Things)

1. “You probably don’t need me.”

Let’s face it: Estate planning is scary. Not only does it involve protecting your hard-earned assets but it makes you think about that most dreaded of topics—your own mortality. That’s one reason why many of us run to an estate planner when it comes time to write a will.

But the fact is, you might not need any help. “The overwhelming majority of estates don’t trigger the federal estate tax,” says a spokesperson for the Internal Revenue Service. In fact, as of 2009 you must be worth at least $3.5 million when you die to pay tax at all. If you fall below that—and don’t have any complicated estate issues—you probably don’t need a lawyer to draw up a will for you. Instead, you can use software like Quicken’s WillMaker Plus (around $45 at Amazon. com) and dispense with the whole task in a single afternoon.

2. “Estate planning isn’t actually my thing.”

What does it take to call oneself an estate planner? Not much, it turns out. Some estate planners are financial planners. Others are CPAs. Many are lawyers. But none of those titles guarantees an intricate knowledge of estate planning. “If you have a $50 million estate and you ask a lawyer if he does estate planning, the answer you’ll get 100 percent of the time is an enthusiastic ‘Yes, I do,’” says Tony Fiorillo, a former financial adviser.

Robert N. Sacks, chairman of an American Bar Association estate committee, says that you should stick with a lawyer who specializes in estates. The ultimate badge of competency: membership in ACTEC, the American College of Trust and Estate Counsel, an invitation-only national organization. (You can search ACTEC attorneys in your area at www.actec.org. )

3. “I’d love to be your executor—it’s a great way to make some extra money.”

Who should execute your will once you’re gone? It’s a tricky question, especially for parents who don’t want to favor one child over another but who also aren’t crazy about the idea of entrusting the job to the son who just depleted his 401(k) for a new Miata.

In your time of indecision, you may find your estate planner offering to take the job. A generous gesture? Not likely. Executors often pull in hefty fees. “It guarantees future employment or retirement money,” says Stephen McDaniel, former president of the National Association of Estate Planners and Councils and a certified estate planning specialist in Tennessee.

In California, for example, where executor fees are based on an estate’s size, a $1 million estate would pay $23,000 to the executor. Many people give the job to family members, who often refuse payment. But an estate planner stepping in to do the job will understandably want to pocket the profit.

4. “You don’t need a living trust.”

Living trusts have been a favorite estate planning tool of the past decade, and it’s easy to see why—they allow your estate to transfer property and assets outside the clunky probate process, saving your heirs time and money. Overzealous planners love them too, since setting one up can boost their bill. “I’ve had several clients who had gone to an estate planner and were pressured into setting up a living trust,” says John Huggard, an estate planner and author of Living Trust, Living Hell: Why You Should Avoid Living Trusts. “It drove the cost of a basic estate plan from $500 to $3,500.”

While the prospect of a long probate can be enough of a deterrent to justify the cost of a living trust, that’s becoming less the case. David Scull, a probate attorney in Bethesda, Md., says that over the years many states—including “almost everything west of the Mississippi”—have simplified their probate processes. Two exceptions: If you live in a big city or own property in two states, probates can still be tedious. But in most cases, he says, “If the executor is organized, it’s possible to do a $10 million estate in minutes.”

5. “I make more money in insurance than on planning your estate.”

John Scherer, a certified financial planner who was once a Northwestern Mutual Life insurance agent, recalls working with a client in need of estate planning. Scherer referred him to an attorney, who charged about $7,500 to draft a will. Then, in order to fund his estate-tax liability, the client considered buying life insurance—a policy Scherer predicted would put about $10,000 in commission in some lucky agent’s pocket.

Given the financial incentive for selling insurance, it’s no wonder so many estate planners have managed to muscle their way into the insurance business as well. Despite the obvious conflict of interest—planners who sell insurance have an incentive to recommend it—it is a lot easier than it once was for planners to do both. That’s because many states have rewritten their laws so that certified public accountants who pass a state exam and are sponsored by an insurance carrier can sell insurance products and collect a commission when doing estate planning.

It’s a requirement that the financial incentive be disclosed, but apparently, many planners aren’t complying with the rule. It’s a “huge” problem, says attorney Jay Adkisson, who runs Quatloos.com, a website that tracks financial scams. He says his site has received dozens of e-mails from people complaining that their CPA or attorney pitched life insurance but didn’t mention a commission. “If someone says, ‘I’m going to help you with estate planning’ and a product is a central point in the presentation—run, don’t walk,” advises John Olsen, an estate planner in St. Louis.

6. “My customer service stinks.”

The tax code gets a major revision about every other year, and people’s lives change constantly. Yet some clients are lucky if they ever hear from their estate planner after the initial meeting. Part of the reason is that many estate planners started practicing years ago, when the idea of maintenance was a foreign concept: Back then people changed jobs less often, moved investments less frequently, and, frankly, amassed wealth less quickly, says Kathleen O’Blennis, an estate planner with Polsinelli Shalton Flanigan Suelthaus PC in St. Louis. Today, “planning is an ongoing issue,” she says.

But don’t take it for granted that your planner will hold your hand once your initial plan is in place. Cautionary tale: O’Blennis once had a client who, under a previous planner, sold his home and failed to get the new home transferred into the existing trust. O’Blennis says she managed to salvage the trust, but it cost the client thousands of dollars. “If I were looking for a planner,” she says, “I’d ask what they’re going to do to help me maintain this thing once the animal is born.”

7. “Your pushy sister is your problem.”

Sure, estate planning is primarily about money, but it’s also about family and their complicated relationships. But good luck finding a planner who knows something about both. “[Planners] are so entrenched in the tax game that they forget about how the estate plan will ultimately impact the family after a death,” says Mike Smith, a court-appointed guardian of estate disputes and chief deputy clerk in the Northern District of Georgia.

Things can get especially dicey when a family limited partnership is involved. This estate-planning tool, which lets people slash estate taxes and protect assets from creditors, divides ownership of the assets among family members. The general partner makes all the decisions, while the limited partners simply reap financial benefits. Sounds simple in theory, but that’s not always the case in reality. Gerald Le Van, an estate attorney and family-business consultant, has worked on a handful of family limited partnerships that he says were headed toward litigation because the siblings just couldn’t get along. His advice is to anticipate problems early. Lesson No. 1: “Siblings will take orders from parents, but not from each other,” Le Van says.

