Finance news. My opinion.

August 24, 2010

Atwood Oceanics makes Fortune’s ‘fastest-growing’ list

Filed under: online — Tags: , , — Professor @ 2:27 pm

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

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June 10, 2010

Elementary: Biggest gains

Filed under: online — Tags: , — Professor @ 12:57 am

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

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May 27, 2010

Why state pension funds may need a $1 trillion bailout

Filed under: finance — Tags: , — Professor @ 1:45 am

Ready for another government bailout? Taxpayers could be on the hook within the decade if current state pension system isn’t reformed.

Even if they continue to rake in the projected 8% in annual returns, pension funds in at least seven states — Illinois, Louisiana, New Jersey, Connecticut, Indiana, Oklahoma, and Hawaii — could dry up by 2020, and 31 states could be in trouble by 2030, according to a recent study by Northwestern University economist Joshua Rauh.

Promised benefit payments are so astronomical that raising taxes would still fall short. The only solution would be to call on the federal government for a bailout, according to the study.

"This is a problem of monumental proportion," said Rauh, an assistant professor of finance at the Kellogg School of Management. "Given that we see the same issue in many states, the total size of a federal rescue plan could exceed the seriousness of the recent economic crisis and potentially cost more than $1 trillion total."

In Illinois, Rauh says the pension funds could be insolvent by 2018 at the current rate cash advance companies. And in the following years, the state will owe government workers $14 billion — more than half of the state’s projected revenue for 2010.

To dodge a bailout, Rauh says the state pension system needs an overhaul that includes allowing states to issue tax-subsidized pension funding bonds for the next 15 years if they consent to other reform measures.

For starters, states must agree to close defined benefit plans to the 1 million new workers who start state jobs annually, and instead offer defined contribution plans and guaranteed access to Social Security, to which only a quarter of public workers currently contribute. Rauh estimates the total cost to the federal government would be about $75 billion.

"Existing pensions would become more secure and new workers would get more than an empty promise, while the country would avoid another massive taxpayer-financed bailout," Rauh said. 

Source

May 19, 2010

Jobless claims down for 4th straight week

Filed under: business — Tags: , , — Professor @ 2:12 am

The number of first-time filers for unemployment insurance fell last week for a fourth straight week, according to a weekly government report released Thursday.

There were 444,000 initial jobless claims filed in the week ended May 8, down 4,000 from an downwardly revised 448,000 the previous week, according to the Labor Department’s weekly report. The number of claims is the lowest since the 442,000 reported in the week ended March 27.

The number of claims was slightly higher than expected. Economists surveyed by Briefing.com had expected new claims to fall to 440,000.

The downward trend in initial claims continues to show general improvement in the economy, and is consistent with monthly reports that show employers are starting to add jobs, said Michael Hanson, senior economist with Bank of America Merrill Lynch.

The government’s latest monthly jobs report, released Friday, showed employers added 290,000 jobs in April, the best gain in four years.

The four-week moving average for weekly initial claims was 450,500, down 9,000 from the previous week. The Labor Department tracks the four-week moving average of the weekly figures, to smooth out the volatility of the measure.

Initial claims have been stuck in the mid- to upper 400,000s since November, but seem to be hitting some resistance once they drop around 450,000.

While the recent decline in the four-week average is encouraging, economists are really looking for the number to get below 400,000 to spur sustainable job growth, said Tim Quinlan, an economist with Wells Fargo Securities.

Quinlan said he expects to see gradual improvement in payrolls through the course of the year, but no dramatic increases in job growth until initial claims fall below 400,000.

Also showing some resistance, instead of a consistent trend, are continuing claims, the number tracking people who file for unemployment benefits for two weeks or more. The government said 4,627,000 people filed continuing claims in the week ended May 1, the most recent data available. That was up 12,000 from the preceding week, but overall is still much improved over the 6,389,000 continuing claims reported in the comparable week last year.

"If you just got laid off and trying to find a job, it’s still a really difficult environment, and the climb in continuing claims tells us it’s taking people a while to land their feet in a job," Quinlan said.

Standard unemployment benefits usually last 26 weeks. The continuing claims number does not include those who have moved into state or federal extensions, or people whose benefits have expired.  

Source

April 23, 2010

SEC charges Miami schemer in massive Ponzi

Filed under: technology — Tags: , — Professor @ 12:51 am

The SEC and the U.S. Attorney’s office in New Jersey on Wednesday charged a Miami Beach-based businessman with allegedly running a Ponzi scheme that sucked in close to $1 billion.

The Securities and Exchange Commission and U.S. District Attorney Paul Fishman filed fraud charges in New Jersey against Nevin K. Shapiro, founder and president of Capitol Investments USA.

