Posts Tagged ‘money

16
Mar

Dodd Lays Out Details of Financial Overhaul Bill

By alfredlester Closed
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WASHINGTON — Senate Democrats, with the backing of the Obama administration, took a big step forward on Monday toward adopting the most sweeping overhaul of financial regulations since the Depression, calling on Republicans to join them to adopt the measure in the thick of an election year.

Exactly 18 months since Lehman Brothers filed for bankruptcy, setting in motion a financial crisis that required a federal bailout of unprecedented scope, the chairman of the Senate Banking Committee laid out a bill that aims to ensure stability for the financial system; close regulatory loopholes that had allowed excessive risk-taking; and protect consumers from the kinds of abusive loans that brought down the housing market.

The bill would enshrine Washington’s role in policing Wall Street, creating a nine-member council, led by the Treasury secretary, to detect systemic risks to the markets and placing the Federal Reserve in charge of all of the nation’s largest and most interconnected financial institutions.

The banking committee chairman, Christopher J. Dodd, Democrat of Connecticut, noted that negotiators from the two parties were not far apart when he announced last week that Democrats would proceed with their own bill.

“We will have financial reform adopted this year in the Congress of the United States,” Mr. Dodd said.

Even so, the measure’s prospects remained far from certain.

The major flashpoints will include, among other things, the scope of authority for a new Consumer Financial Protection Bill to be established within the Fed; the scope of exemptions under new rules governing the trade of derivatives; and the mechanism by which the government could seize and dismantle a large company on the verge of failure.

Another provision is one intended to curb Wall Street’s influence over the Federal Reserve Bank of New York. Its president would be appointed by the president of the United States, not by a board that includes representatives of member banks business card design.

Mr. Dodd estimated that there was substantial bipartisan agreement on 9 of the bill’s 11 titles, the exceptions being consumer protection and corporate governance.

The bill “reflects an awful lot of work that has gone on between Democrats and Republicans on this committee,” Mr. Dodd said, taking pains to praise the top Republican on the committee, Senator Richard C. Shelby of Alabama, and another member, Senator Bob Corker of Tennessee, who had spearheaded Republican negotiations in recent weeks.

The bill quickly attracted praise from observers — if not lawmakers — on both sides of the aisle.

“This will ensure that large financial institutions face the same resolution process as small banks and eliminate the possibility of future government bailouts,” said Sheila C. Bair, a Republican who is chairwoman of the Federal Deposit Insurance Corporation.

Elizabeth Warren, a Harvard law professor who is chairwoman of the Congressional Oversight Panel that oversees the Troubled Asset Relief Program, said in a statement, “Despite the banks’ ferocious lobbying for business as usual, Chairman Dodd took an important step today by advancing new laws to prevent the next crisis. We’re now heading toward a series of votes in which the choice will be clear: families or banks.”

Douglas J. Elliott, a former investment banker and now a fellow at the Brookings Institution, said the proposal appeared to “represent a major improvement to the status quo, but political compromises significantly diminish its effectiveness compared to an ideal set of reforms.”

Dodd Lays Out Details of Financial Overhaul Bill

10
Mar

Senate to pass jobless aid, business tax breaks

By alfredlester Closed
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WASHINGTON – Legislation blending help for the jobless with popular tax breaks for businesses and individuals is slated to pass the Senate Wednesday over protests from conservatives who say it adds too much to the $12.5 trillion national debt.

But compassion for the jobless and the political power of an annual package of tax breaks is likely to produce a bipartisan vote to pass the measure, even though it would add more than $130 billion to the budget deficit over the next year and a half.

The bill would provide unemployment benefits of up to 99 months in many states for people mired in joblessness as the economy slowly recovers from the worst recession in decades. The measure easily cleared a procedural hurdle Tuesday by a 66-34 vote, with eight Republicans voting with Democrats to break a GOP filibuster.

The measure illustrates the great extent to which direct help for the jobless and the poor makes up a large portion of Democrats’ election-year agenda on jobs — and threatens to squeeze out other items amid concerns about a budget deficit projected at a record $1.6 trillion this year.

The sweeping bill cleans up a host of unfinished congressional business from last year that languished as the Senate focused on health care. It would also prevent doctors from absorbing a 21 percent cut in Medicare payments and extends through December a generous 65 percent subsidy of health insurance premiums for the unemployed under the COBRA program, at a cost of $10 billion.

