Finance news. My opinion.

January 31, 2012

Suit says FDA monitored staffers’ private email

Filed under: lenders, mortgage — Tags: , , , — Professor @ 1:36 am

Current and former Food and Drug Administration officials say in a lawsuit that the agency secretly monitored their private email after they raised concerns that approved medical devices might risk public safety.

The doctors and scientists who researched the products approached members of Congress and the incoming Obama administration to express alarm that the devices were approved over their objections.

Their lawsuit, first reported Monday by The Washington Post, says the agency monitored email sent from their personal Gmail and Yahoo accounts from work computers over two years. It says those emails included messages to congressional staff and drafts of whistleblower complaints.

The staffers say they were legally protected whistleblowers and the monitoring violated their constitutional rights to free speech and against illegal search and seizure, even though a warning on FDA computers said they had no expectation to privacy. The defendants say they were admonished or lost their contracts to work with FDA in retaliation.

The FDA said Monday it would not comment on ongoing litigation.

The lawsuit says the plaintiffs were among those who complained in fall 2008 to members of the House Energy and Commerce Committee that senior managers at the Center for Devices and Radiological Health “ordered, intimidated, and coerced FDA experts to modify their scientific reviews, conclusions and recommendations in violation of the law.” Then in January 2009, after Barack Obama’s election but before he was sworn into office, nine FDA employees sent a letter to the Obama transition team complaining of corruption within the FDA device review process that they said was endangering public health.

For example, the FDA scientists alleged that the agency approved the use of computer-aided detection devices with breast mammograms even though they had been determined not to be safe or effective, harming women and resulting in unnecessary public health costs.

The suit says FDA officials began secretly referring to the letter’s signatories as the “FDA 9″ and began the secret monitoring. The suit says the agency used spyware on their government-owned computers that allowed them to take “screen shots,” or pictures of what was on their computer screens without their knowledge.

The scientists’ complaints were the subject of a New York Times article on March 28, 2010, that said FDA brushed aside its own experts’ warnings about the risks of radiation exposure from routinely using powerful CT scans to screen patients for colon cancer.

The lawsuit says lawyers for General Electric Co., which applied for agency approval of CT scans for colon cancer screenings, complained that confidential information may have been leaked to the Times. Agency officials used the letter to make a criminal referral to the Office of Inspector General and attempt to have the plaintiffs investigated and potentially charged with serious crimes, the suit says. But the IG’s office found no evidence of criminal conduct and noted that disclosures relating to public safety to Congress and the media were protected whistleblower activity.

The attorney who filed the suit, National Whistleblowers Center Executive Director Stephen Kohn, said spying on employees who raise health concerns stops others from coming forward in the interest of public safety.

“The FDA’s illegal spying program is not just a problem for the six victims in this case,” Kohn said in a statement Monday. “The day we allow the government to spy on employees based on their lawful whistleblower activities is the day we give up privacy for every honest public servant in America.”

Source

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January 22, 2012

Disney CEO Iger’s pay up 12 pct to $31.4M in 2011

Filed under: economics, term — Tags: , , , — Professor @ 11:04 pm

Walt Disney Co. gave a 2011 pay package valued at about $31.4 million to CEO Bob Iger, up 12 percent from a year earlier, according to an Associated Press analysis of data disclosed in a regulatory filing on Friday.

The company said Iger merited the raise, citing Disney’s growth in the face of a challenging economic environment. Burbank-based Disney generated record-breaking profit and revenue for fiscal 2011.

The boost in Iger’s compensation came after Disney’s share price slid 12.5 percent to $29 during the company’s fiscal year, which ended Oct. 3. That was also the same day the stock market reached its low for 2011 after a turbulent summer and early fall that drove the stocks of many companies sharply lower. Disney shares have since recovered and closed Friday at $39.31.

Iger, 60, received a base salary of $2 million, unchanged from the previous fiscal year, according to documents filed with the Securities and Exchange Commission.

He also received stock awards valued at $8.1 million at the time they were granted, an increase of 10 percent from a year earlier, and option awards valued at about $4.8 million on the day they were granted, up 9 percent from the year before.

Iger’s performance-based cash bonus grew 15 percent from the prior year to about $15.5 million.

His other compensation jumped 21 percent to $962,932, including $371,439 for personal use of company aircraft and $561,303 for security costs.

