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2016-30/0359/en_head.json.gz/14379

White House, Treasury Dismiss Nationalization Talk Friday, 20 Feb 2009 | 6:34 PM ETCNBC.com The White House and Treasury Department late Friday sought to shoot down persistent rumors Citibank and Bank of America are about to become wholly owned subsidiaries of Uncle Sam. The White House said it strongly believed in a privately held bank system, after rumors that the U.S. government could nationalize banks saw shares in Bank of America and Citigroup plummet to shares fall to fresh lows. "Let me reassure as best I can on banks," White House spokesman Robert Gibbs told a news conference. "This administration continues to strongly believe that a privately held banking system is the correct way to go, ensuring they are regulated sufficiently by this government. That's been our belief for quite some time and we continue to have that." The White House spokesman's comments helped lift U.S. stocks from their lows of the day, traders said. The Nasdaq Composite index briefly turned positive, and the Dow Jones industrial average and Standard & Poor's 500 index both cut deep losses. Separately, Treasury spokesman Isaac Baker said in a prepared statement that there are rumors in the market, but they should not be regarded as an indication of the administration's policy. "As Secretary (Timothy) Geithner has said, we will preserve a financial system that is owned and managed by the private sector," Baker said. Earlier Friday, executives at both Citigroup and Bank of America both said they are not in danger of nationalization. But the comments did little to soothe markets. BofA CEO Ken Lewis attributed speculation about the government taking over his institution to a "lack of understanding" regarding the company's operations. "Our company continues to be profitable," Lewis said in a statement. "We see no reason why a company that is profitable with strong levels of capital and liquidity and that continues to lend actively should be considered for nationalization. show chapters Treasury: Preserve Private Sector Banking System The Treasury says investors should not regard rumors as an indication of the administration's policy toward banks and nationalization, reports CNBC's Steve Liesman. Treasury: Preserve Private Sector Banking System Friday, 20 Feb 2009 | 3:53 PM ET Investors dumped shares in droves Friday, sending shares tumbling about 20 percent. The stocks had been weak, but sunk lower after statements from Sen. Christopher Dodd indicating that while the government would prefer to avoid it, nationalizing some banks was a possibility. Still, Lewis held resolute about his bank's position. "Speculation about nationalization is based on a lack of understanding of our bank's financial position as well as a lack of appreciation for the adverse ramifications for our customers and the economy," he said. Meanwhile, two sources close to Citi said the bank has not held talks with the U.S. government about nationalization. The U.S. Treasury has not disclosed much more to Citigroup than it has to the broader public about its plans for the banking sector, the people said. Slideshow: Bank Failures of 2008 —CNBC Senior Economics Reporter Steve Liesman and Reuters contributed to this report. Related Securities

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2016-30/0359/en_head.json.gz/14556

Discover more about working at the ECB and apply for vacancies. More Navigation Path: Home›Media›Speeches›By date›2012›6 July 2012 Media Building trust in a world of unknown unknowns: central bank communication between markets and politics in the crisis Speech by Jörg Asmussen, Member of the Executive Board of the ECB, European Communication Summit 2012, Brussels, 6 July 2012 It has been said that “there have been three great inventions since the beginning of time: fire, the wheel, and central banking [1] ”. Central banking has become my business since January this year, but I feel I am getting my fair share of the other two as well: being behind the steering wheel of the ECB during this crisis turned out to be in the line of fire. You invited a central banker to speak at this year’s European Communication Summit. Thank you for giving me the opportunity to share some thoughts with you on a very relevant topic: central bank communication in the crisis. Communication is an essential and powerful policy tool of central banks. This is because the physical “product” of a modern central bank is something with little intrinsic worth. The euros in our pockets are, after all, only pieces of printed paper. Their value lies in the shared conviction that this so-called fiat money can be used as a means of exchange, as a unit of account and above all as a store of value. “All money is a matter of belief [2] ”. This belief stands and falls with the credibility and trustworthiness of the central bank. This, in turn, rests on its words and deeds. Maintaining this trust is an enormous responsibility. Consistent communication and policy action can create confidence and popular support. By contrast, miscommunication and policy mistakes can create excessive volatility in markets. In extreme cases, the currency itself may be at risk. And with it the value of the peoples’ savings. It was not always obvious that central banks and communication should be mentioned in the same sentence. Central banks used to be secretive places. They used to surprise the markets with their policy moves. They used a language that made the oracle of Delphi appear positively accessible: Alan Greenspan is on record as saying: “If I seem unduly clear to you, you must have misunderstood what I said [3] .” Those days are over. Central bank communication has become a very dynamic discipline. By deliberately steering expectations in financial markets with their communication, central banks let the markets do part of the job of transmitting their policy signals. The crisis was a game-changer in the communication of central banks, and of economic policy makers more generally. In this world of unknown unknowns, and rapid shifts market sentiment, our task has become much more complex. The new challenges can be captured by the following three themes, or fault lines: First: market communication versus political communication; Second: transmitting the message versus facing the discourse Third: arguing with counterfactuals and navigating the short versus the long term I will address each of those in turn. 1. Market communication vs political communication; In the “old” days, central bank communication was focused on a specific target audience: financial markets, specialised financial media, interested academic circles. It was an ‘insiders’ community’, speaking an expert language. Anyone who listened to speeches of central bankers on the economic outlook and the course of monetary policy knows what I mean: they were deliberately unexciting, technical and repetitive. But this type of communication inspired confidence: there was a consistent message and a steady hand at the tiller. The importance of the consistency of the messages across time, countries and media outlets remains. But the context has changed fundamentally. During this crisis, central bankers and policy-makers are faced with a potentially explosive interplay between markets and politics. Messages that are necessary and legitimate in public debates can be completely unsuited for market communication and exacerbate tensions. Let me explain. In Spring 2010, Angela Merkel addressed the German Bundestag to persuade lawmakers to approve the financial assistance programme for Greece. She had to engage in a profoundly political discourse. She employed all tools of rhetoric. And she justified her appeal by declaring that “the future of the euro is at stake”. This was legitimate. However, in financial markets across the globe, that very same message popped up on traders’ screens as a one-liner: “Merkel questions survival of single currency”. If you were a trader, what would you do? The rest is history. One and the same message is received very differently by different audiences. But those audiences cannot be separated easily. “Political” communication and the processing of this information in nervous and fragile markets has been a major factor that exacerbated and propagated the crisis. We still do not have an answer how best to bridge this gap: on the one hand, we must not suffocate open debate in our democracies. We cannot muzzle the public discourse to impose conformity with the needs of nervous markets. At the same time, undisciplined and irresponsible communication has real, costs. Maybe one way forward would be to emphasise that markets should listen to the right kind of statements. If it concerns the euro area as a whole, it is the voices of the supranational level that should count. Markets should also concentrate on what is actually being said by policy-makers, rather than how this is being interpreted by analysts, commentators and the media. The constant extrapolation of what current policy decisions “could” or “are likely” to imply under extreme scenarios sows the seeds of volatility. The focus on what might happen in case of catastrophic tail-events diverts attention from already achieved or agreed policy action. A second aspect of the “brave new world” of communication is the urgent need to communicate beyond the specialist “insider’s circle”. Central banks have to actively communicate with the broader public, for three reasons: First, what used to be obscure and complex issue for monetary policy specialists are now mainstream news. Two years ago, few people had heard of central bank operations or intra-Eurosystem payment flows. These days, television talk shows debate the ECB’s long-term refinancing operations or TARGET2-balances. The people have a legitimate interest and a right to get information and explanation directly from us, rather than via intermediaries. Second, in all of this, we are faced with the inevitable tendency to reduce complexity and simplify the message. This is what the media are supposed to do: “First simplify, then exaggerate! [4] ” Simplification is, of course, legitimate – and also needed. But exaggeration is not. It risks skewing perceptions and distorting the true picture of the situation. Take, for instance, the situation in Ireland or Portugal. This requires comprehensive and in-depth understanding – an analyst’s two-pager often cannot do justice to this complexity. By sharing and explaining its own assessment, the central bank can contribute to a more balanced debate. Third, during the crisis, the ECB has undertaken extraordinary measures. It has provided 1 trillion euro in liquidity to the banking system. It contributes to the design of adjustment programmes for countries receiving EU-IMF assistance. It is part of the Troika going on country missions. It offers advice on the future evolution of Europe. Some criticise us for this, some claim that we go beyond our mandate. Those criticisms must not go unanswered. Adding complexity to an already complex situation is the fact that the ECB communicates in a multi-lingual, multicultural context. One and the same message, even if translated perfectly into the 23 official EU languages, may cause very different public and market reactions. But extraordinary actions call for extraordinary efforts to explain them. This brings me to my second point: 2. Transmitting the message versus facing the discourse In the past, central bank communication was mainly a one-way street. The central bank transmits its messages. As independent institutions, they were – and continue to be – prohibited from yielding to outside influence. And rightfully so. The first President of the ECB, Wim Duisenberg, summed it up very neatly: “I hear, but I do not listen [5] .” The academic debate about central bank communication focused on transparency: Whether central banks were too closed and provided too little information. The globalisation of information, the rise of the internet and the new “prominence” of central bank action create a new context: whatever the central bank does is subject to a worldwide market assessment and media commentary. In blogs and internet comments, via Twitter, on TV channels and in traditional print media, central banks are faced with a barrage of outside opinion that has a powerful impact on public discourse. Professors, Nobel Prize winners, analysts, chief economists, innumerable experts, any individual posting comments on the internet: they all present their analysis and opinion. In many cases, there is thoughtful analysis. In some cases, opinionated polemics. But in almost all cases, they know better. The concepts they use, the solutions they propose and the policy actions they call for – all this shapes the public discourse, and one way or another also influences policy-makers. The difference is that commentators do not need to assume the responsibility for the recommended actions. Policy-makers have to. Let me give you an example: last year, a debate was raging about the size of the European financial assistance facilities, the so-called “Eurozone firewall”. None of the very substantial amounts seemed to be enough: the 500 billion euro that were already on the table, and used to only a very small extent, were decried as insufficient. One trillion euro at least, if not two trillion or more, were seen as necessary. One idea pushed forcefully by the “international expert opinion” was to “leverage” existing funds, by offering incentives to private and public entities to provide additional funds. And indeed, throngs of European officials worked night and day to devise and agree on two options to leverage the European Financial Stability Facility (EFSF). Today the two instruments are there. They could work. Will they ever be used? The caravan of the “commentariat” had already moved on. No-one speaks about leveraging the EFSF anymore. In fact, the actual investors in EFSF bonds were put off by the leveraging options, because it made the EFSF structure more risky and less understandable. The searchlight of attention of the markets and the commentary shifts fast. Yesterday it was the firewalls. Then it was growth. Today it is Spain. For sure, all of these issues require action. But designing and agreeing on responses takes time. No wonder that policy-makers are criticised for constantly being “behind the curve”. Markets want to see immediate and forceful action from Europe’s politicians. And their criticism of the slowness of the European crisis response is in part justified. But democratic politics takes time. It is open, noisy, and messy. We cannot do “crisis management by Politburo”. We need effective communication and a proper public debate. This is especially true for the envisaged next steps towards deeper integration in Eurozone. Why am I telling you this? Because it sheds light on the nexus between a new class of opinion formers, financial markets and policy outcomes. For the euro area and the ECB, the situation is even more peculiar, because the influential “commentariat” comes predominantly from outside the euro area. The big English-language newspapers, the news agencies and wire services that shape opinions in the economic and financial sphere on the Continent are all writing from outside the euro area. There is, of course, nothing wrong with friendly outside advice. And I certainly do not wish to come across as whining and complaining. But it simply remains a fact: the analysis, discourse and policy prescriptions that are propagated come from the outside. Maybe inevitably, they come with a certain disinterested detachment. As if the outside “spectators” are not affected by what is happening. And they come with a dangerously narrow and exclusive perspective on the economics of the monetary union. But if the profound political commitment of Eurozone countries to the historical project of “ever closer union” is neglected, the assessment remains superficial and partial. And the suggested policy responses may be biased or naïve. Why does it matter? Because the discourse influences some of the most important financial markets for the Eurozone. If expectations that have been built up are not fulfilled, if alleged certainties do not materialise, if actions from politicians or central bankers are not forthcoming as anticipated by the “market consensus”, the reaction can be grave: volatility, contagion, all the way to complete market dysfunction. The systemic impact can be major, driving financial institutions, as well as sovereign borrowers into real difficulties. The result is a situation where policy-makers – including the central bank – may feel compelled to react to market developments with ever more powerful responses, in order to contain the a systemic risk and avoid a meltdown. What is the lesson? Central banks have to face up to the public and market discourse – especially because they are independent. We have to participate in this debate. We have to take on the critics, understand their points, and argue our case. We have to listen, explain, and convince. Naturally, we will ultimately do what we judge to be the correct cause of action, in full independence and in line with our mandate. Actions speak louder than words. Especially when they are timely, measured and effective. This is what creates confidence. Precisely for that reason, financial markets, as well as politicians, have been looking to the ECB as a kind of “saviour of last resort”. This creates maybe an even bigger communication challenge: we must explain what the limits of our powers and mandate are. The ECB cannot compensate for what others – notably political authorities – fail to do. There is no substitute for good policies. Saying this is not always popular. But “to be trusted is a greater compliment than being loved. [6] ” When market pundits forecast the “inevitable”, they insinuate a degree of certainty about the future which is simply not there. This brings me to my last point – how to deal with uncertainty, with a world of unknown unknowns. And how to communicate when everyone asks “what if”. 3. Arguing with counterfactuals and navigating the short versus the long term During this crisis, the ECB has taken a number of non-standard measures. They were, by definition, out of the ordinary. But they were motivated by the need to prevent a catastrophe. What we did, we justified with respect to an intangible counter-factual. With respect to history that did not happen. Doing so can be extraordinarily difficult. Let me give you an example. Back in November 2011, we were faced with acute tensions in financial markets; entire market segments had become dysfunctional. The danger of a credit crunch was real. There was an anticipation of an inevitable catastrophe. You may remember the headlines: “The euro has a 50% chance of making it to Christmas [7] ”, or “Ten days to save the eurozone [8] ”. The announcement of our long-term refinancing operations was a sentiment changer. The feared severe credit crunch has not materialised. The euro is still here – and here to stay. But the question “what if the ECB had not acted” remains unanswered. There is no evidence what would have happened in such a counterfactual. This makes justifying our action with reference to such a counterfactual an uphill struggle. The uncertainty embedded in the “what if” question is exacerbated by the discontinuity between the short term and the longer term in the interaction between markets and policy-makers. Let me explain. Markets mainly focus on the immediate future; on the emergency measures to fight the crisis: here, a central bank can be very effective. The ECB can change the market situation within minutes, by adjusting its interest rate, market interventions if needed, adapting its collateral rules, or simply communicating its assessment. This creates certainty, for now. However, for the longer-term, considerable uncertainty remains: short-term fixes do not change the structural features of European economies and markets. Those depend on the countries’ economic policies, which take time to design and implement. Firm commitments from governments can help reduce this uncertainty, but can never eliminate it. The trade-off between the short term and the long term creates a fundamental communication challenge for the ECB. If short-term crisis fighting is successful, for instance through ECB actions, some of the longer term challenges might never be addressed. The immediate pressure subsides, and incentives for governments weaken. More than once did we witness this during this crisis. By contrast, if the fire-fighting in the short-term does not succeed, there may not be a longer term to think about. Our communication is walking a tightrope: markets need reassurance that the ECB will do what is within its power and mandate to guarantee that the euro will not to fail. At the same time, governments need to have the right incentives to tackle the longer-term challenges. Ladies and Gentlemen The crisis was a game changer in the communication of central banks. Navigating between markets and politics has shifted the goalposts of the ECB’s communication. We are facing up to this new environment and its challenges. We are engaging more. We are explaining more. The changed environment, including the spread of new media, might actually be an opportunity in this respect. That said, I would not expect every member of the ECB Governing Council to open a twitter account soon or to accept you as friends on Facebook. Let me close with a word of caution. The ECB has gained stature during this crisis. The people and the markets look to the ECB for solutions. But there should be no illusion that the ECB can single-handedly ensure a plain sailing for our economies and the markets. There are limits of what we can do, and what we know. “Central banks do not have divine wisdom. They try to do the best analysis they can and must be prepared to stand or fall by the quality of that analysis [9] .” Rest assured that we will continue to do this, and to fulfil our mandate. Not least to make sure that central banking remains up there in the list of the three greatest inventions. Thank you very much for your attention. [1]Will Rogers, cited by Paul Samuelson [2]Adam Smith [3]Wall Street Journal 22/09/1987 [4]Instruction of an editor of The Economist to his newly recruited reporters [5]ECB press conference 11/04/2001 [6]George MacDonald, 19th century Scottish writer [7]Jacques Attali 26/11/2011 [8]REUTERS, 30/11/2011 [9]Eddie George, former Governor of the Bank of England Guiding principles European Central BankDirectorate General Communications Sonnemannstrasse 20, 60314 Frankfurt am Main, Germany Tel.: +49 69 1344 7455, E-mail: media@ecb.europa.eu Website: www.ecb.europa.eu Reproduction is permitted provided that the source is acknowledged. Media contacts Twitter Guiding principles Site directory

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2016-30/0359/en_head.json.gz/14637

1 Surprising Way Stocks Can Bite You at Tax Time One of the biggest benefits that investors who buy individual stocks have is that they have a lot of control over when they choose to pay tax on their profits. But lately, a recent trend has proven to be an exception to that rule, and some shareholders will get a nasty tax bite when they file their taxes this April. The latest wrinkle in the tax code comes from what are called corporate inversions. You'll learn more later in this article about these events and how they can cost you at tax time. But first, let's turn to some background on why having to pay taxes prematurely is so unusual at the individual-stock level. The individual-stock advantage Anyone who has ever invested in a traditional mutual fund can tell you that one of the most annoying things about mutual funds is how their shareholders have to pay tax on their profits. Because mutual funds are pass-through entities, the funds themselves don't have to pay any income tax when they sell securities or receive dividend or interest income. Instead, they're required to pass on those dividends and capital gains to their shareholders, who are then responsible for their proportional share of the taxes on those profits. That's the logic behind the distributions that mutual funds pay at the end of most years, and even if you reinvest every penny of that distribution, you'll still owe tax as if you had taken the cash instead. With individual stocks, though, you get to choose when you buy and sell. Although the money that you receive in dividends is subject to tax in the year you receive it, capital gains are all a matter of when you decide to sell. For investors who follow long-term buy-and-hold strategies, holding individual stocks in a taxable account is nearly as valuable a tax shelter as having money in a tax-deferred retirement account -- as long as you hang on to your shares, you won't owe tax on the accumulated gains. When companies make tax moves An exception applies to this rule of no capital-gain recognition, and it's becoming more common. As a recent Wall Street Journal article explained in some detail, companies have increasingly moved away from the U.S. to incorporate in other countries. Although the stated motivation in some cases is to align a business more with the scope of the global economy, there are often significant tax benefits as well. For instance, the WSJ article discusses how Eaton (NYSE: ETN ) expects to save $160 million in taxes annually because of lower tax rates in Ireland, with the company having taken advantage of Cooper Industries' Irish corporate domicile to make the switch when Eaton bought Cooper. Yet due to the way the transaction was structured, Eaton shareholders had to realize gain when they traded shares of the old Eaton for new Eaton shares. Moreover, Eaton isn't the only company using similar transactions to gain tax advantages. Insurance company Aon (NYSE: AON ) restructured itself in April 2012 to create a new parent holding company in the U.K., raising similar issues as the Eaton transaction. Rowan (NYSE: RDC ) did a similar transaction in May, with the same issues also arising. In one case, a spinoff created some of the same tax challenges. Sara Lee's breakup into an international coffee company and its Hillshire Brands (NYSE: HSH ) North American meat business raised the issue, as the distribution of the coffee business and eventual merger into the Dutch company D.E Master Blenders 1753raised many of the same legal questions. Vague regulations Unfortunately, answering when such transactions led to current capital gains taxation isn't easy. Despite assertions in some cases that the surviving company having "substantial business activities" in the new location would allow shareholders to avoid tax, new temporary regulations make it very difficult for companies to pass the substantial business activity test, and the nature of eventual final regulations is still very much up in the air. Moreover, not all international transactions are affected by this obscure tax rule. When Pentair (NYSE: PNR ) combined with the flow control business of Tyco International, it used a structure similar to the ones described above, with Pentair creating a Swiss subsidiary. Yet because Pentair was smaller than the Tyco division, it wasn't subject to the adverse rule. What to do In cases like these, it's difficult for shareholders to do anything, with votes to approve mergers generally going through without impediment. Moreover, the threat of tax avoidance rules getting more complicated could make life difficult for shareholders in an increasing number of situations going forward. Investors need to stay on their toes and scrutinize proposed transactions closely for negative tax impacts. Of course, one solution is to stick with using retirement accounts for your stock investing, since IRAs won't force you to pay tax on gains even on corporate inversion transactions. Find out how to find great long-term companies in our free report "3 Stocks That Will Help You Retire Rich," where you'll find stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. It's completely free, so click here now to keep reading. Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Aon. The Motley Fool owns shares of Aon and Pentair. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Hillshire Brands

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2016-30/0359/en_head.json.gz/14638

This Is One Incredible CEO The Motley Fool's readers have spoken, and I have heeded your cries. After months of pointing out CEO gaffes and faux pas, I've decided to make it a weekly tradition to also point out corporate leaders who are putting the interests of shareholders and the public first and are generally deserving of praise from investors. For reference, here is last week's selection. This week, I plan to dive into the oil and gas industry and highlight the underappreciated CEO of EOG Resources (NYSE: EOG ) , Mark Papa. Kudos to you, Mr. Papa Forget the fact that EOG Resources was once a part of the defunct Enron more than 10 years ago – this is a remarkably well-run oil and gas driller headed by a superior leader. As you might imagine, oil and gas producers haven't fared very well over the past year as oil prices were generally tame throughout most of 2012 and natural gas prices slid heavily as warmer weather crushed demand and forced multiple drillers to cut back on production. Chesapeake Energy (NYSE: CHK ) , one of the nation's largest natural gas drillers, reduced its nat-gas capital expenditures by approximately 70% and promised a renewed focus on oil and natural gas liquids. EnCana (NYSE: ECA ) , Canada's equivalent to Chesapeake Energy in the U.S., responded by reducing production, but also by selling a 40% stake in undeveloped land interests in British Colombia. Last year was all about raising cash and repositioning toward liquid fuels. One of the first companies that proactively reacted to this shift in demand was EOG and its CEO. With the expectation of low natural gas prices hanging around for years to come, Papa has angled his company toward increased oil and natural gas liquid production – two fuel sources with higher margins and stable demand. My Foolish colleague and energy analyst Joel South recently highlighted the key details that have allowed EOG to excel beyond its peers in the past couple of years. First, EOG's focus on cutting costs, specifically with regard to its purchase of a sand mill that cuts out the high markups associated with sand purchases, is saving the company around $1 million per well. Second, rather than shipping oil to Cushing, Okla., or selling oil directly from the well and accepting the West Texas Intermediate price, EOG and peers Hess (NYSE: HES ) and Continental Resources (NYSE: CLR ) have been shipping their Bakken-drilled oil by rail to Louisiana and are being paid a handsome $20-$25 premium at the Brent crude spot price. Even with the added costs of shipping, these companies earn significantly more than if they were selling their product locally. Continental, for instance, is shipping 65% of its daily production to Louisiana. But, as Joel also notes, EOG has been able to increase its liquids production volume at a faster rate than any other U.S. producer since 2010, giving it the edge over all of its peers. Looking ahead, EOG's Papa upped his company's oil and liquids forecast in its most recent quarter to 40% and 38% from 37% and 35%, respectively, and pumped EOG's production forecast to 10.6% growth from 9%. A step above his peers I believe I've demonstrated beyond a reasonable doubt just how EOG has outperformed its peers. Now let's take a look at the other factors, not just operating performance, which make EOG great and make Papa a great leader. It all starts with the company's modest, but rising, dividend. In 2002, EOG was paying out a quarterly stipend of just $0.02. In its latest quarter, EOG paid shareholders $0.17 per share, a 750% increase over the past decade. Considering that EOG is in a very investment-heavy industry, I wouldn't anticipate its dividend will increase dramatically over the next couple of years (not until natural gas prices have a sustainable rally), but a payout ratio of just 15% is begging for a bigger share to be divvied out to shareholders. Oil companies also get the stereotype that they are heartless thrown at them. That isn't the case for EOG which takes good care of both its employees and its surrounding communities. In addition to the usual perks you get working for a top-tier multibillion dollar company, including a 401(k) and flexible health benefits, employees also receive subsidies on fitness centers and tuition reimbursement for approved courses. The greatest perk of all, however, affects both employees and the community: matching charitable gifts up to $75,000! That's right... EOG will match employee contributions, dollar-for-dollar, to approved charitable organizations up to $75,000 per year! As far as I can recall, that's one of, if not the, highest total I've ever witnessed in dollar-for-dollar matching! I'd be doing EOG a disservice if I didn't also mention that it partners with colleges and universities to fund training and educational opportunities, as well as partners with local leaders to assist with annual nationwide fund raising campaigns, such as the March of Dimes Walk America, and the Susan G. Komen Race for the Cure. Two thumbs-up I'm pretty sure I say this every week, but sometimes these CEO's just make it too easy. Mark Papa has executed the game plan perfectly for promoting higher margin liquid products; boosted shareholder payouts; and continued the theme of encouraging charitable contributions within the communities that EOG operates through employee participation and by making donations out of their own pockets. What more can be said about this fantastic CEO other than that he's well-deserving of two thumbs-up from me! Do you have a CEO you'd like to nominate for this prestigious weekly honor? If so, head on over to the new CEO of the Week board and chime in with your fellow Fools on who deserves some praise. If you don't have a nominee yet, don't worry; you can still weigh in on other members' selections. Can Chesapeake dig deep for a turnaround in 2013?Energy investors would be hard-pressed to find another company trading at a deeper discount than Chesapeake Energy. Its share price depreciated after negative news surfaced concerning the company's management and spiraling debt picture. While these issues still persist, giant steps have been taken to help mitigate the problems. To learn more about Chesapeake and its enormous potential, you're invited to check out The Motley Fool's brand new premium report on the company. Simply click here now to access your copy, and as an added bonus, you'll receive a full year of key updates and expert guidance as news continues to develop. Fool contributor Sean Williams has no material interest in any companies mentioned in this article. He loves giving credit when credit is due. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong. The Motley Fool owns shares of, and has written puts on, Chesapeake Energy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy that strongly believes in doing right by investors. Continental Resour…

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2016-30/0359/en_head.json.gz/14749