Democrats also hope to finish work this week on a far smaller job-creation measure blending additional highway spending with new tax breaks for companies that hire the unemployed inferred heaters. The Senate could clear the measure for President Barack Obama’s signature by Friday.

Wednesday’s larger bill also provides the annual extension of $26 billion worth of tax breaks for businesses and individuals that are popular with senators in both parties.

The $66 billion cost of providing additional months of unemployment checks — the core benefit is 26 weeks — is added directly to a budget deficit expected to hit $1.6 trillion this year. Federal cash to help states with Medicaid adds about $25 billion more.

“Even though these programs may be good for your state, a senator has an obligation to stand up and say ‘no more,’” said freshman GOP Sen. George Lemieux of Florida. “No more spending our kids’ future. No more bankrupting the promise of this country.”

But Democrats said it would be heartless to cut off unemployment benefits to the long-term jobless and contended that the benefits inject demand into the economy, helping to lift it.

“This is not just some technical bill,” said Sen. Max Baucus, D-Mont. “This bill helps real people. Failure to enact this bill would cause real hardship. Failure to enact this bill would cost jobs.”

The tax breaks include a property tax deduction for people who don’t itemize, lucrative credits that help businesses finance research and development and a sales tax deduction that mainly helps people in the nine states without income taxes.

Senate to pass jobless aid, business tax breaks

04
Mar

Greece prepares tax rises, debt continues to mount

By alfredlester Closed
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ATHENS (AFP) – Greece, fighting to avert bankruptcy, was to reveal a third wave of tax rises and welfare cuts on Wednesday to win support from the European Union and a reprieve from debt markets.

Prime Minister George Papandreou, who warned lawmakers on Tuesday that the country faced a "wartime situation", was expected to announce the new draconian measures after briefing President Carolos Papoulias.

The latest round of crisis action is believed to include a two-percent increase in sales tax, a pension freeze, heavier benefit cuts for civil servants and steeper tobacco and fuel duties.

The European Commission, the EU's executive arm, insists that Greeks must sort out their fiscal mess — which includes a public debt of nearly 300 billion euros (407 billion dollars) — before expecting any outside help.

Greece must avoid "a nightmare of bankruptcy in which the state would not be able to pay salaries or pensions," Papandreou told lawmakers in Athens. He said: "We find ourselves today in a wartime situation."

That would create a huge headache for its European partners which are alarmed that Greece's problems could cause lasting damage to the credibility and discipline which underpin the eurozone. Related article:EU unveils 2020 vision

Greece needs more than 20 billion euros (27 billion dollars) by May to redeem old debt falling due. It also needs to borrow heavily to finance a public deficit which is close to 13 percent of gross domestic product (GDP).

Overall, the government is desperate to improve its downgraded credit rating and thereby reduce the crippling interest rate, currently slightly above 6.0 percent, which it has to pay to borrow from international investment funds.

And time is short. Papandreou has said that financing needs are assured until the middle of March.

A total of 54 billion euros will have to be raised this year to cover the public deficit which has swollen way beyond the three-percent EU limit make quick cash. Moody's rating agency has estimated that about 15 percent of tax revenues will be absorbed by debt charges this year.

A team of analysts from the Standard and Poor's rating agency is currently in Athens for talks with Greek ministers.

Meanwhile, the sentiment on financial markets about the course of events in Greece is highly uncertain, although there is a suspicion that if the latest round of measures satisfies EU authorities, some sort of support for Greece may emerge in the next week or so.

A Greek official told Dow Jones Newswires that Athens would issue a 10-year bond to raise between three and five billion euros "within days of the announcement of the austerity package."

And economist Neil MacKinnon at VTB Capital told AFP that a rescue "has to be agreed, whether it is some sort of loan package contingent on evidence of Greek budget cuts or debt purchases by EU governments and/or state owned entities or some sort of debt guarantees."

The Greek prime minister flies to Berlin on Friday for talks with German Chancellor Angela Merkel, widely regarded as holding the key to any eurozone bailout.

Papandreou has undertaken to use the crisis to restructure the economy, and cure Greece of decades of fiscal mismanagement and deeply entrenched corruption, but statistics released on Tuesday show that he faces a titanic reform task as bribery is on the rise.

The local branch of Transparency International said that bribes last year rose by 50 million euros from 2008 to 790 million euros (1.1 billion dollars), paid to all parts of the economy, from hospitals to tax officials.