Iger’s total compensation in fiscal 2010 was $28 million.

Disney’s net income for fiscal 2011 grew 21 percent to a record $4.8 billion, or $2.52 per share, aided by the success of films such as “The Lion King” in 3-D, and improved revenue from its consumer products, TV and theme park businesses.

Revenue rose 7 percent to a record $40.9 billion.

The Associated Press formula calculates an executive’s total compensation during the last fiscal year by adding salary, bonuses, perks, above-market interest the company pays on deferred compensation and the estimated value of stock and stock options awarded during the year. The AP formula does not count changes in the present value of pension benefits. That makes the AP total slightly different in most cases from the total reported by companies to the Securities and Exchange Commission.

The value that a company assigned to an executive’s stock and option awards for 2011 was the present value of what the company expected the awards to be worth to the executive over time. Companies use one of several formulas to calculate that value. However, the number is just an estimate, and what an executive ultimately receives will depend on the performance of the company’s stock in the years after the awards are granted. Most stock compensation programs require an executive to wait a specified amount of time to receive shares or exercise options.

Source

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January 16, 2012

Consumer Prices in U.S. Probably Little Changed on Store Holiday Discounts - Bloomberg

Filed under: online, technology — Tags: , , , — Professor @ 11:04 am

The cost of living in the U.S. was probably little changed in December as stores discounted merchandise during the holidays, supporting the Federal Reserve

January 14, 2012

Draghi Says Weapons Working in Debt Crisis - Bloomberg

Filed under: Uncategorized, finance — Tags: , , , — Professor @ 8:08 pm

European Central Bank President Mario Draghi says his strategy for battling Europe

January 9, 2012

Saudi: ‘Internal’ matter if Japan buys Iran oil

Filed under: house, money — Tags: , , , — Professor @ 11:24 pm

A Saudi oil official said that whether Japan or other countries continue to buy Iranian oil was an “internal matter,” reflecting the unease in many nations after the latest U.S. sanctions on Tehran and Iran’s threats to choke off the Strait of Hormuz in response.

The comments by the Oil Ministry official were reported on Monday by the Saudi daily Al-Watan a day after Japanese Foreign Minister Koichiro Gemba met with senior Saudi officials in the kingdom’s capital, Riyadh.

The newspaper said that Japanese officials asked Saudi Arabia, the world’s largest oil exporter, to make up for the potential loss of Iranian oil for Japan. The Asian nation is now even more heavily dependent on oil and natural gas imports after last year’s tsunami forced the shutdown of nuclear reactors.

The latest U.S. sanctions target Iran’s central bank and are aimed at hindering Tehran’s ability to receive payment for its oil exports.

Al-Watan quoted the senior Saudi official as saying that “the issue of buying or not buying oil from Iran is an internal matter to be decided by these countries.” The official was not identified.

Still, Saudi officials have said that Gulf oil producers are ready to step in and offset any loss of Iranian oil in the market, though it remains unclear if the necessary pipelines that would reroute the oil away from the strait are all fully operational. One pipeline with a capacity of about 1.5 million barrels per day being built by the UAE has yet to be completed.

China, a major Iran oil importer, has resisted the sanctions effort. The Asian powerhouse’s deputy foreign minister, Cui Tiankai, said Monday that China’s trade relations with Iran have nothing to do with Tehran’s nuclear program and that sanctions alone cannot resolve the dispute.

The West maintains that Iran is enriching uranium with an eye on developing a weapon, an allegation Tehran denies. Iran says its program is for purely peaceful purposes.

The official Saudi Press Agency said Gemba’s meeting with Saudi Oil Minister Ali Al-Naimi and other top officials “dealt with the current situation in the international oil market and the importance of its stability Online payday loans.”

Iran has repeatedly raised the specter of closing the Strait of Hormuz, through which about a sixth of the world’s oil flows, if the U.S. and its allies impose measures targeting its oil exports.

Many analysts and officials have played down the comments as bluster by the Islamic Republic, noting that such a move would hit Iran hard given that it receives over 80 percent of its government revenue from oil sales.

But on Sunday, an Iranian newspaper quoted a senior Revolutionary Guard commander as saying that the country’s leadership had decided to close off the strait if its oil exports were targeted. The remark marked an escalation of earlier warnings that Tehran could easily close the waterway if it so desired.