Sharon Dunnsdunn@greeleytribune.com Former New Frontier Bank officer charged Tribune file photo | A crowd looks in the front door at New Frontier Bank in west Greeley after the bank was closed by state regulators in April of 2009. A former New Frontier Bank loan officer was charged in federal court Wednesday for a variety of claims of fraud at the bank throughout the four years prior to the bank’s shutdown. « Related Media A former New Frontier Bank loan officer faces federal charges for a variety of claims of fraud involving millions of dollars in the four years prior to the bank’s shut down by state regulators in April 2009. Gregory William Bell appeared in U.S. District Court on Wednesday, having already reached a deal to plead guilty. Details of the agreement will not be revealed until his next court date, which has yet to be set. Bell was the chief loan officer at New Frontier, which catapulted to the top of the northern Colorado market with $2 billion in assets in 10 years. But the bank’s lending practices led to its undoing as it became one of the nation’s most expensive bank failures in 2009, costing the Federal Deposit Insurance Corp. $670 million. Bell, and five of the bank’s board of directors — Larry Seastrom, Robert Brunner, Timothy Thissen, John Kammeier and Jack Renfroe — were banned from banking in November 2010 because of their actions involving the bank’s failure. The board members could not be reached for comment on this story. None have ever publicly commented about the bank’s failure or the personal ramifications from it. The FDIC ordered a criminal investigation into all of the men, but it remains unknown if any of the others also will face criminal charges. According to the court documents, Bell was directly responsible for making more than $20 million in loans to borrowers, in return for $4.3 million being used to purchase New Frontier Bankcorp stock, a way to raise capital as required by the FDIC, which had been investigating the bank. He’s also charged with trying to pocket $160,000 in illegally obtained money, the documents charge. U.S. District Court Magistrate Judge Boyd Boland told Bell’s attorney, Saskia Jordan of Denver, and Assistant U.S. Attorney Thomas O’Rourke to obtain a date from court staff for Bell to enter a guilty plea. He was charged in an “information” rather than an indictment or a criminal complaint. Charging documents known as “informations” are used in federal court by prosecutors when a defendant already has agreed, at the time a charge is filed, to plead guilty. Boland, who oversaw the five-minute court proceeding, released Bell on a personal recognizance bond, which is a promise to appear at future court proceedings. The hearing was held to officially file charges against Bell. U.S. attorneys filed four counts against Bell for making false bank entries, misapplication of funds, bank fraud and money laundering from 2005 to 2008, about a year prior to the bank’s closing in April 2009. If convicted as charged, he could face up to 30 years in prison. According to the information filed, Bell faces one charge of submitting false information on a loan, dated Oct. 26, 2005. The documents state Bell prepared information for a $5.58 million loan to two borrowers, “on which he failed to disclose that a CD, valued at $106,759 pledged as collateral” actually belonged to someone else and that Bell would personally benefit from the loan. On March 14, 2008, the documents state that “Bell willfully misapplied approximately $662,045.79” of the bank’s money. From June 17 to Sept. 9, 2008, the court documents state Bell “devised and participated in a scheme to defraud (the bank).” “Knowing the state and federal regulators had directed NFB to raise capital, (Bell) arranged for eight NFB customers to borrow money from NFB and use proceeds of the loans to purchase shares of stock in New Frontier Bancorp so that New Frontier Bancorp could inject some of the money paid for the stock in to (the bank),” the charging documents stated. The documents stated Bell prepared the loan documents but failed to disclose how the money was going to be used. Rather, he stated in vague terms, the documents stated, that the money would be used for business investments for water sales, to buy agriculture real estate, to open a line of credit for a farm and an investment to manage income from a pending oil and gas lease. From those borrowers, Bell was able to loan out $20 million, in return for the borrowers buying $4 million worth of stock in the bank, which was supposed to help the bank raise money necessary to maintain required capital ratios based on its loans. At the time, state and federal regulations stated banks lending to individual borrowers couldn’t exceed 25 percent of the bank’s capital and reserves for potential loan losses. The documents state that on Aug. 29, 2008, Bell attempted to deposit $260,000 in proceeds from one of those loans to an account of the borrower of that loan. In the fourth count, he’s charged with trying to deposit $160,000 of money from “a transaction that involved the proceeds of a specified unlawful activity” into his own account in June 2008. The documents state he also attempted to disguise the source of the money. John Johnson, owner of Johnson Dairy in Eaton, sued New Frontier Bank in 2009, based on a bad loan Bell helped him get in June 2008 to finance his dairy. In his lawsuit, he claimed that bank officers took advantage of his cash-strapped position at the time to promise him a $5 million loan on the condition that he put $1 million of that into bank stock. At the time, the bank’s Denver attorney stated the allegations were a “gross mischaracterization of a lot of the facts.” There is no longer a record of that lawsuit in the court system. It’s likely the allegations of those loans paying for bank stock led a Boulder business group to back out of a planned deal to bail out the bank before it was shut down. Denver freelance journalist Robert Boczkiewicz contributed to this report. Join the Conversation The Greeley Tribune Updated Dec 5, 2012 10:34PM Published Dec 10, 2012 08:01AM Copyright 2012 The Greeley Tribune. All rights reserved. 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Technology: Delay in crowdfunding rulemaking creates questions and opportunities Despite a lack of regulations, existing crowdfunding companies give the SEC a chance to “beta test” the concept By Jake KoeringJuly 19, 2013 On April 5, 2012, President Obama signed into law the Jumpstart Our Business Startup Act, or “JOBS Act,” which exempted certain “crowdfunding” activities from the registration requirements of the Securities Act. The Securities and Exchange Commission (SEC) was supposed to promulgate rules by Jan. 5, which—subject to statutory boundaries—would implement the crowdfunding exemption. It failed to do so. Six months later, the SEC has not even issued initial proposed regulations. In the meantime, public comments to the SEC on the need and specifics of crowdfunding continue to roll in, and the small business community stamps its foot impatiently. Mary Jo White, who was confirmed as the SEC Commissioner on April 8, has repeatedly stated that completing JOBS Act rulemaking is amongst her top priorities. The delay in rules implementation, however, suggests that balancing the various priorities in the crowdfunding regulation is proving a tough nut to crack. The stated purpose of the JOBS Act was “to increase American job creation and economic growth by improving access to the public capital markets for emerging growth companies.” The term “crowdfund,” however, is not used in the act to refer to access to capital, but instead is used as an acronym for fraud avoidance—“Capital Raising Online While Deterring Fraud and Unethical Non-Disclosure.” The act thus neatly identifies the conflict the SEC’s regulations must resolve: How can we tap into the power of millions of Internet denizens and their social media and online connections to drive business investment while simultaneously ensuring those same investors are not defrauded in the process? The Internet is both the solution and the problem; it provides access to the Internet mob for investment, but does so immediately and without personal interaction, supplying the means for anonymous third parties to bilk potential investors of hard-earned money under the guise of a failed business venture. The comments on the crowdfunding portion of the JOBS Act at the SEC demonstrate significant interest in the regulations. As of the date of this article, the agency has received more than 390 different comments, and the agency lists more than 50 different meetings it has held on the regulations with companies knowledgeable about crowdfunding. Yet, none of those comments or meetings is likely to result in a concrete solution to entirely eliminate the potential fraud for crowdfunding investment. The ability to raise funds from individual investors directly presents too great an opportunity for fraud, and people are, in the end, human beings subject to influence and persuasion. Fraud will happen, and the SEC likely knows this fact. So, the question is, why the delay in implementing the rules? Is the SEC waiting for a solution that does not exist? Perhaps the answer to the SEC’s delays lies in the potential information it is already gaining from existing crowdfunding platforms. Rewards-based crowdfunding has been around for several years, with prominent companies such as Kickstarter and Indiegogo funding thousands of products and raising millions of dollars. More recently, the SEC has begun issuing “No-Action” letters to equity funding portals as well, including FoundersClub Inc. and AngelList LLC, finding their business models acceptable. As these funding systems are deemed acceptable, more and more crowdfunding options are made available to the public, and more and more real-world experience can be imparted to the SEC. The SEC has already consulted many of these companies in the rulemaking process, suggesting strongly that the agency is watching the companies’ success (or lack thereof), in hopes of providing the framework for a successful implementation of the JOBS Act regulations. The lessons learned from these existing portals regarding fraud avoidance will likely shape the SEC’s regulations. Kickstarter is a good example. Per its FAQs, Kickstarter does not screen the projects on its site aside from ensuring they meet a short set of project guidelines, it does not have an equity stake in the projects, and – once a project is funded – Kickstarter disclaims any responsibility for ensuring that it is completed . It steadfastly refuses to refund funds to project backers. Thus, for fraud prevention, it places the onus entirely on the project creator and the Internet community, asserting that its sign-up process creates a legal responsibility to follow through on the project once funded, and that the reputational impact of a failed Kickstarter project acts as a deterrent to fraud. The combined effect of legal responsibility and reputational impact appears to be substantially successful. Since 2009, Kickstarter has launched nearly 105,000 projects, raising nearly $700 million in the process. Of that amount, about 10 percent ($75 million) of the dollars raised were for projects that were funded but that, for whatever reason, were not successfully completed. Although Kickstarter does not archive projects that fail to be funded, it does keep projects that were unsuccessful available for searching. Thus, if a creator fails to complete a project, its failure is available via a simple search on the site or a search engine. A 90-percent success rate suggests Kickstarter’s system works. It enables a reputational review by ensuring transparency as to project expectations, creator identity and historical success. It then makes that information available to the Kickstarter community. Through this process, the Kickstarter community (and sometimes Kickstarter itself) has identified and caused the cancellation of numerous potentially fraudulent projects. The community has been able to identify fraud through unrealistic stated expectations, copying of photographs and other materials in the project description, and departure of the project creator, amongst other information. The combination of a strong and interested community with the transparent information above provides an avenue for the community to police the creators. Because Kickstarter is project-based, its success rate is easier to define than it would be for an equity return on investment. After all, it is easier to identify whether a particular design project was actually made than it is to navigate the challenging confluence of accounting practices, tax laws and business practices that relate to business valuation to determine company growth. But, where the identity of the party issuing the equity is ensured and made transparent and where historical information is made available to the relevant public, the ability of a company to mislead or defraud investors is greatly inhibited. As the SEC gains more knowledge from the real-world crowdfunding projects, it gains knowledge into practices that successfully foster investment while protecting investors. Hopefully, it has already gained enough knowledge to at least issue preliminary regulations for the crowdfunding portion of the JOBS Act in the near future. Other companies have shown crowdfunding works for limited investors and rewards-based investing. It is time to take those lessons and apply them to equity-based crowdfunding and truly jumpstart our business startups. « Prev Jake Koering Jake Koering is a partner in the Litigation and Intellectual Property practice groups at Freeborn & Peters. A long-time technology addict, both professionally and personally,... Data Privacy Breaches Part 2: Preparing for the government investigation Reading the crystal ball: When do I need a litigator? Commercial/Financial 1685 Innovation 1457 Risk Management 691 technology 511 social media 425 sec 408 Obama 277 fraud 159 Join the Conversation

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Home / Life Insurance / Why Your Life Insurance Is Key To Financial Planning For Your Special Needs Child Why your life insurance is key to financial planning for your special-needs child By Barbara Marquand Posted : 03/12/2012 To: From: Subject: URL: http://www.insurance.com/life-insurance/life-events/how-to-use-life-insurance-to-plan-for-special-needs-kids.html Financial planning for any family is complicated, but the challenges rise to a new level when a child has special needs.Let Insurance.com help you find affordable life insurance now. "Parents are not only planning for their family's needs and retirement, but for well beyond their lifetimes," says Linda Hunter Suzman, a Special Care Planner with MassMutual Financial Group in Seattle. The process, including buying life insurance policies, is fraught with legal considerations. Well-meaning parents who name children as beneficiaries on their policies put them at risk for losing eligibility for government assistance. Under federal law, anyone who receives a gift or inheritance of more than $2,000 is disqualified for benefits, such as Supplemental Security Income and Medicaid. That's why assembling a team of trusted financial advisers is critical, including an accountant, attorney and life insurance agent who specialize in helping families like yours. Life insurance as financial safety net: set up a trust An attorney can help you set up a special-needs trust -- an important tool if you think your child will require government help. A special needs trust holds assets for your child, and can be named as a beneficiary for life insurance. A trustee, usually a family member, distributes money to take care of your child. When set up properly, a special -needs trust provides money to maintain your child's quality of life and preserves eligibility for government benefits. The trust shouldn't be generic or inflexible, but designed specifically for your child, says Diedre Wachbrit Braverman, a special-needs estate attorney in Boulder, Colo. Braverman, whose brother has severe autism, speaks from experience; she helped her parents set up a trust. She recommends working with a special-needs attorney -- not just an estate attorney. The Academy of Special Needs Planners provides a search tool to find attorneys. She also recommends finding a knowledgeable life insurance agent. Life insurance plays an important role because most families cannot save enough money for their children's lifetime needs, and the coverage provides security in case a parent dies prematurely. A growing number of life insurance companies have established units for special-needs planning. MassMutual started its SpecialCare program in 2004. The company worked with The American College in Bryn Mawr, Pa., to develop coursework and the Chartered Special Needs Consultant designation for agents who complete the schooling. The training is open only to MassMutual agents, but will become available industry-wide in 2014, says Allen McLellan, associate dean and assistant professor of insurance at The American College. "I predict there will be great demand for it," he says. "Working with families in this situation takes deep and really broad knowledge. Most of the advisers who do well are driven, and the work is a calling." MetLife started its Center for Special Needs Planning 12 years ago upon the urging of an employee, a parent of special-needs children. The program provides training for agents and resources for families. More than 80 percent of the people who work in it have a family member with special needs, says Kelly Piacenti, director, and also a mother of four, including an 11-year-old boy with cerebral palsy. Piacenti is not surprised at results from a recent MetLife survey that showed less than half, 49 percent, of caregivers have identified a guardian for their dependent should they no longer care for them. More than half, 56 percent, are unfamiliar with how to identify a trustee to watch over their dependent's financial holdings, and another 55 percent aren't sure how to set up a plan for lifetime financial assistance for their dependent. Parents of special-needs children are so consumed with the day-to-day they have little time or energy to plan, she says. And questions about the future are scary. "Who's going to do this? Who's going to take care of him when we're not here?" says Piacenti, whose son requires intense medical attention. "This is what keeps us up at night." Tips for using life insurance to plan for the future of your special-needs child Suzman understands the stress on families because she's been there, too. Her son, now in college, was diagnosed on the autism spectrum. She recommends the following insurance tips: Make sure you have enough individual disability insurance and long-term care insurance for yourself, so the family isn't strained if you become disabled or need long-term care. Invest in a whole life insurance policy to help finance your child's lifetime needs. Permanent life insurance also provides cash value, which you can borrow against in emergencies. Consider important riders, such as waiver of premium, which pays the premium if you become disabled; and a guaranteed insurability rider, which lets you purchase more life insurance later without undergoing a medical exam. Finally, don't procrastinate. Help is at hand, and financial planning doesn't have to be expensive, Suzman says. "But not planning, writing no wills and leaving guardianship up to the courts -- that's a parent's worst nightmare." Related Articles on Insurance.com > Term life insurance vs. permanent life insurance: Is cash value the best value? > Whole life insurance: What you need to know > Term life insurance: What you need to know > Ace your life insurance medical exam > How much life insurance do you need? Get Life Quotes Home & Renters Individual/Family Want to bundle home and auto insurance for potential discounts? Do you currently have auto insurance?

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MAY/JUN 2009 VOL 30 NO. 3 FEATURE: The Nationalization Option: Considering a Government Takeover of Citigroup by Robert Weissman INTERVIEWS: The Wall Street Rip Off: Fees and Consequences an interview with John Bogle Eyes on the Prize: Incentivizing Drug Innovation Without Monopolies an interview with James Love New Directions for Government Motors an interview with Jerry Tucker A BIG Idea: A Minimum Income Guarantee an interview with Karl Widerquist Grassroots Power and Non-Market Economies an interview with Beverly Bell DEPARTMENTS: Behind the Lines Single Payer Sanity The Front Dying for Work - Radioactive Mining The Lawrence Summers Memorial Award Greed At a Glance Commercial Alert Names In the News Resources The Front Dying for Work Fifteen workers in the United States die every day due to job injuries, according to “Death on the Job: The Toll of Neglect,” a report issued by the AFL-CIO in April. The report criticizes the Bush administration for allowing meaningful worker-safety measures to stagnate, resulting in extreme under-enforcement of workplace safety standards. In 2007, the most recent year for which job fatality data is available, 5,657 workers died as a result of injuries sustained on the job, according to the report. This total was a slight decline from 2006. Employers reported more than four million work-related injuries and illnesses, but “Death on the Job” documents vast employer underreporting of workplace injuries, and estimates that a more accurate number would be 8 million to 12 million injuries and illnesses a year. The direct and indirect economic costs of disabling injuries and illnesses run between $145 billion and $290 billion a year. “Eight years of inaction and neglect by the Bush administration on major hazards and increased emphasis on employer assistance and voluntary compliance has left workers’ safety and health in serious danger,” the report states. The largest number of fatal work injuries occurred in construction, with 1,204 deaths. Transportation and warehousing had the next most fatal injuries, followed by forestry, fishing and hunting. “Unfortunately, as demonstrated by recent job safety disasters, such as the Sago mine explosion, the Imperial Sugar Refinery dust explosion and construction crane collapses in New York and Miami, which claimed dozens and dozens of lives, too many workers remain at risk and face death, injury or disease as a result of their jobs,” the report states. [See “The System Implodes: The 10 Worst Corporations of 2008,” Multinational Monitor, Nov/Dec 2008.] The manufacturing sector accounted for the largest percentage of non-fatal workplace injuries and illnesses, with 18.8 percent of the 4 million reported injuries and illnesses. The health care and social assistance industries accounted for 16.6 percent of injuries and illnesses, followed by the retail industry at 15 percent. The under-reporting of injuries and illnesses is a significant problem, according to the report. Referring to employer-reported injuries and illnesses, William Kojola, industrial hygienist at the AFL-CIO, says, “Those numbers are pretty much fictitious.” One study cited in the report found that government counts of occupational injury and illness underestimate incidence by as much as 69 percent. “This is an issue of research, but it’s also an issue of what policies and programs employers are putting in place that work as a disincentive for workers to report illnesses,” Kojola says. Those policies and programs include employers implementing programs that discipline or fire workers if they report injuries, or incentive programs where workers are given cash awards or vacations for having a low injury and illness rate, according to Kojola. “These are really insidious programs that drive these illnesses and injuries underground,” he says. However, the report commends recent initiatives by the House Education and Labor Committee, which held an oversight hearing on the issue, and the Senate Labor Appropriations Subcommittee, which provided funding for several initiatives to address underreporting problems, including $1 million for an enhanced OSHA recordkeeping enforcement program. The report remains highly critical of OSHA’s job safety enforcement and coverage, due in part to a lack of sufficient resources. “A combination of too few OSHA inspectors and low penalties makes the threat of an OSHA inspection hollow for too many employers,” the report states. “More than 8.8 million workers still are without OSHA coverage. OSHA’s resources remain inadequate to meet the challenge of ensuring safe working conditions for American’s workers.” There is currently one OSHA inspector for every 66,258 workers, according to the report. At these staffing and inspection levels, it would take federal OSHA 137 years to inspect each workplace under its jurisdiction just once, the report finds, a significant decrease in protection from 1992 — the year the AFL-CIO began its annual reports — when federal OSHA could inspect all workplaces under its jurisdiction once every 84 years. A March report by the U.S. Department of Labor Office of Inspector General found that OSHA’s inadequacies may have contributed to workplace fatalities. At 45 of the worksites where OSHA oversight and follow up on safety violations was deficient — and where proper enforcement actions may have diminished workplace hazards — 58 workers were subsequently killed in the course of their employment. The AFL-CIO report also finds OSHA penalties for safety violations and worker fatalities shockingly low. In fiscal year 2008, “serious” workplace safety violations — meaning the violation posed a substantial probability of death or serious injury — carried an average penalty of only $921. “That’s a trivial amount,” Kojola says. “It doesn’t act as much of an incentive for an employer to comply with the standards. And when it comes to fatalities, the situation is far worse.” The average total penalty for fatality cases was just $11,311. In Utah, the average penalty was a mere $1,106. “Where is the incentive? It’s petty cash penalties for situations where a worker is killed from a willful violation,” Kojola says. In addition, criminal prosecutions resulting from worker fatalities are exceedingly rare, according to the report. In most cases they are labeled misdemeanors, and in 2008, only two cases were prosecuted. “The criminal penalty provisions of the [Occupational Safety and Health Act] are woefully inadequate,” the report states. “Criminal enforcement is limited to those cases where a willful violation results in a worker’s death or where false statements in required reporting are made. The maximum penalty is six months in jail.” But Kojola is optimistic workplace safety enforcement will improve under the Obama administration. The administration has already taken significant and beneficial steps, he says, including expediting the development of a standard on diacetyl, a chemical in the flavoring for buttered popcorn which can cause a serious and fatal lung disease when inhaled by factory workers. The Obama administration also issued an advance notice of proposed rulemaking on the hazards of combustible dust — a measure the Bush administration refused to take even after 14 workers were killed by a combustible dust explosion at a sugar refinery in Georgia. “Already, within the first couple months, [the Obama administration] has taken more decisive steps than the Bush administration did in eight years,” Kojola says. The Obama proposed budget released in May allocated OSHA a $51 million increase over last year. — Jennifer Wedekind Radioactive Mining As the resource sector carries the Australian economy through the global financial crisis, significant uranium deposits lie dormant and undeveloped in Australia’s outback. Spurred by the possibility of the Australian economy sliding into recession, Australian state and federal governments have been busily removing the barriers to further uranium mining within Australia. If capital is scarce, then rainfall is scarcer in the mostly arid state of South Australia. Within this state are the currently operational Beverly and Olympic Dam uranium mines, as well as the Honeymoon mine, which has recently received approval for construction to commence. These mines all require copious amounts of water to function. The Beverly Uranium mine is operated by U.S.-based General Atomics, through subsidiary Heathgate Resources. In August 2008, General Atomics was granted approval to significantly expand operations at Beverly, increasing the size of the mine from 16 square kilometers, to 100 square kilometers. Expansion of the mine was approved by Federal Environment Minister Peter Garrett, former environmental activist and lead signer with rock band Midnight Oil. The mine extracts uranium through the controversial acid in situ leaching (ISL) process. This involves pumping acid into an aquifer which dissolves the uranium ore, before the solution is pumped back to the surface, where the uranium is removed. “The liquid radioactive waste — containing radioactive particles, heavy metals and acid — is simply dumped in groundwater,” says Jim Green, National Nuclear Campaigner with Friends of the Earth Australia. Hydrogeologist Gavin Mudd, of the Civil Engineering Department at Monash University, states that the ISL technique “treats groundwater as a sacrifice zone and the problem remains out of sight, out of mind.” However, Ric Phillips of General Atomics wonders what all the fuss is about. “Essentially, the mining fluid is existing ground water from the formation. We add a little bit of oxidant and a little bit of acid. … Essentially, it’s a water pumping exercise.” Phillips possibly understates the quantities required in the process, given that for every ton of yellowcake which is produced, 18 tons of sulphuric acid, one ton of hydrogen peroxide and 7,000 tons of water are required. The Beverly Uranium mine operates on the land of the Indigenous Adnyamathanha people, who are routinely ignored by government and the mining company. Kelvin Johnson, an Adnyamathanha man, highlighted the injustices faced by his people, stating, “We protest because our land is being damaged against our wishes. … We protest because it is our right and our responsibility to look after this country.” Not too far away from the Beverly mine is the Olympic Dam mine, operated by BHP Billiton. This mine consumes 35 million liters of water each day from the Great Artesian Basin, yet does not pay a cent for this water. According to Green, “The Great Artesian Basin is a vast body of underground water that lives deep under the surface from central to North Eastern Australia.” The Great Artesian Basin plays a critical role in supporting many mound springs, which support rare and delicate fauna and flora. The Olympic Dam mine is currently the third largest mine in the world, producing copper, gold and uranium. However, BHP Billiton is planning a nearly $17 billion expansion of this operation. To support this expansion, a further 216 million liters of water will be required on a daily basis, while 650 megawatts will be needed to power the mine, producing between 4.5 million and 6.6 million tons of carbon dioxide every year. “BHP Billiton is cost cutting on environmental protection by designing its ‘tailings storage facility’ to leak an average of 3 million liters of radioactive liquid waste a day, every day, over decades of proposed mining,” says David Noonan of the Australian Conservation Foundation. Noonan claims that “BHP plans to line only 15 percent of the proposed 44 square kilometer tailings facility that will be up to 65 meters high.” In addition, “Exporting uranium to new customers like China will be an integral part of creating value from the Olympic Dam ore body,” according to Dean Dalla Valle, Chief Operating Officer of BHP Billiton’s Uranium Australia. Green is heavily critical of the move to sell uranium to China, which is yet to sign the Nuclear Non Proliferation Treaty. Soon to become the third operational uranium mine in South Australia, preparatory work has recently commenced at the $98 million Honeymoon uranium mine. The mine is a joint venture between Canada-based Uranium One through subsidiary Southern Cross Resources, and Japanese trading house Mitsui and Co. Located 400 kilometers northwest of Adelaide, Honeymoon will utilize the same ISL process in operation at Beverly. According to the Environmental Impact Statement released by Southern Cross Resources, ISL is the “preferred option,” as it has “clear advantages in terms of economic benefits and minimal environmental impact.” The Honeymoon mine is the first to receive approval after the Australian Labor Party dumped its “three mines” policy in April 2007. In support of this policy change, then Federal Opposition Leader and current Australian Prime Minister Kevin Rudd stated that Australia is “blessed in terms of our rich supply of energy resources and we need to develop them as a reasonable way to combat climate change.” Such thinking is criticized by Gavin Mudd, who states that this argument rests “on the arbitrary and implausible assumption” that the only alternative to the export of uranium for energy production is the further construction of coal fired power plants. Reiterating his support for increased uranium mining, South Australian Premier Mike Rann stated that “(the resource sector) is going to help pull us out of these global economic conditions in better nick that most other places.” Across the border, recently elected West Australian State Premier Colin Barnet has also moved to attract uranium mining to his state. Upon election in November 2008, Barnet dumped the policy preventing uranium mining from occurring in Western Australia. Immediately following this announcement, BHP Billiton announced plans to reactive plans to mine the Yeerilie uranium deposit. With the looming threats posed by climate change and the global financial crisis, Governments within Australia are claiming that mining uranium deposits has now become a moral and economic imperative. Consequently, concerns which previously stunted this industry in Australia are being conveniently forgotten in the rush. — Patrick O’Keeffe THE LAWRENCE SUMMERS MEMORIAL AWARD The May/June Lawrence Summers Memorial Award* goes to J.C. Penney for advertising over Memorial Day weekend a silkscreen T-shirt bearing the slogan, “American Made” — that was made in Mexico. Steve Capozzola at the Alliance for American Manufacturing sent an e-mail to J.C. Penney, saying that the ad was deceptive and asking why the shirt “was emblazoned with an ‘American Made’ slogan when it was in fact made in Mexico.” Responding to his complaint, J.C. Penney spokesperson Kelly Sanchez said, “You indicate that there was a shirt that depicted the slogan ‘American Made.’ This type of slogan is referring to the actual person wearing the shirt and not to the manufacturing of the merchandise.” J.C. Penney told Business Week it will sell the shirts throughout the summer. The line, it says, is “intended to evoke our American lifestyle and pride in being American.” Sources: Tuna Connell, “Made in America: Corporate PR, Not Practice,” AFL-CIO Now Blog, June 11, 2009; Brian Burnsed, “J.C. Penney’s ‘Made in America’ Tee,” Business Week, June 29, 2009. *In a 1991 internal memorandum, then-World Bank economist Lawrence Summers argued for the transfer of waste and dirty industries from industrialized to developing countries. “Just between you and me, shouldn’t the World Bank be encouraging more migration of the dirty industries to the LDCs (lesser developed countries)?” wrote Summers, who went on to serve as Treasury Secretary during the Clinton administration and is the outgoing president of Harvard University. “I think the economic logic behind dumping a load of toxic waste in the lowest wage country is impeccable and we should face up to that. ... I’ve always thought that underpopulated countries in Africa are vastly under polluted; their air quality is vastly inefficiently low [sic] compared to Los Angeles or Mexico City.” Summers later said the memo was meant to be ironic. Mailing ListSearch Editor's Blog Writers' Guidelines HOME

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Layoffs Line the Road to Recovery By SYLVIA NASAR Correction Appended Last month's surge in unemployment made a lot of people wonder how the recession can wind down as long as workers are losing jobs. In fact, layoffs and unemployment typically keep climbing long after spending starts to revive. "What surprises people is that everything doesn't happen simultaneously," said Michael J. Boskin, chairman of the President's Council of Economic Advisers. No one can say for sure that a recovery will arrive between Memorial Day and Labor Day, as many economists expect. But the pattern of past recessions strongly suggests that the transition from economic contraction to expansion takes months and progresses in fits and starts. "Recessions are more predictable than expansions," noted Bruce Steinberg, an economist at Merrill Lynch Capital Markets. If the typical pattern persists, the economy will shed jobs right up until the recovery starts. What is more, unemployment will keep rising for several months after the recession ends. Not only will business bolster production, at first by extending overtime and raising productivity, but more people will flood into the labor market as the chances of quickly finding work start to improve. "We could get another month of decline in payrolls of 200,000 or 250,000, as in March," said Stephen Roach, a Morgan Stanley economist who expects growth to resume this summer. "After that, you'd expect the declines to taper off to 100,000 to 150,000." Here is how past recessions have ended: First, the forces that toppled the economy dissipate. The Federal Reserve provides stimulus with more money and lower interest rates. Investors and consumers turn more optimistic, and after a while, spending comes sporadically. Orders Filled From Stockpiles Business does not rehire laid-off workers right away. Initially, companies fill orders with goods that piled up during the slump. Then the layoffs stop, usually signaling the end of the recession. Consider the previous recession, which lasted from January 1981 through November 1982. The economy lost more than 300,000 jobs in July 1982 and roughly 200,000 jobs a month in each of the last four months of the recession. Payrolls even dipped a bit in December 1982, the first month of the recovery. Further, businesses started aggressively expanding their work forces only in March 1983, and unemployment topped out at 10.8 percent early that year. In short, sales pick up months before companies start rehiring. Consumer spending starts to recover even though many people are still losing their jobs or are having trouble finding work. Increasingly confident consumers who have hung onto their jobs start spending, more than offseting the loss of buying power of workers being laid off. How do economists expect this recession to end? "We've got some of the preconditions for a turnaround," Mr. Boskin said. The war is over, oil prices are down and inflation is falling. With the Federal Reserve easing monetary policy, the money supply is rapidly growing and both short- and long-term interest rates have fallen substantially from the levels of the fall. Investors have turned bullish, and consumers' spirits have revived. "The process has already begun," said Mr. Steinberg of Merrill Lynch. Housing Rebounds First Housing is almost always the first segment of the economy to perk up. "The reason is that as mortgage rates come down, housing becomes more affordable for people who haven't lost their jobs," Mr. Steinberg said. Now, for example, houses are more affordable than they have been in 14 years, according to the National Association of Realtors. Besides, only about a million people buy a brand-new house in any given year, and recently many fewer have been buying. It thus takes only a small fraction of the 95 million American households to spark a rebound by buying new homes. Sales of new and existing homes jumped in February, and surveys by the Mortgage Bankers Association and the National Association of Home Builders suggest that sales -- especially of the entry-level houses that first-time buyers purchase -- continued to head up in March. A revival in home buying typically spills over to spending on everything from sinks to sofas, as buyers feather their new nests. At the same time, consumers who had postponed car purchases start showing up again at dealers' lots. Recovery Takes Time "This will be consumer-led, not a business-led recovery," said David W. Mullins, the new vice chairman of the Federal Reserve. But it usually takes time for the economy to shift from recession to expansion, and there are setbacks. "There's a dissonance between attitudes and spending right now," Mr. Mullins said. "It's a mirror image of last summer, when attitudes stank, but sales kept going for a couple of months after confidence collapsed." While consumer confidence has rebounded strongly, car sales edged up only a bit in February and March. Beyond slightly higher factory orders for consumer goods, there is no sign yet of a broader revival of spending. Such a revival would not necessarily spell instant relief from layoffs. For starters, business outlays for machinery and buildings usually turn down toward the end of a recession. Such outlays -- which amount to about a tenth of the gross national product, compared with two-thirds for consumer spending -- rose in the first months of the recession. More important, "when consumer spending starts to stabilize," Mr. Roach said, "the classical pattern is for business to keep trimming production and cutting costs." That is because inventories typically pile up during the first leg of the downturn. "Clearing shelves of excess stocks can take months," Mr. Roach added. Cars are a case in point. Although the annual selling rate is running slightly above six million, the Big Three and the Japanese auto makers with United States plants are holding production below a five million annual rate. One reason for hope this time around is that business was a lot quicker to respond to the collapse in demand. Consumption fell sharply in the fall, and businesses immediately slashed inventories at an annual rate of $28 billion -- nearly a record. "This is the promptest move in any recession since the 50's," Mr. Roach said. Contrast that to the 1973-75 recession, when business held onto workers and kept turning out goods nearly a year into the slump. Finally, the bottom fell out of the economy and unemployment soared to 9 percent. Despite the fact that inventories are thin by past standards, Mr. Roach expects businesses to do more trimming, since they are still a bit fatter than executives would like. But at some point, business must step up production just to keep inventories from falling further. To be sure, there are risks that this process, which seems to have started already, could be short-circuited. One risk is that the credit drought will persist. "Our concern is that if the tightness continues, it would be a substantial moderating force," said Mr. Mullins of the Federal Reserve. "We are concerned about bankers being willing to lend to home builders and exporters." A bigger threat is that consumers will become discouraged or run out of cash before business stops retrenching. "It's a race between consumers who want to spend and business that wants to cut costs," said David Kelly, an economist at DRI/McGraw Hill. Nonetheless, he says he expects consumers to hang in there. Graph: 'What Turns Up as Recessions End' shows housing starts for single family homes and domestic and imported car sales from '68 to '90 (Source: Merrill Lynch) Correction: April 10, 1991, Wednesday A chart in Business Day yesterday showed the beginnings and ends of some U.S. recessions incorrectly. This is a corrected version of the chart, with recessions shown as white bands. (Source: Merrill Lynch) An article in Business Day on Tuesday about post-recession employment trends misstated the unemployment rate after the recession that ended in November 1982. Unemployment reached its peak of 10.8 percent in the last month of that recession, not early in 1983. It held there in December 1982 and then declined. Inside NYTimes.com Health » Too Hot to Handle

