Late Edition August 07 2008 at 02:57 PM Chi-Chu Tschang and Harry Maurer
A Spike in Jobless Claims
The number of new claims for unemployment benefits hit a six-year high in the week ending Aug. 2, said the Labor Dept. They rose 7,000, to 455,000 after seasonal adjustment, the highest since March, 2002. The four-week moving average, a more trustworthy measure, rose to 419,500, the most since July, 2003, and above the 400,000 level usually associated with recessions.
The jump for the week surprised economists, who had predicted a 20,000 decline. Part of the rise may be due to technical factors, especially the extension of unemployment benefits, which led more people to file claims. But the steep numbers still offer another signal that the economy is struggling mightily.
Source: Wall Street Journal
The ECB Holds Steady
Mirroring the Fed's decision yesterday, the European Central Bank left its benchmark rate unchanged at 4.25%. ECB chief Jean-Claude Trichet drew a gloomy picture of Europe's economy, predicting slow growth in the second and third quarters In response, the euro sank against the dollar, which has been staging a modest rally over the past couple of weeks.
Source: Wall Street Journal
Refco Owner Headed for Jail
Tone Grant, owner of the failed Refco commodities trading firm, was sentenced to 10 years in prison by a New York judge for a fraud that cost investors $2 billion. The government said Grant conspired with CEO Phillip Bennett and others to misrepresent the firm's finances.
Source: Bloomberg
Citi Will Buy Back Securities
Citigroup has agreed to buy back or help clients sell $19.5 billion worth of auction-rate securities (ARS) from investors and pay a $100 million fine to settle with regulators, paving the way for similar deals by other banks. Citi will repurchase about $7.5 billion, with its top managers keen to minimize regulatory troubles and focus on improving Citi's financial health. UBS is working on its own ARS settlement as Citi finalizes its agreement with the New York attorney general's office and 12 state securities regulators that are investigating at least a dozen Wall Street firms for their role in the sales and marketing of auction-rate investments. Citi and UBS declined to comment.
Source: Bloomberg
Chrysler, Nissan in Talks for Midsize Cars
Chrysler is in talks with Nissan about jointly producing midsize cars. Since the two companies agreed earlier this year to team up on pickup trucks and subcompact cars, they have been discussing an agreement under which Nissan would produce midsize sedans that Chrysler would sell in the U.S. under its own name. A partnership with Nissan on midsize sedans would put Chrysler on a path to becoming a marketer and seller of cars made by others.
Source: Wall Street Journal
Bad Mortgage Bets Land AIG Large Loss
American International Group posted its third consecutive quarterly net loss of more than $5 billion as it wrote down bad mortgage-related investments. AIG took a loss of $5.56 billion in the second quarter in what are called credit default swaps, the same area that led to losses in the prior two quarters. The world's largest insurer, one of the hardest hit in the credit crisis, also cited a general deterioration in its mainstream insurance businesses for the poor results.
Source: Reuters
IRS Offers to Settle Tax Shelter Cases
The Internal Revenue Service offered more than 45 corporations, including banks, the chance to settle disputes over the use of two tax shelters designed to defer taxes and bolster their balance sheets. The offer allows the companies to keep 20% of their claimed tax losses if they agreed to get out of the shelters by the end of 2010. The companies would have to pay the remaining 80% of the improperly claimed deductions and many will face with seven-figure tax bills.
Source: New York Times
Poor U.S. Sales Puts Drag on Toyota Profits
Toyota's profit fell for the second consecutive quarter as U.S. sales of sport-utility vehicles and trucks plunged. Net income fell 28% to $3.2 billion in the three months ended June from a year earlier. In the U.S., Toyota is heading for the first annual drop in sales since 1995 as fuel prices rise. The carmaker cut its fiscal-year vehicle sales forecast to 8.74 million from 9.06 million.
Source: Bloomberg
Sprint Makes Progress, But Not Much
Earnings of Sprint Nextel show some hopeful signs, but its improvements lose some of their luster on closer examination. The percentage of postpaid subscribers jumping ship each month dropped from 2.45% in the first quarter to 2% in the second quarter. The drop, however, could partly be seasonal, as subscribers worry about planning vacations rather than seeking out better deals. The carrier's revenue per prepaid user rose slightly but its s postpaid subscriber base has shrunk from 41.6 million to 38.9 million in the past year.
Source: BusinessWeek
Disney to Relaunch Cable Channel for Boys
Disney, which has made billions catering to the princess fantasies of young girls, plans to relaunch Toon Disney as Disney XD, a cable channel that will target boys. From February, Disney XD, aiming at boys ages 6 to 14, will offer original action-adventure and comedy series, movies, animation and sports-themed shows developed with Walt Disney-owned ESPN.
Source: Los Angeles Times
Tanker Bidding Changes Favor Airbus
The $40 billion Air Force refueling-tanker contest is to be rerun under amended rules and a new timeline, but Boeing's congressional allies say the changes skew the competition in favor of the Airbus A330 jet. Senior Boeing officials consider a range of options that include trying to convince the Pentagon to amend its latest selection criteria; formally protesting the changes; and perhaps even opting against bidding on the lucrative contract.
Source: Seattle Times
Conversation of the Day: RECRUITMENT &DEVELOPMENT
"Leaving employee selection to HR will give you people who have skills you can identify on a checklist, but not necessarily an attitude that will fit with your team."
Tell Us: What's the No.1 sign a Company Doesn't Care About Its Workers?
No comments:
Post a Comment
Keep a civil tongue.