8. “I’m in bed with the bank.”

You might not know it, but your planner may have other relationships that could affect your estate. Take the case of management consultant Edmund McCormick, who appointed Bankers Trust as corporate fiduciary of his $37 million estate. After McCormick’s death back in 1988, Bankers Trust appointed the law firm White & Case to represent the estate through probate. As it turned out, White & Case was also a Bankers Trust attorney, meaning that the estate had no unbiased legal representation, says Patrick Hanley, spokesperson for Edmund McCormick’s widow, Suzanne.

Things turned litigious when, according to Hanley, White & Case failed to go after two of the estate’s coexecutors who were allegedly involved in the embezzlement of $232,000 from the estate. To Hanley, the reason is clear: Such a lawsuit would have been embarrassing for Bankers Trust, which failed to catch the problem early. In 1998, Suzanne McCormick and her family filed objections against the bank with the Surrogate Court in White Plains, N.Y., alleging mismanagement of the estate and breaches of fiduciary duties; she lost the case. To add insult to injury, White & Case was paid $250,000 out of the estate for its services. (White & Case declined to comment; the lawyer representing Bankers Trust says that White & Case acted without bias.)

Despite the outcome of the case, McCormick’s situation serves as a cautionary tale for anyone with a complicated estate. “The banks and lawyers are having collusive relationships,” says Standish Smith, founder of Heirs, a nonprofit organization in Villanova, Pa., that helps beneficiaries with complaints regarding trusts and estates. “It’s hard to figure out if the lawyer is working for the client or the bank.”

9. “Go ahead and sue me—you won’t win . . .”

In some cases, the mistakes of an estate planner are caught early. In most situations, however, your planner’s blunders won’t surface until long after you’re gone. And that can create big problems if your heirs want to sue for malpractice. “The key witness is dead,” says Bruce Ross, an estate planner and trust lawyer in Los Angeles.

Generally speaking, beneficiaries have two main hurdles in estateexecutor malpractice suits. The first is statute of limitations. The death of the parent begins the statute clock running, oftentimes causing it to expire before problems come to light. (Statute of limitations rules vary by state.) The second hurdle is privity, a contract law that prohibits a third party (in this case, a beneficiary) from suing a party in the original contract (for example, an executor). It works like this: If a car dealer sells you a lemon, and you in turn sell it to your neighbor, the neighbor can’t sue the dealer, because he’s one step removed.

So what options does a beneficiary with a beef have, if any? If an estate planner who makes a mistake is also a lawyer with malpractice insurance, beneficiaries may have a shot at getting their due. “If a lawyer says he’s a specialist, he’s held to a higher standard,” says Ross. Indeed, most states have relaxed their privity law precedence and some, led by California, have even written into the legal code the liabilities held by lawyers who act as estate executors.

10. “. . . but things might be changing.”

Texas, which long upheld a strict interpretation of privity, is another state that has recently pried open the door to estate planner malpractice suits. In a landmark 2005 case, the state Supreme Court found in favor of a petition filed by Kristen Terk Belt and Kimberly Terk Murphy, joint executors of their father’s estate, to take to trial law firm Oppenheimer, Blend, Harrison & Tate, of San Antonio, for legal malpractice. The two daughters had hired the law firm to draft a will and advise on asset management, which they claimed the firm failed to do adequately by neglecting to protect the estate’s assets with simple tax planning.

What green-lighted their suit in the face of the state’s strict privity interpretation was the fact that the sisters were not just beneficiaries but also executors of their father’s estate. This case led the way for Texas and other states as well to begin holding lawyers accountable to an estate after the death of the parent, whether or not these lawyers served as the estate’s executor.

In light of the trend, a good attorney will suggest that beneficiaries also act as executors to help protect their interests, but many lawyers continue to write themselves into the estate plan as the sole fiduciary, even after “most states have put regulations on attorneys acting as sole fiduciaries,” says Dominic J. Campisi, chair of the ABA Malpractice Committee of Real Property, Probate and Trust Law. Some states, like Massachusetts, have a long history of assigning law firms as executors, and attorneys aren’t given an incentive to discuss other options.

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

Source: SmartMoney.com | 17 Aug 2009 | 10:00 pm

Transfield proposes 154 job cuts

Contractor Transfield Services is proposing to make 154 staff redundant, saying it needed to adapt its telecommunications business to stay ahead of significant changes. The move was revealed today by the Engineering, Printing and...
Source: New Zealand Herald - Business | 17 Aug 2009 | 9:00 pm

Million-dollar bonuses back on Wall St

Wall St firms are again recruiting commodities traders with promises of US$1 million ($1.4 million) bonuses as prices of raw materials double. Less than a year after oil tumbled a record 54 per cent and the Reuters/Jefferies CRB...
Source: New Zealand Herald - Business | 17 Aug 2009 | 8:00 pm

Jail good idea for cartels, says Key

Jail time for those who operate price-fixing cartels is an idea worth considering, Prime Minister John Key said yesterday. Mr Key and many of his senior colleagues are meeting their counterparts from Australia this week and on...
Source: New Zealand Herald - Business | 17 Aug 2009 | 7:30 pm

Ex-Stanford adviser says warned SEC about bad CDs (AP)

AP - A former financial adviser with R. Allen Stanford's financial company told a U.S. Senate panel on Monday that she warned the Securities and Exchange Commission about the firm's hawking of shady investments five years before it closed the firm and accused the Texas billionaire of running a Ponzi scheme.
Source: Yahoo! News: Stock Markets News | 17 Aug 2009 | 7:29 pm

F&P chief tells of secret cancer fight

Fisher & Paykel Appliances chief executive John Bongard is fighting prostate cancer and is to leave the business in December. Chairman Gary Paykel yesterday announced the shock departure to shareholders at the company's annual meeting,...
Source: New Zealand Herald - Business | 17 Aug 2009 | 7:00 pm

SEC extends comment period on short-selling (AP)

AP - The Securities and Exchange Commission is extending the public comment period on possible approaches to reining the practice of short-selling, and may be leaning toward one of the two main alternatives being considered.
Source: Yahoo! News: Stock Markets News | 17 Aug 2009 | 6:49 pm

Guy Burgess 'exploited BBC expenses to make himself a better spy'

Guy Burgess abused the BBC’s expenses system by insisting on travelling first class, running up large bar bills and spending most of his time meeting contacts who could have helped his spying career, according to documents made public by the corporation.
Source: Latest Business News from Times Online | 17 Aug 2009 | 6:00 pm

Leaky homes bill likely to top $11.5 billion

The bill for leaky homes is likely to top $11 billion, a review found. The news prompted Building and Construction Minister Maurice Williamson to meet with local government leaders yesterday. He was tight-lipped about the meeting...
Source: New Zealand Herald - Business | 17 Aug 2009 | 6:00 pm

Man accused over America's biggest credit card identity fraud

A Florida man has been accused of stealing information about 130 million credit and debt cards from customers of 7-Eleven and other retail giants in the biggest identify theft case ever uncovered in America.