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Mort Neblett Member/Manager OFP Financial Partners OFP Financial Partners, LLC (OFP) was founded by Mort Sterling Neblett in 2002. He operates the company from an office in Wilmington, North Carolina located on historic Hewlett`s Creek. Mr. Neblett was born in Wilmington, North Carolina and was educated in Public and Private schools in the state of North Carolina. In January of 1963, he graduated from the University of North Carolina/Chapel Hill. After active duty in the North Carolina National Guard, 16th Special Forces, he received an honorable discharge from the Armed Forces of the United States. In 1966 Mr. Neblett and his wife Judy, decided to work their way around the world, taking two years or so to complete the trip. Beginning in the Philippines, they travelled to Japan for a week, stopping in five other countries in Southeast Asia and on to Melbourne, Australia. In Melbourne, they both worked and travelled the country for two years. Leaving Melbourne in 1968, they travelled back to America through Indonesia and Singapore, stopping in India, and going west to the Middle East, spending a week in Beirut, Lebanon, and time in Europe. Arriving in New York, they completed what Mort and Judy describe as a “chance of a lifetime trip”. They were still in their twenties. During that same year they spent the Christmas holidays in Rome, Italy and New Year`s in Cairo, Egypt. Leaving Egypt, they flew to Addis Ababa, Ethiopia through the Sudan and on to Kenya and Tanzania for an African Safari. A fellow traveler in Africa persuaded Mort to visit a stock brokerage firm in New York upon his return. The firm was F I DuPont & Co. and the introduction was to Mr. Edmund DuPont who was managing the firm at that time. In 1969, Mr. Neblett joined F. I. DuPont & Co, a New York Stock Exchange Member Firm. Mr. Neblett was elected President of the training class of seventy two. After completing his training and exams and becoming certified to trade in commodities, he and Judy moved to Atlanta, Georgia. In 1973, Mort joined Robinson-Humphrey & Co. as a co-partner in the International Department. For the next twenty plus years at R-H, his travel exceeded one hundred fifty business and pleasure trips abroad, coupled with extensive domestic travel. During his business career at R-H, Mr. Neblett was mostly responsible for investing, on behalf of his firm`s clients, parts of large investment portfolios. The firm`s clients were diversifying and expanding their investments in the Southeastern region of America. These investments were across many asset categories, and included common stocks, real estate, unquoted investments, and convertible securities. These were asset categories of interest to the firm`s clients which included Scottish Investment Trusts, English Merchant Banks, Pension Funds, Insurance Companies, etc. While at Robinson-Humphrey, Mr Neblett was a Managing Director and member of the Board of Directors of the firm. He was an Allied Member of the New York Stock Exchange as was his partner, John Lowenberg. Each of them was therefore qualified to vote the NYSE seats owned by Robinson-Humphrey. He co-managed the International Business of R-H with John Lowenberg, served on the firm`s Commitment Committee and its Investment Policy Committee. He also started Mid-East American, Inc., (MEA), a joint venture with William Kent & Co. in Greenwich, Connecticut. William Kent & Co had offices throughout the Middle East and North Africa and maintained a residence in Riyadh, Saudi Arabia . The business of MEA was to sell or distribute products and services of the investment banking clients of Robinson-Humphrey through the agent companies of William Kent & Co. These agent companies were typically owned by the leading merchant families of the region. Mid-East American succeeded in selling crop dusting air planes in North Africa, chocolate flavored drinks in Egypt, and a variety of other products and services. Anxious to return to North Carolina in 1992, Mr. Neblett retired from R-H and joined Morgan Keegan & Co (M-K), a New York Stock Exchange Member Firm based in Memphis, Tennessee. Mr. Neblett and Allen Morgan, founder of M-K), were friends, years before, at the University of North Carolina. At Morgan Keegan & Co., Mr. Neblett was a Managing Director and Senior Investment Banker. While at Morgan Keegan he and his local partner, Frances Goodman, helped with the firm`s entry into the Carolinas and negotiated the purchase of J Lee Peeler & Co in Durham, North Carolina. The Peeler firm was a municipal bond and brokerage firm and Bond Counsel to the University of North Carolina based in Durham, North Carolina. He also helped start M-K`s first Early Stage Fund and served on its Investment Policy Committee. During that time, he was responsible for the sale of Park Meridian Bank in Charlotte, North Carolina to Regions Financial Bank in Birmingham, Alabama. Over the years Mr. Neblett has been a founding shareholder of three banks, including Adam & Co in Edinburgh, Scotland. He founded and operated the Chattahoochee Cattle Company in Franklin, Georgia, raising beef cattle and coastal Bermuda hay for animal feed. He has been a limited partner of five venture capital partnerships in the United States. Mr. Neblett has served on a variety of public and private boards including Habersham Energy in Denver, Colorado and a regional public community bank. On the public/private side, Mr. Neblett has served on the Board of Visitors of The University of North Carolina/Wilmington, The Cameron Business School Advisory Board of The University of North Carolina/Wilmington, and he is a founder of the UNC/W International Cabinet Foundation. He is a member of IMAF Cape Fear LLC., an Inception Micro Angel Fund. His experience has also included board memberships of The Wilmington Housing Authority, The Wilmington Chamber of Commerce, and The Cameron Art Museum. While living in Atlanta, he served as a Board Member of The Southern Center of International Studies meeting many world leaders and travelling several times to NATO headquarters in Belgium and to other meetings in Europe and elsewhere. In Atlanta he was honored with gubernatorial appointments to sit on the Board of The Georgia World Congress Center and The Atlanta Committee for the Atlanta Olympic Games Board. Mr. Neblett is married to Judith Mary Deopp from West Chester,Pa. They have two sons, both of whom reside in Wilmington, North Carolina. His personal interests include golf, fishing, and hunting. He is an avid surf fisherman spending parts of the Spring and Fall on the Outer Banks of North Carolina deep sea fishing and surf fishing. Mr Neblett has spent over thirty years researching his family`s history in America. An early American ancestor, John Neblett who was born in Gloucestershire, England in 1635 came to Virginia as a young man. The earliest Neblett in Virginia came in 1613. Many Neblett generations have followed. Of special interests to Mort are his ancestors, Capt. Sterling Neblett, born in 1753 and his son, Dr. Sterling Neblett, born 1792. Both were planters and their historic plantation homes are still occupied. Capt. Sterling Neblett lived at Woodland, a plantation where he supervised the construction of Woodland, the home. Dr. Sterling Neblett, son of Capt. Sterling Neblett, built the home Brickland for his plantation. Brickland is on the National Register of Historic Places. The home was started in 1818 with the final section completed in 1822. Sterling Neblett II studied medicine in Virginia, Pennsylvania and Maryland. He was a member of the Virginia Legislature, serving in the House of Delegates. Seven of his sons were in the Confederate Army. ©Copyright OFP Financial Partners, LLC Hosting Provided by LMC Web Media Mort S. Neblett, Member/Manager Mort@ofpfinancialpartners.com

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TOPICS > Economy Treasury Official Explains Fed’s Move to Rescue Housing Firms September 8, 2008 at 6:10 PM EDT Loading the player... After a recap of the weekend's news on the government takeover of housing giants Fannie Mae and Freddie Mac, acting Treasury Undersecretary Andrew Ryan details the move. http://www-tc.pbs.org/newshour/rss/media/2008/09/08/20080908_mortgage28.mp3SEE PODCASTS RELATED LINKSMarkets Rise on News of Fannie Mae, Freddie Mac Takeover Home Prices Dip, but Market Signals Improvement Wall Street Role's in the U.S. Mortgage Crisis Examined Worries of a Bailout of Mortgage Giants Hit Markets Hard Paulson Wants to Avoid Bailout for Fannie Mae, Freddie Mac KWAME HOLMAN: The Treasury Department’s decision yesterday to take over the mortgage giants came after both companies faced serious problems securing enough money from private sources to purchase new mortgages. Treasury Secretary Henry Paulson announced the dramatic move. HENRY PAULSON, U.S. Treasury Secretary: A failure of either of them would cause great turmoil in the financial markets here at home and around the globe. This turmoil would directly and negatively impact household wealth, from family budgets, to home values, to savings for college and retirement. A failure would affect the ability of Americans to get home loans, auto loans, and other consumer credit and business finance. And a failure would be harmful to economic growth and job creation. KWAME HOLMAN: Fannie Mae and Freddie Mac are by far the largest providers of U.S. home loan financing, owning or guaranteeing some $5 trillion in loans, about half the outstanding mortgages in the United States. The companies were created by the government decades ago to help more Americans afford the cost of buying a home. The pair are unusual entities, private companies that are traded on the stock market, but operate as government-sponsored enterprises, or GSEs. But, as mortgage defaults have continued to rise, Fannie and Freddie have racked up about $12 billion in losses. HENRY PAULSON: Our economy and our markets will not recover until the bulk of this housing correction is behind us. Fannie Mae and Freddie Mac are critical to turning the corner on housing. KWAME HOLMAN: Under the plan, both companies have been placed in a conservatorship to be restructured, similar to a bankruptcy process. Top officers were replaced, and overall control was given to a federal regulator. And the government can provide money as needed, up to $200 billion total, for the two companies. The government also would guarantee the investments of bondholders, who hold huge amounts of debt issued by Fannie and Freddie. Those bondholders include pension funds, mutual funds and central banks overseas. But shareholders of Fannie and Freddie stock would not be protected. Eighty percent of the companies would now be owned by the government. A shareholder’s stake would be reduced to just 20 percent of the value of either company. Fannie and Freddie would be forced to reduce their portfolios by 10 percent a year, beginning in 2010. SEN. RICHARD SHELBY (R), Alabama: What’s the trigger? At what point, in other words? KWAME HOLMAN: Paulson received congressional approval in July to use taxpayer funds to finance an intervention, but expected at the time that having the authority to do so would be sufficient. HENRY PAULSON: There are no plans to access either of these temporary backstops. If accessing them becomes necessary, we would do so only under terms and conditions that protect the U.S. taxpayer. KWAME HOLMAN: Stock prices around the globe rallied today on news of the takeover. The move also was supported on the presidential campaign trail. Both Democrat Barack Obama and Republican John McCain said the bailout was necessary, but said they had some concerns. SEN. JOHN MCCAIN (R-AZ), Presidential Nominee: Today, we’re looking at costly government-led restructuring of our home loan agencies. We need to keep people in their homes, but we can’t allow this to turn into a bailout of Wall Street speculators and irresponsible executives. SEN. BARACK OBAMA (D-IL), Presidential Nominee: So much of this housing crisis could have been prevented if the feds had done their job regulating many of these agencies. Now, not only are people losing their homes, but taxpayers are also going to be potentially on the hook for some of the bill. KWAME HOLMAN: The treasury secretary said he expects the takeover to provide stability for now, but Congress and the next president will have to act on the long-term future of Fannie Mae and Freddie Mac. Conditions behind the planAnthony RyanActing Treasury Undersecretary [W]e have seen how market has deteriorated. We have seen them have greater challenges, in terms of accessing the capital markets. We have also seen the impact it's had on every American. JUDY WOODRUFF: And for a closer look at the plan and the government's rationale, we're joined by acting Treasury Undersecretary Anthony Ryan.Secretary Ryan, thank you for being here.ÂANTHONY RYAN, Acting U.S. Treasury Undersecretary: My pleasure.JUDY WOODRUFF: Now, we just heard Secretary Paulson just a little while this summer that there were no plans to -- to do this. What changed?ANTHONY RYAN: Well, the conditions did deteriorate in July and August.And these companies have faced these challenges. And, as the secretary said yesterday, our focus has been on ensuring actions are taken to help facilitate market stability. And the secretary also talked about the important role they play, not just in the mortgage market, but our capital market.JUDY WOODRUFF: You know, the reports were that, if this hadn't been done, the companies were facing collapse. And, at the same time the American public was being told they were capitalized, that they had something like scores of billions of dollars in capital on hand. So, some people don't make the connection.ANTHONY RYAN: Well, I think you need to appreciate the exposures that they have. And it's literally in the trillions of dollars.So, while billions is certainly a big number, relative to the amount of exposure that they had, in terms of their liabilities and the guarantees on mortgage-backed securities, and the scale of that, and the distribution of that, not just here in the United States, but around the world, these institutions are very, very large. And it's very important that they are in a position where they continue to function, given their relationships to other aspects and other financial institutions.JUDY WOODRUFF: Why the need to do this right now?ANTHONY RYAN: Well, we have seen how market has deteriorated. We have seen them have greater challenges, in terms of accessing the capital markets. We have also seen the impact it's had on every American, either directly, in terms of rising mortgage rates -- and we know we're dealing with this housing correction in our economy, but we also must recognize that our capital markets are interconnected.So, this strain is mortgage rates is not constrained just to mortgage rates. We have seen that impact in terms of other types of loans, student loans, car loans, credit cards. And we need to make sure that our capital markets can continue to work for our citizens.JUDY WOODRUFF: Who is to blame for this?ANTHONY RYAN: Well, we're not in a finger-pointing mode right now. We're in the mode of doing everything we can to facilitate our capital markets.We're looking forward to facilitating additional mortgage availability. I think everybody can be part of the solution, in terms of improving practices on mortgage underwriting and investor discipline. And that's something we want to continue to focus on, not just as it relates to these two enterprises, but across the broader markets more broadly.Details of the dealAnthony RyanActing Treasury Undersecretary This summer, legislation was moved to the president, created a new independent regulator, the FHFA. The new regulator has more authorities and more ability to impact the regulation of these enterprises. JUDY WOODRUFF: Well, what about the charges that are broadly out there, that there was a lack of oversight, a lack of regulatory control over these companies that played a huge role in all of this?ANTHONY RYAN: Well, we have seen some important changes.This summer, legislation was moved to the president, created a new independent regulator, the FHFA. The new regulator has more authorities and more ability to impact the regulation of these enterprises.And I think this will be a constructive development. And, in addition to that, the marketplace and market practices have to be part of the solution. I think, collectively, we will be in a better position, that, ultimately, our markets and our citizens will be well afforded.JUDY WOODRUFF: Were Fannie Mae and Freddie Mac leveling with everybody about just the true shape that they were in financially?ANTHONY RYAN: Well, I think they have to file as public companies, in terms of reports with the Securities and Exchange Commission. That information is in the marketplace.You have a lot of the different investors looking at these issues. But I think it also illustrates the -- the scale of these operations. And some of the covenants that we put in place with the agreements that the treasury entered into on Sunday will help reduce some of the risks associated with some of their operations.JUDY WOODRUFF: I ask because there were the reports about these outside investment -- the investment banking teams came in, looked over the books, and said they didn't have nearly as much capital on hand as they had indicated they did.ANTHONY RYAN: Well, we worked with a lot of different advisers as part of that information-gathering and assessments, so that we could advise the secretary relative to the new authorities that Congress gave him just a few months ago.And, as part of that work, we looked at market information. And that was very helpful, in terms of helping us structure something that addressed all of the various objectives that we had, not just in terms of market availability, but also mortgage availability and protections for the taxpayers.JUDY WOODRUFF: Why did Treasury decide, Secretary Ryan, to essentially bail out the bondholders, people who hold the debt in Fannie Mae, but not the shareholders?ANTHONY RYAN: Well, it's important to recognize that the -- we want these enterprises to continue to be in a position to finance their operations and continue to provide mortgage credit to our marketplace.The debt holders help facilitate that. And we also wanted market stability. And there are literally trillions of debt exposures, as well as the guarantees that these mortgage enterprises have been engaged in. So, that was a very -- part of market stability.But, importantly, while we looked at the shareholders -- and, obviously, they have taken on very real losses over the last year, with their stocks down significantly -- it's important to recognize that we don't want to put the shareholders' interests in front of the taxpayers' interests. And, so, that was part of our term and conditions, to ensure that the taxpayer's interests were being protected.JUDY WOODRUFF: But the bondholders are being helped here.ANTHONY RYAN: Yes, the bondholders are being helped, as part of our market stability, but we're also getting considerations for that as well. And there are terms and conditions in the agreement.JUDY WOODRUFF: What do you mean considerations?ANTHONY RYAN: Well, we're receiving a senior preferred position in these enterprises. This is one of the agreements that we entered into yesterday.And, in addition to that, we will also receive warrants, so that we can have up to 80 percent of the companies going forward, so that the taxpayer is being compensated for providing that commitment to these enterprises, which supports the debt holders and the holders of the guaranteed mortgage-backed securities.Associated costs?Anthony RyanActing Treasury Undersecretary And we will do everything we can to make sure that they're operating well and that the taxpayer is being protected on a lot of different scenarios. JUDY WOODRUFF: Well, speaking of the taxpayers, I read analysis to say that there will probably be among the most expensive rescues ever financed by the taxpayers in this country, saying it could end up in the tens of billions of dollars.ANTHONY RYAN: Well, these are important commitments that we are making. We have a lot of protections for the taxpayers.That being said, we very much need to see our capital markets continue to function. And we looked at this, and felt this was the optimal position and decision to be making at this point in time.JUDY WOODRUFF: So, how much are we talking, in terms of cost to the taxpayers?ANTHONY RYAN: Well, I think that will be determined in the months ahead and in the years ahead, in terms of how these enterprises work, how these losses play through their position.And we will do everything we can to make sure that they're operating well and that the taxpayer is being protected on a lot of different scenarios, whether it's with this agreement or some of the other activities that the secretary outlined yesterday.JUDY WOODRUFF: But don't -- but don't taxpayers deserve to know now how much this is going to cost?ANTHONY RYAN: Well, I think it's a function of, they have to know that we took their interests in mind and were very hard about putting in agreements to protect those taxpayers' interests.The ultimate return or loss will be determined as a function of how the markets evolve, how our economy evolves, and what the actual results of these enterprises will be.JUDY WOODRUFF: This essentially makes the federal government the nation's largest provider of home mortgages.And I guess my question is, isn't that an odd position for the government to be in, when we live in a capital-driven economy?ANTHONY RYAN: Well, I think you put your finger right on a very important issue, which led to many of the challenges that we have addressed over the weekend.What this period does is, it give the opportunities for the markets to be stable, for the enterprises to continue to operate and provide capital, but, importantly, it gives an opportunity, in the sense, for a time-out, to engage on that very important issue and ask some of those fundamental questions.These are an odd construct, where we have a public mission, in terms of housing, and we also have shareholders who are looking for their returns to be maximized. And those objectives can be conflicting. And that led to many of the challenges that we're addressing today.JUDY WOODRUFF: So, are you saying, down the road, Fannie and Freddie get back on their feet, or what?ANTHONY RYAN: Well, I think, down the road, there certainly needs to be a discussion and a debate about the ultimate form and the ultimate structure of how the government wants to deal with housing.And I expect that to occur in the next administration and with the next Congress, to ask these fundamental issues. But, in the meantime, we have taken actions to help facilitate stability in the markets. And these enterprises can continue to deploy capital to our citizens, in terms of mortgage credit, which is so important for us to work through the current challenges in our economy today.JUDY WOODRUFF: But you're saying those are questions that, for this administration, you didn't feel you had the ability to answer that, or...ANTHONY RYAN: I think we will share thoughts and views on that in the months ahead. And the secretary mentioned this yesterday.But I think our first order of focus is, make sure we have stability in our capital markets. So, we're very focused on that at the moment.JUDY WOODRUFF: Acting Undersecretary of the Treasury Anthony Ryan, it's good to have you with us.ANTHONY RYAN: Thank you very much.JUDY WOODRUFF: Thanks very much. crisis debt Economy federal government housing investment bank loan mortgage tax payer

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| Wed Feb 10, 2010 6:41pm EST CME buys 90 percent of Dow indexes in joint venture | By Jonathan Spicer NEW YORK CME Group Inc (CME.O) will acquire 90 percent of the Dow Jones' namesake indexes business in a debt-funded joint venture that values the century-old business at $675 million.Dow Jones will retain a 10 percent stake in the venture, called CME Group Index Services, which will raise some $613 million in third-party debt, the companies said on Wednesday. Dow Jones will get $607.5 million of the proceeds.The Dow name will remain to preserve the familiar Dow Jones Industrial average .DJI brand, under the terms of the deal with Dow Jones & Co's owner News Corp (NWSA.O). The brand was created in 1896 by Charles Dow, a company founder.The deal gives Chicago-based CME Group, the world's largest derivatives exchange operator, a key asset beyond 2014 when its exclusive right to offer futures on the Industrial average and other Dow indexes would have expired."We would expect to continue to have very, long-term license rights," CME Group Chief Executive Craig Donohue said on a conference call with reporters, adding 90 percent of the joint venture's earnings will flow directly to CME.The growth and profit margins of the index business make it "very attractive," Donohue said. CME Group will contribute a portion of its market data services, valued at $613 million, to the joint venture. Dow Jones will continue to own the brand.The joint venture represents just 3 percent of CME Group's revenue and is a fraction of its $18 billion market cap."It is just not that exciting strategically given the size," said Mark Lane, a Chicago-based analyst at William Blair & Co.Dow Jones Indexes creates and licenses indexes that investors and others use to measure the performance of markets, including stocks, bonds and real estate. The business offers more than 130,000 equity indices, according to its website. The deal is expected to close in the current quarter.While the shares of both CME Group and News Corp were little changed in post-market trading, some saw the deal as a way for the exchange operator to protect trading volumes and spark indexing growth."In combination with that brand and the recognition of the DJI, as well as market expertise put together, the CME will have a much larger global reach," said Joseph Cusick, senior market analyst at brokerage optionsXpress in Chicago. CME Group currently pays Dow Jones licensing fees that let it offer futures and options contracts based on the Dow industrials. The deal gives it these rights and also represents yet another proprietary product for the company whose core business relies on products that cannot be transferred to other exchanges."The threat is that you wake up one day and realize that (Dow) negotiated with another exchange, and the index goes somewhere else and you lose volumes on those contracts," said Diego Perfumo, an analyst at Equity Research Desk.The structure of the deal, which creates a so-called leveraged partnership, has been used more frequently of late as it comes with tax advantages for both sides. It was used by the Ricketts family when it took control of the Chicago Cubs baseball team in a $845 million deal.Such a structure, however, works only in situations where the buyer has the capacity to effectively make the purchase with debt, as CME Group did in this case.Barclays Capital (BARC.L) advised CME Group and Goldman Sachs Group Inc (GS.N) advised Dow Jones on the deal.(Additional reporting by Ann Saphir, Paritosh Bansal and Angela Moon; editing by Robert MacMillan, Leslie Gevirtz)

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Markets & Economy COMMENT: Scotland needs new start-up businesses MICHAEL WESTMACOTT It is entrepreneurs who will shape the economic landscape, writes Michael Westmacott The Federation of Small Businesses (FSB) quotes Scottish government statistics to show that small and medium-sized enterprises now account for well over 90 per cent of all Scottish businesses and for more than half of all private sector employment.If Scotland is to seriously consider voting Yes, then we must also be convinced that independence is an opportunity for small companies to grow, and for entrepreneurs to create new ones. Last year, some 526,000 UK businesses were registered with Companies House – nearly 100,000 more than in 2011. Of those, more than 136,000 start-ups were in Greater London, more than one in five of new companies, despite having one in eight of the UK’s population. A report from the Centre for Cities says that London is creating ten times more private sector jobs than Edinburgh (with just over 7,000 start-ups). Glasgow saw more than 8,000 new registrations.To put it simply, we need entrepreneurial spirit to be shared across the UK, because regional economic growth and prosperity generates greater local demand for goods and services.It’s why interventions by the likes of Sir Tom Hunter are so important because his mission is to see Scotland embrace entrepreneurialism with greater enthusiasm – whichever way Scotland votes. While entrepreneurial activity is at an all-time high, we have some way to go to match the level of start-ups in, for example, the USA and Canada. Part of the problem seems to be that we want to leave education and get a job – creating our own company remains a second best for many. But things are changing. The Curriculum for Excellence is building the world of work into the curriculum, and colleges of further and higher education are focusing more on enterprise.The new world economies are being driven by ever-changing technologies. Adapt, innovate or die has never been so apposite.Yes or No, Scotland the Brand is attracting global coverage, and from salmon to whisky, golf to haggis, our reputation for product quality is internationally recognised. It’s something we have to capitalise on.The future increasingly lies with entrepreneurs who can shape the new economic landscape, building new companies than can become big companies, and embed a growing spirit of entrepreneurship in Scotland. That will also take more joined- up thinking from politicians, think-tanks, educationalists and business leaders. While the big numbers of future economic growth will be global, the reality is that every new company starts out small, and we should celebrate small as well as big. Whatever the referendum outcome, Scotland needs entrepreneurs like never before.• Michael Westmacott is a partner in Scottish PR agency Laidlaw Westmacott.

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http://www.sfgate.com/bayarea/article/S-F-considers-stock-option-tax-break-2372785.php S.F. considers stock-option tax break Rachel Gordon, Chronicle Staff Writer San Francisco supervisors unveiled new plans that would give companies a tax break on stock options as an incentive to keep them in the city. San Francisco is the only city in California and one of the few in the nation that taxes gains on stock options - tucking the provision into the city's payroll tax, which also includes salaries, wages and bonuses. The issue emerged amid discussions on the proposal approved by supervisors last month exempting companies that move to or remain in the Mid-Market and Tenderloin districts from paying the payroll tax on new employees for six years. "An efficiently designed stock options exclusion can, therefore, have the policy advantage of providing a tangible benefit to a few successful companies, reducing their incentive to leave San Francisco, while leaving the majority of taxpayers - and the city's payroll tax revenue - unaffected," said Ted Egan, the city's chief economist. Two pieces of legislation were introduced to address the issue. One, discussed but not voted on at the Board of Supervisors' Budget Committee on Wednesday, would offer private companies a partial payroll tax exclusion on employee stock granted before an initial public offering. For high-value companies, the worth of the stock can skyrocket once the company goes public, resulting in a much bigger tax burden for companies in San Francisco. Those companies "would like to see as much assistance as they possibly could so that they could stay, grow and prosper in San Francisco," said Supervisor Ross Mirkarimi, chief sponsor of the legislation. Under the proposal, an individual company would have to pay no more than $750,000 a year in business taxes on gains derived from stock-based compensation. Companies still would pay payroll tax tied to other forms of compensation. Egan said it is likely only a handful of companies would benefit from the proposed tax break because the worth of their stock options would exceed the $750,000 cap. "We are greatly encouraged by the progress on the issue and the discussions that took place today," Zynga, an online gaming company that could potentially benefit from the legislation, said in a statement. The proposed tax break would sunset after six years, giving city officials breathing room as they craft plans to overhaul San Francisco's business tax. "This legislation takes away the incentive for private companies to leave as they consider an initial public offering," said Supervisor David Chiu, a co-sponsor. Supervisor Mark Farrell, meanwhile, has a proposal that would offer a break on stock-option compensation to both public and private companies. The part of a company's payroll tax tied to stock options would be capped at what it paid either last year or this year - whichever amount is greater - in perpetuity. It is unclear whether the two pieces of legislation will be amended and made into one proposal or whether each will be considered independently. E-mail Rachel Gordon at rgordon@sfchronicle.com.