Greece prepares tax rises, debt continues to mount

02
Mar

Dividends on the rise after worst-on-record year

By alfredlester Closed
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CHICAGO (MarketWatch) — After 2009 saw companies slashing or eliminating dividend payouts left and right, many American firms are beginning to cautiously reinstate — or even raise — theirs in this period of assumed recovery.

While shareholder payouts still lag versus 2008’s, more than a dozen of the S&P 500 have raised or initiated a dividend this year, while only two have decreased or suspended them. And the firms now offering higher payouts represent a wide range of industries, from Coca-Cola to Tiffany and P.F. Chang’s to T. Rowe Price .

And there could be more to come.

“We expect dividend payments to rebound in 2010, including those from the financial sector, as dividends are reinstated, since some companies now have both the ability and incentive to pay dividends,” said Jeffrey Kleintop of LPL Financial Research. “In the current environment, a boost to the dividend payment may signal more confidence in sustained growth by business leaders than their guidance on the earnings outlook, helping to lift stock prices along with the dividend payout.”

That comes after an especially rough spell as “the past two years have been tough on dividends,” Kleintop added. “In fact, 2009 marked the worst year on record for dividends since 1955, resulting in a 21% decline in dividends per share for the S&P 500 companies as a whole.”

In 2008 and 2009, 32 S&P 500 companies suspended their dividends, while only 11 initiated them, but 49 have raised or initiated dividends so far this year. One of the latest is Qualcomm , which announced late Monday that that its quarterly dividend would increase almost 12% to 19 cents a share.

‘2009 marked the worst year on record for dividends since 1955.’

Jeffrey Kleintop, LPL Financial Research

“The strength of our business model is enabling significant investments in our strategic business initiatives while returning capital to stockholders,” said Paul Jacobs, chief executive of the wireless-technologies firm, in announcing the hike. “Since commencing this program in 2003, we have returned $12.6 billion to our stockholders through a combination of dividends and stock repurchases payday advance online.”

For the month of February alone and for all reporting issues — not just the S&P 500 — dividend increases are up 29% from February 2009, although they’re still down 42% from February 2008, noted Howard Silverblatt, senior analyst at S&P Indices.

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“February is typically a good month, and this one has come through,” he said. “Actual cash payments are still down year-over-year, but at least it’s starting to go back up.” He added that he expects it will “most likely [be] 2012-13 until we reach 2008 levels.”

For the S&P 500, “it is the best month in two years, with a very impressive three-month run,” he continued. “I expect more good news, but not as much of it over the next few months; I also expect reductions to start next month.”

Josh Peters, editor of Morningstar’s DividendInvestor, said dividends “really bottomed out last summer after a spate of cutting we hadn’t seen since the Great Depression,” including one from Dow Chemical , for the first time in 97 years. At the same time, he noted that some of the mote stable consumer-focused companies, like McDonald’s and General Mills , “continued to raise theirs even during the crash.”

But over the last couple of months, “we have seen less-traditional payers deciding to raise their dividends,” including retailers, restaurant chains and tech firms, he said. “And assuming we don’t tip back into a double-dip recession, we should continue to see more dividend increases than cuts.”

Many companies will have to do so just to stay competitive against other issues in the stock market, he said, especially as more and more Baby Boomers near retirement.

“They have learned that stock prices don’t just go up, and they will want the reliable income,” Peters said. “Compared to 10 years ago, the idea of trying to live off capital gains is truly frightening.”

Dividends on the rise after worst-on-record year

12
Feb

Michelin posts 71 pct drop in 2009 profit

By alfredlester Closed
Categories: Free blog Tips, all, business, market and power
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PARIS – French tire maker Michelin on Friday reported a 71 percent drop in earnings last year as auto markets slumped, and said it is “vigilant” for the year ahead.

Michelin posted a net profit of euro104 million ($143 million), less than the euro357 million earned last year. Revenues declined 9.8 percent to euro14.8 billion.

Like auto maker Renault SA, Michelin, which is based in Clermont-Ferrand, France, achieved its aim of generating positive free cash flow at the year end to help it ride out the crisis.

Michelin had a positive free cash flow — the funds a company is able to generate after maintaining or expanding assets — of euro1.4 billion compared to a negative euro359 million in 2008 after it ran down inventories and reduced capital expenditure.

In 2010, Michelin is again targeting positive free cash flow.