Shapiro is accused of fraudulently offering risk-free annual returns as high as 26% to investors in his grocery diverting operation, a type of business where low-cost groceries are purchased in one region and sold for a higher price elsewhere.

"[Shapiro] used his prominence and prestige to gain investors’ trust in funding Capitol’s grocery-diverting business, but behind their backs he diverted their money to enrich himself," said Eric Bustillo, director of the SEC’s Miami regional office.

Investigators from the U.S. Attorney’s office said more than 60 investors, many of them in New Jersey, sent Shapiro more than $880 million, incurring losses of at least $80 million.

The SEC said that Shapiro’s "lavish" lifestyle included a $5 million house in tony Miami Beach and a $1 million boat, as well as "luxury cars, expensive clothes, high-stakes gambling and season tickets to premium sporting events."

In a classic pyramid-style scheme, the Ponzi scammer uses new investments to pay off existing investors, while claiming that the stolen funds are legitimate returns.

The feds said that Shapiro claimed to make tens of millions of dollars a year through Capitol. In reality, Capitol was operating at a loss by 2004 and had "virtually no" legitimate investment activity by 2005, according to federal authorities.

Shapiro paid $13 million to contacts who could reel in fresh investors in order to keep the scam going, according to the SEC.

He is also listed as a donor on the University of Miami’s Web site, which describes him as "an ardent, devoted, intense supporter of the University of Miami Athletics."

"For the tremendous philanthropic support he provides, the University of Miami is proud to name the Student-Athlete Lounge after Nevin Shapiro," the site reads.

A spokesman for the athletics club was not immediately available for comment.

Kate Meyers, one of three lawyers representing Shapiro at the Lewis Tein firm in Coconut Grove, Fla., confirmed that Shapiro "surrendered this morning to authorities in New Jersey."

She said the two lead defense lawyers in the case are Michael Tein and Guy Lewis. 

Source

April 22, 2010

Doctors have few answers on health law

Filed under: management — Tags: , , — Professor @ 9:54 am

Dr. Roger Evans, a cardiologist in Wichita, Kan., is used to answering patients’ questions about their hearts. But lately, he said, he has spent half his time answering a succession of different questions — about the health care law.

Donald Moore, 75, one of those patients, expressed his uneasiness about the law recently: “The fact is that I don’t understand it, and no one else I talk to understands it. Every day, you read something different in the paper.”

Moore’s latest concern was a “rumor that the new health care procedures are going to be monitored and managed by the IRS.”

“That’s a turnoff right there,” he said. “How much is true, how much is fiction, out here no one knows.”

Most of the health care law, which President Barack Obama signed last month has yet to take effect, but for many doctors it is already having an impact.

“We’ve had to add an hour or two to the day because patients want to talk about it,” said Evans, who travels around the state and said questions often left him scratching his head. “I see 30 to 50 patients in a day, and it is the subject of conversation more than half the time.”

After months of public wrangling and brinksmanship in Washington, the nation’s doctors now find themselves having to answer questions about a 2,400-page law that many do not understand themselves, and which they may have opposed. “Not only is the public confused, but so are our members,” said Dr. Lori Heim, president of the American Academy of Family Physicians, which supported the bill. “There’s been a lot of misinformation out in the media. We’ve been trying to get to them simple answers — what does this mean for my practice, what does it mean for my patients, what does it mean for the future?”

Some doctors said their patients were pushing for surgery now, for fear that it will not be covered in the future or that they will end up on a waiting list. “It’s ludicrous to be coerced to perform surgery because of fear of noncoverage in the future,” said Dr. Eustaquio Abay II, a neurosurgeon in Wichita. “I refuse.”

Abay said he had tried to read the law, but gave up because it was all legal jargon to him. “They think we have all the answers, but we don’t,” he said of patients.
While many doctors say they are not besieged, the queries have been particularly robust in states where the plan was unpopular, Heim said.

Joseph Baker III, president of the Medicare Rights Center, a nonprofit organization that operates a hotline for patients with questions, characterized the volume of calls about the bill as moderate. But he said the level of confusion was high, comparable to that created when Medicare added prescription drug coverage in 2004.

Often, Baker said, callers have been getting their information from media commentators or doctors who opposed the legislation. “They’re being told by their providers, ‘Now I won’t be able to take Medicare patients,’” he said.

“People call us confused, panicked, anxious,” he said. “And in most instances, we say there are some benefits in the short term, like closing the doughnut hole,” as the gap in Medicare prescription drug coverage is known, “and that the things that might have a negative impact, like lower reimbursement to providers, will happen over a number of years. Usually that calms people down.”