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Baha, a Gundlach Star, Recalls DoubleLine’s Stormy Beginnings DoubleLine now has $53 billion in AUM and 5 new funds in the wings, but Bonnie Baha remembers when firm had nearly nothing Bonnie Baha of DoubleLine. As many savvy investors know by now, DoubleLine Capital has a story to tell: a creation myth that involves CEO Jeff Gundlach’s stormy departure from the TCW Group, the lawsuit that followed and the dramatic turnaround of a company that blasted from zero to $53 billion of assets under management in just three years. But as the stellar DBLTX and DLTNX Total Return Bond funds approach their three-year benchmark on April 6 and five new DoubleLine funds prepare for launch, what is less known is the story behind the 45 or so people who followed Gundlach when TCW fired him in December 2009. Over truffle omelets in The Palace on Wednesday in midtown Manhattan, Gundlach loyalist Bonnie Baha talked about why she left TCW after a 20-year career there to follow the eccentric and highly successful bond king as he started up DoubleLine the Monday after his Friday firing, even though she received offers from other firms, including Standard & Poor’s. “If I had to place my money on somebody, I’d place it on Jeffrey,” said Baha, who serves as a DoubleLine portfolio manager and co-director of global developed credit at the company’s Los Angeles headquarters. “There is a ‘revenge is sweet’ factor, but there was a religious and spiritual element.” TCW Experience Was an 'Unplanned Pregnancy' There was also an element of Baha’s feeling as if she was experiencing “an unplanned pregnancy,” when TCW rocked her world with its sudden announcement that it was replacing Gundlach with a fixed-income team from Metropolitan West. “I came in on Monday, and there were people we didn’t know sitting at our desks.” Later, in 2010, Gundlach evoked those spiritual feelings after TCW sued, potential clients left in droves, and he came to his DoubleLine colleagues with tears in his eyes to promise that he took it as his personal responsibility to be sure they received a paycheck, recalled Baha, who also remembers that he was so stressed that he was losing weight and sleep as his loyal followers were paying their bills with credit cards and savings. To be sure, Baha acknowledges that Gundlach’s strong personality can be read as arrogant—something she herself did back in the 1990s when she was a vice president on the TCW trading floor and didn’t like the way he was dressing down a colleague publicly. As Bloomberg reports it, Baha called Gundlach “a freaking jerk,” but as Baha herself remembers it, she called him the much more blunt, “f*****g a*****e.” It was the start of a beautiful friendship. Later that day, Gundlach went to her office and spent two hours describing his hardscrabble upbringing in Buffalo, N.Y. “It’s not like we were buddy-buddy after that,” Baha said. “He’s not that kind of guy.” Baha’s Spidey Sense Yet they have built a relationship of mutual respect that now has him depending on Baha’s market calls. For example, her “Spidey sense” (DoubleLine analyst Loren Fleckenstein’s term for it) led her to suggest that Gundlach cut off DoubleLine’s trade with Lehman Brothers and MF Global before those two firms blew up. Today, DoubleLine’s market capitalization is about $1 billion while another TCW offshoot, Howard Marks’ Oaktree—which serves as a role model to the folks at DoubleLine—counts $7 billion in market cap. Meanwhile, TCW, which effectively lost its suit against Gundlach in 2011, was sold to the Carlyle Group in August 2012. “The transaction will conclude a lengthy sales process for TCW, which has some $130 billion in assets,” The New York Times’ Dealbook reported at the time. “Société Générale, which bought a controlling stake in TCW in 2001 for about $880 million, has been under pressure to raise additional capital and has been exploring the divestiture of noncore assets.” As the dust settles on all the drama, DoubleLine’s reputation for growth is becoming established. Robert Cohen, a credit analyst who will manage DoubleLine’s new floating rate fund with Baha when it launches later in 2013, joined the firm last summer after the TCW lawsuit was resolved. As far as Cohen was concerned, he was joining a company with a proven track record. “I came in the glory days when DoubleLine was earning millions. I skipped all the drama,” Cohen said at The Palace breakfast. “All I know is that DoubleLine is successful and people are tripping over themselves to talk to us.” Read What’s Jeff Gundlach Thinking? From the October 2012 issue of Investment Advisor magazine at AdvisorOne. Sell Oppenheimer Muni Funds on Puerto Rico Risk, Ameriprise Says DoubleLine Capital DoubleLine Jeff Gundlach Jeffrey Gundlach

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Public and Private Investments in Women and Girls Through the Equal Futures Partnership Posted by Wenchi Yu May 3, 2013 Equal Futures Partnership Meeting at World Bank in April 2013 On April 18, 2013, President of the World Bank Group Jim Yong Kim co-hosted the second Equal Futures Partnership meeting, along with the U.S. Secretary of Treasury Jacob Lew, Senior Advisor to President Obama Valerie Jarrett, and National Economic Advisor to President Obama Gene Sperling on the margins of the World Bank Spring Meetings in Washington, D.C. The 13 founding members issued a report on progress made thus far, while six new country members joined the partnership with new commitments, and three more signaled intent to join at the next convening. Some of the new country commitments centered on increasing women's political participation in legislatures, removing legislative and policy barriers to women's participation in the formal economy, and strengthening law enforcement to address gender-based violence. In response to President Obama's challenge to the world to break down barriers to women's political and economic participation, former Secretary of State Hillary Rodham Clinton launched the Equal Futures Partnership on behalf of the United States in September 2012 along with 12 other founding members. Each founding member made national commitments to policy, legal, and regulatory reforms to promote two mutually reinforcing goals: expanded economic opportunity for women and increased political and civic participation by women at local, state, and national levels. Multilateral stakeholders, including UN Women and the World Bank, along with leading businesses and non-profit institutions also pledged support for the partnership. As government officials noted, the private sector is a critical part of achieving a truly equal future for all. HTC's Founder and Chairwoman Cher Wang used her personal story to talk about the importance of having more women and girls involved in technology and to expand the talent pool. She urged women to use technology and online communication to pursue education and gender equality. She also announced the donation of 100,000 HTC tablets to women in the Asia-Pacific region. Discovery International Network's President and CEO Mark Hollinger spoke passionately about using innovative technology to educate children, especially in the fields of science, technology, engineering, and mathematics (STEM). In addition, Hyatt Hotels announced their support for the U.S.-China Women-LEAD initiative which promotes exchanges among young women from China and the United States. The White House Council on Women and Girls hosted a roundtable with private sector partners to discuss future opportunities for public-private partnerships, as well as the U.S. plan to establish a regular dialogue with the private sector to strategically align Equal Futures country commitments and private sector resources and expertise. Related Content: White House Blog | Treasury Blog Previous: Conversations With America: Making Foreign Policy Less Foreign »« Next: Indonesian Students Connect Business and Responsible Environmental Stewardship . Global Women's Issues 479 Economic and Business Issues 273 STEM 37 Latest Stories We All Need Food, Sometimes We Also Need Help Over 1,400 miles separate Washington, DC from Haiti. That distance can translate into a gulf between those working on global… more 0 United States Convenes Counter-ISIL Ministerial Meeting On July 21, U.S. Secretary of State John Kerry and U.S. Secretary of Defense Ash Carter convened a meeting with… more 0 ‘Ultramarathon Man’ Dean Karnazes Runs Along the Silk Road 25 Years After Soviet Independence Dean Karnazes is no stranger to long-distance running or adventure. He once ran 50 marathons in 50 states in 50… more 0 Pages……next ›last » Socials

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The Pareto Principle: Applying the 80/20 Rule to Your Business | Author Bryan Eisenberg | Analytics ROI Marketing Italian economist Vilfredo Federico Damaso Pareto observed in 1906 that 80 percent of the land in Italy was owned by 20 percent of the population. Later, he observed this noteworthy ratio seemed to apply to other parts of life, such as gardening: 80 percent of his peas were produced by 20 percent of the peapods. Over time, this concept has come to be known as the “Pareto Principle,” “The 80/20 Rule,” and even “The Vital Few and Trivial Many Rule.” Interestingly, another of Pareto’s most noteworthy and controversial theories is that human beings are not, for the most part, motivated by logic and reason but rather by sentiment. Observing the Pareto Principle in Action Here are some 80/20 rule applications: Does 20 percent of your sales force produce 80 percent of revenues? Do 20 percent of your products account for 80 percent of product sales? Do 80 percent of your visitors see only 20 percent of your Web site pages? Do 80 percent of delays arise from 20 percent of the possible causes of delay? Do 80 percent of customer complaints arise from 20 percent of your products or services? We all waste lots of time on trivial, repetitive tasks. That often means people are kept busy whether it is important or not, equipment is running whether needed or not, sales are made whether they are profitable or not. Is the assertion that a small number of events produce the majority of results valid? It may not be a hard rule with a fixed ratio, but the observation has merit: A handful of customers out of many produces the bulk of revenues. A handful of products out of many items in a line produces the bulk of orders. A handful of salespeople out of many produces the majority of new business. A handful of scientists produces most research and development innovations. Most grievances come from a few employees, and most absenteeism can be narrowed down to specific individuals. Most accidents occur in clearly identifiable groups. Truly poor (or great) performance is achieved by a few easily identifiable individuals. We tend to ignore these realities in practice. We often give the best salespeople the most difficult accounts instead of focusing their talent in areas where they could generate extraordinary volumes. The most highly skilled workers are often given the toughest work, although concentrating their skills on trouble-free jobs would allow them to produce significantly more than less-skilled coworkers. The most talented people are often assigned to the most challenging problems that, even when resolved, generally contribute little additional revenue for the company. Applying the Pareto Principle to Your E-Business Here are three ways you can use the Pareto Principle. 1. Use best-seller lists. Find the “vital few” and make them easy for your visitors to find. Book bestseller lists, music top-40 charts, TV ratings, and Hollywood box-office receipts are not merely a barometer of popular culture. They’re important marketing tools. According to John Bear (“The #1 New York Times Bestseller”): On Sunday, August 9, 1942, with no prior announcement and no fanfare, the New York Times published a list, ‘The Best Selling Books, Here and Elsewhere.’ Without exception, that list has appeared in every Sunday edition of the paper for 50 years. A book that makes it to the top of the New York Times’s bestseller list can proudly display “#1 New York Times Bestseller” on its book jacket. The publishers hope you will find yourself in a bookstore, see the book, and think, “If everyone else is reading it and buying it, I will, too.” Think The Amazon.com 100 was created for some other reason? 2. Find out what to optimize on your Web site. Often, when we review a client’s WebTrends report, we spend a lot of time analyzing where and how traffic flows through the site. Guess what? About 80 percent of the traffic hits only 20 percent of the pages. We’ve found this to be true for both business-to-business (B2B) and business-to-consumer (B2C) sites (although it’s not always true for content sites). Where do we focus our energy? Ideally, on those 20 percent of pages that are critical to the sales and buying processes and are required to maximize conversions. If users can’t find those critical pages, we optimize the pages required to lead them there in the conversion process. Take a look at Max-Effect.com, first the old site, then the redesigned one. When we analyzed how people bought yellow pages ad design from Max-Effect, we came to the conclusion they flowed through three pages: the home page, the samples page, then the contact page. So we spent time rewriting the copy on those pages and changing the samples page from a bunch of thumbnails to a couple of before-and-after ads with some copy. Bottom line: Max-Effect is generating four times more leads and closing more business with a third less traffic. 3. Fix or discontinue problematic products and services. Stop wasting precious resources on products and services that drain energy, time, and money. Whatever the problem costs you today, when you redirect your efforts the return on investment will be much greater. Without negative baggage, you’ll see real improvement in efficiency, morale, and productivity. Why only three items, and not a top-10 list? You guessed it, the Pareto Principle. Again. NYTimes.com Thought leadership, best practice &handpicked news. Subscribe to join the leading global community of over 200k digital marketers. Email Address Comments Featured VideoTom Lombardo, JLLSee more videosrhc-mpu-ad-slot2 Newsletter

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Ready To Launch Big Returns Come in Micro-sized Packages A microloan from a community-based lender can provide the cash you need. Lydia Dishman The Staff of Entrepreneur Media Inc. Why More Baby Boomers Are Looking to Franchise David Nilssen 2 Mission-Driven Entrepreneurs Share Their Path to Success Michael Glauser Twitter, the social media micro-blogging service, just received $100 million in new funding from T. Rowe Price and New York's Insight Venture Partners, according to recent reports. It's a staggering amount when you think of Twitter's modest beginning as a simple sketch on a legal pad. It is, however, the ultimate dream for entrepreneurs who start on a shoestring, with nothing more than sweat equity and the hope that their ideas gain traction in the wider world. Twitter's founders were fortunate to start within another privately held firm. But what do you do when all you have is a good idea? What if all you need is a small amount of cash to get website hosting or to purchase raw materials to transform into fabulous products? Is it possible to finance a big dream with a small loan? The answer is yes, with a microloan. What's a Microloan? Loans of $35,000 or less are classified as microloans, although some loan companies have made as much as $50,000 available. Often, the funds are distributed through nonprofit, community-based lenders who obtain the money from the Small Business Administration. The microloan program was initially founded to help startup, newly established or growing small-business concerns. Applications for loans are submitted to the local agency, and it decides whether the funds will be granted. Payment and interest terms vary depending on the size of the loan and the lender. Microcredit has become a somewhat interchangeable term, although the concept began outside the U.S. to assist borrowers who would not qualify for a bank loan. Microcredit is extended in as little as $20 increments for an impoverished person in a developing country, for a year or less. This credit is not secured by collateral and requires repayment in weekly installments. Where to Find a Lender SBA-partnered microlenders are located in 46 of the 50 states, as well as the District of Columbia and Puerto Rico. A full listing of participating lenders can be found on the SBA's website. Other organizations not affiliated with the SBA extend microloans, such as Kiva, a person-to-person microlending website that facilitates loans to entrepreneurs in other countries. Kiva recently partnered with Opportunity Fund and Accion USA to offer loans to American entrepreneurs. The Opportunity Fund has already made $10 million in loans to San Francisco Bay-area businesses, according to Shaolee Sen, director of marketing and communications. Local economic development organizations are also a good resource for funds. David Olson, CEO of FreeStride Therapeutics Inc., a biotech startup based in Ann Arbor, Mich., obtained a loan from the Michigan Economic Development Corp., which was facilitated by the local business accelerator, Ann Arbor SPARK. Who Can Apply It would be great if the criteria for a loan were just a wing and a prayer. Sen points out that Opportunity Fund does help candidates who "lack access to capital and have little or no credit or a new business that cannot qualify for a bank loan and wants an alternative to a credit card." That does not mean you can get by with a poor history. Opportunity Fund will not consider applicants with bankruptcies within the last year, open tax liens or outstanding judgments. Ann Arbor SPARK has similar parameters but is looking for startups that have "passed the concept development and analysis phase, and have very specific needs to achieve commercialization milestones to meet the requirements of an investor or to close initial sales." Skip Simms, director of business accelerator services and manager of Michigan Pre-seed Capital Fund and Ann Arbor SPARK, adds that candidates who have a few customers or pending sales that need some working capital to close those sales, build product or ramp up production are more likely to be considered. Also, candidates for loans from any microlender need to have their business based in the state or area served by the lender. How to Increase the Chance of Getting a Loan Even at the micro level, Harold Aughton says entrepreneurs must have a well-thought-out idea before approaching a lender. Aughton, chief operating officer of Earthtone Greetings, recently received a microloan of $25,000 from Bridegway Capital. He says he and his wife developed an idea to make sending greeting cards simpler. Starting with Aughton's own nature photography and skills as a programmer, the couple used their personal savings to get started. But Earthtone Greetings needed another small capital infusion to keep growing. Aughton says the loan officer at Bridgeway Capital evaluated everything from the couples' education to the potential market for their service. It helped that the greeting card business currently accounts for more than $7.5 billion in annual retail sales. "If I could get a half a percent of that market, that is pretty significant for a small business," Aughton says. Simms advises that the next step is to have a well-thought-out business plan. "We don't, at this stage of a company's life, expect a fully baked plan, but we need a plan that gives us confidence the entrepreneur has thought through all the issues," he says. Additionally, candidates for SPARK loans need to provide a balance sheet and budget for the next few years. Simms says that is to ensure that the business owner understands the financial demands he or she will be facing and how the owner plan to address them. How to Use the Loan The Aughtons will use their microloan funds to get their website from beta-test phase to an open-for-e-commerce site. Aughton says it will also help them market their service to printers as well as individuals. SBA loans can only be used only for "working capital and acquisition of materials, supplies, furniture, fixtures and equipment. Loans cannot be made to acquire land or property." Simms also cautions not to consider asking for loans to cover operating expenses, such as salaries. "The companies we will loan to are still in bootstrapping mode and need to use cash to generate sales. Don't use our loan to pay off other loans, either," he says. A microloan can also be used to purchase something intangible, like confidence, Olson says. Once a company secures a loan, it is much more likely to attract subsequent funds. "FreeStride Therapeutics Inc. is developing a new drug to treat lameness in horses. The company plans to begin clinical studies later this year," he says. "We plan to use the data we will collect using the microloan to secure follow-on private investment." Startup Financing

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Soeun Phnom Penh, Cambodia / Vehicle A loan of $900 helped to purchase a new motorbike for commuting and build a restroom for family use. Soeun's story Mr. Soeun S. (pictured above) and his wife, Mrs. Sreyhoeun Tep, live in a suburb of Phnom Penh about 17 kilometers outside of the city. They have three sons and one daughter. Two attend school and the other two are still young. Mr. Soeun S. is a barber. His wife is a garment factory worker. In March 2010, he applied for his first loan to purchase a second-hand motorbike, but it's not strong and breaks down sometimes. That’s why he wants to sell the old motorbike and add to money from the loan to purchase a new motorcycle. He will also use a part of the loan to build a restroom for family use. More from Soeun's previous loan » About MAXIMA Microfinance Plc: MAXIMA Microfinance Plc is a Cambodian microfinance institution founded in 2000 to help low-income rural and urban people and small- to medium-sized businesses (SMEs) access financial services. Sustainable access to credit helps to create jobs and enables business owners improve their living conditions, educate their children, provide health care to their families, and more. It also enables the rural poor to remain at home with their families, rather than moving to city centers in search of employment. MAXIMA Microfinance Plc Kiva is proud to work with MAXIMA because of its outreach to the poor in underserved markets of Cambodia. MAXIMA even has a branch serving clients on a remote island in the Mekong River where no other MFI operates. Many of these clients are directly funded through Kiva loans. More about MAXIMA Microfinance Plc

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USCANADALog In Early hit puts Formation 8 in spotlight: VCJ By Joanna Glasner If Formation 8 Partners had a theme song, it might be Frank Sinatra’s “My Way” Since inception, partners at the San Francisco-based tech-focused venture firm have done things their own way, whether it be setting fund size or determining how many overseas offices a newly launched VC ought to maintain. The firm closed its first fund, a $448 million vehicle, in 2012 with a mantra to invest in early-stage Internet, software and energy tech companies tackling “hard problems.” It was the largest first-time fund since the dot-com boom, by partner estimates. The co-founders of Formation 8 are, even by venture standards, a well-connected bunch: Joe Lonsdale, co-founder of analytics provider Palantir Technologies (recently valued at about $9 billion); Brian Bonwoong Koo, a member of the founding family of Korean conglomerate LG Group, whose investment arm he formerly ran; and Jim Kim, formerly of Khosla Ventures and CMEA Capital. From inception, Formation 8 wooed entrepreneurs by pitching the firm’s deep connections to Asian markets as a value add. The firm maintains offices in Seoul, Singapore, Shanghai and Beijing. Its LPs are also some of the largest Asian corporations, including Korea Telecom and LS Group. “We definitely wanted a fund that had scale,” said Kim, who noted that helping negotiate partnering opportunities for portfolio companies takes a lot of effort, and “you don’t want to do all that work if you only have a tiny sliver of ownership.” That said, partners didn’t want to raise something much larger than what they have, after looking at research showing that for funds above $500 million, it gets harder to return a multiple, as you need multiple home runs just to pay back LPs. Luckily, Formation 8 LPs can already count on at least one home run return. The firm scored one of the fastest huge exits ever for a new fund, when Facebook announced this year that it will acquire virtual reality headset maker Oculus VR for $2 billion. Formation 8 invested in two rounds in 2013 for the Irvine, Calif.-based company, alongside Spark Capital and others. Kim didn’t elaborate on returns, although media reports said the acquisition provided a few thousand percent rate of return. Though Oculus is the deal with which Formation 8 is most closely associated, the firm has backed a number of other startups that have raised large up rounds or drawn considerable attention. The list includes RelateIQ, a developer of enterprise relationship management software that raised a $40 million round in March and a $20 million one in the summer of last year. Formation 8 was a backer in both rounds. The firm also invested last year in Thalmic Labs, a developer of wearables technology, co-investing once again alongside Spark. This story first appeared in Reuters Venture Capital Journal. Subscribers can read the original story here. To subscribe to VCJ and other venture-related research products, click here for the Marketplace. Photo: A man uses the Oculus Rift virtual reality headset at the 2014 Electronic Entertainment Expo, known as E3, in Los Angeles, June 10, 2014. The sale of Oculus VR, maker of the device, for $2 billion to Facebook, has boosted the profile of Formation 8. The San Francisco-based venture firm invested in two early rounds in Oculus. REUTERS/Jonathan Alcorn

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Category: Virginia Virginia Deductions from Income The following entries show as deductions on your return. Please note the Code number on the item, as this will appear on your VA 760-CG under Deductions Foster Care Deduction – Code 102Foster parents may claim a deduction of $1,000 for each child residing in their home under permanent foster care, as defined in the Code of Virginia, providing they claim the foster child as a dependent on their federal and Virginia income tax returns. Bone Marrow Screening Fee –Code 103 Eenter the amount of the fee paid for an initial screening to become a possible bone marrow donor, provided you were not reimbursed for the fee and did not claim a deduction for the fee on your federal return.Virginia College Savings Plan Prepaid Tuition Contract Payments and Savings Account Contributions –Code 104 If you are under age 70 on or before December 31 of the taxable year, enter the lesser of $4,000 or the amount paid during the taxable year for each prepaid tuition contract or a savings trust account entered into with the Virginia College Savings Plan (previously called the Virginia Higher Education Tuition Trust Fund). If you paid more than $4,000 per contract or account during the year, you may carry forward any undeducted amounts until the purchase price has been fully deducted. If you are age 70 or older on or before December 31 of the taxable year, you may deduct the entire amount paid to the Virginia College Savings Plan during the year. Continuing Teacher Education –Code 105 A licensed primary or secondary school teacher may enter a deduction equal to twenty percent of unreimbursed tuition costs incurred to attend continuing teacher education courses that are required as a condition of employment, provided these expenses were not deducted from federal adjusted gross income.Long-Term Health Care Premiums –Code 106 Enter the amount of premiums paid for long-term health care insurance, provided they were not actually included as a deduction on Schedule A of your federal income tax return. In addition, the premiums may not have been used as the basis of the Virginia Long-Term Care Insurance Credit, although the taxpayer may be able to claim both the Credit and the Virginia deduction in the same year. For example, if an individual purchased a policy on July 1 and made payments on a monthly basis, he would claim a credit in the current taxable year for 6 months of premiums and a credit in the second year for the next six months of premiums in order to reach the allowed total of 12 months. In that case, the individual could also claim a deduction in the second year for the 6 months of premiums that were not used as a basis for the credit. Virginia Public School Construction Grants Program and Fund –Code 107 Enter the amount of total contributions to the Virginia Public School Construction Grants Program and Fund, provided you have not claimed a deduction for this amount on your federal income tax return. Tobacco Quota Buyout –Code 108 Allows a deduction from taxable income for payments received in the preceding year in accordance with the Tobacco Quota Buyout Program of the American Jobs Creation Act of 2004 to the extent included in federal adjusted gross income. For example, on your 2014 Virginia return you may deduct the portion of such payments received in 2013 that is included in your 2013 federal adjusted gross income; while payments received in 2014 may generate a deduction on your 2015 Virginia return. Individuals cannot claim a deduction for a payment that has been, or will be, subtracted by a corporation unless the subtraction is shown on a schedule VK-1 you received from an S Corporation. If you chose to accept payment in installments, the gain from the installment received in the preceding year may be deducted. If, however, you opted to receive a single payment, 10% of the gain recognized for federal purposes in the year that the payment was received may be deducted in the following year and in each of the nine succeeding taxable years. Sales Tax Paid on Certain Energy Efficient Equipment or Appliances –Code 109 Allows an income tax deduction for 20% of the sales tax paid on certain energy efficient equipment or appliances, up to $500 per year. If filing a joint return, you may deduct up to $1,000. Organ and Tissue Donor Expenses – Code 110Allows a deduction for unreimbursed expenses that are paid by a living organ and tissue donor that have not been taken as a medical deduction on the taxpayer’s federal income tax return. The amount of the deduction is the lesser of $5,000 or the actual amount paid by the taxpayer. If filing a joint return, the deduction is limited to $10,000 or the actual amount paid. Charitable Mileage –Code 111 Enter the difference between 18 cents per mile and the charitable mileage deduction per mile allowed on federal Schedule A. If you used actual expenses for the charitable mileage deduction, and those expenses were less than 18 cents per mile, then you may use the difference between actual expenses and 18 cents per mile. Bank Franchise Subchapter S Corporation –Code 112 Certain shareholders of small businesses may be able to deduct the gain or add the loss of the S Corporation. Complete the worksheet found on the state website to determine the amount of your adjustment.Income from Dealer Disposition of Property- Code 113 Allows an adjustment for certain income from dealer dispositions of property made on or after January 1, 2009. In the year of disposition the adjustment will be a subtraction for gain attributable to installment payments to be made in future taxable years provided that (i) the gain arises from an installment sale for which federal law does not permit the dealer to elect installment reporting of income, and (ii) the dealer elects installment treatment of the income for Virginia purposes on or before the due date prescribed by law for filing the taxpayer's income tax return. In subsequent taxable years the adjustment will be an addition for gain attributable to any payments made during the taxable year with respect to the disposition. In the years following the year of disposition, the taxpayer would be required to add back the amount that would have been reported under the installment method. Each disposition must be tracked separately for purposes of this adjustment.Other- Code 199Attach an explanation for other deductions. Your Name: Your Email: To Email: Verify Sum: Privacy Policy

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Checking accounts vs prepaid cards, Suze Orman edition By Felix Salmon January 10, 2012 liked it yesterday morning. The main reason is an interview she gave to GOOD: " data-share-img="" data-share="twitter,facebook,linkedin,reddit,google,mail" data-share-count="false"> I still like Suze Orman’s Approved Card — but maybe not as much as I liked it yesterday morning. The main reason is an interview she gave to GOOD: The majority of people who have these cards are called the unbanked and the underbanked. They do not have a bank account at all—unbanked—and even if they do have a bank account, what’s then happening is that they’re not using all the services that the bank is providing… The 99 % movement, the Occupiers, is a very valid movement. It’s a movement that is very necessary. By the way, this card was developed for them, because this card which I have now created is a way for you to carry a little bank in your pocket with you. I’m actually asking the 99 percenters, ‘you best join me with this movement, people.’ If you want to keep your money in big banks, if you want to continue to get fees, if you want to continue to get all those things, you leave it right where it is. If you want to make a difference in your own life, how you use money, the accounting of money, everything about it, I am telling you put your money on me. Orman, here, is destigmatizing the idea of being unbanked, which is very much in keeping with her “people first” approach to finance. If you’re going to provide a prepaid card to the unbanked, then it’s silly to lecture your customers on how they really should have a bank account instead. But Orman goes further than that, to the point at which she’s actually encouraging the banked to become the unbanked — to close out their bank accounts and use the Approved Card as a checking-account alternative. And I don’t think that’s a good idea. Now I can see where Orman is coming from: the “move your money” campaign makes perfect sense in the context of big, heartless banks which charge enormous fees to people who can’t afford them. But I haven’t seen any impartial financial advice saying that the best place to move your money is a prepaid card, as opposed to a community bank or a credit union. The whole Suze Orman brand is centered on giving good financial advice — but Orman is helplessly conflicted now, and she’s giving advice which looks very much as though it’s mainly serving Suze Orman’s interests, rather than the general public’s. If she wants to make the case that people with bank accounts should become unbanked, she’s going to have to do so very carefully, spelling out her argument explicitly, because that advice is decidedly out of the mainstream. On top of that, I also remembered the Amex prepaid card this morning — which looks in many ways even better than Orman’s offering, not least because it has no monthly fee. I get the feeling that they’re targeting different populations, but if you’re choosing between the two, and especially if you want a prepaid card to supplement your checking account rather than to replace it, then the Amex card, it seems to me, is probably the superior choice. And there’s an Approved Card fee that I missed, yesterday, when I was writing about it. I said that the Approved Card would have to have great customer support; I didn’t notice that it charges $2 per call if you’re forced to call more than once in any given calendar month. Jeremy Quittner of American Banker, covering Orman’s card launch, does nothing to assuage my concerns: “Younger people are not interested in traditional checking accounts, they don’t write checks, and their need to write them has diminished, particularly with fees on checking accounts,” says Patricia Sahm, managing director of Auriemma Consulting, of New York… Neither Suze Orman nor her representatives made themselves available to comment. If Orman is serious when she says that “I couldn’t be more proud of this card if I tried,” then she should be extremely transparent and responsive when rolling out this product. And she should be very clear about whether she’s encouraging people in general, and young women in particular, to use her prepaid card rather than opening up a bank account. I still think that people should have bank accounts. If you decline overdraft protection and just use the debit card which comes with your account, that behaves much like a prepaid card but has much more flexibility: for one thing, you can deposit cash into a bank account for free, while putting cash onto a debit card is non-trivial and costs money. Do young people need checks? No — and there’s probably a case to be made for a new kind of financial product, a no-monthly-fee bank account without checks. Basically, what the Brits call a “current account”. Such an account would be at a competitive disadvantage with respect to Orman’s Approved Card, since a normal debit card is subject to Durbin limits on interchange fees, but prepaid debt cards are exempt from those limits, meaning that Orman can charge merchants a lot of money when they accept her card as payment. But from the perspective of what people like Orman like to call “financial wellness”, a bank account is, over the long term, surely always a Good Thing. And Orman shouldn’t be doing anything which discourages people from having one. Counterparties Next Post » Can financial innovations help the eurozone? 9 comments

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http://blogs.wsj.com/deals/2009/04/14/mean-street-thinking-in-the-age-of-the-unthinkable/ Mean Street: Thinking in the Age of the Unthinkable Evan Newmark Apr 14, 2009 12:18 pm ET If you regularly read this column, you know I’m pretty partial to the contrarian approach. I’ve somehow defended John Thain, Hank Paulson and Wall Street bonuses. But that pales to the unconventional thinking of my friend Joshua Cooper Ramo, managing director at Kissinger Associates and a former foreign editor of Time magazine. You may know him from his stint at as a host on NBC for the Beijing Olympics. But his métier is bigger than that. His new bestselling book “The Age of the Unthinkable” attempts nothing less than to turn decades of conventional geopolitical thinking on its head. And here’s the kicker: Ramo may not totally pull it off, but he certainly gets you thinking in ways you had not considered before. And for me, that’s the true test of a good book. Ramo believes that the traditional realpolitik approach to world affairs, in which nation-states seek to maximize their power, is out of date. His approach is more fluid. The world is chaotic and unpredictable. Individuals and societies respond to all sorts of change. In Ramo’s worldview, the powerful are scrambling to adapt just like you and me. Now, some of you may be saying, “Forget reshaping the world. I just want to make money.” But as Ramo points out, in an unsure world, thinking differently may be the surest way to making money. Take Mike Moritz, the Silicon Valley venture capitalist, who funded Yahoo!, Google, PayPal and YouTube. As Ramo says, “what set him apart was this weird quirk: he didn’t care so much about the technology.” Instead, Moritz excelled in empathy, believing that it was his ability to connect with entrepreneurs and engineers that gave him an edge. Or look at Shigeru Miyamoto, Nintendo’s genius innovator who gave the world Donkey Kong and the Nintendo DS. How did Miyamoto come up with the Wii, which went on to challenge Microsoft’s Xbox and Sony’s Playstation? Apparently, he was designing a game with his wife in mind. Ramo finds change everywhere. Google, iPhones, Facebook, Twitter, Bear Stearns, Lehman Brothers, AIG, Merrill Lynch, Hizb’allah, Iran, Iraq, Pakistan, North Korea. It is the defining feature of our age. And as Ramo makes clear, you can let all the “ceaseless and unthinkable” change keep you up at night or you can embrace it. Unfortunately, but predictably, Ramo’s “okay, so what do I do about it?” argument is the weak spot in his book. In a world defined by change, even Ramo, can’t come up with too many specifics, much less a clear roadmap, for coping with the future. Sure, he gives it a good try. But even he must know that foreign aid organized into a highly decentralized “Department of Global Decency” won’t really fly. But criticizing Ramo for not having all the answers misses his bigger point. You have to start somewhere — and questioning how we look at the world is as good as any place to start. Goldman Sachs: Highlights of First Quarter Earnings Goldman Sachs and Merrill: Did December Ever Happen?