Chief Executive Officer Michel Rollier said Michelin has “improved its major financial metrics, the foundations of its future growth” as it responded to a “historic decline in tire demand, especially in mature economies paydayloan.”

Looking ahead, he said Michelin is exercising “extreme vigilance.”

Michelin said markets for car and light truck tires fell sharply in the first half as carmakers slashed production and cut inventories, but lifted in the second half thanks to government scrappage schemes.

The exception was China, were demand surged 65 percent, making the country the largest market ahead of the United States for the first time.

Demand for truck tires remained low, the company said.

Michelin posts 71 pct drop in 2009 profit

Hot News: Rates on 30-year mortgages average under 5 pct

10
Feb

Earnings Preview: PepsiCo Inc.

By alfredlester Closed
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NEW YORK – PepsiCo Inc., maker of soft drinks and snacks, reports its fourth-quarter results before the market opens Thursday.

WHAT TO WATCH FOR: Changes in the way consumers are buying snacks and soft drinks as they continue watching their wallets. PepsiCo Inc.’s beverage sales have fallen in North America as people either cut out the expense or started switching to healthier juices and teas. Snack sales have held up better as people buy more food at grocery stores and eat out less often.

Analysts expect PepsiCo to report that its beverage sales remained soft in the fourth quarter. They will focus on the company’s snack division, Frito-Lay, maker of brands like Doritos, where growth could slow in the quarter.

Competition in the snack business is intense, wrote Bill Pecoriello, an analyst who heads ConsumerEdge Research LLC.

“Frito has been losing share even as year-over-year price increases and promotional intensity come more in line with historical norms,” he said short term personal loan.

He said international growth trends need to hold up as well because they have been driving the company’s growth.

WHY IT MATTERS: PepsiCo makes products that people at varying income levels buy, so its results offer a window into how shoppers are spending their money.

WHAT’S EXPECTED: Analysts polled by Thomson Reuters expect PepsiCo to earn 90 cents per share on revenue of $13.27 billion.

LAST YEAR’S QUARTER: PepsiCo reported profit of $719 million, or 46 cents per share a year earlier. Excluding restructuring and other one-time items, the company earned $1.39 billion, or 88 cents per share.

Earnings Preview: PepsiCo Inc.

09
Feb

Feds Bullard: May see asset sales late 2010

By alfredlester Closed
Categories: all, blog, economic, market and money
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WASHINGTON (Reuters) – The Federal Reserve could sell some assets later this year in an effort to whittle down its bloated balance sheet to avoid inflation, a senior Federal Reserve official said on Monday.

The Fed's purchases last year of longer-term Treasuries and other debt, undertaken to help revive the economy, were financed by adding cash to the financial system. But leaving large amounts of cash sloshing around as the economy strengthens risks fueling inflation.

"Maybe you get in the second half of 2010 or something like that, if things are going pretty well, maybe then you'd sell a little bit at that point and you'd try to see how the market reacts," St. Louis Federal Reserve Bank President James Bullard told Reuters in an interview.

The U.S. central bank should try to get its balance sheet, which has ballooned by more than $1 trillion, down to a normal size before the next recession strikes to ensure it has the ammunition it needs to counter a downturn, Bullard said.

After the Fed slashed interest rates to near zero in late 2008, it launched a buying spree that also included mortgage-backed securities and debt issued by housing finance agencies to provide further support for the economy.

SALES BEFORE RATE HIKES

Bullard, who is a voting member on the Fed's policy-setting panel this year, said his preference would be to begin selling some assets before raising interest rates, although he said not all Fed policymakers were likely to see it his way.

He said the idea would be not only to get the balance sheet back to a pre-crisis size, but to return it to holdings of mostly U.S. Treasury securities.

The St. Louis Fed chief has long been an advocate of more actively managing the Fed's assets — either by selling them or by leaving open the option of buying more if the economy stumbles anew. The consensus view at the Fed favors shuttering the purchase programs as planned and relying on rate hikes initially to tighten financial conditions.

However, with an economic recovery seemingly on track, Bullard made clear officials had begun to debate how best to normalize the Fed's balance sheet. Fed Chairman Ben Bernanke could shed more light on the central bank's plans in congressional testimony on Wednesday.

Bullard said markets would be disrupted if they came to believe the Fed was planning large-scale sales of mortgage-backed securities. However, he said the idea of gradual sales as a strategy is under discussion.

"Selling has more sympathy than you might think free credit report online. It's more a question of timing and speed," Bullard said.