Source: Latest Business News from Times Online | 17 Aug 2009 | 6:00 pm

Montagu aims to sell Survitec for £300m

Montagu Private Equity wants to sell Survitec, the defence group that makes safety equipment for British forces in Afghanistan.


Source: Latest Business News from Times Online | 17 Aug 2009 | 6:00 pm

Business big shot: Jonathan Lane of Shaftesbury

“Good things come to he who waits” is a philosophy that has proved rewarding for Jonathan Lane, chief executive of Shaftesbury, the commercial property company, which owns Carnaby Street and other chunks of prime real estate in London’s West End. His patience is paying off.


Source: Latest Business News from Times Online | 17 Aug 2009 | 6:00 pm

Identity theft case puts 130m at risk

The US brought criminal charges over the alleged theft of account details linked to 130m credit cards, a case of identity theft that far exceeds anything of its kind that has ever come to light before
Source: Financial Times - US homepage | 17 Aug 2009 | 5:51 pm

CIT posts loss, completes debt exchange

NEW YORK (Reuters) - CIT Group Inc, a cash-strapped corporate lender scrambling to stay afloat, on Monday reported a second-quarter loss and said it continues to pursue a turnaround plan outside of bankruptcy court.
Source: Reuters: Business News | 17 Aug 2009 | 5:44 pm

Resene scoops $1m to make 'greener' paint

Resene Paints has won $1 million of research and development services to create a world-first sustainable paint. Resene is the inaugural winner of What's Your Problem New Zealand?, a competition set up by the Crown Research Institute...
Source: New Zealand Herald - Business | 17 Aug 2009 | 5:30 pm

Hear: Is Financial Innovation A Friend Or Foe?

On today's Planet Money:

We started our debate on financial innovation a few weeks ago with the Atlantic's Mike Konczal and Columbia's Charles Calomiris. Today Tyler Cowen of Marginal Revolution and Felix Salmon of Reuters join Mike to answer the question: has financial innovation in the last 25 years been positive or negative?

-- Blogger Felix Salmon says that financial innovation was a good thing, until it became a way for bankers to get around regulation.

-- Economics professor Tyler Cowen argues that it wasn't financial innovations that caused economic calamities -- it was leverage -- banks being able to borrow huge amounts of cash with little money down.

-- Financial engineer Mike Konczal says it's all about competition. If a rival bank comes up with a new innovation, you need to compete -- whether it's dangerous or not.

Bonus: An innovation in the way you buy your newspaper.

Download the podcast; or subscribe. Intro music: Phoenix's "Listztomania." Find us: Twitter/ Facebook/ Flickr.

This picture comes from listener Frank Caliva, who found this credit-card-accepting newspaper box right outside of the McPherson Square Metro station in Washington, DC. He writes:

This was the first box I've ever seen that didn't just have a coin slot, but had an actual credit card reader attached to the box.

The Journal is up to $2.00 a paper, and I suppose since it's unlikely most people have two dollars' worth of change in their pockets, a credit card reader might make sense. I think it's also a testament to the fact that dollar coins just don't seem to catch on in the United States. From an efficiency standpoint (both for the purchaser and the seller) popping two coins in a slot seems to make more sense than having to go through the trouble of installing/supporting a credit card reader.

On the other hand, the box is in a pretty [fancy] part of DC, filled with lobby shops and law firms. Swiping a credit card may make more sense for people who charge everything to clients anyway.

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 5:29 pm

Second Curve’s Brown Discusses Private Equity in Banks: Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 5:21 pm

Global Stocks Dive As Reports Raise Economic Worries (Investor's Business Daily)

Investor's Business Daily - Stocks sold off worldwide Monday as news from China and Japan raised concerns that investors have been too bullish about a global economic recovery.
Source: Yahoo! News: Stock Markets News | 17 Aug 2009 | 5:13 pm

Last dance?

Swine flu and the economy hits tango industry
Source: BBC News | Business | World Edition | 17 Aug 2009 | 5:05 pm

Higher GST proposed to shift tax focus from incomes

Raising the rate of GST could increase the economy's efficiency if it was used to shift the mix of taxes away from income tax, a working group reviewing the tax system says. The panel comprises private-sector tax specialists, academics...
Source: New Zealand Herald - Business | 17 Aug 2009 | 5:00 pm

Write-Offs: 08.17.09

$$$ Guaranteed Bonuses: Good or Bad? [The Deal]

$$$ Comp Watch: AIG Chief Benmosche Gets $7 Million Annual Salary [Bloomberg]

$$$ Goldman Sachs doesn't care what you think of Goldman Sachs, Matt Taibbi! [Dealbook]

$$$ Deadline To Seek Indictment Of Sergey Aleynikov Extended [DJ]

$$$ Alleged International Hacker Indicted for Massive Attack on U.S. Retail and Banking Networks [DOJ]

Sponsored Topics: Goldman Sachs - Matt Taibbi - American International Group - United States - Business
Source: Dealbreaker | 17 Aug 2009 | 4:52 pm

The Dow Jones industrials' moves since Lehman fall (AP)

AP - How far the Dow Jones industrial average has fallen or advanced each trading day since Lehman Brothers Holdings Inc. filed for Chapter 11 bankruptcy protection on Sept. 15. Since Lehman's fall, which touched off a paralysis of the credit markets and deepened the recession, the stock market has gone through an extended period of volatility before kicking into a big rally starting this spring. The numbers are the closing levels for the Dow:
Source: Yahoo! News: Business | 17 Aug 2009 | 4:39 pm