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IP/11/145The Hague, 11 February 2011First of new EU microfinance projects gets off the ground in The NetherlandsAccess to credit is a major concern for many EU companies, in particular for Small and Medium Entreprises (SMEs) and for entrepreneurs who want to start their own business or get new projects off the ground. Without financing, companies and entrepreneurs can lose out on important employment opportunities. This has become even more worrying in the current economic context. That is why the European Commission has today, jointly with the European Investment Fund (EIF), launched the first EU microfinance project in the Netherlands. This EU-wide initiative will allocate various European funds to the Dutch Microfinance Institution Qredits to facilitate loans of over EUR 20 million to small businesses and people in the Netherlands who have lost their jobs and want to set up their own company. As part of the EU's Europe 2020 strategy for smart, sustainable and inclusive growth, the EU Microfinance Facility is one of the concrete actions taken at European level to address the consequences of the crisis (IP/09/1070) Princess Máxima of the Netherlands, EU Commissioner for Employment, Social Affairs and Inclusion László Andor, Dutch Deputy Prime Minister Maxime Verhagen and EIF's Chief Executive Richard Pelly all attended today's launch event. Speaking to journalists, Commissioner Andor said "This new Microfinance Facility will help boost entrepreneurship and the social economy in Europe. Its core aim is to create jobs and specifically help vulnerable groups find an alternative route out of unemployment. Over the next eight years, we hope to provide small loans to around 45,000 European entrepreneurs. "At the event, the Chief Executive of the European Investment Fund (EIF), Mr Richard Pelly, and Managing Director of Qredits, Mr Elwin Groenevelt signed a guarantee agreement and loan deal which will facilitate the provision of the EUR 20 million loan, through Qredits, to micro-entrepreneurs in the Netherlands. Qredits hopes to extend support under EUR 25,000 to over 1,000 small businesses in the Netherlands, many of whom are higher risk borrowers and often face difficulties in accessing credit from traditional banking sources.BackgroundThe European Progress Microfinance Facility (Progress Microfinance) is a new initiative established with EUR 200 million of funding from the European Commission and the European Investment Bank Group, managed by the European Investment Fund (EIF). Progress Microfinance aims to increase access to finance for micro-entrepreneurs, including the self-employed. The facility aims to make it easier for people who might have difficulties in accessing funds for business start-ups. Although it has a particular focus on groups with limited access to the conventional credit market, it is not restricted to these. Examples include female entrepreneurs, young entrepreneurs, entrepreneurs belonging to a minority group, entrepreneurs with a disability, sole traders etc. Financial products (micro-credit guarantees and funded instruments) are made available through eligible intermediaries such as Qredits participating in the facility. Through the European Progress Microfinance Facility, the European Investment Fund provides a guarantee to institutions like Qredits, enabling it to lend to micro-entrepreneurs. Micro-credit in the EU means loans under €25,000. It is tailored to micro-enterprises, employing fewer than 10 people (91% of all European businesses), and unemployed or inactive people who want to go into self-employment but do not have access to traditional banking services. 99% of start-ups in Europe are micro or small enterprises and one third of these are launched by people who are unemployed. Further informationAbout European Progress Microfinance Facility: http://ec.europa.eu/epmf About the EIF: http://www.eif.org About Qredits: www.qredits.nl Side Bar

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MULTICHANNEL MERCHANT » ECOMMERCE » MONSTER OFFERS TO UNVEIL DAILY DEAL INDUSTRY’S FIRST END-TO-END MOBILE BANKING SOLUTION Monster Offers to Unveil Daily Deal Industry’s First End-to-End Mobile Banking Solution Apr 20, 2011 11:34 PM By MCM staff SAN DIEGO–(BUSINESS WIRE)–Monster Offers (OTCBB: MONT), a leading Mobile Banking solutions provider and Daily Deal aggregator, announced its strategic vision to help local consumers find relevant daily deals, make those deals extremely easy-to-buy, and provide accurate and detailed data analytics to the Daily Deal industry. Leveraging its recent exclusive worldwide agreement with Zala, Monster Offers will deploy a series of consumer and business banking solutions under a newly formed subsidiary this quarter. These solutions will be available on more than 150 approved handsets including iPhone, Android, Blackberry, and Nokia. Users will also be issued a Visa or MasterCard integrated with their deal redemption account. MONSTER OFFERS QUOTE “Monster Offers has been marching toward our vision of making Daily Deals easy-to-buy and redeem, delivering valuable analytics to help deal providers such as Groupon, Living Social, and hundreds of others improve their programs, and creating a more user-friendly Daily Deals search and purchase experience. Our long-term vision goes one step further and is focused on helping Daily Deal providers improve their customer experience while also providing higher value to their participating merchants.” - Paul Gain, Monster Offers CEO About Monster Offers: Monster Offers is a popular daily deal aggregator, collecting daily deals from multiple sites in local communities across the U.S. and Canada. Focused on providing innovation and utility for Daily Deal consumers and providers, the company collects and publishes thousands of daily deals and allows consumers to organize these deals by geography or product categories, or to personalize the results using keyword search. The company will introduce new mobile technology in 2011 to address unmet category needs in areas such as loyalty, rewards, payment processing, merchant services, and a Daily Deal eWallet. Monster Offers recently launched its Hyper-Local Daily Deal Reporting Program, designed to help providers improve the revenue and profits of local and regional Daily Deal programs. More information can be found by visiting http://www.monsteroffers.com. Any statements contained in this press release that relate to future plans, events or performance are forward-looking statements that involve risks and uncertainties, including, but not limited to, the risks associated with the management appointment described in this press release, and other risks identified in the filings by Monster Offers (MONT), with the Securities and Exchange Commission. Further information on risks faced by MONT are detailed in the Form 10-K for the year ended December 31, 2010, and in its subsequent Quarterly Reports on Form 10-Q. These filings are or will become available on a website maintained by the Securities and Exchange Commission at http://www.sec.gov. The information contained in this press release is accurate as of the date indicated. Actual results, events or performance may differ materially. Monster Offers does not undertake any obligation to publicly release the result of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

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DEALBOOK; Goldman-Facebook Deal Raises Debate on Investor Pool By AZAM AHMED 7:46 p.m. | Updated After news broke of the investment by Goldman Sachs in the social networking site Facebook, a harsh spotlight was cast on a nearly 50-year-old law that limits the number of shareholders in a private company. In 1964, regulators started requiring companies with more than 499 shareholders to publicly report their financial results. It is a rule that has been debated from the outset - and the issues raised now are the same ones raised then. The Securities and Exchange Commission is examining the frenzied buying and selling of Facebook shares and other private technology companies in the secondary market. To some, the structure of the Goldman deal merely looks like a way to circumvent the law. Through a special purpose vehicle, the firm could potentially pool money from thousands of wealthy clients and still be considered one investor because the entity would be managed by Goldman. Section 12 (g) of the Securities Exchange Act of 1934 came about in the 1960s as over-the-counter trading in shares of privately held companies began to heat up and regulators worried that investors were not getting enough information. A special study from that period found that the ''disclosures voluntarily made by unlisted companies left a great deal to be desired,'' according to a speech by the S.E.C. commissioner at the time, Hugh F. Owens, given before the Practicing Law Institute in New York in 1964. ''Not only did the volume of information delivered to shareholders vary considerably, but the candor with which it was presented was highly variable,'' he said in the speech. ''They involve thousands of corporations and hundreds of thousands of investors. The Securities Acts Amendments of 1964 effectively remove the distinction, which has existed as to a large number of the companies whose securities are traded over-the-counter.'' That is the same sort of issue facing regulators now, with shares in Facebook trading at a frenetic pace on the secondary market. The announcement that Goldman will use a special purpose vehicle to raise and invest $1.5 billion in the company - money collected from a variety of wealthy individuals - has only intensified the scrutiny. In practice, a large fund that represents hundreds or thousands of individuals can be considered a single record holder. ''So long as Goldman is the sole decision maker for all investors it's irrelevant,'' said Eleazer Klein, a partner at the law firm Schulte Roth & Zabel. Even so, questions remain about whether such a deal may stray from the spirit of the law while adhering to its letter. ''Whether something is done primarily to circumvent the rules is a philosophical question,'' Mr. Klein said. ''There is a natural tension between being allowed to structure something in a manner that complies with the law and at the same point circumvents the law.'' How did the government come up with the 500-shareholder limit, a threshold that over the years has been called both too high and too low? The government did not want to subject small companies with limited shareholders to the costs of regulation and compliance. At the same time, regulators did not want to allow large companies with a multitude of investors to reap the benefits of public financing without disclosure and registration. Ultimately, lawyers say the number was picked arbitrarily. Scientific or not, it all comes back to investor protection. One issue today is whether wealthy investors - like those who will participate in the Goldman deal - need the same protection as smaller investors. There are plenty of examples where the government has determined that they do not, as with hedge funds and private equity investments. ''We've lowered the bar for certain types of investors that we felt need less protection,'' said Christian Leuz, a finance professor at the University of Chicago Booth School of Business. ''But maybe what we've learned in recent years after the financial crisis is that sophisticated doesn't always mean high net worth.'' Although the 500-investor threshold has long been the subject of debate, start-ups like Google raised it to a new level in the last decade. Many private technology companies reward and attract talent by offering stock options or shares in the company. Those employee-owned shares typically do not count toward the 500-investor limit. But once those shares are sold on a private exchange - often after employees leave the company - they are no longer exempt. Venture capital firms, too, divest shares in the secondary market. The development of this changing dynamic has only complicated the numbers game. ''Prior to that, it was pretty easy to maintain less than 500 shareholders,'' said Adam C. Pritchard, a professor at the University of Michigan Law School. This is a more complete version of the story than the one that appeared in print. PHOTOS: Hugh F. Owens, a member of the S.E.C. in the 1960s, questioned the reliability of information about unlisted stocks in that era. (PHOTOGRAPHS BY GEORGE TAMES/THE NEW YORK TIMES; JASON ALDEN/BLOOMBERG NEWS)

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BFX trading turnover tops $50bn mark The Bahrain Financial Exchange (BFX) has achieved a major milestone this month when its total cumulative trading turnover crossed the $50 billion mark driven by a 69 per cent jump in the total trading volume which soared to over 4 million contracts. The compounded monthly growth rate of the BFX trading volume for the period between December 2011 and January 2013 was 69 per cent per month, indicating the rapid growth in the BFX derivatives segment primarily due to the increase in the BFX membership and overall market participation, said a statement from exchange. For the period between the launch date on November 23, 2011 and February 8, 2013, the total cumulative trading volume surged to 4.37 million contracts, with a cumulative trading turnover of $52.85 billion, it stated. The highest daily trading volume of 118,495 contracts was recorded on January 17, 2013, said the statement. The trading volume on the BFX markets reached 1 million contracts in 258 trading days; whereas, the 4 million contracts mark was achieved in only 51 trading days. Similarly, the trading turnover on the BFX markets reached $25 billion in 246 trading days, as compared to the next $25 billion mark, which was achieved in 63 trading days. The BFX Futures are currently available on the US Dollar versus the Indian Rupee (USD-INR) currency pair, Euro versus the US Dollar (EUR-USD) currency pair, Gold, Silver and Natural Gas, said the statement. Other innovative products in the pipeline include the BFX MCX USD Gold and Silver Futures as well as Options contracts on the USD-INR currency pair, it added. Commenting on the milestone, Arshad Khan, the managing director and chief executive officer of the BFX and the BFX Clearing and Depository Corporation (BCDC), said: "A good set of trading figures to start year 2013 is a positive indicator for the effectiveness of our strategy in balancing between attracting higher liquidity and the selected products we have listed in our Exchange, and further reinforces a promising long-term growth in the regional capital markets." "Factoring-in today’s market appetite, we have recently launched Futures contracts on Silver and INR-$currency pair and we are pleased to report that as a result, the trading volume on the BFX markets during the first 29 calendar days of Q1 2013 is already 143 per cent of the total trading volume during the entire fourth quarter of 2012," remarked Khan. "Excellent opportunities for hedging, investments and arbitrage continue to attract a diverse range of market participants from all across the region," he added.-TradeArabia News Service trading | futures | Bahrain Financial Exchange | More Finance & Capital Market Stories

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VegasTechFund is now VTF Capital, looks beyond Sin City for commerce startups Ken Yeung February 24, 2016 9:00 AM Above: The world-famous "Welcome To Vegas" sign in Las Vegas, Nevada.Image Credit: WriterGal39/Flickr One of Las Vegas’ most well-known venture capital firms is undergoing a bit of transformation. The VegasTechFund has rebranded itself to highlight its changing focus. Now calling itself VTF Capital, it’s setting out to make investments throughout the United States in startups within the commerce and marketplace sectors. Started by Zappos chief executive Tony Hsieh, Zach Ware, Will Young, and Fred Mossler in 2012, the original intent of what’s now VTF Capital was to support the Las Vegas technology ecosystem. However, the team naturally progressed toward “what provided the most value to companies and brought the most value based on our experience.” As it stands, the firm has made more than 90 investments, with 70 percent based outside Sin City. Above: VTF Capital managing partner Zach WareImage Credit: VTF CApital “Early on, we were early investors and operating as a fund. We didn’t know if it made sense to say what we did,” explained Ware in an interview with VentureBeat. “We wanted to meet incredible founders and didn’t think it was productive four years ago to say what categories we wanted to focus on.” As the firm matured, the founders realized they weren’t meeting a lot of companies due to a poorly articulated statement of what VTF did and their reluctance to specify a space they wanted to invest in. That all changes today. Not only have Hsieh and Mossler stepped away from day-to-day operations, leaving the primary team as Ware and Young, but they have also established a dedicated focus on vertical commerce, physical commerce, and access, along with a shift away from just Las Vegas to look at startups from Los Angeles, Dallas, Columbus, New York City, San Francisco, and other cities. It also isn’t going to actively encourage portfolio companies to relocate to Las Vegas, something the firm did in its early days. “We realized that forcing a company to relocate to Las Vegas just wasn’t the best when they needed to be closer to their customers. There are some companies where living [here] makes a lot of sense and for others it doesn’t,” Ware said. While VTF Capital has always looked at commerce and marketplace companies, this is the first time that Ware is publicizing it, in hopes of attracting interesting startups. It’s an area he and Young know quite well and have deep experience in, whereas other investors, he asserts, “don’t know how to build a company in the space.” Above: VTF Capital General Partner Will YoungImage Credit: VTF Capital “Great commerce is a collection of smart systems and brilliant financial planning. Long-lasting commerce companies are parts operations, technology, design, people, and finance,” the firm explains on its website. These are things both Ware and Young believe they can offer startups, mostly because of their experience working at Zappos. The firm has begun looking at startups that are innovating in retail and commerce across three categories. With vertical commerce, VTF Capital is looking at those that define an entire category of products and shopping, such as those that make and sell items directly to consumers. Physical commerce involves bricks-and-mortar locations and what startups are doing to help stores remain competitive — as the firm puts it, “What is the role of the store?” Lastly, Ware said that VTF Capital wants investments in startups that are making it easier and more efficient to transact. Ware said that VTF Capital will continue to make seed and series A investments and currently doesn’t have any plans for extending into growth capital soon. However, he revealed that there are some plans to tackle some of the elements around ecommerce “lacking in the current venture market today.” He declined to elaborate further. Although the firm has made some investments outside the U.S., such as in Canada, Ware’s primarily focused on domestic startups. However, he said that VTF Capital may make moves in Europe if it can overcome the legal structures in place on the continent. If that happens, Ware may look particularly to Ireland in the future. Some of the firm’s portfolio companies include Buffer, Ring, General Assembly, Banjo, Galvanize, Combatant Gentlemen, Surf Air, Karma, FanDuel, SkillShare, and Pando.

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CPAs have issues with plan to eliminate Bureau of Audits CPA's say fraud could be on the rise Thursday, March 22, 2012 1:00 pm Kim Kalunian Under Governor Lincoln Chafee’s budget proposal for FY2013, the Bureau of Audits, which provides internal auditing functions for the state’s government, would be eliminated, says Rhode Island’s CPA’s. Christine Hunsinger, press secretary for Governor Lincoln Chafee, said the Bureau would not be abolished, but instead consolidated into an Office of Management and Budget. “We want to be more efficient and transparent,” said Hunsinger, who said the move isn’t to cut costs, but to ramp up productivity. But those at the Rhode Island Society of Certified Public Accountant (RISCPA) don’t agree. “The proposal would undermine transparency, accountability and the crucial internal audit function of the State,” said Robert Mancini, Executive Director of the RISCPA in a statement. RISCPA said the consolidation would strip away the most important qualifier of the Bureau: it’s independence. By folding the Bureau into another office, the team of auditors would essentially be auditing themselves. The Bureau of Audits currently provides an independent appraisal of financial efficiency for the Executive Branch of Rhode Island’s government. They are an internal audit and management advisory service that reports their findings to the Governor and Director of Administration. The Bureau helped to return $13.3 million to the state in settlement money from civil cases following its forensic audit of the Rhode Island Resource Recovery Corporation. “If approved, Governor Chafee is sending a message that accountability isn’t a priority,” said Martha Conn Hultzman, RISCPA Board President in a statement. “At a time when Rhode Island is looking to cut wasteful spending, the Bureau of Audits provides an independent eye to identify those problem areas and potential remedies.” RISCPA is now publicly opposing the change to the Bureau, saying it could mean extraneous spending and fraud will slip through the cracks. They say the current proposal would transition the Bureau into the non-auditing entity and is concerned that audit reports, should they be made, would not be made available to the public. “If we gut the state’s internal audit function, the day-to-day watchdog function for the taxpayers will cease to exist,” said Ernest Almonte, RISCPA Past President and former RI Auditor General in a statement. “Eliminating the auditing function would make it easier for individuals to commit and get away with fraud.” Hunsinger said Rhode Island is one of very few states that does not have an Office of Management and Budget. She says the creation of the office, which will fall under the umbrella of the Department of Administration, will ramp up efficiency. A report released by the State Integrity Investigation earlier this month gave Rhode Island a “C” rating on it’s corruption risk report card. Rhode Island ranked 10th out of 50 states, and was given a “B+” rating on the internal auditing section. If the Bureau of Audits was eliminated, the State Integrity investigation said the state’s overall score would drop to a D, and Rhode Island’s rank would fall to 33. The Bureau of Audits currently has a staff of 10, and sources are saying that some of those CPA’s would be in danger of losing their jobs should the Bureau be eliminated. Still Hunsinger said it’s hard to tell if any employees would lose their jobs or if they would simply change positions. “Most employees would be folded into the new office,” she said. Sources are quick to point out that no where in the budget proposal does it say that personnel on staff of the Office of Management and Budget would require the same certifications the CPA’s of the Bureau of Audits currently hold. Without those certified auditors, some worry that no audits will be performed. Hultzman thought Chafee might be making this move to consolidate personnel costs, but Hunsinger said that isn’t the case. Currently Hultzman and RISCPA are reaching out to legislators to combat the proposal. “We know it’s just a proposal,” said Hultzman in an interview last week, “We’re communicating with our [1,900] members and encouraging them to testify against it.” RISCPA plans to testify against the bill in both the House and the Senate. “Eliminating the Bureau of Audits, a key tool in preventing corruption, would be a grave mistake,” said Mancini.

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News Releases New Report Finds International Finance Institutions Critical for Job Creation in Emerging Markets News Release | 23 September 2011 FacebookTwitterLinkedInPrint MANILA, PHILIPPINES - A new report finds that international finance institutions play a key role in catalyzing job creation and growth through the private sector in emerging markets, particularly as governments face increased pressure on public resources. The report, International Finance Institutions and Development through the Private Sector, was produced by 31 international finance institutions (IFIs) and was launched during the World Bank-International Monetary Fund Annual Meetings. Key findings of the report are: IFIs provide the private sector in developing countries with critical capital and knowledge. Private sector direct foreign investment finance has reached over $40 billion in commitments a year-about 5% of capital flows to emerging markets. IFIs help companies set standards and manage risk in areas such as environmental and social standards; corporate governance; health and safety, sponsor and business integrity; labor and human rights; revenue transparency; and international financial reporting. IFIs catalyze additional financing from other private sector players. Each $1 of capital supplied to IFIs can lead to $12 in private sector project investment. IFIs support entrepreneurship and innovation, helping demonstrate the viability of private solutions in new or challenging areas. "More jobs mean higher incomes for families and are key to reducing still-high poverty in Asia and elsewhere in the world. Since the private sector generates most of the jobs, development institutions should focus on helping create dynamic and sustainable private sector firms," said Lakshmi Venkatachalam, Vice President (Private Sector and Cofinancing Operations) at the Asian Development Bank (ADB), which helped produce the report. ADB aims to scale up private sector development and private sector operations to 50% of the Bank's annual operations by 2020. The report was initiated under the sponsorship of the Private Sector Development Institutions Roundtable, an annual meeting of the heads of IFIs that focus on the private sector. FacebookTwitterLinkedInPrint Subjects PovertyPrivate sector developmentSocial development and protection

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First Niagara expands in Syracuse Bank adapts to growth in mortgage business By Jonathan D. Epstein Responding to rapid growth, First Niagara Financial Group is opening a third mortgage processing center in downtown Syracuse to serve customers in its Central and Eastern New York markets.The Buffalo-based owner of First Niagara Bank, which already employs 500 in the Syracuse region and operates 49 branches, will open its Central New York Mortgage Center in a former HSBC Bank USA facility on Washington Street next month, with at least 25 new full-time jobs. Those workers will join mortgage lenders the bank gained earlier this year through its purchase of HSBC’s upstate New York retail and small business banking operations.The bank already has mortgage facilities in Buffalo and New Haven, Conn., but it said mortgage originations have soared 66 percent in the past year, with 85 percent coming through branches. Mortgage banking revenues soared 53 percent in the third quarter compared with a year earlier, and were up 2½ times for the first nine months of the year. First Niagara bought HSBC’s business in May.“We are excited to continue our growth in Central New York, create new jobs and join in downtown Syracuse’s renaissance,” Senior Vice President Andy Fornarola said.First Niagara, with $36 billion in assets and $28 billion in deposits, operates 432 branches and more than 400 ATMs in New York, Pennsylvania, Connecticut and Massachusetts.email: jepstein@buffnews.com

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About SATC About Craig Smith Why SATC? SATC in the Media Swiss America Reviews Gold Market News Featured Commentary Latest Other Videos Real Money Blog About Numismatics Precious Metals Coin Database $20 Gold Pieces Best Gold Coin Values Gold/Silver IRAs Why Gold Prices Rise A Short History Of Gold Avoiding Gold Scams No way out for Greece inside the euro zone Due to the spending cuts in Greece, such as tax hikes and cutting jobs, it is expected to shrink by 5.5% this next year. The unemployment rate is rising and business are struggling in this economy and many see "no way out" for the country. Masao Suzuki Fight Back! News On Sunday, Oct. 3, the Greek Cabinet voted on a new budget proposal for 2012 that includes 6.5 billion euros ($8.5 billion) in spending cuts and tax hikes, including cutting 30,000 government jobs. This budget will go to the Greek Parliament on Monday, Oct. 4, in hopes of getting another 8 billion euros ($10.5 billion) from the European Financial Stability Facility (EFSF) in order to pay back German, French and other European banks that own large amounts of Greek bonds. This austerity has cost the working people of Greece. This year the Greek economy is expected to shrink by 5.5%, as more and more businesses are failing. With the unemployment rate at 16% and rising, Greek workers and their supporters have been organizing huge street protests and strikes to protest the austerity plans of the social democratic (socialist in words, pro-business in deeds) PASOK government. As the Greek government spending cuts and tax increases deepen their recession, tax revenues fall, making the government budget deficit even bigger and leading to calls for even more cuts and tax increases, which increase unemployment and poverty even more. This vicious cycle has gotten to the point where hospitals are running out of medicines and suicides are way up. Greece is not alone. Over the last year, more and more European governments have had problems selling their bonds to borrow money. The crisis began in Greece, but has since spread to Portugal, Ireland, Spain, and now Italy. With big German and French banks set to lose billions, and perhaps even fail if Greece or another euro zone country defaults on the its government bonds, the other governments in the euro zone (the 17 countries that share a common currency, the euro) have arranged a bailout fund, the EFSF, and are demanding austerity from Greece and other countries.. The mainstream media and politicians try to blame Greece for the crisis by saying that Greece borrowed and spent too much. Politicians in the United States (and other countries) are using the example of Greece to try to get the United States to cut spending and reduce our budget deficit. If done here, this would have the impact of pushing the United States back into a recession, causing the unemployment rate to go up, and the amount of tax revenues to go down, which would tend to increase the budget deficit. But the European financial crisis is not fundamentally a problem of too much government debt. While the Greek, Portuguese and Italian governments have been running sizable budget deficits for years, Spain and Ireland both had budget surpluses in the years before the 2008 financial crisis. Japan has been running large government budget deficits for 20 years and has a total government debt (compared to the size of the economy) much larger than Greece, but has no debt crisis. Indeed, while interest rates on some Greek government debt has risen to 85% (showing that bond buyers think that Greece will default), Japanese government bonds have interest rates of less than 2%! What Greece, Portugal, Ireland, Spain and Italy all had in common was that they all depended on large flows of foreign capital to pay for their trade deficits as they imported more than they exported. This is why Japan is not facing a financial crisis like Europe, because Japan has a large trade surplus, as it exports more than it imports. Japan, despite its huge government debt, does not rely on inflows of foreign capital; instead Japan is exporting capital to other countries, such as the United States. The euro zone crisis is similar to the 1997 financial crisis that began in Thailand and spread to Indonesia, Malaysia, South Korea and other Asian economies. Then, as now, big inflows of foreign capital turned to outflows, causing financial crisis and a deep recession. What happened in Asia was that the value of Asian moneys plunged. This led to higher inflation that cut the purchasing power of working people, but it also making their goods cheaper on world markets, so that these countries were able to export more. This is what Greece, Portugal, Ireland, Spain and Italy cannot do, because they are a part of the euro zone. So instead, what is being done is to try to lower the wages of working people in those countries, through high unemployment and cuts in government services, in order to make their economies even more attractive to businesses searching for the lowest possible wage. Argentina also tried to do this following the economic crisis in Latin America in 1998. For many years, Argentina set the value of its money, the peso, as equal to the U.S. dollar. The government of Argentina, like the governments of Greece and other euro zone countries, tried to maintain the value of its currency on par with the U.S. dollar and Argentina’s economy fell deeper and deeper into a depression. But then in 2001, Argentina defaulted (stopped paying back) its government debt, and allowed the peso to fall dramatically in value, allowing Argentina’s economy to export more and grow again. More and more austerity will just further impoverish the working people of Greece and won’t solve the Greek debt problem. Greece needs to follow the example of Argentina, default on their government debt and go back to their own currency, the drachma. This is not a cure-all for the people of Greece who will have to cope with higher prices, but it will free the economy from the euro-chains that are helping to destroy their economy right now. Working people here in the United States should support the working people of Greece, who have organized massive street protests and strikes to oppose the austerity plans of their government. We also need to understand that whether it is common currency such as the euro, or free-trade agreements promoted by the United States, that these international agreements are all about boosting profits by allow capital to move to wherever it can find the cheapest labor. In the end, it is the workers who pay. To see original article CLICK HEREPrevious External Article:Gold rises as investors see bargains, bet on continued uncertaintyNext External Article:Global Markets Fall on Greek Default Concerns More Links Weekly Charts Current Spot Prices Gold$1322.39 Silver$19.63 Platinum$1082.00 About Swiss America The moment you contact Swiss America, our team of trained professionals stand ready to serve you… U.S. Numismatics © 2016 Swiss America Trading Corp. All Rights Reserved. | Privacy Policy | Site Map | Contact Us | Mobile Version SWISS AMERICA and Block Logo are registered trademarks of Swiss America Trading Corp. Where did you hear about us?Pat BooneMichael SavageOtherWayne Allyn RootJason StapletonChristopher Greene (AMTV)Ron Douglas×

