Finance news. My opinion.

Bank of England policy maker Martin Weale said Britain needs an increase in interest rates now to prevent higher prices becoming entrenched in the economy.

“The longer inflation stays above the target and the further it rises, the greater the risk that inflationary expectations will become built in,” Weale wrote in an article the Guardian published today. “These arguments make a powerful case for a modest rise in the bank rate” as “the costs of a small rise now would be lower than the eventual price of addressing higher ingrained inflation.”

Weale this month joined Andrew Sentance in voting for a quarter-point rate increase, after inflation accelerated to 3.7 percent in December, compared with the bank’s 2 percent target. The central bank’s Monetary Policy Committee also has to take into account signs the economic recovery is fading, after initial estimate from the statistics office showed the economy shrank 0.5 percent in the fourth quarter.

Recent gross-domestic-product figures show that the economy is “appreciably weaker than expected,” Weale said. The 0.5 percent contraction compared with economists forecast for 0.5 percent growth.

Inflation Pressures

Most of the recent increase in inflation has been due to the weakness of the pound, higher energy prices and an increase in the U.K.’s sales tax, Weale said. Still, there is a risk that some “one-off” pressures will persist, and that “continuing rapid economic development in China and elsewhere will lead to persistent upward pressure on commodity prices,” he said electronic check payday advance.

The pound was little changed against the dollar today and was trading at $1.5857 as of 9:06 a.m. in London. It weakened 0.1 percent against the euro to 85.92 pence.

While Weale and Sentance voted to increase the benchmark rate at the Jan. 13 meeting, Adam Posen kept up his call for more stimulus to aid growth. The remaining six members of the panel, including Governor Mervyn King, voted to leave the rate on hold and keep its bond-purchase program at 200 billion pounds. ($317 billion).

Britons’ expectations for inflation for the next year rose in January to their highest level since 2008, Citigroup Inc. said on Jan. 28. The median prediction for price increases in the coming 12 months climbed to 3.6 percent from 3.5 percent in December, it said, citing a survey by YouGov Plc.

“If growth resumes shortly, my concerns about inflationary expectations would remain,” he wrote. “But were the recent weakness to mark the start of a sustained new downturn, inflationary pressures would be likely to fade without a bank rate increase.”

Source

French drugmaker Sanofi-Aventis SA said Thursday a clinical trial showed its drug candidate iniparib did not improve survival or slow disease progression in patients with breast cancer.

The late-stage clinical trial was designed to evaluate iniparib as a treatment for “triple negative” breast cancer, a type of breast cancer that is particularly difficult to treat. The study involved 519 patients whose cancer had metastasized or spread to other body parts. The trial compared a chemotherapy regimen including iniparib to one without it, evaluating its effects on overall patient survival and the amount of time patients lived before their disease resumed progressing or they died.

Sanofi-Aventis said there was not a significant difference between the regimen that included iniparib and the one that did not. Both regimens included the cancer drug Gemzar and the chemotherapy drug carboplatin.

However, the company said some patients who had been treated with one or two other therapies before enrolling in the trial did benefit from the iniparib regimen.

Sanofi-Aventis said 15 to 20 percent of breast cancer patients have the “triple negative” type of the disease, and they have a worse prognosis than other types of breast cancer. The disease is called triple negative because the tumors have normal levels of three proteins that are often found in high levels in breast cancer patients. Patients are usually treated with chemotherapy because the cancer does not respond to hormone-based drugs like tamoxifen, or drugs that target epidermal growth factors like Herceptin.

Shares of Sanofi-Aventis fell 25 cents to $35 in aftermarket trading. The stock picked up 6 cents during the day before Sanofi announced the trial’s results.

Source

A small St. Louis company is taking gooey butter cake worldwide.

Siblings Marilyn Ann Scull and Dale Allen Schotte began commercial production of their mother’s recipe for the signature St. Louis dessert in 2006, a few weeks after they opened Park Avenue Coffee in Lafayette Square. In their first full year of production, they turned out about 700 cakes in a tiny space at the rear of the store at 1919 Park Avenue.

Now they have a new company name, Ann & Allen Baking Co.; a new production facility with 2,000 square feet in Dogtown; and a new line of cake mixes.

By mid-December, Ann & Allen had baked more than 22,000 cakes this year for Park Avenue Coffee, other local retail outlets, catering and online sales. They now make more than 70 flavors and have shipped cakes this year to 79 countries, including Afghanistan and New Zealand.