"You'd kind of want the situation to be back to normal in some kind of time frame before the next storm comes for the economy so that at that point you'd have a fresh set of tools and you can react at that point," he said. "There will be a lot more discussion going forward about how exactly to do this."

INFLATION EXPECTATIONS SEEN RISING

The Fed's unprecedented policy actions helped lift the U.S. economy out of its deepest downturn since the 1930s. After contracting for four straight quarters, the economy grew at a 2.2 percent annual rate in the third quarter of last year and a 5.7 percent pace in the final three months of the year.

Bullard said the economy should grow at an annual rate above 3 percent in the first half of this year, adding that unemployment may have peaked. The U.S. jobless rate dropped to 9.7 percent in January from 10 percent in December.

The Fed is scheduled to wrap up its purchases of $1.43 trillion in mortgage-related securities by the end of next month. The program was undertaken to lower mortgage rates and prop up the struggling housing market.

Bullard said he does not expect a substantial jump in mortgage rates when the program ends, as some fear.

"I think it will be seamless," he said.

Further emphasizing his concerns about preventing inflation, Bullard said inflation expectation are at or above the Fed's implicit target range. Central bankers lay great stress on holding inflation expectations in check because they believe doing so is key to keeping inflation at bay.

"If the data keep coming in as expected and the economy keeps improving, then those will continue to ratchet up unless the central bank sends some signals that, 'No, we intend to keep inflation close to target,'" he said.

Bullard said that if the rise in inflation expectations began to look troubling, the Fed could discard its pledge to hold interest rates exceptionally low for an extended period, even if unemployment remained high.

"We know that the expectations are very important to how these things evolve, and so if those started to get out of hand, we really have to come back in and send a signal to the market," he said. "It would trump everything."

Fed’s Bullard: May see asset sales late 2010

03
Feb

Obama pushes energy plan that GOP may support

By alfredlester Closed
Categories: business, economic, market, money and power
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WASHINGTON – Looking for a political and policy victory, President Barack Obama on Thursday pushed energy proposals designed to attract allies and opponents alike, calling for increased ethanol production and new technology to limit pollution from the use of coal.

Facing a Senate with a newly energized Republican minority, Obama has begun tailoring his energy policy to GOP-supported ideas, starting in his State of the Union address last week with calls for offshore oil drilling opposed by environmentalists and a bigger role for nuclear power.

The first-term president — politically weakened by the loss of the late Sen. Edward M. Kennedy’s seat to Massachusetts Republican Scott Brown — also has begun promoting his energy policy as a job-creating boost to the economy.

“Now, there’s no reason that we shouldn’t be able to work together in a bipartisan way to get this done,” Obama said during a bipartisan meeting with governors in the White House’s State Dining Room. “It’s good for our national security and reducing our dependence on foreign oil. It’s good for our economy, because it will produce jobs.”

He spoke as the White House released presidential task force recommendations calling on both Washington and the private sector to spend more money on biofuels like ethanol. The group said the nation likely will fall short of goals Congress has set for creating more environmentally friendly energy.

At the same time, the Environmental Protection Agency issued a new rule requiring U.S. companies to produce at least 13 billion gallons of renewable fuels this year — up from about 11.1 billion in 2009. The congressional goal is 36 billions gallons of renewable fuel by 2022.

EPA Administrator Lisa Jackson said the new rules would reduce oil dependence by million of barrels a year and “help bring new economic opportunity to millions of Americans, particularly in rural America us fast cash.”

In his meeting with the governors, Obama also announced a new task force to study ways to increase the use of coal in meeting the nation’s energy needs without increasing the pollution that contributes to global warming.

“It’s been said that the United States is the Saudi Arabia of coal, and that’s because … it’s one of our most abundant energy resources,” Obama said. “If we can develop the technology to capture the carbon pollution released by coal, it can create jobs and provide energy well into the future.”

Washington Gov. Christine Gregoire said the president told coal-state governors he understood their resistance to change when coal suppliers in their states are making money. She said Obama urged them to be partners in developing clean coal alternatives, a proposal that was embraced by many Republicans in the room.

“There was consensus around, let’s see if we can develop a clean coal strategy of the future,” she said.

The White House meeting comes a day after Obama signaled a willingness to separate a controversial cap-and-trade proposal aimed at limiting carbon pollution from more attractive green energy jobs and energy efficiency proposals. The House approved the anti-pollution measure last year as part of a comprehensive energy bill, but it is unlikely to win Republican support on Capitol Hill.