The Dow Jones industrials' moves since Lehman fall (AP)

AP - How far the Dow Jones industrial average has fallen or advanced each trading day since Lehman Brothers Holdings Inc. filed for Chapter 11 bankruptcy protection on Sept. 15. Since Lehman's fall, which touched off a paralysis of the credit markets and deepened the recession, the stock market has gone through an extended period of volatility before kicking into a big rally starting this spring. The numbers are the closing levels for the Dow:
Source: Yahoo! News: Stock Markets News | 17 Aug 2009 | 4:39 pm

Investors’ fears are eased on Talf

The Federal Reserve and the US Treasury extended a $200bn programme designed to revive the securitisation market, bringing relief to investors concerned the supply of cheap government financing was set to end.
Source: Financial Times - US homepage | 17 Aug 2009 | 4:35 pm

Identity theft: three accused over biggest bank card scam in US history

Three men have been charged with stealing the numbers of more than 134 million credit and debit cards in what the US Justice Department said was the largest case of identity theft in US history.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 17 Aug 2009 | 4:30 pm

Three indicted in largest U.S. identity theft scheme

NEW YORK (Reuters) - Three men were indicted on Monday for allegedly stealing more than 130 million credit and debit card numbers in what U.S. authorities said they believe is the largest hacking and identity theft case ever prosecuted.
Source: Reuters: Business News | 17 Aug 2009 | 4:29 pm

Summary Box: Fed extends lending program (AP)

AP - WHAT HAPPENED?: The Federal Reserve said it's extending a program that was due to end Dec. 31. The major part of the program, aimed at boosting consumer and business lending, will now run through March 31. Another part that supports new loans for commercial mortgage-backed securities will be extended through June.
Source: Yahoo! News: Business | 17 Aug 2009 | 4:21 pm

GM completes Saab deal with Koenigsegg

Accord will mark another step forward in efforts to restructure GM as the loss-making US carmaker narrows its range of brands
Source: Financial Times - US homepage | 17 Aug 2009 | 4:13 pm

Adventures In Monopoly Money

Once worth more than the US Dollar, the undisputed king of high denomination currencies, the Zimbabwean dollar is fighting for its life. The country's finance minister, Tendai Biti, is trying to end the era of one of the few currencies that had to adjust the font size on its notes to accommodate the number of zeroes.

"We are putting the tombstone on the corpse of the Zimbabwe dollar," Biti told lawmakers in a midyear fiscal policy statement. In a speech to business leaders, he said, "We are no longer printing our own money."

Still, there are some individuals determined to use their last three trillion to ride the bus and avoid using non-trillion denominated currencies such as the USD and ZAR. While the currency may be reaching multi-year highs based on eBay sale prices, there is one individual in particular who sees a role for the currency beyond a collector's item.

President Robert Mugabe has called for the return of the Zimdollar as legal tender, complaining that most Zimbabweans lack the hard currency needed to buy basic goods.

Basic goods like the wheelbarrows needed to transport enough cash to buy anything other than a bus pass.

Sponsored Topics: Zimbabwe - Tendai Biti - Robert Mugabe - Morgan Tsvangirai - Africa
Source: Dealbreaker | 17 Aug 2009 | 4:05 pm

Fears rally is over as shares tumble

Shares worldwide fell yesterday with the FTSE 100 losing 1.5pc rasing fears that the recent stock market rally has come to an end.
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 17 Aug 2009 | 4:03 pm

Stocks tumble as investors worry about consumers (AP)

AP - Investors are finding out what everybody else already knew: The consumer isn't going to spend the economy into recovery.

Source: Yahoo! News: Stock Markets News | 17 Aug 2009 | 4:01 pm

Ex-Wall St. broker convicted in $1B subprime fraud (AP)

AP - A former Wall Street broker has been convicted of conspiracy and securities fraud after investors lost nearly $1 billion in a subprime mortgage fraud.
Source: Yahoo! News: Stock Markets News | 17 Aug 2009 | 3:59 pm

Bernie Madoff: Oh Well, That's Business, Right? Sometimes You Just Got 'Do' Stuff You Don't Wanna Do!

I don't know how this was missed this Friday but damn if Berns is not growing on us. The question is did he actually lay it on this thick or did the secretary, who cannot stop talking about Big B's proclivs for massage parlor handies and skanks, just misunderstand him?

"She's a pain in the ass, but I guess I have to go out with her for lunch," Bernard Madoff would say to his secretary about the aggressive blond woman nearly a decade younger than his wife Ruth, who would show up at his Lipstick Building office and demand that he leave in the middle of the day.

Sponsored Topics: Bernard Madoff - Lipstick Building - Health - Massage parlor - Ruth
Source: Dealbreaker | 17 Aug 2009 | 3:57 pm

Biggest I.D. theft scheme busted

Read full story for latest details.
Source: Business and financial news - CNNMoney.com | 17 Aug 2009 | 3:56 pm

Traders of 'plain vanilla' products pip elite in bonus boom

Pay deals for teams of "plain vanilla" fixed income commodity and currency traders are being "bid up".
Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 17 Aug 2009 | 3:51 pm

New AIG chief to receive $7m pay

Robert Benmosche, AIG’s new chief executive, will receive annual pay of $7m in cash and shares and be in line for a bonus of $3.5m a year, the government-controlled insurer announced
Source: Financial Times - US homepage | 17 Aug 2009 | 3:40 pm

AIG's new boss: $3 million salary ... plus

AIG's new boss will make an annual salary of $3 million and receive bonuses and stock options worth millions more, according to a company filing on Monday.
Source: Business and financial news - CNNMoney.com | 17 Aug 2009 | 3:17 pm

Reader's Digest eyes bankruptcy

The publisher of Reader's Digest magazines plans to file for Chapter 11 bankruptcy as it tries to cut up to 75% of its debts.
Source: BBC News | Business | World Edition | 17 Aug 2009 | 3:09 pm

AIG's Handicap

By now you'd think there were few embarrassments left for AIG to suffer. After close to $200 billion in bailout funds and multiple rounds of retention bonus battles, if AIG just so happened to be paying for a private gold course in Connecticut for its (remaining) senior executives, even they must have followed the lead of other golfing bailout ventures and sold the property.