What’s more, they’ve sold more than 10,000 boxes of their gooey butter cake mix in its first year of production. Schotte says the mix is currently sold at 56 stores in 15 states. Straub’s and Eckert’s are their two largest customers in the metro area.

And at 9 p.m. Thursday, Park Avenue Coffee will reach a national cable TV audience when the Food Network pits it against another St. Louis specialist, Gooey Louie, on “Food Feuds.”

As with most success stories, Scull’s and Schotte’s has some twists. Schotte spent 20 years in the computer industry, primarily working for an Ohio-based company that specializes in automobile dealerships. He was moonlighting as a consultant when he was hired by the owners of what was then called Perc on the Park. In addition to utilizing his skill with computers, they turned to him for advice on everything from retail operations to décor.

“I told them, ‘If you ever want to sell, let me know,’” Schotte says.

When they did just that two years later, Schotte told them he wasn’t interested anymore. But that soon changed, after he got a call from Scull.

“My sister calls me all hysterical,” Schotte says. She had quit her job with Domino’s pizza, where she had worked for 20 years. “She said, ‘That’s it, I’m done.’”

When Schotte raised the possibility of buying Perc in the Park, Scull resisted, saying she didn’t even drink coffee.

“I said, ‘Just put away the pepperoni and substitute little beans,’” Schotte says.

They bought the shop, renaming it Park Avenue Coffee, then added a quintessential local treat, gooey butter cake, to the menu. Scull called their mother, Evelyn Thomeczek Schotte, for the recipe.

Evelyn Schotte was one of 13 children who grew up on her family’s farms in Leslie

Alan Skeoch was paying $477 a month for electricity used at his farm near Erin, Ont., using direct debits from his bank account.

On Dec. 1, Hydro One withdrew $11,907 from his account without notice, wiping out all his savings.

He had fallen behind on his payments because the electricity meter at his second property hadn

DUBLIN — Lawmakers in Prime Minister Brian Cowen’s own party mounted a rebellion Tuesday to try to oust him, an effort that could trigger a snap election and delay a massive EU-IMF bailout of Ireland.

Despite the discontent, Cowen’s Cabinet colleagues in the Fianna Fail party said they were confident the rebels have too few votes to pursue a no-confidence motion against Cowen.

At stake is the future course of the potentially €100 billion ($135 billion) European Union and International Monetary Fund rescue of Ireland, a nation heading toward bankruptcy next year because of Irish banks’ reckless speculation in overpriced real estate.

Ireland’s deficit this year is 32 percent of GDP — the highest in Europe since World War II — and its banks are running short of cash because they can’t borrow on open markets.

The Irish political and economic crisis, and its uncertain solution, drove up borrowing costs Tuesday for debt-struck nations from Portugal to Spain. It also fanned fears that a third member of the 16-nation eurozone — after Greece and now Ireland — might be backed into its own bailout corner soon.

The Cabinet gathered Tuesday at Cowen’s office to complete its four-year plan for unprecedented budget cuts tied to Ireland’s international bailout. The plan, which proposes to slash €15 billion ($20 billion U.S.) from the country’s 2011-14 budget deficits through a combination of cuts and tax hikes, is to be published Wednesday.

One of Cowen’s loyal lieutenants, Transport Minister Noel Dempsey, said the EU-IMF rescue aid couldn’t flow until Ireland began slashing €6 billion ($8.2 billion U.S.) from its 2011 deficit.

“We don’t have the luxury of time in relation to this,” Dempsey said. “We asked for assistance. We were given that assistance on the basis that we were going to produce this four-year plan, that we were going to produce a budget, and that budget would pass. If we can’t do that, then the assistance isn’t there.”

Two separate political meetings were happening Tuesday — one led by a handful of party rebels, the second by the full 70-strong bloc of Fianna Fail lawmakers.

“There’s serious discontent within the parliamentary party. I believe it’s now up to those who’ve spoken out to take soundings amongst their colleagues to take action to remove that man (Cowen) immediately,” Fianna Fail lawmaker John McGuinness said.

Cowen conceded Monday night he must call an election next year but sought to delay it as long as possible. His hand was forced when the junior party in his coalition, the Greens, said it would withdraw support once the 2011 budget passed.