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Fed may reduce bond buying and stay with low interest ratess September 18, 2013 | by Reuters The Federal Reserve building in Washington (Reuters) The U.S. Federal Reserve is expected to begin its long retreat from ultra-easy monetary policy on Wednesday by announcing a small reduction in its bond buying, while stressing that interest rates will remain near zero for a long time to come. Most economists expect the Fed to scale back its monthly purchases by a modest $10 billion, taking them to $75 billion and signaling the beginning of the end to an unprecedented episode of monetary expansion that has been felt worldwide. The baby step would begin to provide a bookend of sorts to the central bank’s response to the global financial crisis that reached fever pitch five years ago this week with the collapse of investment bank Lehman Brothers. “It is an important milestone … juxtaposed against five years ago, when the Fed began the huge expansion of its balance sheet,” said Carl Tannenbaum, chief economist at Northern Trust in Chicago. “This is going to be the first step, potentially, in a very, very long walk.” The Fed will announce its decision in a statement following a two-day meeting at 2 p.m. (1800 GMT), and Fed Chairman Ben Bernanke will hold a news conference a half hour later. It is also set to release fresh quarterly economic and interest rate projections. In slashing overnight rates to zero in late 2008, the Fed launched an extraordinarily bold campaign to shelter the U.S. economy. The effort included three rounds of bond purchases that more than tripled its balance sheet to around $3.6 trillion. The actions, unthinkable to many within the Fed prior to the crisis, sparked intense criticism from those who feared the measures would create an asset bubble or fuel inflation. But the central bank’s show of force was credited with saving the U.S. and world economies from a much worse fate. With the U.S. economy now on a somewhat steady, if tepid, recovery path and unemployment falling, policymakers have said the time was drawing near to begin ratcheting back their bond buying with an eye toward ending the program around mid-2014. While U.S. government bond yields and mortgage rates have shot higher in anticipation of less Fed support, the central bank will still be expanding its balance sheet for many more months as it tries to wean the economy and financial markets from its ever-expanding stimulus. YELLEN AND FORWARD GUIDANCE Fed Chairman Ben Bernanke, in what is likely his penultimate news conference before stepping down in January, is expected to reinforce the central bank’s commitment to keep overnight rates near zero for a long time to come as a way to temper any jitters the bond market may feel. The forward guidance on rates is aimed at holding down longer-term borrowing costs, which encompass investors’ views on the path of short-term rates. That task may have gotten easier after former Treasury Secretary Lawrence Summers withdrew from the race to replace Bernanke when his term ends on January 31, restoring current Fed Vice Chair Janet Yellen to the front-runner position. Yellen, who would become the first woman ever to hold the job if nominated by President Barack Obama and confirmed by the U.S. Senate, could be expected to maintain the policy path set by the Bernanke-led Fed. Investors and economists were less certain on where Summers might lead the central bank. “I think that probably does add to the credibility of the forward guidance in terms of the greater expectation of continuity in the basic philosophy and direction of policy,” said David Stockton, a former senior Fed economist. “If there had been as much uncertainty about the transition as there was a week ago, that credibility may have been less secure,” said Stockton, who is now a senior fellow at the Peterson Institute for International Economics in Washington. The Fed has said it will not begin raising rates at least until the unemployment rate hits 6.5 percent, provided inflation does not threaten to pierce 2.5 percent. The jobless rate stood at 7.3 percent in August. But 10-year bond yields have risen more than a percentage point since Bernanke initially discussed scaling back the Fed’s bond purchases, a signal that investors had brought forward their anticipated lift-off date for overnight rates. Some analysts wonder if the Fed might try to hammer home the message that rates would stay lower for longer by reducing the unemployment threshold to 6.0 percent. But it could prove hard for Bernanke to muster sufficient support from other members of the central bank’s policy-setting committee for such a move. “They will be hesitant to put in any more explicit forward guidance,” said Dean Maki, chief U.S. economist at Barclays Capital in New York. “They really cannot credibly say a lot about 1-1/2 years from now.” Copyright © 2013 Thomson Reuters. All rights reserved. Copyright © 2013 Capitol Hill Blue

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WSJ’s Casino Piece: A Few Details Short of a Full Deck By Felix Salmon Alexandra Berzon has an enjoyable piece in today’s WSJ about the Cosmpolitan, the new $4 billion casino, fully paid for by Deutsche Bank, which is opening up in Las Vegas next month. Berzon gets the obligatory isn’t-Wall-Street-a-casino-anyway shot in at the beginning of the piece, and then walks through the chain of events which resulted in a $60 million loan to a Las Vegas developer somehow morphing into ownership of a $4 billion project. But I would have loved to see a bit more detail on the finances: Deutsche was originally just funding the project, pumping in a loan of $1 billion to build the soaring two-tower development. But its original developer, Ian Bruce Eichner, defaulted on Deutsche loans in 2008…By the time the Cosmopolitan holds its grand opening next month with a New Year’s Eve party featuring Jay Z and Coldplay, Deutsche will have spent an additional $3 billion from its own coffers. That makes it one of the most expensive resorts in Las Vegas history. Already, Deutsche has written off nearly $1 billion of its Cosmopolitan investment, according to securities filings… After Mr. Eichner left the development, the bank was still uncomfortable about getting directly into the casino business. It tried to cut deals with more established players, including Hilton Worldwide and MGM Resorts International, but the deals didn’t come through.Several other potential investors declined because they weren’t confident the Cosmopolitan could cover its loans, according to people involved in the talks. What’s missing here is any explanation of its decision from Deutsche itself, beyond a bland statement that Thomas Fiato, the bank’s head of corporate investments, made to Nevada regulators. Berzon has talked to “people involved in the talks”, and there’s nothing about Deutsche refusing to comment, so I assume she talked to Deutsche executives off the record. But after reading her article I’m left with a lot of questions. For one thing, how did Deutsche come to the decision that the best thing to do with a construction site in the middle of Las Vegas was spend $3 billion of its own money turning it into a new casino? I can see how it might have been a bit overoptimistic when it lent $1 billion to Eichner in the first place. But when Eichner defaulted on that loan and Deutsche defaulted, clearly there were problems in the Las Vegas real estate market. And when big casino operators took a look at the construction site and walked away, that was obviously a sign that Deutsche’s sunk costs were never going to be recovered. And yet, somehow, Deutsche decided that the smart thing to do was to throw $3 billion of good money after its $1 billion of bad money. Why? What made them think that they could see a healthy return on that $3 billion even as no one else showed any interest in the deal? And given that casino investments are always risky, what justification did they have for adding such a big one to Deutsche’s balance sheet? Furthermore, when did Deutsche take its “nearly $1 billion” write-off? If Deutsche knew that it was going to write off substantially all of its initial loan in any case, then wouldn’t it have been just as expensive and much less risky to just give the entire construction site away? And if Deutsche has now put $4 billion into the development, does that mean that the Cosmopolitan, which has yet to host a single paying guest, is valued at something north of $3 billion on Deutsche’s books? What would a reasonable valuation be, in this market? Finally, what does Berzon mean when she says that other potential investors walked away “because they weren’t confident the Cosmopolitan could cover its loans”? What loans? Wasn’t Deutsche the owner of the project at that point, perfectly capable of selling an equity stake unencumbered by any debt? The tale that Berzon tells is entirely consistent with Fiato and his team getting so caught up in the Cosmopolitan concept when they agreed to finance it that they simply couldn’t let go, wanting to retain at least a substantial debt-finance involvement and ultimately deciding to finish themselves what Eichner was unable to do, placing valuations on the Cosmopolitan that no one else was willing to ratify. But we don’t quite get there: we get hints of that story, but not enough detail to see it clearly. Let’s hope there’s a follow-up. Felix Salmon is an Audit contributor. He's also the finance blogger for Reuters; this post can also be found at Reuters.com. Tags: real estate, WSJ Trending stories

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Dean Witter was born in Wausau, Wisconsin in 1887. He moved to California with his family in 1891, and after purchasing country land tracts in various areas of the state, the family moved to San Carlos on the Peninsula and eventually settled in Berkeley. Dean Witter graduated from the University of California, Berkeley in 1909, and from 1909 worked for Louis Sloss & Company as a salesman on the California coast. With Charles Blyth he started Blyth, Witter & Company in 1914 and the two men ran the company until 1924, when he launched Dean Witter & Company with his brother Guy, cousins Jean and Ed Witter and their brother-in-law, Fritz Janney. The San Francisco office of Dean Witter, located at 45 Montgomery Street, was company headquarters; the business expanded greatly over the years, partly through mergers. At the time of Witter's death in 1969 there were nearly 80 branches of Dean Witter & Co. in the U.S. and Canada and the company was the largest investment house on the West Coast. Dean Witter interrupted his career to volunteer for duty in both World War I and World War II, during which he attained the rank of colonel. During Dean Witter's lifetime, he found recreation in hunting and fishing and in enjoyment of the outdoors. In business and as a fisherman, Colonel Witter enjoyed pursuing the difficult task. He preferred the elusive trout to the easy fishing of a well-stocked pond. In this spirit, The Dean Witter Foundation seeks to practice imaginative grantmaking in the fields of finance and conservation. It is the policy of The Dean Witter Foundation to support specific wildlife conservation projects in Northern California and seminal opportunities to improve and extend environmental education. The Foundation makes additional grants to launch and expand innovative K-12 public education initiatives. We encourage prospective applicants to telephone or write the Consultant to determine whether their proposed program falls within the Foundation's areas of interest and grantmaking priorities

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Muhammad Aliuddin Ansari President Muhammad Aliuddin Ansari is the President of Engro Corporation since May 2012. He is a graduate of Business Administration with a specialization in Finance & Investments. Ali started his career as an Investment Manager at Bank of America in London, which later became Worldinvest after a management buyout. Prior to joining Engro, he has also worked as CEO Pakistan and later as COO Emerging Europe for Credit Lyonnais Securities Asia (CLSA). He has also worked as CEO AKD Securities and was instrumental in launching Online Trading, Venture Capital and Private Equity investments. In 2006 he partnered with an Oil & Gas company to form Dewan Drilling, Pakistan’s first independent Drilling company which he led as its CEO before joining Engro. Ali is a member of the Board of Directors of Engro Corporation Limited and the Chairman of Engro Corporation’s subsidiaries along with being a member on Sindh Engro Coal Mining Company, Dewan Drilling Limited, Pakistan Chemical & Energy Sector Skill Development Company, Pakistan Business Council. He has chaired a number of SECP committees, NCCPL and also served on the Boards of the Karachi Stock Exchange, Dawood Hercules Corporation Limited, Hubco, Lucky Cement and Al Meezan Investment Management amongst others. He joined the Board in 2009.

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Is National Grid the Perfect Stock? Everyone would love to find the perfect stock. But will you ever really find a stock that gives you everything you could possibly want? One thing's for sure: If you don't look, you'll never find truly great investments. So let's first take a look at what you'd want to see from a perfect stock, and then decide whether National Grid (NYSE: NGG ) fits the bill. The quest for perfectionWhen you're looking for great stocks, you have to do your due diligence. A stock that looks great based on one factor may turn out to be horrible in other ways. The best stocks, however, excel in many different areas, which all come together to make up a very attractive picture. Some of the most basic yet important things to look for in a stock are: Growth. Expanding businesses show healthy revenue growth. While past growth is no guarantee that revenue will keep rising, it's certainly a better sign than a stagnant top line. Margins. Higher sales don't mean anything if a company can't turn them into profits. Strong margins ensure that a company can turn revenue into profit. Balance sheet. Debt-laden companies have banks and bondholders competing with shareholders for management's attention. Companies with strong balance sheets don't have to worry about the distraction of debt. Money-making opportunities. Companies need to be able to turn their resources into profitable business opportunities. Return on equity helps measure how well a company is finding those opportunities. Valuation. You can't afford to pay too much for even the best companies. Earnings multiples are simple, but using normalized figures gives you a sense of how valuation fits into a longer-term context. Dividends. Investors are demanding tangible proof of profits, and there's nothing more tangible than getting a check every three months. Companies with solid dividends and strong commitments to increasing payouts treat shareholders well. With those factors in mind, let's take a closer look at National Grid. What We Want to See Pass or Fail? 5-Year Annual Revenue Growth > 15% 1-Year Revenue Growth > 12% Gross Margin > 35% Net Margin > 15% Debt to Equity < 50% Current Ratio > 1.3 Return on Equity > 15% Normalized P/E < 20 Current Yield > 2% 5-Year Dividend Growth > 10% Source: Capital IQ, a division of Standard and Poor's. Total score = number of passes. A score of 5 definitely isn't perfect, but for a utility, it's pretty good. National Grid actually comes very close to getting an extra point for long-term revenue growth, since it's been growing at a faster clip than competitors Duke Energy (NYSE: DUK ) and Southern Company (NYSE: SO ) over the past five years. However, National Grid's balance sheet is far more leveraged than those two utilities, although none of them meets the 50% debt-to-equity threshold we like to see. One reason investors have been hesitant about National Grid is that it raised capital recently, diluting existing shareholders, after saying it wouldn't. But the company has a high dividend yield, while trading at a normalized earnings multiple that's even cheaper than Inside Value pick Exelon (NYSE: EXC ) . So even if National Grid may not be perfect, it's worth a look if you're seeking reliable dividend income at a reasonable price. Keep searchingNo stock is a sure thing, but some stocks are a lot closer to perfect than others. By looking for the perfect stock, you'll go a long way toward improving your investing prowess and learning how to separate out the best investments from the rest. The Motley Fool is recommending 50 stocks in 50 days for its new "11 O'Clock Stock" series. For more information, click here. Then come back to Fool.com every single weekday at 11 a.m. ET for a brand-new pick! True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. Fool contributor Dan Caplinger doesn't own shares of the companies mentioned in this article. Duke Energy, National Grid, and Southern Company are Motley Fool Income Investor recommendations. The Fool owns shares of Exelon, which is a Motley Fool Inside Value selection. Try any of our Foolish newsletters today, free for 30 days. The Fool has a disclosure policy. ETFsRule wrote: It's also important to look at the magnitude of each of these characteristics - a pass/fail grade is not always enough. The one that jumps out here is their debt/equity - it's much too high. Even if they had passing grades in every other category, I still could not buy this stock. It's too risky to invest in a company with such an astronomical level of debt.

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Home Federal celebrates 80 years of rich history By Paula Barness, Bluff Country Newspaper Group Tuesday, March 25, 2014 3:02 AM Excitement was building for the organization as crews put up the first Home Federal sign the year it opened in 1934. A large crowd was on hand for the grand reopening of the Home Federal Savings Bank in 1956 after the building was completely remodeled. The modernization was the first major change to the building in its history. What began in a small upstairs office in downtown Spring Valley 80 years ago has become a mainstay in the town's history. Home Federal Savings Bank is celebrating the impressive achievement this week.Eighty years ago, a number of businessmen met in that small upstairs office to hear a presentation by C.H. Ellingson, a United States government official employed by the Federal Home Loan Bank Board of Washington, DC. Ellingson was trying to recruit the men to organize a federal savings and loan association for Spring Valley and the surrounding area.Home Federal received its charter from the Federal Home Loan Bank on March 27, 1934, and opened for business.With the country in the midst of the Great Depression, the organization was determined to provide a safe place for local people to open savings accounts and earn interest on their money. During a time when home loans were scarce, they worked to use this money to provide home loans to other community members and for the construction of homes, which would in turn give employment to laborers and local businesses.In the early 1940s, the firm moved its headquarters to its longtime home at the corner of Broadway Avenue and Courtland Street, which is now the home of Essig Agency.By the time Home Federal celebrated its 40-year anniversary it was the largest thrift and home financing institution in Minnesota outside the Twin Cities and Duluth.Though the business has grown, with its headquarters now in Rochester, and added branches throughout southeastern Minnesota and Iowa, Home Federal has still stayed a strong part of the growth of Spring Valley. "We thank 80 years of employees who have made this bank strong," expressed President and CEO of Home Federal Savings Bank Brad Krehbiel, "On behalf of today's 200 employees of Home Federal we are renewing our 80-year commitment to enhance the financial well-being of our clients and communities one relationship at a time."

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Economists Opposing Fed Audit Have Undisclosed Fed Ties As the debate over an audit of the Federal Reserve intensifies in the House, one camp is trotting out eight academics that it calls a "political cross section of prominent economists." A review of their backgrounds shows they are anything but. In a letter to the House Financial Services Committee earlier this month, all eight wrote that they support the type of amendment now being introduced by Rep. Mel Watt (D-N.C.). Watt's approach purports to increase Fed transparency while it actually would tighten restrictions on any audits that could go forward. The letter was sent around Wednesday by Watt's staff to members of the committee in advance of a vote scheduled for Thursday. Watt's measure is in competition with an amendment cosponsored by Reps. Ron Paul (R-Texas) and Alan Grayson (D-Fla.), which would repeal the restrictions that Watt leaves in place. But far from a broad cross-section, the "prominent economists" lobbying on behalf of the Watt bill are in fact deeply involved with the Federal Reserve. Seven of the eight are either currently on the Fed's payroll or have been in the past. The Fed connections are not outlined in the letter sent around to committee members on Wednesday, but are publicly discernible through a review of their resumes, which are all posted online. In September, Huffington Post reported that the Federal Reserve has accomplished a soft form of effective control over the field of monetary economics simply by employing -- and being the means for career advance -- for an overwhelming proportion of the discipline. Now that the Fed is locked in a legislative battle on the Hill, it can call on those economists to give their "unvarnished" opinions to lawmakers. The connections that the seven economists lobbying Congress have to the Fed are not incidental and four of them maintain current positions. Let's run the traps: Frederic Mishkin is a former board member, having served from 2006-2008. His career at the Fed stretches back to 1977 and he currently holds two positions: one as a member of the Center for Latin American Economics at the Federal Reserve Bank of Dallas, where he's been since 1996; and another as an academic consultant to the Federal Reserve Bank of New York, where he's been since 1997. Anil K. Kashyap is currently a consultant with the Federal Reserve Bank of Chicago, a position he's held since 1991. He's also on the economic advisory panel of the New York branch and was a consultant there in 2003. He was a visiting scholar at the division of monetary affairs at the Board of Governors of in1994, 2001 and 2005 and at the division of international finance in 1997. Pete Klenow was a visiting scholar at the Federal Reserve Bank of Minneapolis from 1994-1999, 2003-2004, 2006 and again this year. From 2000-2003 he was also a senior economist at that branch. He's currently a visiting scholar at the Federal Reserve Bank of San Francisco, a position he's held since 2005. He was a visiting scholar at the Federal Reserve Bank of Kansas City from 2004-2006. Ricardo J. Caballero was a visiting scholar at Federal Reserve Bank of Boston from 2004-2005 and a visiting scholar at the Federal Reserve Board on multiple occasions. Robert Hall was a research assistant at the Board of Governors of the Federal Reserve System from 1982-1984 and an economist there from 1988-1991. Thomas Sargent was an adviser to the Federal Reserve Bank of Minneapolis from 1981 to 1987 and continues to write frequently for Fed-sponsored journals. Micheal Woodford is currently on the Monetary Policy Advisory Committee of Federal Reserve Bank of New York, a position he's held since 2004. He's also listed as a consultant to the research department there dating back to 2005. In the past, he's been a visiting scholar at the Board of Governors and various regional branches in 1987, 1993-1998 and 2000-present, often at multiple banks in the same year. Economists with Fed connections strongly reject the notion that being paid by the bank influences their thinking. But Robert Auerbach, who spent years investigating the institution and is the author of "Deception and Abuse at the Fed", says that those economists are simply in denial. "If you're on the Fed payroll there's a conflict of interest," says Auerbach. The tie between the economists backing Watt's amendment and the Fed doesn't by itself mean that it's bad policy, but it does make clear which amendment is favored by the Federal Reserve. If there's still any doubt, the e-mail from Watt staff notes that former Fed chairs Alan Greenspan and Paul Volcker also support a version of it. Meanwhile, a broad coalition of liberal organizations is lining up behind the Paul-Grayson amendment, which also has the backing of most Republicans on the committee. The AFL-CIO and other labor groups, as well as Americans for Financial Reform signed on to a letter posted Wednesday calling for committee members to back the Paul-Grayson approach. "In creating the Federal Reserve nearly 100 years ago, the Congress envisioned a central bank free from political pressure. But the structure that may have once ensured independence now appears to put the Fed much closer to the financial industry than the American people, who deserve to know who the beneficiaries are," reads the letter. The Fed, in other words, is not presently independent of political pressure, but that pressure comes from Wall Street banks rather than from the American people through their elected representatives. It's a distinction that the note from Watt's staff on Wednesday subtly acknowledges, by focusing on legislative and executive branch pressure, rather than financial industry influence. The Paul-Grayson amendment, it warns, "would place the United States well outside of the mainstream of industrialized nations that shield their central banks from political interference by the Legislative and Executive branches of government, with potentially disastrous results to the U.S. economy." The Fed Fed Audit The Fed

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NewsBusinessBusiness News City nervous ahead of bank reform report By Margareta Pagano, Business Editor Saturday 2 April 2011 23:00 BST Shares in the UK's high street banks are likely to come under pressure again this week as the City digests the Treasury Select Committee's latest proposals for more competition in the sector ahead of next week's interim report from the Independent Commission on Banking.In a damning critique of the UK's "oligopolistic" banking industry, the influential committee recommends making competition a primary objective of the City's new regulator, the Financial Conduct Authority, and a major shake-up in the way new banks and other lending institutions are encouraged into the market. City analysts fear that any possible break up of the banks and the extra costs associated with reform will put further pressure on an already nervous banking sector. The shares will remain fragile until the ICB, chaired by Sir John Vickers, reports on 11 April. The committee's report, which noted that a handful of banks control 85 per cent of the market, is particularly concerned about the concentration held by Lloyds and RBS, which are both partly owned by the state. It proposes that the new Financial Conduct Authority should be required to make competition a primary focus – possibly setting up a financial competition body reporting to the Bank of England. While the report falls short of calling for a break-up of Lloyds, which has a 30 per cent share of the retail market following the rescue of HBOS, it calls on the ICB to look "over and above" the RBS and Lloyds divestments to promote competition. This could also include the mutualisation of Northern Rock or breaking-up different parts of the banks such as small business lending. It also criticises the lack of transparency for customers. Andrew Tyrie, the Treasury committee chairman, said: "The chief executives of the large incumbents told us that retail banking was enormously competitive. But a far larger range of witnesses described the industry as close to an oligopoly." On the "too big to fail" issue, the committee supports the view that a full break-up between retail and investment banking would not solve the problem and instead backs some form of subsidiarisation or legal "ring-fencing" between the two divisions. In her Boost Bank Competition report published last week, Andrea Leadsom, a Tory committee member, called for radical reform to allow new banks to enter the market and allow consumers more choice. Over the past decade, bank numbers have fallen from 41 to 22, while in the same time the big banks' assets have increased four fold. More about: Treasury Select Committee

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From Worst to First: The Best Business Tax is None By Ken Braun, published on Jan. 1, 2007 According to the Tax Foundation, Michigan’s Single Business Tax is America’s worst state corporate tax. Fortunately, this job killer will expire on Dec. 31, 2007. Many politicians believe that we must craft a replacement tax because they claim the government cannot do without the $1.9 billion in SBT revenue. But if the SBT dies and politicians fail to approve a new tax, we will join three other states that the Tax Foundation says do not have any general corporate tax. Judging from what has been happening to those and other states at the top of the Tax Foundation’s corporate tax ranking, our politicians should consider "failure" an option.For every dollar that employers must pay in corporate taxes to the state, they have one dollar less to disburse as wages to workers or as investment in growth. Michigan’s historical high-water mark for jobs was April 2000. From then until October 2006, the number of jobs in the United States (excluding Michigan) increased 6.8 percent. Michigan lost more than 207,000 jobs in those six years — a decline of 4.2 percent, while the five states ranked by the Tax Foundation as having the lowest general corporate taxes have increased their job total by 14.3 percent. The three states that have no general corporate tax at all combined for a 17.6 percent job growth, according to the U.S. Labor Department. What if Michigan had eliminated the SBT six years ago, and had added jobs at a pace comparable to the other 49 states? In this hypothetical, Michigan would now have an additional 545,000 jobs. Assuming that state income and sales tax collection per job had remained constant, just these two taxes would today bring in an additional $1.6 billion in state revenue per year — nearly all of what is now brought in by the SBT. Even more striking, if our job growth had paced the three states that have no general corporate tax at all, then the additional income and sales taxes would be more than $3.2 billion — making up all of the "lost" SBT revenue and tacking on an extra $1.3 billion. We cannot know for certain what would have happened to Michigan if its tax structure had been different. But remember that the calculation above considers only the additional income and sales taxes from those extra jobs. It does not account for a potential increase in the billions of dollars now collected for property and real estate taxes, "sin" taxes, motor fuel taxes, insurance taxes, licenses, fees and other sources of revenue. Unless those half-million to 1 million extra workers were all homeless and didn’t drink, smoke, gamble, drive or buy insurance, it is quite possible that the increased revenue estimates above are conservative. Admittedly, Michigan’s economy did well in the late 1990s, even with the SBT in place. But given the magnitude and persistence of Michigan’s current problems, this is a tax that we can do without. For every dollar that employers must pay in corporate taxes to the state, they have one dollar less to disburse as wages to workers or as investment in growth. It is perhaps no surprise that the state with the worst corporate tax is losing the most jobs, while the rest of the nation is rapidly creating them. Returning Michigan job growth to the national average or better will not happen overnight, regardless of what the tax changes may be. A trimming of expenses will be necessary, and here it is important to bear in mind that the SBT only accounts for about 5 percent of the total state budget. Michigan businesses have cut back their budgets during this prolonged one-state recession, and state government has cost-cutting that can still be done. An audit of public school health insurance purchasing revealed reforms that could save $200 million to $400 million each year. Another $40 million could be saved annually if Michigan joined other states that impose a lifetime limit of four years for welfare benefits (as opposed to recent legislation that appears to impose this limit, but grants a multitude of exceptions). These and other common-sense reforms should be used to "pay" for the current budget deficit and any SBT revenue that is "lost" in the short run. Nearly all of the plans that have been proposed to replace the SBT with other taxes come with assurances that they will provide tax relief for some Michigan businesses (though often at the expense of tax hikes for others). There is thus a bipartisan understanding that tax cuts create jobs. The politicians need to take the logical next step in their thinking and realize that all of Michigan’s job providers need tax relief. Replacing the SBT with nothing is a reasonable option. For Michigan to succeed, policymakers should dare to "fail." ##### Kenneth M. Braun is a policy analyst specializing in fiscal and budgetary issues for the Mackinac Center for Public Policy, a research and educational institute headquartered in Midland, Mich. Permission to reprint in whole or in part is hereby granted, provided that the author and the Center are properly cited. Michigan’s Single Business Tax, ranked the worst corporate tax in the nation, is entering its final year of existence. In light of the job creation and economic expansion experienced by states without corporate taxes, Michigan policymakers would do the state a favor if they fail to produce a replacement. Ken Braun MichCapCon Flashback: The Republicans Who Blocked Charter School Choice Michigan’s ‘Hollywood Welfare’ Plan: Stylish Stars Trumping Taxpayers

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Puerto Rico governor approves $3.5 bln bond sale NEW YORK (MarketWatch) -- Puerto Rico Governor Alejandro García Padilla signed a bill Tuesday authorizing the sale of $3.5 billion in general obligation municipal bonds. The sale, which is being underwritten by Barclays, RBC Capital Markets and Morgan Stanley, is intended to repay outstanding lines of credit, refinance outstanding debt, and strengthen liquidity. "I am confident that this bond offering, along with amendments to the budget and our strategies to promote job creation and industrial development, will take Puerto Rico forward in a stronger fashion," said García Padilla in a statement. Puerto Rico has been struggling with a flagging economy, tight liquidity, and budget deficits in recent years, which has raised questions among municipal market participants about the island's ability to repay its $70 billion in municipal bond debt. The demand for the sale, which could come as soon as this week, is likely to provide direction for Puerto Rico's debt prices.