The Morefar Back O'Beyond course, coincidentally opened in 1964 by the founder of the company that became AIG, continues to build on its legend. Given the bailout champions penchant for going big, the rumors that the sand traps were filled with expensive crushed granite and the course's ponds doubled as landing strips for client floatplanes certainly sound about right. But with all of Congress on their case AIG, must have learned their lesson by now. So, the question remains- who owns this AIG-associated golf course?

Sponsored Topics: Golf - Golf course - sport - United States - Courses
Source: Dealbreaker | 17 Aug 2009 | 2:59 pm

Fidelity’s Top Portfolio Changes (BAC, WFC, GS, MS, JPM, AAPL, MSFT, CSCO, ORCL, XOM, CVX, PFE, ESRX, WYE, GE, SBUX)

Fidelity Management & Research Company, or FMR, was among the giants which released its quarterly holdings over the most recent days.  While it is always interesting to see which holdings are the top holdings, most traders look at the big portfolio changes to try to gain insight into the minds of fund managers. We looked [...]

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Source: 24/7 Wall St. | 17 Aug 2009 | 2:58 pm

Apple's iPhone 3GS is No. 1 in Japan

The iPhone, which has had a tough time competing in the Japanese market, finally broke through in July with the launch of the iPhone 3GS.
Source: Business and financial news - CNNMoney.com | 17 Aug 2009 | 2:57 pm

How the major stock indexes fared on Monday (AP)

AP - Major U.S. stocks indexes tumbled by the biggest amount in six weeks Monday as investors feared they have been too quick in betting on an economic rebound during the market's five-month rally. Jitters about China's economy and lackluster profits at home-improvement retailer Lowe's Cos. added to concerns from last week that a rebound in the economy is far off.
Source: Yahoo! News: Stock Markets News | 17 Aug 2009 | 2:55 pm

Dear Canyon Crew

Also enclosed are plans for the future. Our "strategy," basically. The short version is: suck less than '08, our worst year ever. The long version can be found below.

Canyon Value Realization Fund [PDF]

Sponsored Topics: Year-to-date - United States - Canyon - Business - Travel and Tourism
Source: Dealbreaker | 17 Aug 2009 | 2:48 pm

Presented By:

Source: Dealbreaker | 17 Aug 2009 | 2:48 pm

Stocks hit despite growth in Japan

World stocks tumbled on Monday as doubts about the strength of economic recovery threatened to derail the five-month rally in the global markets.
Source: Financial Times - US homepage | 17 Aug 2009 | 2:39 pm

What's Going On With The Public Plan?

By Mathew Katz

This weekend, it looked like the Obama administration was shying away from insisting on a public option as part of health care reform. Today, an aide wrote that the president will continue to fight for the creation of a public health insurance plan.

The notion that the administration was giving up on the public plan ruffled a lot of feathers on the left. Even if it's apparently back on the table, there's going to be huge hurdles to passing it. Yesterday, Democratic Senator Kent Conrad, a ranking member of the Senate Finance Committee, said that there simply aren't enough votes in the Senate in favor of the plan. His committee is likely to endorse a regional health-care co-op program.

If you're confused about what these co-ops are all about, there's a great explainer over at Reuters. In short, these co-ops involve a form of health insurance wherein all policyholders have some ownership rights, and, more importantly, don't have to worry about turning a profit. The government would provide money to help set up national, state, and regional co-ops. However, co-ops already exist, and few have managed to be successful competitors to major insurance companies. If the point of a public plan is to provide a viable, competitive, nonprofit alternative to private insurers, co-ops may not be able to cut it.

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 2:37 pm

Banks still reluctant to lend

Loans for consumers and businesses remained tough to come by over the past three months, according to a report published Monday by the Federal Reserve.
Source: Business and financial news - CNNMoney.com | 17 Aug 2009 | 2:25 pm

Javelin Creates First U.S.-Based Islamic ETF: Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 2:15 pm

US claims to have thwarted Taliban

The US said that Taliban insurgents in Afghanistan had failed in a ferocious bid to derail the country’s Afghanistan’s elections, to be held on Thursday, with a wave of violent attacks.
Source: Financial Times - US homepage | 17 Aug 2009 | 2:09 pm

What Would It Take To Get You To Watch Fox Business?

In a purely hypothetical scenario, how does a racist crypt keeper sound? Here's the sitch. Basically no one watches FBN. That much should be obvious but here it is: for the month of June, from 5 to 9 PM, CNBC's audience was 11 times the size of Fox's, which hurts pretty bad, especially considering the GE-owned network, by its own admission, has no standards. Where FBN is most noticeably getting its ass kicked is the 6 to 9 AM time slot, i.e. the domain of Alexis Glick, host of "Money For Breakfast." Now executives are apparently strongly considering throwing Glick out on her ass, and replacing it by Don Imus, who sort of knows what he's talking about re: Wall Street, kind of. Doesn't much matter. What's being banked on is the NPH enthusiast's ability to lure you away from shit like the Hot Carl Crew of Becky Quick, Joe Kernan and Mr. Quintilla, the competition at the time. Would Big D do the trick? What if they threw in Jeff Macke, a pair of scantily clad tits, and a buncha car people? How 'bout now?

Sponsored Topics: Alexis Glick - Fox Business Network - Don Imus - Wall Street - CNBC
Source: Dealbreaker | 17 Aug 2009 | 1:53 pm

Meltzer Calls Lehman Failure Fed's Biggest Mistake: Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 1:39 pm

Cantor's Goncalves Sees 10-Year Note at 2.9% in 2009: Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 1:33 pm

Huntington Preferred Capital declares dividend (AP)

AP - Huntington Preferred Capital Inc., which buys and manages mortgage assets, said Monday its board declared a regular quarterly dividend of 49 cents per share of its Class C preferred stock.
Source: Yahoo! News: Business | 17 Aug 2009 | 1:13 pm

Charles Schwab sued over auction-rate securities

Andrew Cuomo, the New York attorney-general, sued Charles Schwab, the biggest independent broker in the US, over its sales and marketing of auction-rate securities, in the latest stage of his investigation into the collapse of the market
Source: Financial Times - US homepage | 17 Aug 2009 | 12:58 pm

Rural areas' hard times not in the stats

Nebraska has one of the nation's lowest unemployment rates at 5%. But numbers that may look good on paper don't always translate well in real life -- especially in real rural life. Sarah McCammon reports.
Source: Marketplace | 17 Aug 2009 | 12:51 pm

Motivated. Results-oriented. Jobless.