Energy has been a major part of the president’s domestic agenda since he took office, but it has taken on new urgency in the wake of Brown’s victory in Massachusetts as both the president and his Democratic allies on Congress look ahead to the fall elections.

___

Associated Press Writer Julie Pace contributed to this report.

Obama pushes energy plan that GOP may support

Hot News: Bernanke voices economic concerns as hes sworn in

20
Jan

Kraft to Acquire Cadbury in Deal Worth $19 Billion

By alfredlester Closed
Categories: all, economic, money, online and world
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After months of fiercely resisting any deal, Cadbury agreed on Tuesday to an improved takeover offer from Kraft Foods, worth about $19 billion.

For Kraft, the deal offers a chance to expand its footprint in emerging markets and in higher-growth sectors like gum and candy.

“It transforms the portfolio, accelerates long-term growth and delivers highly attractive returns,” Irene B. Rosenfeld, Kraft’s chairwoman and chief executive, said in a statement.

Cadbury for its part will benefit from the supply chain of a larger company, said Jon Cox, a food and beverage analyst at Kepler Capital Management in Zurich.

But the prospect of a takeover of Cadbury, the 186-year-old British company, especially by an American multinational like Kraft, sent shudders throughout Britain and prompted a wave of public protests.

The Mail on Sunday, one of the biggest-selling British newspapers, ran a “Keep Cadbury British” campaign.

“It’s sad to see another British company bought up by a multinational,” Mr. Cox said, “but that’s finance.”

Prime Minister Gordon Brown said Tuesday that his government was “determined that the levels of investment that take place in Cadbury in the United Kingdom are maintained,” and that “at a time when people are worried about their jobs, that jobs in Cadbury can be secure.”

During a conference call Tuesday, Kraft executives reiterated that the company would keep a strong presence in Britain and would be a “net importer” of jobs in the country.

The move will also continue the consolidation that has dominated the food business over the last decade.

While mergers involving food companies dipped somewhat last year — preliminary data from the Food Institute, a trade organization, showed 58 acquisitions in 2009, versus 130 in 2008 — analysts expect deal-making to pick up again as companies seek greater scale and presence in developing countries.

“We’re in the middle of a little wave of deal activity,” Greg Pearlman, the head of the food and consumer group at BMO Capital Markets, said. “Will they all be as big and global and transforming as this? No good credit score. But I do think there’s some pent-up demand for strategic acquisitions.”

That may present challenges for companies like Hershey that lack an international presence to pursue global competitors. Hershey, based in Pennsylvania, had been readying a potential bid for Cadbury, according to people briefed on the matter. Yet with Cadbury’s board recommending the new Kraft bid, a counteroffer from Hershey seems unlikely.

The agreement between Kraft and Cadbury came together over the weekend, after weeks of sometimes blistering volleys.

Cadbury in particular fought fiercely. Its chairman, Roger Carr, derided Kraft as showing “contempt” for the well-known brand and dismissed its hostile bidder as a low-growth conglomerate.

On Tuesday, Mr. Carr softened his language, saying in a joint statement that the new offer “represents good value for Cadbury shareholders.”

“For Cadbury shareholders, it’s the best possible deal, given they were dealt a bum hand, because there were no counterbidders,” Mr. Cox said. “The clear winner is Kraft.”

Kraft’s original, unsolicited offer, made in September, was worth about $16.7 billion.

The new offer is about a 5 percent premium over Cadbury’s closing share price of 807.5 pence on Monday and a 14 percent improvement over Kraft’s first offer in September.

Under the terms, Kraft will pay 500 pence in cash and offer 0.1874 new Kraft shares for each share of Cadbury. That amounts to a payment of 840 pence ($13.80) for each Cadbury share. Additionally, Cadbury will pay out a special dividend of 10 pence a share.

Tuesday was the last day Kraft could raise its offer under British takeover rules. Cadbury shareholders have until 1 p.m. London time on Feb. 2 to decide whether to accept it. While the terms of the offer are final, Kraft reserved the right to raise its bid if a rival offer were made.

William Neuman contributed reporting.

Kraft to Acquire Cadbury in Deal Worth $19 Billion

30
Dec

Panel Rejects French Carbon Tax

By alfredlester Closed
Categories: all, blog, market, money and news
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BRUSSELS — France’s Constitutional Council has rejected a tax on carbon emissions strongly backed by President Nicolas Sarkozy that was to take effect Friday. But his ruling conservative party said the measure would be redrafted so it could be passed into law next year.