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Tax filing season starts Jan. 30 For about 80 percent of filers WASHINGTON (AP) — The Internal Revenue Service says late changes to federal tax laws should mean only a short delay for most taxpayers to file their 2012 returns.The agency said Tuesday that more than 120 million taxpayers — about 80 percent of all filers — should be able to start filing their federal returns on Jan. 30. Others will have to wait until late February or March to file because the agency needs time to update and test its systems.Those who will have to wait include people claiming residential energy credits, depreciation of property or general business credits. The filing season had been slated to start Jan. 22 but was delayed because of the big tax package passed by Congress Jan. 1.Onlinehttp://www.irs.gov/Filing

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AC dealers seeking 1st casino contracts ATLANTIC CITY, N.J. (AP) -- Barbara Basile, a single mother struggling to support herself and two teenage sons on a part-time salary as a dealer at Bally's Atlantic City, personifies what the unionization drive being fought casino-by-casino here is all about. "This is my only job, and I'm in despair about that fact that I have no health insurance for my children," she said. "All I want is to be able to support my kids; I'm not asking for the moon." Basile was one of dozens of dealers from casinos across the city who rallied outside the Sheraton hotel Tuesday morning as contract talks began between the United Auto Workers and the Tropicana Casino and Resort. The talks with Caesars Atlantic City are in their ninth month without a resolution. The union has yet to reach an agreement with any of the four Atlantic City casinos at which they won representation elections last year, including Trump Plaza Hotel and Casino, and Bally's. The union plans to try to organize workers at all 11 casinos here. It lost elections at Trump Marina Hotel Casino, the Atlantic City Hilton Casino Resort, and at Caesars, where cashiers voted against joining the UAW. "This is about the quality of life," said Paula Cifelli, a dealer at Caesars. "Everyone's running around working two jobs because they can't afford to live in this area without having two jobs. "We're not here to slam the casinos," she said. "We all want a happy, fair contract. You have happy employees, you get happy customers." Among the chief issues the union is seeking to negotiate are salary increases, job security, more full-time jobs, and better health care coverage for part-time workers. The talks come as Atlantic City's casinos are still smarting from their first-ever down year in 2007, when revenue declined by 5.7 percent over the previous year, due largely to out-of-state slots parlors siphoning away Atlantic City's gaming customers. Further complicating matters is the uncertain status of the Tropicana, whose former owners, Columbia Sussex Corp., were stripped of their casino license last month, forcing the property to be sold. A new buyer probably won't be found until the end of April, making it difficult for interim management to conduct meaningful negotiations. Representatives of the Tropicana and Caesars wouldn't comment Tuesday on the negotiations. Basile, the Bally's dealer, said the contract talks have given her hope for the first time that things might get better. "I had no Christmas last year. Zero," she said. "I didn't even decorate. Why put up a tree if you can't decorate it? I had to explain to the kids that I had to pay the utilities and there was nothing left over for decorations or lights, and that there would be no presents to put underneath it." She said her schedule is sometimes as sparse as two shifts per week. Going out to eat, or even renting videos are unaffordable luxuries. "My apartment lease is up and I'm going to have to move because I can't afford to renew it," she said. "I'd love to be able to let the kids remember what steak tastes like instead of hot dogs and macaroni and cheese every night." Joe DePalo said he is hanging on only by living at his ailing mother's apartment in Toms River, making the 60-mile commute four times a week to his job at Bally's. "I'm 51 years old, living with my mother, and I have no health insurance," he said. "I'm an excellent employee. I show up and do my job to the best of my ability, but I'm not recognized for it. We need to have a voice for people like me."

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Onlookers say fiscal cliff deal offers some encouragement to business owners The fiscal cliff deal struck in Congress raises income tax rates for single taxpayers making more than $400,000 and married couples earning above $450,000 — and many of these wealthy taxpayers are small-businesses owners. But by putting an end to the uncertainty over future tax rates, the deal could encourage businesses to invest, expand and hire more workers, experts said. Still, there are new clouds on the horizon: in a few weeks, Congress is expected to embark on deficit reduction, with spending cuts that could dampen economic activity."With some stability, business owners can now make business decisions," said Alan D. Sobel, managing member of Sobel & Co., in Livingston. "What really interferes with making decisions is uncertainty — people become paralyzed and sit on the sidelines. So my sense is that now that there is some element of certainty — at least, as it relates to income taxes — business owners are going to be freed up to be able to make decisions about investments in equipment, investments in people, in opening up new markets."David Brogan, first vice president of the New Jersey Business & Industry Association, echoed that sentiment, saying the deal "will create a level of certainty that is necessary for any economic rebound." He said keeping tax rate unchanged for singles earning less than $400,000 and couples earning less than $450,000 will mean a significant number of New Jersey small businesses won't see their taxes go up; President Barack Obama's original proposal — to raise taxes on incomes of more than $200,000 and $250,000, respectively — would have done far more damage in New Jersey, Brogan said.Brogan said businesses also will be helped by the move by Congress, as part of the fiscal cliff deal, to extend bonus deprecation, which had been set to expire at the end of 2012, for another year. This allows companies to write off 50 percent of the capital investment the first year.Bob Mathers, director in the tax department at Hunter Group CPA LLC, in Fair Lawn, said the extension of the bonus depreciation rule for one year is a direct boost to business. "We now know what’s going to happen for the next 12 months. We know if we need to spend money on equipment, that we can do that and get a direct writeoff without having to spread it out over several years," he said. "When Congress comes back, there will still be a lot of talk about tax reform, but least we do have some certainty for the next 12 months."Many companies did resolve to move forward with their business plans last year — buying equipment or buildings, and hiring new workers — regardless of what happened in Washington. Some evidence of business confidence can be seen in Small Business Administration loan demand, which was strong in 2012, when New Jersey had its third-best SBA lending year on record, according to Al Titone, state district director for the SBA."People just couldn't wait any more," he said. "You can only sit so long on the sidelines and then basically you jump in when you think you've got an opportunity."Anika Khan, senior economist of Wells Fargo, said the looming cliff led businesses to "defer a lot of their spending activity due to uncertainty." But the deal reached by Congress doesn't restore clarity, she said, and the end of the payroll tax holiday affects all workers, and "is going to cause household to pull back a bit on making some of their spending decisions."And in a few weeks, there will be budget cuts that will impact the economy, she added. "Until businesses get completely clear about what the economic landscape is going to look like, and what their contribution is going to have to be, they are going to continue to be on the fence."Pat O'Keefe, director of economic research at CohnReznick, said when Congress takes up federal spending, "the ripple will be significant."Lawmakers, he said, must address long-term cost increases in Medicare, Social Security and Medicaid. "If that curve is not tilted downward or reduced gradually, it becomes highly disruptive," O'Keefe said. "And the rancorous brinksmanship that has characterized fiscal and tax policy for the better part of a decade always runs the risk of a catastrophic event."

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A Surprisingly Uncontroversial Program That Gives Money To Poor People The Economy Explained March 15, 20135:00 AM ET Marianne McCune William Thomas Cain/Getty Images Last year, a federal program called the Earned Income Tax Credit took about $60 billion from wealthier Americans and gave it to the working poor. And here's the surprising thing: This redistribution of wealth has been embraced by every president from Ronald Reagan to Barack Obama. "This program worked," says Richard Burkhauser, an economist at Cornell University and the American Enterprise Institute. "And there's not a hell of a lot of these programs where you can see the tremendous change in the behavior of people in exactly the way that all of us hoped it would happen." When he says it worked, he means it helped single mothers on welfare find work and get out of poverty. In the 1930s, in the early days of welfare, many of the women who received it were widows. Americans didn't think single mothers should have to work, so the government paid them to stay home. But by the '90s, the idea of paying people not to work seemed backwards to many Americans. If moms want to get paid, many thought, they should get a job. The Earned Income Tax Credit started as a small program in the 1970s and was expanded under President Reagan. But it was President Clinton who turned the program into what it is today — one that effectively gives low-wage working parents a big bonus. For some workers making around $15,000 a year, that bonus can now reach nearly $6,000. As the name suggests, the money is paid out like a tax refund, when workers file their income taxes. Mirian Ochoa was on food stamps, in debt from a divorce and caring for a son in special ed. On her long commute to work, she remembers going past McDonald's every day and smelling the french fries but telling herself, "You have to say no, because I have to pay my rent." The first year she got the credit, Ochoa received $3,000. Over the years, she says, the credit allowed her to pay off debts, get an associate's degree in accounting, get off of food stamps, and move to a better school district for her son. "I found an apartment there, and I changed my son's life," she says. This gets to one feature of the credit that economists love — something that goes back to Milton Friedman, one of the most influential conservative economists of the 20th century. He argued that, rather than creating lots of targeted programs for poor people, the government should simply give them money and let them decide how to spend it — even if, like Mirian Ochoa, they sometimes spend $1,000 to take their son to Disney World and Universal Studios. Her son's favorite part was the Incredible Hulk roller coaster. "He's small, little fat boy, and running and saying, 'Mother, come with me, do the ride,' " she says. I say 'No, it's too much, I cannot do it. But go! Go!' " To Ochoa, this was money well-spent. Her ex-husband had promised the trip to her son but never came through. And she says taking him was a key moment in his life. Now he's in college, studying graphic design in Orlando, Fla. The Earned Income Tax Credit is not perfect. It doesn't help people who can't get work. Some people game the system. Others are eligible but never collect. But while most programs to help the poor are constantly under the magnifying glass, this one has expanded every decade since the 1970s. Encouraging poor people to work and giving them a boost for keeping at it remains relatively uncontroversial. For now. Big College Merit Scholarships Are A Problem (If You Don't Get One)March 14, 2013 Episode 444: New Jersey WineMarch 15, 2013 Episode 713: Paying for the Crime Episode 712: I Want My Money Back Episode 711: Hooked on Heroin Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ. Please enable JavaScript to view the comments powered by Disqus. Planet Money Imagine you could call up a friend and say, "Meet me at the bar and tell me what's going on with the economy." Now imagine that's actually a fun evening. That's what we're going for at Planet Money. Want to know more? Check out our "about" page. Want to connect with the Planet Money team? Send us an email. @planetmoney Planet Money App A Pocketful of Planet Money

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Economic Recession (2010) Pew Research CenterDecember 14, 2010 How a Different America Responded to the Great Depression The American public’s sour mood is in interesting contrast with many of the public’s views during the Great Depression of the 1930s, not only on economic, political and social issues, but also on the role of government in addressing them. Pew Research CenterDecember 14, 2010 Reagan’s Recession In the depths of the 1981-1982 recession, Americans were far more displeased with their president and his policies than were their predecessors during the Great Depression, more so even than in today’s high-unemployment economy. HispanicOctober 29, 2010 After the Great Recession: Foreign Born Gain Jobs; Native Born Lose Jobs Immigrants are gaining jobs at a time when native-born workers continue to sustain losses. Foreign-born workers job gains may be the result of greater flexibility with regard to wages and hours of work or greater mobility. But despite rising employment, immigrants have experienced a sharp decline in earnings as well as a still substantial net loss in jobs. Social TrendsOctober 22, 2010 Is the Recession Linked to Fewer Marriages? When researchers look at possible links among social, economic and demographic trends — such as the current recession and declining marriage rates — they face a challenge. Two trends may be heading in the same direction, but are they related? Correlation, the statisticians frequently warn, is no guarantee of causation. Social TrendsSeptember 24, 2010 One Recession, Two Americas For a narrow majority of Americans (55%), the Great Recession brought a mix of unemployment, missed mortgage or rent payments, shrinking paychecks and shattered household budgets. But for the other 45%, the recession was largely free of such difficulties. Social TrendsSeptember 15, 2010 Walking Away Nearly six-in-ten Americans say it is “unacceptable” for homeowners to stop making their mortgage payments, but more than a third say the practice of “walking away” from a home mortgage is acceptable under certain circumstances. Homeowners whose home values declined during the recession and those who have spent time unemployed are more likely to say that “walking away” from a mortgage is acceptable. Social TrendsSeptember 9, 2010 Since the Start of the Great Recession, More Children Raised by Grandparents One child in 10 in the U.S. lives with a grandparent, a share that increased slowly and steadily over the past decade before rising sharply from 2007 to 2008, the first year of the Great Recession. About 40% of all children who live with a grandparent (or grandparents) are also being raised primarily by that grandparent. Social TrendsSeptember 2, 2010 Most ’Re-employed’ Workers Say They’re Overqualified for Their New Job Workers who suffered a spell of unemployment during the recession are, on average, less satisfied with their new jobs than workers who didn’t. These re-employed workers also are more likely to consider themselves over-qualified for their current position. And six-in-ten say they changed careers or seriously thought about it while they were unemployed. Social TrendsJune 30, 2010 Infographic: How the Great Recession Has Changed Life in America Interactive graphic that charts the impact of the “Great Recession” on Americans. Polling data with breakdowns by age, education, race, gender and political affiliation. Social TrendsJune 29, 2010 The Great Recession at 30 Months More than half (55%) of adults in the labor force say that since the economic slump began 30 months ago, they have suffered a spell of unemployment, a cut in pay, a reduction in hours or have become involuntary part-time workers; the recession has also led to a new frugality and diminished expectations about retirement and their children’s future.

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Dodd-Frank's Derivatives Rules Could Cost Main Street $1 Trillion Daniel Indiviglio The new financial regulation bill is advertised as a crack down on Wall Street excess, but if one provision is left as is, it could cost Main Street companies as much as $1 trillion. The rule would expose so-called "end-users," which are non-financial firms that use derivatives to hedge, not speculate, to new margin requirements on their derivatives. The bill that Congress may pass tonight or tomorrow still includes the provision. Tuesday night, as the conference committee was revising how the new bill would be paid for, Sen. Saxby Chambliss (R-GA) brought up this concern about the legislation that had previously gone unnoticed. In the Senate's initial offer, end-users would have been fully exempt from margin requirement costs. The House changed the language, however, and that change was accepted. Unfortunately, the provision's meaning changed as well, leaving Main Street firms on the hook for these costs. The Senate side of the conference committee held a vote to revise the language last night, which tied 6-6, so failed without a majority. This International Swaps Dealers Association released a statement about this issue yesterday, saying: A change in the wording of the financial reform bill now being finalized in the US Congress could cost US companies as much as $1 trillion in capital and liquidity requirements, according to research by the International Swaps and Derivatives Association, Inc. (ISDA). About $400 billion would be needed as collateral that corporations could be required to post with their dealer counterparties to cover the current exposure of their OTC derivatives transactions. ISDA estimates that $370 billion represents the additional credit capacity that companies could need to maintain to cover potential future exposure of those transactions. If markets return to levels prevailing at the end of 2008, additional collateral needs would bring the total to $1 trillion.So the cost might not get all the way to $1 trillion, but it would certainly be in the hundreds of billions. That's an awfully big burden to place on Main Street, so it's no wonder that some in Congress are concerned. But most Democratic conferees were uncomfortable opening back up the language yesterday, at the risk of delaying the bill a few days. They said that this issue could be taken care of in a technical amendment once the bill passes. If it isn't, then the rule will put a serious strain on U.S. companies. Daniel Indiviglio was an associate editor at The Atlantic from 2009 through 2011. He is now the Washington, D.C.-based columnist for Reuters Breakingviews. He is also a 2011 Robert Novak Journalism Fellow through the Phillips Foundation. previousIf Cell Phones Are Behind the Bee Decline, What Are They Doing to Humans?nextThe Final Solution?

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New London running out of cash Published March 27. 2014 12:01AM By Colin A. Young Day Staff Writer New London - For more than two months, the city's finance director has been meeting with financial and legal advisers on a plan to straighten out New London's balance sheet and put some cash back in the bank.The plan would involve bonding roughly $10 million to free up cash the city needs to pay its bills and meet payroll.Finance Director Jeff Smith told a City Council committee Monday night that he and the council will have to act quickly to get the city's financial house in order."We have basically no cash in the bank and we are trying to do just-in-time financing, and it is not going to continue working," Smith told the City Council's Finance Committee. "We will, at some point, not be able to pay our bills and not be able to make payroll. And when that happens it will be a serious problem, and we probably won't be in charge of our own destiny after that."If the city does not act, Smith said, New London could run out of cash in mid-May or early June."We really need, now, to fix this once and for all," he said.The problem is a complex one that deals with different disciplines of municipal finance, Smith said. But at its heart is the city's withering fund balance, or savings account, chronic deficits in the city's capital projects fund and millions of dollars in state reimbursements that the city has never received.The city has failed to collect $6.9 million in grant funding, including $5.3 million in state grant funding for school construction projects dating back to 2000. Between 2007 and 2011, the city overspent capital projects by about $1 million.The city's fund balance has plummeted from $6.3 million at the beginning of fiscal year 2011 to $1.4 million at the end of fiscal year 2013.The city has had cash flow problems for "a number of years," Smith said, but in December, while out of the office on medical leave, he got an alarming phone call."I got a call from my treasurer saying, 'We're out of money' and 'How are we going to pay our bills?'" he said. "What we did is we didn't pay any bills for a couple of weeks so we could make payroll payments."Over the last two years, the city has borrowed about $3 million on a short-term basis to "provide necessary operating funds" with the assumption that it would receive the outstanding grant money by now."That initial optimism has not proved correct and the city must now move with deliberate speed to fix our balance sheet so that we can continue to pay our bills and meet our payrolls," Smith wrote in his memo to the mayor and City Council.In addition to the $5.3 million in state grant funding the city has never collected for school construction projects, it has never received about $1 million for the Parade Plaza reconstruction project and about $600,000 for the remediation of Veterans Field.The problem, Smith said, does not lie at the origin of those projects, but rather with the follow-through. A large part of the problem, he said, is that the city did not properly file the paperwork needed to receive grant funds and then did not pursue the outstanding money properly."This isn't money that was spent willy-nilly. This is money that was spent on good, solid capital projects," Smith said. There's "nothing wrong with what people did. We just didn't handle getting our grants back in a timely manner."Smith likened the process of collecting outstanding grant money to running through mud."We are working on that," he said, "but I have been surprised by how difficult it is."There are also about half a dozen projects for which the city raised more money than the project cost. The net balance from those projects, more than $500,000, should be transferred to the capital projects reserve fund to have on hand as a contingency, Smith said.He also recommended that a portion of that reserve be deposited into the Board of Education's yet-to-be-established nonlapsing fund so it could be used for maintenance and upkeep of the city's schools. Formation of that account is awaiting approval of the full council.The approximately $10 million Smith has recommended that the city bond would be split into four ordinances the City Council will be asked to approve before April 25 to give Smith time to prepare the bond packages. The Finance Committee was not asked to take any action Monday, and Smith said he expects to present his proposed ordinances to the full council as early as at its next meeting.City Council President Wade A. Hyslop Jr., who is also chairman of the Finance Committee, was traveling Wednesday and said councilors will need some time to review Smith's proposal.Roughly $6.9 million would be bonded to account for the outstanding state grants, $1 million to cover overspending on a handful of city projects such as improvements to City Pier, $1 million for smaller projects that drew from the general operating fund, and $1 million for vehicle purchases made last year that were originally going to be paid from the general fund.The bond packages would have the near-immediate impact of almost doubling the city's fund balance to about $2.4 million, Smith said.If or when the city is able to collect the outstanding grant money, it will be placed in an escrow account that will be used solely for debt service, he said.Smith said he doesn't "see a lot of options.""This is what you have to do when you're behind the eight ball. If this had been done correctly over the years, we wouldn't be in this position," Smith said. "We're here now because it wasn't done correctly."c.young@theday.com Proposed New London budget includes 7.24% hike New London Mayor Finizio will not seek second term New London officials expecting $3.6 million state reimbursement More bad fiscal news for New London

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CNB Bank & Trust promotes local talent CNB Bank & Trust has announced that Joe Orrico has been promoted to Assistant Vice President and Kelly Wood has been promoted to Assistant Vice President. These promotions followed the board of directors’ annual employee review process. Joe is a graduate of Stagg High School in Palos Hills. After schooling he attained several years’ of experience working in customer service and sales. Since transitioning into community banking in 2006 as a teller, he has worked his way up to his current position. Joe began employment with CNB of Oak Forest when they opened their facility in 2010 as a Lead Sales Rep. Joe now serves as Assistant Vice President/ Regional CSR Supervisor and resides in Joliet with his wife, Jessica, and their son Maelin with another son on the way. Kelly is a graduate of Sandburg High School in Orland Park where soon after graduation she began her career in banking as a teller. With over 19 years’ experience as a Teller Supervisor in community banking, her qualifications made her a perfect fit to lead the Oak Forest teller department in 2010. Kelly is currently our Assistant Vice President/ Regional Teller Supervisor, and resides in Tinley Park with her husband Scott, and two children, Tyler and Madelynne. “Everyone at CNB joins me in congratulating Joe and Kelly on their promotions,” said Tinberg. “We are very proud of the quality of people we have in our organization. We have an experienced group of professional and personable men and women focused on the needs of our clients.” CNB Bank & Trust has 13 locations, including Palos Heights and Oak Forest. For more information about CNB or its many banking services, call the Oak Forest facility at 535-8905, or visit the website at www.cnbil.com.

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Treasury Sells Remaining AIG Shares, Profiting From Bailout Sale of the stock garners $7.6 billion, with overall bailout giving taxpayers a profit of about $22.7 billion AIG headquarters in New York. (Photo: AP) The Treasury Department on Tuesday sold its remaining 16% of American International Group common shares for $7.6 billion, putting an end to the government’s 50-month shotgun financial tryst with the global insurer. Industry officials, financial analysts and Washington insiders speculate that Treasury’s sale of its remaining 234 million common shares of AIG through an initial public offering will set the stage on Thursday for designation of AIG as the first systemically significant non-bank. That is expected to take place at a closed meeting of the Financial Stability Oversight Council. Washington Analysis, a buy-side analyst group, said in a weekly bulletin to subscribers Monday that the FSOC will likely have on its agenda whether to designate AIG, Prudential Financial and General Electric as systemic significant non-banks. However, other Washington officials say they expect only AIG to be designated a SIFI at this meeting, with decisions on other non-banks debated one-by-one into next year. If AIG is so designated, it would be historic, marking the first time that an insurance company would be federally regulated. Washington Analysis researchers say, however, that the exact details of what non-bank SIFI status will mean will not become clear until the Fed issues additional rules during 2013’s first quarter. Such designations were created through provisions of the Dodd-Frank financial services reform act of 2010. Under the law, the Federal Reserve Bank would be the consolidated regulator of AIG, but the states would still oversee its insurance-operating subsidiaries. The 234.2 million shares of AIG were priced Monday night at $32.50, according to AIG. When the deal closes Friday, Treasury will have sold the last of its remaining shares of AIG common stock, receiving proceeds of approximately $7.6 billion from the sale, AIG said. The overall bailout netted taxpayers a profit of about $22.7 billion. The closing of this transaction will mark the full resolution of America’s financial support of AIG. After the closing of today's offering, Treasury will continue to hold warrants to purchase approximately 2.7 million shares of AIG common stock – the sale of which is expected to provide an additional positive return to taxpayers. Since September 2008, America committed a total of $182.3 billion in connection with stabilizing AIG during the financial crisis. Since then, through asset sales and other actions by AIG, America has not only recovered all $182.3 billion but also earned a combined positive return of $22.7 billion. “We are very pleased to repay 100% of all that America invested in AIG plus a total combined positive return – or profit – of $22.7 billion,” said AIG President and Chief Executive Officer Robert H. Benmosche. “On behalf of the 62,000 employees of AIG, it is my honor and privilege to thank America for giving us the opportunity to keep our promise to make America whole on its investment in AIG plus a substantial profit. Thank you America. Let’s bring on tomorrow.” Bank of America Merrill Lynch, Citigroup, Deutsche Bank Securities Inc., Goldman, Sachs & Co. and J.P. Morgan Securities LLC have been retained as joint book runners for the offering, Treasury says. The Treasury, the Federal Reserve Board and the Federal Reserve Bank of New York became involved with AIG in September 2008 when a unit of AIG’s holding company, AIG Financial Products, had issued credit default swaps on what was later learned to be $2.77 trillion of securities and synthetic securities backed by mortgages of varying quality. As the value of the underlying securities declined, and AIG’s credit rating was lowered by rating agencies, the terms of the CDS required AIG to put up collateral. AIG became unable to raise the cash to meet such margin calls. After several banks declined to provide a private-sector solution, the NY Fed provided an initial $85 billion in cash in exchange for 79.9% of AIG’s stock. The NY Fed, in tandem with the Federal Reserve Board and the Treasury departments of the Bush and later Obama administrations, ultimately invested more than $100 billion in additional funds. The sale, if completed, would end several controversial and tense chapters in the life of Timothy Geithner, who is expected to leave his role as Treasury secretary early next year. Geithner was president of the NY Fed when the Federal Reserve Board was told by Henry Paulson, then secretary of the Treasury in the Bush administration, to rescue AIG. Besides dealing with the huge liability from the CDS, later investigations by the Government Accountability Office and the Pennsylvania Insurance Department found that AIG’s insurance subsidiaries, both life and property and casualty, had cross-guaranteed the liabilities of AIGFP. Among the issues that surfaced during the government’s rescue was the fact that AIG officials who had led the company astray, including those in London who had devised the CDS investment, were owed more than $100 million in bonuses. The political solution that resulted was a reduction in the amount of bonuses paid as well as a system overseen by attorney Ken Feinberg that limited the bonuses companies receiving federal aid could pay their employees. Indeed, Benmosche said one of the reasons he wants the federal government to divest itself of a financial interest in AIG is to be rid of the limits on executive compensation imposed on those who received bailouts in the 2008-2010 period. Please enable JavaScript to view the comments powered by Disqus. By Arthur D. Postal

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2016-30/0359/en_head.json.gz/19044