Last month's unemployment figures contained a ray of hope for recent college grads: their jobless rate of 4.7% was half of what people with only high school degrees experienced. Still, that's small comfort to commentator and new graduate Sarah Klenakis.
Source: Marketplace | 17 Aug 2009 | 12:51 pm

Stimulus could go to pay the rent

The Obama administration reportedly plans to push more than $4 billion into federally subsidized rental housing -- a major shift from the Bush administration's ownership society programs. The Boston Globe's Joe Williams explains to host Tess Vigeland.
Source: Marketplace | 17 Aug 2009 | 12:51 pm

Aetna workers fret about reform plans

President Obama is hoping to squeeze big-time savings out of the health-care industry, which brings in $700 billion a year. That may sound great, unless you happen to work for an insurance company. Joel Rose reports.
Source: Marketplace | 17 Aug 2009 | 12:51 pm

Why are banks still failing?

Five more bank failures were announced over the weekend, bringing this year's total to 77. And a Texas bank may be next. Marketplace's Senior Business Correspondent Bob Moon reports on why bank failures are rising at this point in the financial crisis.
Source: Marketplace | 17 Aug 2009 | 12:51 pm

'Astroturf' campaign fights climate bill

Big oil and coal companies are using their trade associations to organize fake grass-roots protests against the climate bill working its way through Congress. Steve Henn reports.
Source: Marketplace | 17 Aug 2009 | 12:51 pm

If no public health care, is it reform?

The Obama administration is hinting it could drop its proposal for a government-run health plan that would compete with private insurers and force down the cost of premiums. But if that plan goes, is meaningful reform possible? Tamara Keith reports.
Source: Marketplace | 17 Aug 2009 | 12:51 pm

Suit claims Schwab misled investors

New York Attorney General Andrew Cuomo is suing brokerage giant Charles Schwab, accusing the company of fraud and misleading investors when it sold them auction rate securities that blew up at the beginning of the financial crisis. Jill Barshay reports.
Source: Marketplace | 17 Aug 2009 | 12:51 pm

MKM's Darda Says Credit Markets Sending Recovery Signal: Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 12:48 pm

Chandler Is Optimistic on Dollar; Likes Norwegian Krone: Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 12:45 pm

Business Schools Offer Students Hot Job Seeking Tips

Actually it's just one tip but if used wisely should be all you need. It's really only intended to be shared with MBA-candidates who paid the privilege but for a limited-time only it's being passed on to even the peasants among us. Here it comes. Tell me if you're ready. Are you ready? Are you ready for the noise? Are you ready for the thunda? Are you ready to have the artist known as your soon to be formerly unemployed ass rocked? 'Cause I'm laying this on you, NOW: beg your parents to get you a job. That's their actual advice. Boom. Done. Set for life.

Do mom and dad not have anything to offer in the way of a paycheck? All is not lost. After severing ties with those worthless pricks, devote all energy to S'ing the D's of distant relatives and/or your more well-connected friends' parents.

So far, Elon has forged alliances with major finance powerhouses and boutiques alike. The school's executive director of career services, Tom Vecchione, says he often advises students not to shy away from tangential family contacts. "Hey, maybe you know Billy," he tells them. "But do you know what Billy's dad does?"

Hope this was helpful.

For MBA Jobs Seekers, The Family Matters [BW]

Sponsored Topics: Business school - Master of Business Administration - Family - Family Matters - Education
Source: Dealbreaker | 17 Aug 2009 | 12:40 pm

Housing Market Index Up, Thanks To Expectations Of Recovery

By Mathew Katz

The National Association of Home Builders and Wells Fargo just released their monthly housing market index, and it's up one point. The index came in at 18 for August, the second increase in two months and the highest it's been in over a year.

Breaking down the numbers, the increase has more to do with expected housing sales than current sales, which remained unchanged this month. Expectations for sales over the next six months rose to 30 points from 26. That prediction is based on an increase in people are looking to buy a house: the index of buyers' traffic rose from 13 to 16.

Still, analysts were expecting the index to rise to 19 this month, and the current number is a far cry from its height during the bubble -- it hit 72 in 2005. And the index is still among the lowest it's ever been since NAHB began recording numbers in 1985.

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 12:31 pm

Mind The Cap

Taking a page out of the major US sports leagues' playbook, Alistair Darling is entertaining a proposal to install a salary cap for financial services firms. The plan, in addition to imposing Nordic tax levels of 90% on Andrew Hall type bonuses, would create a "maximum wage ration" which would effectively link the compensation of senior MDs to first year analysts. We can only hope the plan would include another US creation that would effectively communicate the typical level of disdain for such arrangements and reinforce the distinction between the 'haves' and the 'have nots'- the luxury tax.

Sponsored Topics: Alistair Darling - Andrew Hall - Salary cap - Luxury tax - Business
Source: Dealbreaker | 17 Aug 2009 | 12:27 pm

Home Depot’s Earnings Bar Lowered After Lowe’s (HD, LOW)

The Home Depot, Inc. (NYSE: HD) is set to report earnings tomorrow morning and it may have just caught a break now that Lowe’s Companies Inc. (NYSE: LOW) missed its earnings and has seen its shares drop from the report.  Today’s weak stock market is not helping matters either. Lowe’s said that its profit fell about [...]

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Source: 24/7 Wall St. | 17 Aug 2009 | 12:20 pm

IMS Health Raised to `Neutral’ at Goldman Sachs: Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 12:16 pm

Dell joins stampede to launch smartphone

Dell is preparing to enter the smartphone business as mobile handset and computer makers converge on one of the few parts of the personal technology market to showing strong growth and profits
Source: Financial Times - US homepage | 17 Aug 2009 | 12:11 pm

Up to 90% of US Bills Contain Traces of Cocaine

Time has an interesting article about how most US money contains traces of cocaine:

A study that tested paper money from 30 big cities in five countries—including the U.S., Brazil, Canada, China and Japan—found that big metropolitan areas in both Canada and the U.S. have an alarmingly high presence of cocaine on their currency, with traces of the narcotic on 85-90% of bills. Brazil, coming in just behind the North American nations, had contamination on 80% of paper money. On the other end of the spectrum, in China and Japan, cocaine was present on a much lower 12-20% of banknotes.