The Greens said they expected the country to hold an election by late January, but Fianna Fail officials — furious at the Green ambush — say the budget will require multiple votes on different tax increases that could drag the process into February.

Tensions flared as Fianna Fail and Greens convened around the same table for the first time since Cowen’s weekend decision to take a bailout. The Fianna Fail minister for tourism and the arts, Mary Hanafin, accused the Greens of undermining Ireland at a critical moment.

“I’m very annoyed by it. It certainly wasn’t expected. I’m not sure they (the Greens) have shown they have the best interests of the country at heart,” Hanafin told Irish state radio RTE.

Hanafin said she wouldn’t back any push to oust Cowen. Still, she did say she would put her name forward if the leader’s post became vacant, reflecting the murky political maneuvering within Fianna Fail, Ireland’s dominant political force since the 1930s.

At the European Parliament in Strasbourg, France, EU monetary and financial affairs minister Olli Rehn gathered Ireland’s European lawmakers for a confidential briefing — and came out stressing they must stop the political infighting long enough to pass the 2011 budget.

“It is essential that Ireland pass the budget in the timeline foreseen, and sooner rather than later, because every day that is lost increases uncertainty,” Rehn said. “Let’s adopt the budget, let’s get it out of the way, and let’s move on.”

Cowen pleaded Monday night with his many opponents not to force him from office until the 2011 budget is fully enacted and EU-IMF money is flowing into Irish banks. He even telephoned the two major opposition leaders, Fine Gael’s Enda Kenny and Labour’s Eamon Gilmore, to seek their acquiescence when the government unveils the 2011 budget Dec. 7.

But opposition lawmakers emphasized Tuesday they were determined to oust Cowen as soon as possible in pursuit of a pre-Christmas election.

“What’s the point of a government preparing a four-year plan that they won’t preside over, that they won’t be there to implement, and that they haven’t consulted the people on?” said Fine Gael lawmaker James Reilly.

Reilly and Labour lawmakers both contended that, if Cowen resigned and dissolved parliament now, an election in mid-December could lead to the new government’s revised budget being passed by Christmas.

Dempsey of Fianna Fail, however, called that schedule “quite impossible.”

Shares in Ireland’s three listed banks plummeted for a second day Tuesday.

Bank of Ireland was down 26 percent to a new record low of €0.29. Allied Irish Banks fell 20 percent to €0.33, while Irish Life & Permanent — Ireland’s only bank yet to receive a state bailout — shed 9 percent to €0.77.

Source

Verizon Wireless will begin selling Apple’s iPad at its 2,000 retail stores nationwide on Oct. 28, the companies announced Thursday.

The move ends AT&T’s (T, Fortune 500) exclusive grip as the U.S. wireless carrier for Apple’s wildly popular tablet, and potentially sets the stage for a broader partnership between Apple (AAPL, Fortune 500) and Verizon (VZ, Fortune 500). The two are widely rumored to be preparing to bring Apple’s iPhone to Verizon’s network in early 2011.

Verizon Wireless will offer three iPad bundles, all featuring an iPad Wi-Fi model and a separate Verizon mobile hotspot device. The retail prices range from $630 for a 16 GB iPad to $830 for the 64 GB model.

Those prices match the cost of Apple’s WiFi + 3G iPads, which come with built-in 3G capabilities running over AT&T’s network. Stand-alone, Wi-Fi only iPads — which Verizon says it will also sell — begin at $500.

Customers could already run their Wi-Fi iPads over non-AT&T networks using hotspot external devices, like the one Verizon is selling as part of its iPad bundles. But the Verizon partnership marks the first time Apple has linked up to sell its devices with a U.S. wireless partner other than AT&T.

Verizon’s mobile hotspot comes with the added bonus of being able to connect up to five other devices.

There are a few drawbacks, though. The battery on Verizon’s mobile Wi-Fi device only lasts four hours, compared to the nine to 10 hours Apple estimates iPad users can get from their devices while surfing on Wi-Fi or 3G networks. And although Verizon’s smartphone data plans offer unlimited data use, the company isn’t being so generous with its iPad data cap. A monthly plan offering up to 1 GB of data will cost an additional $20. That compares to $15 on AT&T for a 250 MB data plan, or $25 for a 2 GB plan.

The new iPad rates are still cheaper, though, than Verizon’s current mobile plans for non-phone devices, which start at $40 for 250 MB a month.

Some experts think the competition will be good for consumers.