The threats have rattled global oil markets, with the U.S. benchmark crude futures contract for February delivery hovering at slightly under $102 per barrel in electronic trading in Asia while its North Sea counterpart, Brent, was trading at above $113 per barrel in London.

Japan has been supportive of the U.S. and its allies’ efforts to pressure Iran over its controversial nuclear program. But Asian buyers of Iranian crude, in particular Japan and South Korea, are worried about the impact of the sanctions both on international crude prices and their economies.

Gemba, who is on an eight-day Mideast tour that began Thursday, later traveled to Qatar where they discussed the effect of santions on the oil market. He is slated to travel to the United Arab Emirates for meetings there on Tuesday.

Source

January 8, 2012

Lambert seen in good position to weather airline mergers, changes

Filed under: prices, uk — Tags: , , , — Professor @ 8:32 am

St. Louis should be in a better position to weather the latest round of airline consolidations — and a bankruptcy filing by another major carrier — than some other U.S. cities, aviation officials say.

Delta Air Lines halted its daily nonstop service between St. Louis and Washington’s Reagan-National Airport last week. But the Atlanta-based carrier expects to add a fifth flight later this year to New York’s La Guardia Airport, where it is beefing up its presence.

The latest round of airline mergers — which include the pairings of Southwest Airlines and AirTran and United Airlines and Continental — have communities bracing for lost competition and skimpier schedules.

But Lambert-St. Louis International Airport already took the brunt of its lost flights in the decade that followed American Airline’s acquisition of Trans World Airlines in 2001. Prior to that acquisition, TWA was the dominant carrier at Lambert.

Today, Lambert’s flight schedule is spread over 13 air carriers, said Airport Director Rhonda Hamm-Niebruegge. Southwest Airlines now offers more daily flights — 84 — than any other airline serving Lambert.

“It just happened to us first, which was hard,” Hamm-Niebruegge said. “It did give us time to see the value of diversification and going out and trying to broaden your base.”

In recent months, Southwest Airlines has merged with fellow low-cost carrier AirTran Airways. St. Louis is one of 33 markets served by both airlines. In July, AirTran moved to a gate and ticket space inside Lambert’s Terminal 2, near Southwest.

Southwest spokeswoman Laurel Moffat said the airline is working on obtaining Federal Aviation Administration approval to operate as a single carrier. Southwest expects to receive the single-operation certificate by the end of the first quarter.

But the process of absorbing AirTran into the Southwest brand is expected to take several years, she said. AirTran serves Atlanta and Orlando from St. Louis. Southwest already has picked up AirTran’s service between Milwaukee and Lambert.

The AirTran merger with Southwest will cause “a lot of problems” elsewhere — including AirTran’s hub in Atlanta — but none is expected in St. Louis, said airline analyst Michael Boyd my credit score. Same is true for the United-Continental merger.

“Honestly, you have fewer brand choices,” he said. “But we’ve looked at this. There aren’t any great changes in terms of access for St. Louis.”

Last month, Delta Air Lines and US Airways concluded a swap of slots at Reagan-National Airport and La Guardia Airport, respectively.

The move nixed one Delta flight between St. Louis and Reagan. But Delta expects to add a flight to La Guardia this spring, giving it five direct flights between Lambert-St. Louis and that destination.

Delta completed its merger with Northwest Airlines in 2008.

United and Continental completed their merger in October 2010 and are still integrating their operations. A spokesman said the company is working toward adopting a single United brand identity late this quarter. So far, no changes have been announced in St. Louis.

Hamm-Niebruegge said the destinations currently served by United and Continental flights don’t compete.

United has daily flights to Chicago’s O’Hare International Airport, Denver, San Francisco and Washington’s Dulles Airport out of Lambert. Continental flies to Cleveland, Houston and Newark.

Hamm-Niebruegge said nothing has changed with American Airlines’ local plans either.

AMR Corp., American’s parent company, filed for bankruptcy protection in November and made immediate assurances that there would be no immediate changes to the flight schedules in St. Louis.

Overall, St. Louis is “in a steady state right now,” said aviation consultant Darryl Jenkins, chairman of the American Aviation Institute.