The findings, presented Sunday at a meeting of the American Chemical Society in Washington, D.C., suggest that the prevalence of cocaine-laced bills in U.S. cities has jumped about 20% since just two years ago. University of Massachusetts chemistry professor Yuegang Zuo, the lead author on the current study, conducted a similar analysis in 2007 which found that 67% of U.S. banknotes had some traces of cocaine. The study authors speculate that the increase of residue on bills is likely in step with an increase in cocaine consumption—already as much as a $70 billion annual industry in the U.S., according to the researchers. An estimated 6 million Americans use cocaine each year, consuming somewhere between 259-447 tons of the stuff.

Read more here.

As news goes, the dollar bill-coke connection isn’t new–Snopes breaks down how it works.

Source: Business Pundit | 17 Aug 2009 | 12:08 pm

TALF Gets An Extension

By Caitlin Kenney

The Federal Reserve and the Treasury Department are extending the TALF program to help support the credit markets. The program provides money to investors to purchase new asset-backed securities as well as commercial real-estate debt. The commercial real-estate industry and a group of lawmakers requested the extension, saying the program needed more time to get going.

Bloomberg reports:

Commercial property values have fallen 35 percent since peaking in October 2007, according to Moody's Investors Service. The extension may help firms such as Vornado Realty Trust, which is considering the sale of commercial MBS through the TALF. Almost $165 billion of mortgages for skyscrapers, shopping malls and hotels are due this year.

While financial-market conditions "have improved considerably in recent months," the markets for ABS and CMBS "are still impaired and seem likely to remain so for some time," the Fed and Treasury said.

The Fed says loans for newly issued commercial mortgage backed securities have been extended through June 30, 2010 because "new CMBS deals can take a significant amount of time to arrange." Loans for other asset backed securities and CMBS sold before Jan.1 have been extended three months to March 31.

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 12:00 pm

24/7 Wall St. TV: VW’s Huge Mistake

Volkswagen Aktiengesellschaft, the company known to most Americans as VW, wants to become the world’s largest car company within a decade. VW has almost no chance of realizing that aspiration because it did not use the disintegration of the US car companies to get a sizable share of the world’s largest auto market. VW’s piece [...]

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Source: 24/7 Wall St. | 17 Aug 2009 | 11:55 am

Federal Prosecutors May Let Andy And Mark Madoff Enjoy Labor Day Weekend

Before indicting their asses! The Daily Beast reports that enough "hard evidence" has been compiled against the boys to convict them of possibly being in on the whole damn thing, though they (and their uncle Peter) won't hear anything official 'til after the holiday weekend. Which is nice, especially for the people of Nantucket, who rely on the the Madoff largesse. In other Ponzi Nation news, this happened:

"Bernie had a tremendous libido, like so many men in power," the source added. "He told me that Ruth just couldn't satisfy it. I suppose no one woman could. He had the habit of cozying up to potential female investors. He'd use a low kind of sexy voice and he'd say something like, 'Don't worry, I'll be there for you. You'll never have to worry.'"

Earlier: What Kind Of Package Is A Bernie Madoff Package

Madoff's Other Girlfriends [TDB]

Sponsored Topics: Bernard Madoff - Ponzi scheme - Labor Day - Nantucket - Daily Beast
Source: Dealbreaker | 17 Aug 2009 | 11:53 am

Using A Mall As An Economics Lab

By Mathew Katz

When it comes to measuring consumer confidence and spending habits, we often look to reports and surveys. But in Calgary, Alberta, economists and retail specialists have a chance to see firsthand if consumer strength will grow or fall as the recession tapers out. Their 'lab' is CrossIron Mills, a massive new 1.1-million-square-foot mall, which is set to expand the city's retail space by 3.5 percent when it opens this week.

The opening is a huge gamble on the part of the developers of the $495-million shopping center, but it might be a great predictor of where the retail economy is heading. Economists and retail experts aren't just analyzing foot traffic and sales numbers at the new mall -- they're also looking at consumer behavior. Are consumers going to avoid the stigma of conspicuous consumption and stay away from expensive new luxury stores, or re-embrace Gucci and Prada with gusto?

So far, things look fairly gloomy -- a number of anchor retailers that were set to open in the new space have either delayed their opening or pulled out altogether. And a nearby mall, the Chinook Centre, just saw July sales fall two percent.

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 11:06 am

Cohen Says Recession Ending Now, Sees No `Double Dip': Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 10:48 am

Darling dismisses pay commission

Chancellor Alistair Darling has come out against calls for a new commission to curb "excessive" pay.
Source: BBC News | Business | World Edition | 17 Aug 2009 | 10:19 am

Maisonneuve Likes Dell, Hewlett-Packard, Boeing: Audio

Source: Bloomberg - All Podcasts | 17 Aug 2009 | 10:08 am

Chicago Shuts Down To Save Money

By Caitlin Kenney

Non-essential city services are closed in Chicago today. The city's public libraries, health clinics, town hall and other offices have been shut down as part of an effort to help balance the 2009 budget. Today's closure is one of three planned reduced-service days this year, the other two will be held the Friday after Thanksgiving and on Christmas Eve. The city expects the three reduced-service days to save $8.3 million.

"Every dollar we save from these measures helps to save jobs, and in the long-term, maintain service for Chicagoans," said Mayor Richard M. Daley. "This plan engages most civilian employees to accept cuts and to be part of the solution to our budget crisis. I want to thank them again for their sacrifice."

In addition to working without pay today, city workers have been asked to take six furlough days and six unpaid holidays this year. Mayor Richard M. Daley says the city is expecting a 2009 budget shortfall of between $250 million and $300 million.

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 10:00 am

The Economics Of Health Care (Australian Style)

Peter writes:

Watching the US health care debate from a distance, with the context of the Australian system on my mind, one question keeps coming up: why does it cost so much more in the USA?