"Once Verizon starts to see a lot of uptick in iPad adoption, we’ll have a price war, which is good for consumers and corporations," said Laura DiDio, principal analyst with ITIC. "Apple is still giving AT&T a bit of a ‘favored nation’ status for a while, and it’ll be up to Verizon to sweeten the pot."

For Apple, it’s yet another brilliant marketing move.

"We’re thrilled to be working with Verizon Wireless to get iPad into the hands of even more customers this holiday season," Apple chief operating officer Tim Cook said in a prepared statement.

Following that bang with a whimper, AT&T announced Thursday that it too will start stocking iPads in its 2,200 retail stores on Oct. 28. The device will also be on shelves at Wal-Mart (WMT, Fortune 500), Best Buy (BBY, Fortune 500) and Target (TGT, Fortune 500).

"Basically, Apple figured out a way for the carriers and stores to do the selling for it, which is very clever," noted DiDio. "Soon we’ll see it on every carrier, which will only fuel price wars and demand — everyone is going to want an iPad."

The tablet, which first hit the market in April, could get even more appealing when Apple updates to its next version.

Verizon and Apple are rumored to be working on an iPhone that would run on Verizon’s forthcoming 4G-LTE network, with broadband-like speeds. Now that Verizon is officially on board as an iPad partner, the next iteration of Apple’s tablet could have those same 4G capabilities baked in. 

Source

Atwood Oceanics Inc. was named as the fastest growing company by Fortune magazine.

The Houston-based offshore driller was founded in 1968 and has about 1,000 employees.

Fortune reported Atwood (NYSE: ATW) posting 24 percent revenue growth, and 85 percent earnings per share growth, in the past three years. It slipped from a No. 45 rank last year.

Austin-based Luminex was the fastest-growing Texas firm on the list, coming in at No instant payday loan. 42 with 32 percent revenue growth over three years. No other Houston firms made the list.

Canada-based Eldorado Gold topped the list with 42 percent revenue growth in three years, followed by Vermont-based Green Mountain Coffee Roasters and Georgia-based Ebix.

Source

ADC Telecommunications Inc. has been sold to Tyco Electronics in a $1.25 billion deal, the companies announced Tuesday.

Tyco will pay $12.75 per share for Eden Prairie-based ADC, which makes technology for the telecommunications industry.

The transaction is expected to close in the fourth quarter.

Tyco, based in Switzerland, recorded more than $10 billion in revenue last year. The company, formerly part of Tyco International, makes electrical components for several industries, including networking equipment used by telecom companies.

The deal will allow Tyco to expand its portfolio of wireless connectivity products, which are used to build mobile networks, the company said in a news release. Tyco (NYSE: TEL) also will incorporate ADC's U.S. professional services business into its operations payday loan lenders.

The acquisition will add up to 14 cents per share to Tyco's full-year earnings, the company said.

ADC ranked No. 32 on the Minneapolis/St. Paul Business Journal's most recent list of the largest public companies in the state. The firm has 9,050 employees in Minnesota.

An ADC spokesperson couldn't be reached for comment on how the deal will affect jobs in the Twin Cities.

The company has a long history in the Twin Cities. It grew rapidly during the tech boom of the 1990s — becoming a $3 billion company by 2000. It cut its staff sharply after the dot-com bubble burst.

Source

Fletcher Elementary School in the City of Tonawanda registered a nice gain a year ago. It moved up nine places from 160th in 2008 to 151st in 2009.

But this year's jump makes last year's seem insignificant. Fletcher has vaulted 93 places to 58th, the strongest improvement by any elementary school in the region.

Buffalo's Elmwood Village Charter School is next with a gain of 84 places, followed by St. Mary's of Lancaster, which has moved up 76 places between 2009 and 2010.

The following are the 10 schools with the biggest gains in this year's standings:

• 1. Fletcher ES (Tonawanda), up 93 places

• 2. Elmwood Village CS (Buffalo), up 84 places

• 3. St. Mary's ES (Lancaster), up 76 places

• 4. St. John Vianney School (Orchard Park), up 72 places

• 5. St. Paul's School (Kenmore-Tonawanda), up 61 places

• 6. Ivers J. Norton ES (Olean), up 55 places

• 6. Windom ES (Orchard Park), up 55 places

• 8. Union Pleasant ES (Hamburg), up 54 places

• 9. Our Lady of Pompeii School (Lancaster), up 51 places

• 10. Newfane IS (Newfane), up 50 places

Source

From the first day he launched his online skateboard store in 2002, Mike Duncan faced a problem that has plagued retailers since the dawn of online shopping: abandoned shopping carts.

