Late Edition December 29 2008 at 03:06 PM Harry Maurer
Slowdown in the Midwest
The Rust Belt is living up to its name these days. Factory output in the Midwest fell to its lowest level in 12 years, says the Chicago Fed. Its Midwest factory index for November dropped 1.6% to a seasonally adjusted 96.4 from a downwardly adjusted 98.0 in October. The November number was the weakest since January, 1997.
That put industrial output down 10.8% from a year earlier. The region's auto output sank 24%, compared with a nationwide slide of 15.7%.
Source: Reuters
Oil Traders Unfazed by Fighting in Gaza
Oil prices briefly jumped this morning but then settled back as the markets reacted calmly to Israel's attacks on Gaza. Prices rose around 7% in early trading, but by 2:30 they were up only slightly more than 4% on the New York Merc, to $39.27 a barrel. Retail gasoline prices are still falling and now average around $1.60 a gallon in the U.S.
Source: Associated Press
The Euro, 10 Years Later
A decade after it came into existence--first as a virtual currency, then three years later in bills and coins--the European euro has largely banished its doubters and is helping the 14-member eurozone withstand the global economic crisis. Indeed, according to a new poll, a large majority of continental Europeans now believe the euro could overtake the dollar in global importance during the next five years. The strength of the common currency has been much in evidence recently. After falling from a historic high of more than $1.60 in April 2008 back to around $1.25 in November, the euro has recently clawed its way back to $1.42. The commensurate weakening of the dollar worries exporters in Germany and Japan. The hardest hit of all major currencies is the British pound, which has fallen to near-parity with the euro in a reflection of Britain's grim economic prospects.
Source: AP/L.A. Times, Financial Times, Wall Street Journal, Times of London
No Word on GMAC Vote as Deadline Expires
Two days after a crucial deadline passed, GMAC, the financing arm of General Motors, remained silent Sunday over whether bondholders had approved a plan that would help provide GMAC with federal bailout money.
Source: New York Times
Kuwait Scraps Massive Dow Chemical Venture
Amid local political opposition, the government of Kuwait on Dec. 28 cancelled a planned $17.4 billion petrochemical joint venture with Dow Chemical, striking a huge blow to the U.S. manufacturer and casting doubt on its planned takeover of Rohm & Haas.
Source: MarketWatch
Emerging Economies Face Rush for Credit
Analysts warn that emerging market borrowers could be crowded out of the credit markets by $3 trillion of government bonds expected to be issued by the big developed economies in 2009--three times more than in 2008.
Source: Financial Times
U.S. Corporate Profits Likely Down for Sixth Time
Profits reported by Standard & Poor's 500 companies in the fourth quarter of 2008 likely will be down for the sixth quarter in a row, their longest losing streak for two decades, S&P says.
Source: Bloomberg
Private Equity Groups Near Deal to Buy IndyMac
A group of firms including J.C. Flowers, Dune Capital Management, and Paulson & Co. is close to buying failed lender IndyMac in a deal partly financed by the federal government.
Source: New York Times
Hope Fades for PS3 as Comeback Player
If Sony was counting on the PS3 videogame console to revive its fortunes in this year's Christmas shopping season, the troubled Japanese electronics giant is in for disappointment. Sales in November fell 19% year-over-year, even as the Nintendo Wii and Microsoft Xbox 360 gained.
Source: Wall Street Journal
Music Industry Looks to Web for Revival
The Internet used to be the bane of the recording industry. Now, in a belated recognition of the Web's potential as a distribution medium, major record companies are looking to strike deals with Net giants such as YouTube or even to set up their own sites to sell music online.
Source: Financial Times
Why Online Ads Are Weathering the Recession
In most media, 2009 will bring unkind cuts, and Madison Avenue will never be the same. But Internet advertising seems to be holding up, potentially growing as much as 10% next year.
Source: BusinessWeek
Conversation of the Day: FedEx Erases Kinko's
Reader Bob Paine writes: "For me, the end of the Kinko's name is merely the official death notice for a company that long since passed away."
Read the Story and Tell Us What You Think
Hot Topic on the Business Exchange: Mobile Industry
The dynamic mobile industry spans thousands of companies large and small--from handset makers such as Nokia, Samsung, and Apple, to service providers like AT&T, Vodafone, and China Mobile. Reader Ray Kwong and others are sharing their insights.
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