The only thing that would upset the status quo would be a jolt to the area economy — good or bad, Jenkins said. Dramatic improvements to the region’s economic condition could mean more flights. Conversely, a loss of employers would mean fewer planes.

“I think for the foreseeable future, St. Louis will probably keep the city pairs it has and keep those frequencies,” Jenkins said.

Source

December 31, 2011

Corn Traders Extend Bullish Bets on South America Crop Damage: Commodities - Bloomberg

Filed under: news, technology — Tags: , , , — Professor @ 3:00 am

Corn traders are bullish for a fifth consecutive week on speculation that dry weather in South America is damaging crops, boosting demand for U.S. supplies at a time when stockpiles are predicted to shrink to a 16-year low.

Nineteen of 25 traders surveyed by Bloomberg expect corn to advance next week. Lower-than-average humidity and dry soil will curb crop development in Argentina and southern Brazil through at least Jan. 7, according to T-Storm Weather LLC, a forecaster in Chicago. Argentina is the world

December 29, 2011

Gold, silver prices fall as European debt crisis forces values down.

Filed under: house, legal — Tags: , , , — Professor @ 12:32 pm

Gold fell, capping the longest slump since October 2009, and silver tumbled to a three-month low as Europe’s deepening debt crisis drove commodities and stocks lower.

The euro dropped to an 11-month low against the dollar as lending to financial institutions sent the European Central Bank’s balance sheet to a record high. The Standard & Poor’s GSCI index of 24 raw materials and the MSCI World Index of equities were poised for the biggest declines in two weeks.

Platinum approached the lowest since November 2009, and palladium dropped almost 3 percent.

The ECB said lending to euro-area banks jumped 214 billion euros ($276.9 billion) to 879 billion in the week ended Dec. 23, bolstering credit to the economy during the financial turmoil. Gold has slumped 19 percent from a record $1,923.70 an ounce on Sept. 6, partly on sales to cover losses in other markets.

“What’s going on in Europe is very worrying,” James Dailey, who manages $215 million at TEAM Financial Management LLC in Harrisburg, Pa., said in an e-mail. “The dollar’s strength is working against all commodities, including gold.”

Gold futures for February delivery declined 2 percent to settle at $1,564.10 at 1:47 p.m. on the Comex in New York. The price dropped for the fifth straight session, the longest slide since October 2009. The commodity headed for the first quarterly slump since September 2008.

Silver futures for March delivery fell 5 quick guaranteed personal loans.2 percent to $27.234 an ounce on the Comex. Earlier, the price touched $27.10, the lowest since Sept. 26. The metal has plummeted 45 percent from a 31-year high of $49.845 on April 25.

Gold imports by India, the biggest consumer, may drop as much as 50 percent this month after the rupee plunged, according to the Bombay Bullion Association. China restricted gold trading in spot and futures contracts to the Shanghai Gold Exchange and the Shanghai Futures Exchange to crack down on illegal buying and selling of commodities.

Platinum futures for April delivery declined 3.2 percent to $1,392.40 an ounce on the New York Mercantile Exchange. Earlier, the price touched $1,388.60. On Dec. 15, the metal declined to $1,376, the lowest since Nov. 13, 2009.

Palladium futures for March delivery slumped 2.9 percent to 647.15 an ounce on Nymex, the biggest drop since Dec. 14.

This year, gold has advanced 10 percent, heading for the 11th straight annual gain, on demand for an alternative investment amid slumping equities.

“Gold has been one of the best performers this year, so it comes as no surprise that we are seeing some end-of-year profit-taking,” said Ronald Stoeferle, a commodity analyst at Erste Group Bank AG in Vienna.

Source

December 12, 2011

Lee Enterprises files for bankruptcy

Filed under: news, uk — Tags: , , , — Professor @ 2:56 pm

Lee Enterprises, owner of the St. Louis Post-Dispatch and other newspapers, filed for prepackaged bankruptcy early today in an effort to refinance about $1 billion in debt.

The bankruptcy was expected. Two weeks ago, the Davenport, Iowa-based publisher announced it would file for bankruptcy “on or about Dec. 12″ as part of a debt refinancing plan it had successfully negotiated with creditors.

Lee filed its Chapter 11 bankruptcy petition in the Wilmington, Del., bankruptcy court, becoming the latest newspaper publisher saddled with debt to seek the court to help its finances. Though based in Iowa, the publisher is incorporated in Delaware.