The council ruled late Tuesday that the bill contained too many exemptions for polluters, broke with past practices and threatened to make tax collection unfair.

The ruling is a blow to Mr. Sarkozy, who has sought to burnish his green credentials by holding international talks next year to seek agreement on emission cuts following the Copenhagen climate conference. Environmental groups have said they expect the talks to be held in Paris.

The Copenhagen conference, which ended without a timetable to reach a binding global agreement to curb greenhouse gas emissions, represented a humiliation for European Union leaders seeking to lead global efforts to tackle climate change.

Mr. Sarkozy said he strongly favored the tax, scheduled to go into force on the first day of the new year, as a way to shift France onto a low-carbon path and modify the way the state collects revenue.

The tax was set at €17 for each ton of carbon dioxide.

Members of opposition Socialist party, many of whom said the tax would damage citizens’ purchasing power, said the defeat was personal one for Mr. Sarkozy because he had cultivated an image of aggressively on fighting emissions on the international stage but was unable to put in place workable policies at home.

Members of the French Green party said the defeat would force the government to come forward with a bill that would be more effective in helping to curb France’s contribution to global warming.

A number of Scandinavian countries already have similar taxes, which raise the cost of fuel for motorists and for household heating.

But in its ruling, the French council said the tax was flawed because it would have primarily raised the cost of fuel for vehicles and heating even though there are many other sources of emissions cash advance to savings account.

Senior members of Mr. Sarkozy’s party immediately said the government would amend the text of the bill, taking into account the objections of the council, and present a new text for approval by the country’s council of ministers on Jan. 20.

But it remains unclear how the bill could be modified to meet the demands of the council without fierce objections from French industry.

A move to subject heavy industries to the tax would be opposed by French companies that already complain the costs of doing business in the country make it difficult for them to compete in Europe and elsewhere.

France has backed efforts to introduce an E.U.-wide carbon tax that could overcome some of those objections. But many countries like Britain strongly oppose moving such fiscal decision-making from national capitals to Brussels.

Mr. Sarkozy also has promoted so-called border taxes at the E.U.’s frontiers to protect the competitiveness of European industry. But those taxes could provoke a trade war with key partners like China and the United States.

The European Union has operated an Emissions Trading System since 2005 that requires large polluters like cement manufacturers, steelworks and electricity utilities to hold a certain quota of permits to emit greenhouse gases.

Those companies must buy additional permits if they exceed their quota.

But the price of those permits has never been high enough for long enough to push utilities to adopt lasting changes. The French carbon tax was envisaged as a means to nudge industry toward systemic change by pushing up the cost of using products and services based on fossil fuels.

Panel Rejects French Carbon Tax

25
Dec

Weekend Investor: How to keep your finances on track in 2010

By alfredlester Closed
Categories: business, economic, life, money and world
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NEW YORK (MarketWatch) — There’s no way to put a positive spin on what happened to most investors’ retirement portfolios in 2008 and early this year. Simply put, the losses were brutal, and in some cases ruined long-held retirement plans.

Yet if there’s any consolation to be taken from the past 18 months, it’s that many people now pay more attention to their total financial picture — not just stock and bond investments, but saving and spending habits as well.

Buckle up for 2010 markets

A dozen experts weigh in with their 2010 predictions for stocks, bonds and the economy. Barron’s Clare McKeen reports.

“There’s no silver bullet that can undo what happened last year,” said Richard Hisey, president of AARP Financial Inc. “There’s no guarantee [that losses won't happen again] but that’s no reason to not take steps [to improve finances].”

There are basic financial measures that all investors should be aware of, Hisey said, such as being disciplined about spending and keeping a watchful eye on an investment portfolio’s asset allocation.

“If anyone takes an objective look at their finances and how they can improve them, it’s surprising how [much] they can make improvements by having a budget and sticking to it,” Hisey said.

“People don’t have time to focus on their saving as much as they should,” he added. “By keeping the message simple and encouraging work on basic things, it’s easier to get through.”

As the new year approaches, here are some steps to get your finances back on track:

1. Be practical. Inventory all of your assets and liabilities and take it even further by looking at the different types of liabilities. Use some assets — savings in a cash account that yields practically zero, for instance — to repay certain types of debt, such as the balance on a credit card that’s charging 15% interest a year.