The questions do not always reflect the actual provisions of the law. The major changes for this year, including coverage on their parents’ policies for adult children under age 26, rarely come up, said Dr. Melissa Gerdes, a family practitioner in Whitehouse, Texas, who said it was not unusual for her patients to discuss politics in the examining room. She said that only one patient had asked about the new law’s provisions on the doughnut hole, and that she could not recall any patient who had inquired about coverage for adult children.

“The big one I get is, ‘Are you going to be able to keep seeing me?’” Gerdes said. (She tells them she will.)

At Dr. Alieta Eck’s free clinic in Somerset, N.J., where all the doctors donate their time, Eck said many of her patients were excited about the new program. “People say, ‘I can’t wait for Obamacare,’” said Eck, who has been outspoken in her opposition to the program. “They’re already getting free care.”

Eck said that her office had not been overrun with questions about the bill, but that during visits at her paid practice, “most patients are fearing that everything’s going to cost them more.”

For many doctors, the big frustration comes when they do not know what to say to their patients.

“Quite honestly, I don’t know how to answer their concerns,” said Dr. Deborah Sutcliffe, a solo practitioner in Red Bluff, Calif. “Sometimes they’re more informed than I am, sometimes they’re not. I haven’t read the damn thing.”

Source

April 12, 2010

Peabody Energy seeks help in bid for Macarthur Coal

Filed under: marketing — Tags: , — Professor @ 7:18 am

Having seen its $3.3 billion takeover bid spurned by the board of Macarthur Coal Ltd., Peabody Energy Corp. is asking Australia’s Takeovers Panel to intervene on its behalf.

Peabody is asking the panel to require Macarthur to postpone a Monday meeting where shareholders will consider issuing stock to complete the purchase of a third coal producer Gloucester Coal Ltd.

Macarthur agreed in December to buy Gloucester. But Peabody has said that its interest in Macarthur is contingent the Gloucester deal being scuttled.

Macarthur’s board rejected both Peabody offers, saying they don’t fully value the company, which is in the midst of an aggressive expansion. The board also recommended that shareholders vote to issue shares on Monday to complete the Gloucester transaction.

Australia’s Takeovers Panel is a peer-reviewed body that operates under the country’s securities law, according to its web site. It is charged with resolving disputes over takeover proposals. Its 54-members consist of executives, lawyers and academics appointed by the Governor General.

In its appeal to the panel, Peabody argues that Macarthur failed to provide shareholders with enough information to compare its bid with the Gloucester agreement.

The St. Louis-based company asked that Macarthur provide more disclosure, including updated analysis from an independent expert on the Gloucester proposal, and that Monday’s shareholder meeting be delayed until 10 business days after shareholders receive the additional information.

In a statement Thursday, Macarthur said shareholders “have all information required to make an informed decision.”

The company also criticized Peabody for taking out full-page ads in major Australian newspapers, calling them “self serving and potentially misleading.

Source

April 6, 2010

Want all 3,000 iPad apps? $12,572.78

Filed under: management — Tags: , — Professor @ 8:03 am

Mobile ad exchange Mobclix Inc. reports Sunday morning that there were 3,000 iPad apps available and only about 20 percent of them were free.

If being one of the first 600,000 to 700,000 estimated iPad owners after the first day of sales isn't status enough for the dedicated Apple Inc. fanatic, they can have all the apps available as of the time of the Mobclix report for $12,572.78.

The average price of an iPad app, Mobclix reports, is $4.99.

Games make up the biggest segment of apps available, with 942 and only 138 of those are free.

Click here to read more Business Journal stories about the iPad launch.

Source

March 29, 2010

Roth IRA is confusing even to financial advisers

Filed under: marketing — Tags: , , — Professor @ 9:30 pm

This is why I must keep writing about Roth IRA conversions:

A dozen readers age 70 1/2 and older have written to say their financial advisers recommended they convert their entire traditional IRAs to Roth IRAs this year. By converting everything, the advisers claimed, they’d avoid having to take required minimum distributions from their traditional IRAs for 2010.

That’s incorrect and potentially very costly advice.

"It’s absolutely not true," said Ed Slott, a certified public accountant in Rockville Centre, N.Y., who publishes a monthly "IRA Advisor" newsletter for financial professionals (at www.irahelp.com). After age 70-1/2, holders of traditional IRAs must start withdrawing a minimum amount each year (the required minimum distribution or "RMD"). This distribution must be taken before any remaining funds can be converted to a Roth IRA.

Failure to take a required distribution is subject to a 50 percent penalty on the amount that should have been withdrawn but wasn’t. Any RMD funds mistakenly "converted" into a Roth IRA can be considered an "excess" contribution to the Roth IRA, resulting in a 6 percent excise penalty for every year the money remains in the Roth IRA, Slott said.