The company said that the bankruptcy will have no impact on its business and that its papers will continue to publish. Vendors, advertisers, subscribers, employees and the company’s operations will not be affected.

In its bankruptcy filing, Lee lists $1.15 billion in assets and $994.5 million in liabilities.

When the publisher announced its bankruptcy plans, Lee said had secured agreements with nearly all of its creditors, which it predicted would allow an exit from bankruptcy in 60 days or less.

The filing is unusual in that the company plans to shed no debt and pay a higher interest rate to all lenders.

In return, lenders agreed to extend the loans - now due in April - until at least December 2015. The plan also preserves most of the stock’s value, allowing Lee to continue trading on the New York Stock Exchange during the bankruptcy process.

Lee also previously said it would cede a 13 percent ownership stake to three creditors, Goldman Sachs, Monarch Master Funding Ltd., and Franklin Templeton/Mutual Quest Fund.

The newspaper publisher says the refinancing plan is needed to keep it in business.

“Our ability to operate as a going concern is dependent on our ability to obtain approval by the U.S. Bankruptcy Court of the refinancing plan approved by creditors and to generate cash flows and maintain liquidity sufficient to service our debt,” the company said Friday in its annual report.

Though the refinancing plan will increase its higher interest payment - it would pay an average of 9.2 percent interest rate on its debt versus 5.1 percent currently - the publisher said it can pay that level of interest while also paying down the principal.

Lee’s newspapers turn an operating profit, and Lee has been making its debt payments. But the company, one of the nation’s largest newspaper chains, has been struggling for months to refinance the debt before it comes due in April.

Like other newspaper chains, Lee piled on debt to make acquisitions, then only to suffer from declining circulation and advertising revenue brought on both by the sluggish economy and the migration of advertising revenue and readers to the Internet.

Without refinancing, Lee would not have the cash to repay the maturing debt.

An effort to issue junk bonds in the spring failed, forcing the company to negotiate a refinancing plan this summer with creditors. Those negotiations led the refinancing plan with two groups of creditors.

One group holds about $865 million in debt secured by properties that Lee owned before 2005. Most of that debt was assumed that year when Lee bought St. Louis-based Pulitzer Inc., then the owner of the Post-Dispatch, for $1.5 billion.

The company said 94 percent of those debt holders have agreed to the deal. At one point, Lee hoped to borrow money to redeem the debt of those creditors not consenting to the refinancing, but those plans fell through.

A second group of creditors holds $138 million in debt, which Lee inherited with the Pulitzer deal. That debt is secured by the old Pulitzer properties, including the Post-Dispatch. All of those creditors agreed to the deal.

To deal with creditors not agreeing to the refinancing, the Lee has resorted to a prepackaged bankruptcy, in which a company works out terms with most creditors in advance. This allows the debtor to quickly reorganize and emerge from bankruptcy. The company then uses the bankruptcy proceedings to force its plan on lenders who didn’t agree to the refinancing.

In order to gain approval of the prepackaged plan, at least 50 percent of each class of creditors must vote to approve it, and those voting for it must own two-thirds of the dollar amount of the debt.

Dissenters can object, but they must convince the court that the deal is not fair and equitable.

Lee newspapers have a combined daily circulation of 1.3 million and Sunday circulation of 1.6 million, as of the end of September. Lee also owns nearly 300 specialty publications, including the Suburban Journals of Greater St. Louis, Ladue News, and Feast and St. Louis’ Best Bridal magazines.

Source

December 2, 2011

Retailers report strong sales for November

Filed under: finance, online — Tags: , , , — Professor @ 7:36 pm

Retailers are reporting strong sales gains in November, boosted by a discount-fueled spending binge for the start of the holiday shopping season last weekend. Now, the challenge is to keep shoppers spending throughout the most important selling period of the year.

Macy’s Inc., Costco Wholesale Corp., Limited Brands Inc. and teen retailer Buckle Inc. all reported sales gains Thursday that beat Wall Street estimates. Target Corp., however, was a straggler, reporting a slim sales gain that was below what analysts had expected.

The figures are based on revenue at stores opened at least a year and are considered a key indicator of a retailers health.

Source

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