2. Revisit retirement goals. For many people, retirement means days of fishing or playing golf, or lying on a beach sipping cocktails. In truth, it may be time to shelve those dreams and prepare for a retirement that includes some sacrifices.

This realization can be difficult for baby boomers, who often have a disconnect between how they envision retirement and how they’ve actually prepared for it, Hisey said.

For example, you might have to move to a smaller house or apartment. And many people at retirement age will have to accept that they’ll still be working, if only part-time, Hisey said.

3. Don’t ignore inflation. The impact of inflation on a nest egg is difficult to grasp, especially since inflation lately has been relatively tame.

One way to imagine the sting of inflation, Hisey said, is to compare what basic goods and services cost a couple of decades ago with their prices today instant payday loan. Gasoline is a good example, Hisey said: “Remember when you paid less than $1 a gallon for gas, and then think about paying $4 a gallon recently.”

4. Save, save, save. It’s often-quoted advice, but saving as much money as possible — and starting early — can make a huge difference in the quality of your later years. Some investment companies recommend stashing away 10% or even 15% of gross salary, but Hisey didn’t want to put a set number on it. Even 2%, if that’s all one can afford, should be set aside — but always with a view to increasing that amount.

5. Be smart about insurance. Get strategic about what insurance to take and when to take it. For instance, for a younger person with a young family, full life insurance makes sense. But once the children have left and are making their own money — and as the infirmities of old age creep in — it might be worth drawing down the life insurance and increasing disability insurance so that illness doesn’t mean the loss of income.

There’s also the matter of having the right type of insurance. Hisey spoke of one family whose house burned down who turned to their insurer only to discover that their insurance payout had a limit. The family was forced to tap retirement savings to buy another house.

“People should look at their finances the way companies do,” Hisey said. “There are assets such as hard assets and also human capital — the value of your work — and you need to protect those assets. Look as hard at your insurance portfolio as you would your investment portfolio.”

6. Don’t let panic dictate investment choices. Last year’s losses have led many investors to change their asset allocation and diversification strategies. In some cases, this is the result of deliberate decisions taken in light of the changed market. But all too often it’s the reaction of a panicked or fearful investor.

Regardless of what the market is doing, sticking with an allocation that matches an investor’s principles, especially when it comes to risk, is most important, said Hisey.

7. Get help if you need it. AARP encourages investors to work with financial professionals when it comes to making their financial and investing decisions. The organization believes these professionals can provide valuable guidance, particularly in times of crisis.

“Make sure you find somebody you can trust,” Hisey said. “It should be a relationship like the one you have with your doctor — get second opinions if want them and keep asking questions. If they can’t explain things in ways that you understand, move on.”

Weekend Investor: How to keep your finances on track in 2010

04
Dec

AIG chooses HK as AIA listing venue

By alfredlester Closed
Categories: all, economic, life, market and online
Tags: , , , ,

BEIJING, Dec.4 (Xinhuanet) — The American International Group Inc.(AIG) said Thursday it chose Hong Kong asthe listing venue for its Asian life insurance unit American International Assurance (AIA), media reports said on Friday. Related AIG pays back a large chunk of bailout loans AIG keeps profitable for second quarter One year after financial crisis The troubled butbailed-out U.S.insurer will go ahead with the up-to-10 billion U.S. dollarinitial public offering. Preparations for the offering, aimed at raising funds to repay a U.S. government bailout, had stalled since Bob Benmosche took the helm at AIG in August.

People familiar with the situation said AIG has appointed Deutsche Bank AG and Morgan Stanley as joint global coordinators for the planned initial public offering. It has yet to name the rest of the bookrunners.

AIGsaid on Tuesday it had closed a pact with the New York Federal Reserve that slashes its debt under a credit facility by more than half, to 17 billion U payday advance online.S. dollars.

AIG shares rose more than 11 percent to 31.72 dollars, partly reversing a steep fall in the stock on Monday after investors were spooked by concerns over a possible shortfall in reserves for non-life insurance claims.

The debt reduction is the result of a deal first announced last March to give the New York Fed a preferred stake in two of AIG’s biggest life insurance units, American Life Insurance Co and American International Assurance, effectively swapping debt for equity.

“AIG continues to make good on its commitment to pay the American people back,” Chief Executive Robert Benmosche said in a statement, which also warned of volatility.

(Agencies)

AIG chooses HK as AIA listing venue

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