To answer a common question, people eligible to make a direct contribution to a Roth IRA — which is different from a conversion — can certainly use money from an RMD for the contribution. But to be eligible to contribute, you or your spouse must have "earned income," which means mostly income from work — the RMD itself does not qualify — and your income cannot exceed certain limits. The IRA direct contribution limit for 2010 is $6,000 for people 50 and over, while conversions have no limit.

Slott, who runs training seminars for financial professionals on IRAs, said he’s found a general lack of knowledge about the rules and potential pitfalls of Roth IRA conversions among many advisers no fax pay day loans.

"I am starting to realize how much they don’t know," Slott said, particularly bank employees and brokers who are not tax-law specialists. As of this year, anybody with a traditional IRA is eligible to convert to a Roth. Whether it makes sense to do so depends on a host of individual circumstances, which is why getting good advice is important.

But bad advice abounds. Another reader said he decided against converting because his adviser told him that, once in the Roth IRA, the converted funds could not be withdrawn for five years.

"That’s wrong, too," Slott said. Converted funds can be withdrawn at any time, although there may be penalties.

But penalties are probably not as bad as you think. A much-feared 10 percent tax penalty on withdrawals applies only if you withdraw the converted funds before age 591/2 and also have not held the funds for at least five years.

Once you are at least 591/2, "there is no more 10 percent penalty, period," even if you withdraw the money right after you convert, Slott emphasized. Five years after a conversion, and once you are at least 591/2, all the money, including any subsequent investment gains, can be withdrawn tax-free.

Even if you are 591/2 or older, if you withdraw converted funds within five years, you would owe ordinary income taxes on any investment gains since the conversion — but not on the amount converted. Taxes can be minimized or avoided through well-timed partial withdrawals. The first funds withdrawn from a Roth IRA are generally considered to be any direct contributions and converted principal, which have already been taxed and would not be taxed again.

Source

March 28, 2010

Census Bureau: Dallas posts biggest population gain

Filed under: term — Tags: , , — Professor @ 1:27 pm

Don’t mess with Texas! Cities in the Lone Star State were among the fastest growing places in 2009.

Dallas-Fort Worth and Houston gained the most new residents of any city — netting more than 140,000 each — according to the Census Bureau’s annual metropolitan area population estimates released on Wednesday. Meanwhile, music center Austin posted the second highest growth rate among top cities — 3.1% — just behind Raleigh, N.C.

"Texas stands as the most prominent Sun Belt survivor of the last half of the decade because of its diversified economy, smaller run-ups in housing prices, and fewer foreclosures," said William Frey, a demographer for the Brookings Institute, a liberal think tank.

Overall, the population of the United States has grown more than 9% to 307,006,550 since the 2000 census. The population grew 0.86% since last year’s estimates.

These figures are an advance look at what to expect when the 2010 census results are released in December. The population figures determine how much federal money states and cities receive, as well their representation in Congress, among other things.

The Brookings Institute study estimates that federal program will dole out more than $500 billion a year to states and communities over the next decade based on data collected through the 2010 Census.

For example, since the 2000 census, the population in Provo-Orem, Utah, has jumped by more than 47%, according to the 2009 estimates. That puts the area in line for a boost in federal funding; in 2008 the area collected more than $300 million, according to the Brookings Institute

Plus, Utah stands to gain a fourth congressional seat, according to projections from the Virginia-based political consulting firm Election Data Services.

In the past decade the Dallas area has added almost 1 faxless cash advances.3 million people — more than any other city. As a result, it stands to receive quite a bit more than the $4 billion in federal funds it earned in 2008. And Election Data Services predicts that Texas will pick up at least three more seats in Congress. (It currently has 32 House seats.)

Biggest losers: Detroit, which was battered by the collapse of the auto industry and faces a 15.6% unemployment rate, lost more than 20,000 people in 2009, or 0.5% of its residents. The Youngstown, Ohio, metropolitan area, which includes parts of Pennsylvania, shed more than 1% of its population.

Over the past decade, New Orleans has struggled the most. The population held relatively steady prior to Hurricane Katrina but lost more than 300,000 residents between 2005 and 2006 and posted a net loss of more than 126,000 people, or 9.6% of its residents, since the 2000 census.

The Big Easy could see its federal funds come down from the $1.8 billion collected in 2008. And Louisiana could lose one of its seven congressional seats, according to Election Data Services.

Census 2010: Last week more than 120 million census questionnaires were mailed to residential addresses and workers continued delivering questionnaires to 12 million addresses in rural areas. The bureau will use the completed questionnaires and data collected through door-to-door visits to determine the nation’s headcount.

To ensure they get a fair share of federal funding, state and local officials are promoting the 2010 Census and pushing for residents to fill out forms. And the Census Bureau is spending $133 million to boost participation rates.  

Source

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