The pharmaceutical benefit scheme (PBS) ensures that no matter how much a particular medication costs, the most I will pay is $33-$35/month. The PBS is set up around the very idea that the patient shouldn't have an interest in the cost of a medication. If the most appropriate medication costs twice as much as something that will kind of do the job, the government will cover the difference.

Medicare, which covers all Australians, will pay doctors for each consultation. This is a little misleading as the scheduled fees set by the government are generally low, so usually an out of pocket expense is incurred. There are doctors who charge only the scheduled amount (bulk bill) but these generally feel like a McDonald's drive through, with each appointment lasting 5-7 minutes. I prefer to have 15 -20 minutes set aside for the appointment, so I pay an extra $22.

I've seen footage of people complaining (often quite loudly) that the USA is about to become some kind of socialist, commy, pinko nightmare. My only experience is socialized medicine and it works very well in Australia. If it weren't for the medication I could keep my out of pocket expenses at nil, but I've chosen to pay more for some services and make use of the private system if I ever need to go to hospital.

These are my costs:

Consultations: GP (5-6 visits yr): $22 (govt pays additional $33) Specialist (1 visit/yr): $0 (govt pays additional $60ish) -- bulk billed (GP costs can change in my case. Frequently, if I only need a new script the GP will bulk bill because it only takes three minutes.My specialist now charges an out of pocket expense for new patients, as a long term patient I've been grandfathered.)

Private Health Insurance (hospital cover): $65/month (govt pays additional $27)

Average cost: $1061/year

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 9:07 am

New York Manufacturing Index Shoots Up

By Mathew Katz

More good news: manufacturing is up in the New York region for the first time in over a year, according to the Federal Reserve Bank of New York. The bank just released its monthly Empire State Manufacturing Survey for August, and the general business conditions index is up 13 points to 12.1, its highest level since November 2007. Any number higher than zero indicates growth in the manufacturing industry.

The New York numbers come after last week's announcement by the Federal Reserve that overall industrial production across the country is up by 0.5 percent. Today's report also has some interesting details for the unemployed: while increased demand for cars and auto parts fueled part of the index's rise, manufacturers are finally re-starting assembly lines after months of slashing their inventories. With signs pointing toward an end to the recession, companies are trying to re-stock their shelves, hoping that demand will follow.

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 9:06 am

Don’t Park Here. Especially on Mondays.

Source: Business Pundit | 17 Aug 2009 | 7:39 am

“You’re in Good Hands with Allstate” Ed Reimers Passes Away

Image source

Ed Reimers, best known as Allstate Insurance’s spokesman between 1957-1979, died yesterday at age 96. More:

Reimers, who also served as an announcer for several TV shows in the 1950s and ’60s, died at his daughter’s home in Saratoga Springs, said Dean Lindoerfer, his nephew by marriage. The cause of Reimers’ death wasn’t immediately clear.

With his white hair and resonant voice, Reimers was best known for delivering the Allstate Corp.’s famous slogan. He was the insurance giant’s TV spokesman for 22 years, starting in 1957, according to the Northbrook, Ill.-based company’s Web site.

96 years old? Reimers was in good hands with AllState. Here’s more on the actor.

Source: Business Pundit | 17 Aug 2009 | 7:20 am

Recession Over! (In Japan). Plus: Here Comes A Bank Failure

By Mathew Katz

Laura's on a much needed vacation this week, so I'm back at Planet Money HQ to help on the blog.

Last week, we posted a scary chart showing plummeting Japanese wages. This week, there's some good news for Japan -- their recession is over. Japan is the world's second-largest economy, and this recovery comes after four successive quarters of negative GDP growth. Let's hope an increase in wages will come out of this.

The Financial Times reports that U.S. bank regulators have set today as a deadline for bids to buy Guaranty Financial. The FDIC is trying to find a buyer for the troubled bank, which said last month that it will likely fail soon. If it does, it could be the largest bank failure of the year.

On the health care front, the Obama administration signaled yesterday that it could be willing to drop the creation of a 'public option' from its health care reform plan. Health and Human Services secretary Kathleen Sebelius said yesterday on CNN that the public plan was "not an essential element" of reform. The move is sure to bring some conservatives into the fold, but some left-leaning Democrats, including Howard Dean, say that the public option is indispensable.

And with new regulations governing credit cards set to go into effect on Thursday, credit card companies are rushing to raise their rates. Once the regulations are in place, companies will need to give consumers 45 days' notice if they are raising fees or interest rates, instead of the the 15-day notice required right now. The regulations also ensure that consumers will have a longer period to pay credit card bills before getting slammed with late fees, but the companies are making up for that by -- raising those fees as well.

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Source: NPR Blogs: Planet Money | 17 Aug 2009 | 7:08 am

Twitter to Make Money from Business Services

How will Twitter make money? Co-founder Biz Stone answered the potential million-dollar question during a PBS interview last Friday. USAToday has more:

We finally get to see and hear from elusive Twitter co-founder Biz Stone — who has gotten into the habit of answering media queries via blog posts and email. Tavis Smiley’s interview of Stone (aired) on PBS channels across the nation. PBS gave us a copy of the transcript.

On how Twitter will avoid the fate of popular social networks that get tons of eyeballs — but not nearly enough online advertising revenue to operate in the black, Stone has a simple answer: Twitter is not going after ad revenue.

Stone outlines of a plan to get corporate giants like Whole Foods, Best Buy, Jet Blue and Comcast, along with small businesses, like New York City cookie shops, to pay Twitter for professional services related to generating Twitter traffic for commercial purposes. He says Twitter this year will begin selling what sounds like subscription services to businesses.

“Twitter will remain free for everyone, but we may be able to offer an additional layer of value to some of these commercial accounts,” says Stone. “Whether it’s through analytics, ‘How can I Twitter better?’ Or whether it’s through some sort of certification, you know, ‘How can we make sure everybody knows that this is definitely JetBlue and not someone pretending to be JetBlue?’

I wonder whether Twitter is going for a buyout. A business service sounds interesting enough, but the real bucks have got to be in a buyout. Surely Google wouldn’t mind a piece of the action (again)…

Source: Business Pundit | 17 Aug 2009 | 7:02 am

A Complete Chart of Gay Marriage

Source: Business Pundit | 17 Aug 2009 | 5:53 am