That’s the term for customers loading merchandise into a virtual cart, then leaving the website without paying for anything. These customers aren’t stealing, but they drive merchants crazy. To them, every abandoned cart is a sale they failed to close.

"If you can get just a small fraction of customers to decide to make the purchase instead of leave, you’re talking about a business adding potentially thousands or hundreds of thousands of dollars a year in sales," says Duncan, who owns gear and apparel shop Warehouse Skateboards in Wilmington, N.C.

Last year, Duncan began using LivePerson.com to tackle his abandoned-cart problem. LivePerson (LPSN) specializes in connecting subject-matter experts with online consumers, and draws most of its revenue from selling its services to online retailers. Merchants like Duncan can rent LivePerson’s software to connect their own customer-service staffers with potential buyers.

For browsers poking through a website, LivePerson’s instant messages — the equivalent of a salesperson approaching in a store and asking, "May I help you?" — can be unsettling. But customers can click a button to dismiss the LivePerson agent and ignore the chat feature.

"We may get two out of 10 customers who dismiss us," Duncan says. From the eight customers who don’t, Duncan gets a wealth of information about his site–and the potential to close sales that might otherwise slip away.

"Customers will ask us, ‘Why can’t I see my shipping rate?’ Well, it’s because at that particular moment of shopping, we hadn’t collected their address yet, but it’s good for us to know they’re wondering that," he says. "Once we started using LivePerson.com, we’ve changed how our menus look, the content, the layout — it’s like we’ve been beta testing every day."

The service helps move more merchandise: "If you go into a store to buy a skateboard, the salesperson is going to say, ‘You need a helmet and some knee pads, right?’ We can upsell our average order value to the tune of $15 and $20," Duncan says. He’s also noticed a decrease in returns, because agents can guide customers — like parents holiday shopping for their kids — who don’t know the nuances of the latest skateboarding gear.

Duncan pays $99 a month for one LivePerson license, which shifts between two Warehouse Skateboard employees who staff the chat line from nine hours a day, Monday through Friday. During the holiday season, he ramps up to four licenses and expands the chat hours to 8 a.m. midnight, seven days a week. The staffers juggle their chat duties with their other customer interactions, using e-mail, fax, and the telephone to communicate

Duncan estimates that he’s been able to convert 1% of his abandoned shopping carts into sales. Sounds small, but for a company generates millions each year in sales (Warehouse Skateboards is privately held, and Duncan won’t divulge its revenue), small percentages add up fast. "It’s been very effective for us," Duncan says of the investment.

Francisco Bustos’, owner of two flower-delivery websites, took a different approach to the abandoned-cart problem. Using performance-monitoring technology from Gomez, he focused on shavings seconds off his sites’ page-load times.

Those seconds quickly add up to dollars: "You can just imagine for Mother’s Day, it’s very important. We can’t allow even two or three hours for the website to be slow or not working," says Bustos, who runs global retailers DaFlores.com and RosesnBoxes from Miami. The business has 10 employees and annual revenue of $3 million.

Gomez helps Bustos zoom in on problem spots. Customers from Australia were abandoning DaFlores in droves. After analyzing the traffic with Gomez, Bustos made back-end changes to speed up local load times. "We’re getting 25% more orders from Australia than we used to," he says.

Gomez prices its service based on consumption, with the bill varying depending on how extensively a customer wants to deploy its testing tools. The rates start at around $4,400 per year.

Bustos says it’s worth the hundreds of dollars each month he pays. The value really hit home one sleepless night at 3 A.M., when Bustos — awake thanks to his newborn son — glanced at his Web stats. To his astonishment, he saw orders piling up, unprocessed. A component had broken in his site’s shopping-cat software. Before Gomez, he only would have noticed something amiss after hours of inaction. But now, he was able to alert his IT expert and get the problem solved just before dawn — a critical advantage, since morning is a florist’s busiest time of day for processing orders.

Duncan puts the plight of the abandoned online shopping cart this way: "It costs a lot of money for a business to drive people to your website. If they leave without buying something, you’ve lost not just a sale but quite possibly a repeat customer." 

Source