DOL, SEC, FINRA Enforcement Roundup: DOL Recovers $43 Million for Madoff Victims SEC charges hedge fund managers with fraud; FINRA issues censure and fine Bernie Madoff in December 2008. (Photo: AP) Among recent enforcement actions on behalf of investors were the Labor Department’s settlement for more than $43 million for Madoff victims; SEC charges against two Connecticut-based hedge fund managers and their firms for fraud, and against a Virgin Islands-based advisor, also for fraud; and a censure and fine by FINRA of a firm for numerous reporting failures. Labor Department Recovers $43 Million for Madoff Victims Workers and retirees whose employee benefit plans had invested in funds managed by Austin Capital Management may have been shocked to learn that those plans’ investment losses were tied to Bernard Madoff’s Ponzi scheme. However, they will receive some restitution in the form of a settlement reached by the Labor Department with Austin Capital Management Ltd. and its general partner, Austin Capital Management GP Corp. Under the terms of the settlement, $34,363,636 will be placed into a settlement fund for plan investors, which, together with an earlier settlement of $9,090,909 from Austin Capital’s parent company, KeyCorp, will be distributed to the plans by an independent fiduciary selected by the department. After an investigation by the Dallas regional office of the Employee Benefits Security Administration (EBSA), the Labor Department said Austin Capital violated ERISA by investing the assets of ERISA-covered plans with Madoff via the Rye Select Broad Market Prime Fund, offered by Tremont Partners and known as the “BMP Fund.” The BMP Fund, in turn, was 100% invested with Madoff. The funds invested in the BMP Fund were the Austin Safe Harbor ERISA Dedicated Fund, Safe Harbor Portable Alpha Offshore Fund One, Safe Harbor Portable Alpha Offshore Fund Two, Safe Harbor Offshore Fund, All Seasons Qualified Purchaser Fund, All Seasons Offshore Fund and the Balanced Offshore Fund. The two settlements together total $43,454,545. In addition, Austin Capital Management is on the hook for a civil penalty of $4,345,455. SEC Charges Hedge Fund Managers with Fraud Two Connecticut-based hedge fund managers and their advisory firm were charged with fraud by the SEC for lying to investors. David Bryson and Bart Gutekunst, co-owners of New Stream Capital, are alleged to have secretly reorganized the fund’s capital structure prior to its failure during the financial crisis. They changed the fund to give priority to its largest investor, Gottex Fund Management, in the event of the fund’s liquidation, but continued to market the fund as if all investors were of equal standing. Two others were charged: David Bryson’s sister, Tara Bryson, former head of investor relations for the firm, and Richard Pereira, former chief financial officer. The firm’s Cayman Islands affiliate was also charged; it allowed the managers to raise almost $50 million and sock away large fees while the fund’s investors were left holding the bag when it went bankrupt. The $750 million hedge fund was focused on illiquid investments in asset-based lending. In March 2008, Gottex threatened to pull its whole investment from the fund—almost $300 million. A few months before this, New Stream had restructured its fund, creating two new feeder funds that wiped out the preferential liquidation rights Gottex had held via the feeder fund through which it had invested. After Gottex’s threat, however, Bryson and Gutekunst changed the capital structure to once again favor Gottex. The pair did not disclose the change to investors, nor did they let anyone know—except privately, within the firm—that should Gottex decide to redeem its investments, the fund would “tank,” in Bryson’s opinion. Instead, investors were reassured as to redemption levels holding steady—when they were actually mounting—and were told nothing of liquidity problems. In September of that year, however, the firm had to stop redemptions and cease raising new funds when redemption requests hit $545 million. It tried several times to restructure, but to no avail, and in March of 2011 it and its affiliates filed for bankruptcy. Bryson, Gutekunst, and Pereira face a range of charges, in addition to the SEC seeking a variety of sanctions and relief that include injunctions, disgorgement of ill-gotten gains with prejudgment interest, and penalties. Tara Bryson has agreed to settle with the SEC, with the settlement awaiting court approval. SEC Charges Virgin Islands-Based Advisor With Defrauding Clients James Tagliaferri was charged by the SEC with defrauding clients of his St. Thomas-based firm TAG Virgin Islands, and also faces criminal charges from the U.S. Attorney’s Office for the Southern District of New York over the same actions, after he withheld information on kickbacks he received and then used client funds in a Ponzi-type scheme. Some time around 2007, according to the SEC, Tagliaferri abandoned an earlier strategy of investing TAG client funds primarily in conservative and liquid investments that included municipal bonds and blue chips. He turned instead to highly illiquid securities that included promissory notes issued by a few closely held private companies that turned out to be holding companies through which an individual and his family effected personal and business transactions. He also sank at least $40 million in client funds into the notes of International Equine Acquisitions Holdings, a private horse-racing company. Using his discretionary authority over client accounts, Tagliaferri bought these securities in exchange for more than $3.35 million in cash and approximately 500,000 shares of stock of a microcap company. He never disclosed this arrangement to clients, despite its conflict of interest, and when promissory notes came due and clients wanted their money, he would use funds from other clients to pay them by investing their funds in microcap and other thinly traded public companies. He raised at least $80 million this way, so that he could pay the interest or principal due to other clients on some of the notes. He also spelled out the scheme in e-mails he sent in April of 2010 to the individual behind the holding companies in which he had invested his clients’ funds. The clients, of course, knew nothing of this. The SEC’s investigation is continuing. Lightspeed Trading Censured, Fined $200,000 by FINRA FINRA censured and fined New York-based Lightspeed Trading $200,000 for failure to submit new order reports and route reports to the Order Audit Trail System (OATS). The firm neither admitted nor denied the findings, but consented to FINRA’s actions; it will also be required to revise its WSPs regarding complete and accurate OATS reporting of the firm’s orders routed to its affiliates. Lightspeed’s customer orders were directly placed into its affiliate’s order routing, execution and technology platform, and data on these orders was reported to OATS immediately by other member firms. Lightspeed mistakenly believed, according to the findings, that reports were not required for orders routed to its affiliate. The firm’s supervisory system, including WSPs, were built around this error. In addition, there were other failures in reporting and compliance. office for the Southern District of New York Dallas regional office David Bryson

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New Hire Roundup: Westport Resources Promotes DeLaura FINRA promotes Axelrod, Welcomes Sokobin; more This week in new hires, Westport Resources promoted Christopher DeLaura and added Ashley Schexnaildre, Susan Axelrod was promoted and Jonathan Sokobin was added by FINRA, Keith Fletcher was named vice chairman at American Independence, Angelo Pirrito went to HSBC Global Asset Management, and Agecroft Partners brought in Jim Sauls. Also, Alliance Benefit Group welcomed Don Mackanos and added its first West Coast licensee, Dorothea Rodd was promoted at New York Life, U.S. Bank announced appointments in San Francisco and Chicago, and Mike Anderson joined the board at the Bank Insurance and Securities Association. Westport Resources Promotes DeLaura, Adds Schexnaildre Westport Resources announced the promotion of Christopher DeLaura to chief operating officer of its wealth management division, the private client group. Additionally, the firm welcomed Ashley Schexnaildre as controller of both Westport Resources Management, which includes the private client group, and its broker-dealer division, Westport Resources Investment Services. DeLaura joined in 2010 as a financial planning specialist in the private client group. In addition to his new responsibilities, he will continue to manage the firm’s global tactical asset allocation investment strategy. Prior to joining, he worked at UBS for 13 years in several roles in the corporate offices on strategy and different technologies. He also worked with and managed assets for high-net-worth individuals. Schexnaildre joined on April 1, and most recently served as interim controller for M6 Partners/Capital Lodging in N.D. At the same time he served as controller for that company’s owner, Commonwealth Advisors, in Baton Rouge, La. Axelrod Promoted, Sokobin Welcomed at FINRA The Financial Industry Regulatory Authority (FINRA) announced that Susan Axelrod will become executive vice president of regulatory operations. In this role, she will oversee enforcement, the office of fraud detection and market intelligence and member regulation (sales practice, risk oversight and operational regulation and shared services). Previously she was the head of the member regulation sales practice area. Mike Rufino, chief operating officer of member regulation—sales practice, will assume the role of acting head of the sales practice group. Axelrod will report directly to Richard Ketchum, chairman and CEO. Before becoming head of member regulation sales practice, Axelrod was SVP and deputy of regulatory operations, where she assisted in the oversight of market regulation, enforcement and member regulation. Prior to joining in 2007, Axelrod was chief of staff to the CEO of NYSE Regulation. Axelrod began her career at NYSE in 1989 as a staff attorney in the division of enforcement and became an enforcement director in 1997. FINRA also announced that Dr. Jonathan Sokobin, currently acting deputy director, research and analysis in the office of financial research at the U.S. Treasury Department, will join as chief economist and SVP. He will also report directly to Ketchum and will start on May 20. In 2011, Sokobin joined Treasury as chief of analytical strategy in the office of financial research. Earlier, he was acting director of the SEC's division of risk, strategy and financial innovation (Risk Fin). He joined the SEC staff full time in 2000 and was named deputy chief economist in 2004. From 2008 to 2010, he served as director of the former office of risk assessment.American Independence Names Keith Fletcher Vice Chairman American Independence Financial Services (American Independence) announced that Keith Fletcher has joined the firm as vice chairman and a member of the executive committee. Fletcher, with 30 years of experience, was recently chief marketing officer and head of product management for Security Global and Rydex Investments (later Guggenheim Investments). Prior to that, he was managing director at Lyster Watson. Previously he served as EVP/chief marketing officer for Van Eck Global. He has also held senior sales and marketing positions at Fidelity Investments and Furman Selz Asset Management. He started his career as an institutional marketing manager for the Dreyfus Corp. HSBC Global Asset Management Appoints Angelo Pirrito HSBC Global Asset Management (USA) announced that Angelo Pirrito has joined as vice president, RIA sales, based in San Francisco. In this newly created role, Pirrito will be responsible for distributing emerging-market and international investment products through RIAs, trust companies, private banks and family offices on the west coast. He reports to Damion Hendrickson, SVP and national head of RIA sales. Pirrito has more than 20 years of financial services experience and has spent more than a decade working directly with the RIA channel. He was most recently with Direxion, where he was director of sales. He previously worked at other firms, including Deutsche Bank, Julius Baer Investment Management and Merrill Lynch Investment Managers. Agecroft Partners Hires European Marketing Head Agecroft Partners has hired Jim Sauls as managing director and head of European marketing. Saul’s responsibilities will include heading Agecroft’s marketing efforts in Europe and assisting with due diligence on potential managers the firm may represent. He brings more than 20 years of institutional experience marketing hedge funds and derivative products on a global basis. Before joining, he spent 10 years with Calatrava Securities, where he was director of marketing and CEO of their affiliated commodity pool operator. Prior to that, he held senior marketing and sales roles at both Fimat USA and Sanwa Futures. Alliance Benefit Group Announces New Executive Director, West Coast Licensee Alliance Benefit Group (ABG) announced that Don (Mac) Mackanos has been named executive director. He will spearhead efforts to expand the brand nationally and recruit new licensees to the ABG network. He will also focus on creating new revenue opportunities for licensees. Mackanos joins from TRUSTIVO. Prior to that, he ran the retirement services segment for SunGard. ABG also announced that it has added Spectrum Pension Consultants to its national network. Spectrum was incorporated in 1978 and has an open-architecture 401(k) platform. Spectrum is the 14th licensee to become affiliated with ABG and its first on the West Coast. New York Life Promotes Dorothea Rodd to SVP New York Life has announced the promotion of Dorothea (Dottie) Rodd to SVP and head of corporate services. In this role, she has oversight of procurement, business and financial services, process enhancement programs, corporate insurance risk management, corporate aircraft, travel and dining services, corporate security, business resilience, facilities management and corporate records management. She reports to Frank Boccio, EVP and chief administrative officer. Rodd joined in 1981 as an auditor trainee and has held positions of increasing responsibility. Since 2012, she has been head of corporate services, providing corporate service functions and support to the company. Prior to that, she served as first vice president in human resources, where she was responsible for operations and service functions; and as a vice president in the corporate services department in charge of procedures and systems for accounts payable, the travel reimbursement system, credit card administration and financial analysis for procurement. U.S. Bank Appoints Oliveira in San Francisco, Names Rixie in Chicago U.S. Bank announced today that Martim De Arantes Oliveira has been appointed regional managing director for Ascent Private Capital Management of U.S. Bank in San Francisco. In his new role, he is responsible for driving the growth of the new San Francisco office, which will open this summer, and leads an initial team of seven professionals. He reports to Michael Cole, president of Ascent Private Capital Management. Oliveira brings more than 16 years of experience in the financial services industry, primarily assisting ultrahigh-net-worth families with wealth management. He previously served as the West Coast regional director for Silver Bridge Advisors in San Francisco. Previously, he served as a founding and managing principal of H&S Financial Advisors. U.S. Bank also announced that Gerald Rixie has been named a wealth management consultant for The Private Client Reserve in Chicago. Rixie brings a range of experience to his new post that includes work with HNW families and individuals, corporate finance, investments and operations. Before joining, he served as CFO of Calamos Family Partners in Naperville, Ill. Securities America’s Anderson Joins BISA Board Mike Anderson, first vice president of financial institutions and business growth at Securities America, has been named to the Bank Insurance and Securities Association’s (BISA) board of directors. A former president of Accutrade and Ameritrade Inc., Anderson joined Securities America in January 2012 with more than 20 years of industry experience. Prior to joining Securities America, he was vice president of development and executive coach for Leadership Resources, a management development company. He was also the founding vice president of Ameritrade Advisor Services. Following his 10 years with Ameritrade Holding Corporation,Andersonwas president of InfoUSA, a direct mail marketing list manufacturer, and a principal at Charter Hill Partners, a regional mergers and acquisitions firm. Read the April 17 New Hire Roundup at AdvisorOne. Richard Ketchum

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Cyprus to seize citizens' cash Country reaches last-minute deal on $10 billion euro bailout (Reuters) – Cyprus clinched a last-ditch deal with international lenders to shut down its second-largest bank and inflict heavy losses on uninsured depositors, including wealthy Russians, in return for a 10 billion euro ($13 billion) bailout. The agreement came hours before a deadline to avert a collapse of the banking system in fraught negotiations between President Nicos Anastasiades and heads of the European Union, the European Central Bank and the International Monetary Fund. Without a deal, Cyprus’s banking system would have collapsed and the country could have become the first to crash out of the European single currency.

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2016-30/0359/en_head.json.gz/19260

JPMorgan SmartRetirement 2045 Fund(JSAZX)R2 ACINSTITUTIONALR6SELECT Loading... OverviewPerformanceFees and Investment MinimumsPortfolioManagementDocumentsDisclaimer ObjectiveThe Fund seeks high total return with a shift to current income and some capital appreciation over time as the Fund approaches and passes the target retirement date.Strategy/Investment processUses an asset allocation strategy designed for investors expecting to retire around the year 2045, becoming more conservative as the Fund nears the target retirement date.Invests in a combination of equity, fixed income and short-term JPMorgan mutual funds. Overview widget loading ... The benefits of target date funds for millennialsDecember 8, 2015How target date funds can help place millennials on a better investing path to reach their retirement goals. Fund Managers Jeffrey Geller Portfolio Manager Anne Lester Portfolio Manager Michael Schoenhaut Portfolio Manager Daniel Oldroyd Portfolio Manager Eric Bernbaum Portfolio Manager Fund Literature JPMorgan SmartRetirement Funds - Commentary (A Shares) Quarterly Fact Sheet: SmartRetirement 2045 (R2) SmartRetirement Funds presentation SmartRetirement Funds sales aid Supplemental Data Sheet - SmartRetirement 2045 Fund Quarterly Certified Holdings - JPMorgan SmartRetirement 2045 Fund Load More DisclaimerPlease refer to the prospectus for additional information about cut-off times. Total return assumes reinvestment of income. The S&P Target Date Index Series (each, an Index) reflects exposure to various asset classes included in target date funds driven by a survey of such funds for each particular target date. These asset class exposures include U.S. large cap, U.S. mid cap, U.S. small cap, international equities, emerging markets, U.S. and international REITs, core fixed income, short term treasuries, Treasury Inflation Protected Securities, high yield corporate bonds and commodities and are represented by exchange traded funds (ETFs) in the index calculation. The original inception date for the Indexes was September 25, 2008 (the Original Inception Date), except the S&P Target Date 2050 Index (the Index), which was May 31, 2011. Subsequently, Standard & Poor's (S&P) decided to provide return information for periods prior to the Original Inception Date. Return information for the Indexes, except the S&P Target Date 2050 Index, is now available beginning from May 31, 2005. Effective March 1, 2010, S&P modified the method used to calculate Index levels and returns for each Index. Prior to March 1, 2010, each Index was reconstituted once per year on the last trading day of May, with effect on the first trading day of June. Reconstitution is the process whereby asset class weights are established for the upcoming year. Effective March 1, 2010, each Index is reconstituted on the same schedule. However, the Indexes are now rebalanced on a monthly basis. Rebalancing is the process whereby the asset class weights that were determined at the previous reconstitution are reestablished. This process takes place after the close of business on the last trading day of each month, with effect on the first trading day of the following month. The Index returns are calculated on a daily basis and will continue to be calculated daily. The performance of the index does not reflect the deduction of expenses associated with a fund or the ETFs included in the index, such as investment management fees. By contrast, the performance of the Fund reflects the deduction of the fund expenses, including sales charges if applicable. Investors cannot invest directly in an index. The performance of the Lipper Mixed-Asset Target 2045 Funds Average includes expenses associated with a mutual fund, such as investment management fees. These expenses are not identical to the expenses charged by the Fund. An individual cannot invest directly in an index. Total return assumes reinvestment of dividends and capital gains distributions and reflects the deduction of any sales charges, where applicable. Performance may reflect the waiver of a portion of the Fund's advisory or administrative fees and/or reimbursement of certain expenses for certain periods since the inception date. If fees had not been waived and/or certain expenses were not reimbursed, performance would have been less favorable. ©2016, American Bankers Association, CUSIP Database provided by the Standard & Poor's CUSIP Service Bureau, a division of The McGraw-Hill Companies, Inc. All rights reserved.©2016, Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Morningstar Rating™ metrics are calculated monthly by subtracting 90-day Treasury return from the fund's load-adjusted return and adjusting for risk. Stars are awarded as follows: top 10% of funds, 5 stars; next 22.5%, 4 stars; next 35%, 3 stars; next 22.5%, 2 stars; bottom 10%, 1 star. Morningstar Ratings are based on 3, 5 and 10 year metrics. Different share classes may have different ratings.The following risks could cause the fund to lose money or perform more poorly than other investments. For more complete risk information, see the prospectus. This investment is not a complete retirement program and may not provide sufficient retirement income. Target date funds are funds with the target date being the approximate date when investors plan to start withdrawing their money. Generally, the asset allocation of each fund will change on an annual basis with the asset allocation becoming more conservative as the fund nears the target retirement date. The principal value of the fund(s) is not guaranteed at any time, including at the target date. There may be additional fees or expenses associated with investing in a Fund of Funds strategy. Asset allocation does not guarantee investment returns and does not eliminate the risk of loss.Total return assumes reinvestment of income. Sharpe ratio measures the fund's excess return compared to a risk-free investment. The higher the Sharpe ratio, the better the returns relative to the risk taken. The strategic asset allocation depicts the Fund's targeted weights based on JPMorgan's internal analysis. Strategic allocations are reviewed on at least an annual basis. The strategic asset allocation of most Target Date Funds changes annually to become more conservative. Tracking Error: The active risk of the portfolio, which determines the annualized standard deviation of the excess returns between the portfolio and the benchmark. Alpha: The relationship between the performance of the Fund and its beta over a three-year period of time. Standard deviation/Volatility: A statistical measure of the degree to which the Fund's returns have varied from its historical average. The higher the standard deviation, the wider the range of returns from its average and the greater the historical volatility. The standard deviation is calculated over a 36-month period based on Fund's monthly returns. The standard deviation shown is based on the Fund's Class A Shares or the oldest share class, where Class A Shares are not available. R2: The percentage of a Fund's movements that result from movements in the index ranging from 0 to 100. A Fund with an R2 of 100 means that 100 percent of the Fund's movement can completely be explained by movements in the Fund's external index benchmark. Risk measures are calculated based upon the Funds' broad-based index as stated in the prospectus.

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Posts tagged with Regulations Social media and the financial sector: eight best practice tips As of April 1, the Financial Services Authority has been replaced by two new bodies, the Prudential Regulatory Authority (PRA), which regulates the operations of financial organisations, and the Financial Conduct Authority (FCA), which monitors how financial organisations treat consumers. As far as the FCA is concerned, whether financial organisations choose to communicate over social media channels or in print, the rules remain the same. The communication must be clear, fair and not misleading, regardless of which channel the message is broadcast over. The FCA has already stated its intention to monitor what financial organisations are getting up to on social media, and it uses Twitter itself. Permission email marketing, it’s what we do isn’t it? The question of permission and customers rights regarding marketing material is one that has privacy evangelists and marketers head to head. Many forms of direct marketing can be seen by the recipients as intrusive and disturbing and this has led to a bit of a backlash. In some cases, this has spawned legislation (as in TPS in the UK) and in others, poor publicity via the national media and threats of further control from politicians. But, out of all of the different direct marketing channels, email seems to be the quietest when it comes to public outrage. US marketers can no longer self-regulate With the DMA announcing their new one million dollar PR campaign “Data-Driven Marketing Institute,” the question of privacy and rules around customer data has become a greater focus of some of the panels this morning. Jordon Cohen of Moveable Ink, brought up the headline "Target knows a teenage girl is pregnant before her own father does" and posed the question: have we finally gone too far? For those of you who didn't read this headline in February, an irate father charged into a Target store demanding they stop targeting his teenage daughter with emails full of baby products because she wasn't pregnant. It turns out Target was right, and the father was wrong. She was pregnant and her shift in product purchase at Target made the marketers behind the brand know of her news before any of the world may have known. Jason Scoggins of Freshpair stressed that targeting has to go through a "creep" filter and in the case of the Target example, they went too far. FTC seeks to expand restrictions on data collection from children For more than a decade, companies in the United States operating websites that collect data from children have been required to comply with the Children's Online Privacy Protection Act (COPPA). At the time COPPA was implemented, the internet ecosystem was far less mature, and the law didn't cover all of the parties that today frequently collect data from children. So yesterday, the FTC published a proposal (PDF) with the intent of modifying COPPA to ensure that parties not currently governed by COPPA's rules are covered. As European Commission sues five countries, is the cookie law starting to crumble? For large organizations like the BBC, ignoring the recently-enacted EU cookie law probably isn't a viable option. Despite the headaches associated with implementing a solution, the threat of legal actions and fines probably outweighs the costs of compliance. It's a different story for entrepreneurs and owners of small businesses, some of whom indicated a willingness to flout the law until given a reason to reconsider. Even the EU can't comply with its own cookie law If ibuprofen sales are up in the EU this year, it might have something to do with the nightmare known as the EU cookie law. For major companies operating in affected countries, the solution to the problem has been, well, to find a solution to the problem. And for good reason: with the possibility of enforcement action, few businesses can afford not to address the law. But apparently the EU itself can't be bothered with complying with its own rules. Will the OFT regulate paid tweets? Marketers have been paying celebrities to endorse their products and services for decades, so it's no surprise that there's a booming market for celebrity endorsements via their social media profiles. With the help of companies like Ad.ly, celebrities and 'influencers' are reportedly earning thousands upon thousands of dollars for a single tweet or Facebook status update. In the United States, marketers paying high-profile individuals to tweet and blog about their products worried the Federal Trade Commission (FTC) so much that it developed guidelines around the practice. 5 comments Forget grandma, the RIAA's next target is politicians Enforcing copyright online has proven to be quite difficult. More than a decade after Napster brought the subject of digital piracy into the mainstream, content owners are still struggling to protect their rights on the internet. They have finally learned one thing though: suing grandmothers (and dead grandmothers) doesn't work. So what are content owners doing? It appears they are turning their attention to a more receptive audience: politicians. Ofcom: we don't need no stinkin' net neutrality How important is 'network neutrality'? In the United States, the Federal Communications Commission thinks it's such a big deal that it's willing to completely ignore court rulings and potentially even Congress in its altruistic effort to 'protect consumers.' But in a rare example of thoughtful governmental restraint, Ofcom, the UK's communications regulator, has determined that network neutrality may not be all that it's cracked up to be. Will California's woes 'terminate' Silicon Valley? For years, a small region in the western United States has served as a Mecca for technology entrepreneurs looking to follow in the footsteps of all the great founders who built their companies in a place known as Silicon Valley. Companies including Intel, Apple, Google and Facebook, just to name a few, were all started in Silicon Valley, which is recognized the world over as the premiere source of so much technological innovation.But are Silicon Valley's better days behind it? Silicon Valley is located in California, which was recently named the worst state to do business in the United States according to Chief Executive Magazine's annual Best and Worst States for Business survey. It's the second year in a row the state has earned the distinction.

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Home | Mises Library | The Hoover-Roosevelt DepressionThe Hoover-Roosevelt Depression Austrian Economics Overview04/23/2013Mark ThorntonJoseph T. SalernoA Good Talk for the Classroomby Mark ThorntonMurray Rothbard argued that the cause of the Great Depression was the result of Herbert Hoover’s New Deal policies which sought to keep wages and profits high. Robert Higgs, Richard Vedder, and Lowell Gallaway extended this thesis to include FDR’s New Deal policies which created artificially high prices and profits and prevented the normal market correction processes, reduced employment, and consumer demand. DiLorenzo on the Depressionby John CochranThomas J. DiLorenzo in this 2004 Mises Daily, “The New Deal Debunked (again),” provides information behind the Ohanian video referred to above and the work by Cole and Ohanian.Highlights from DiLorenzo:Macroeconomic model builders have finally realized what Henry Hazlitt and John T. Flynn (among others) knew in the 1930s: FDR’s New Deal made the Great Depression longer and deeper. It is a myth that Franklin D. Roosevelt “got us out of the Depression” and “saved capitalism from itself,” as generations of Americans have been taught by the state’s educational establishment.This realization on the part of macroeconomists comes in the form of an article in the August 2004 Journal of Political Economy entitled “New Deal Policies and the Persistence of the Great Depression: A General Equilibrium Analysis,” by UCLA economists Harold L. Cole and Lee E. Ohanian. This is a big deal, since the JPE is arguably the top academic economics journal in the world.And,On top of that, virtually every single one of FDR’s “New Deal” policies made things even worse and prolonged the Depression. Austrian economists have known this for decades, but at least the neoclassical model builders have finally caught on—we can hope.In this regard the most disappointing thing about the Cole-Ohanian article is that they do not even cite the pioneering work of Richard Vedder and Lowell Gallaway—Out of Work: Unemployment and Government in Twentieth Century America—first published in 1993.Indeed, it is somewhat scandalous that they do not cite this well-known work while making essentially the same arguments that Vedder and Gallaway do.And,This last conclusion—that the abandonment of FDR’s policies “coincided” with the recovery of the 1940s is very well documented by another author who is also ignored by Cole and Ohanian, Robert Higgs. In “Regime Uncertainty: Why the Great Depression Lasted So Long and Why Prosperity Resumed after the War” (Independent Review, Spring 1997), Higgs showed that it was the relative neutering of New Deal policies, along with a reduction (in absolute dollars) of the federal budget from $98.4 billion in 1945 to $33 billion in 1948, that brought forth the economic recovery. Private-sector production increased by almost one-third in 1946 alone, as private capital investment increased for the first time in eighteen years.Too bad the true lesson has not been learned. DiLorenzo’s lesson:In short, it was capitalism that finally ended the Great Depression, not FDR’s hair-brained cartel, wage-increasing, unionizing, and welfare state expanding policies.Free-market capitalism is what is needed to generate real recovery from the current Great Recession. Slow recovery, or a double dip recession, will be the future with the continuation of the Fed-supported Bush-Obama hare-brained Keynesian stimulus spending, accompanied by war and welfare state expanding policies which are again generating significant regime uncertainty. Rothbard Vindicated Againby Joseph SalernoIn 2009, Lee Ohanian published the article, “What—or Who—Started the Great Depression,” in the prestigious Journal of Economic Theory (JET) in which he cited Murray Rothbard. For this article, Ohanian spent four years poring over wage data and culling information from sources related to Hoover and his administration. Based on his research, Ohanian argued that Hoover’s policy of propping up wages and encouraging work sharing “was the single most important event in precipitating the Great Depression” and resulted in “a significant labor market distortion.” In a Mises Daily article in September 2009, I called attention to the importance of Ohanian’s article. Here is part of what I wrote:Ohanian contends that Hoover’s policy of propping up wages and encouraging work sharing “was the single most important event in precipitating the Great Depression” and resulted in “a significant labor market distortion.”Thus, “the recession was three times worse—at a minimum—than it otherwise would have been, because of Hoover.”The main reason is that in September 1931, nominal wage rates were 92 percent of their level of two years earlier. Since a significant price deflation had occurred during these two years, real wages rose by 10 percent during the same period, while gross domestic product (GDP) fell by 27 percent. By contrast, during 1920–1921—a period that was accompanied by a severe deflation—“some manufacturing wages fell by 30 percent. GDP, meanwhile, only dropped by 4 percent.”As Ohanian notes, “The Depression was the first time in the history of the US that wages did not fall during a period of significant deflation.” Ohanian estimates that the severe labor-market disequilibrium induced by Hoover’s policies accounted for 18 percent of the 27 percent decline in the nation’s GDP by the fourth quarter of 1931.Regarding the now-conventional explanations of the Great Depression, such as widespread bank failures and the severe contraction of the money supply, Ohanian points out that these two events did not occur to a significant extent until mid-1931, which was two years after the implementation of Hoover’s industrial labor market policies.Moreover, Ohanian argues,any monetary explanation of the Depression requires a theory of very large and very protracted monetary nonneutrality. Such a theory has been elusive because the Depression is so much larger than any other downturn, and because explaining the persistence of such a large nonneutrality requires in turn a theory for why the normal economic forces that ultimately undo monetary nonneutrality were grossly absent in this episode.The conclusion of Ohanian’s paper is quite—one is tempted to say “hardcore”—Rothbardian.The Great Depression that quickly superseded and distorted the benign recession-adjustment process was not in any sense caused by monetary deflation but by government-induced nominal wage rigidities, which of course can be temporarily circumvented by surreptitiously reducing real wages via unanticipated monetary expansion. Thus writes Ohanian:I conclude that the Depression is the consequence of government programs and policies, including those of Hoover, that increased labor’s ability to raise wages above their competitive levels. The Depression would have been much less severe in the absence of Hoover’s program. Similarly, given Hoover’s program, the Depression would have been much less severe if monetary policy had responded to keep the price level from falling, which raised real wages. This analysis also provides a theory for why low nominal spending—what some economists refer to as deficient aggregate demand—generated such a large depression in the 1930s, but not in the early 1920s, which was a period of comparable deflation and monetary contraction, but when firms cut nominal wages considerably.

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World Bank > About the World Bank Print World Bank Home Doing Business with the World Bank About the World Bank Understanding the Project Cycle The PSLO Program Other Multilateral Development Banks The World Bank Group The World Bank Group is a family of international development agencies that provides public and private sector financing in developing and emerging economies. Click here to see examples of World Bank-funded projects that include business opportunities for the private sector. The World Bank is not a “bank” in the common sense. It is one of the United Nations’ specialized agencies. Almost every country in the world is a member of the World Bank. These member countries are jointly responsible for how the institution is capitalized and how its money is spent. The United States is represented on the Bank Group's Board of Directors. In terms of the International Bank for Reconstruction & Development (IBRD), the United States has the largest share of paid-in capital, representing 16.8 percent of the total. Thus, the U.S. is the largest shareholder in the Bank and has the greatest number of board votes. Established in 1944 during a conference held in Bretton Woods, New Hampshire, the World Bank is headquartered in Washington, DC, and it employs approximately 10,000 people with representative offices in more than 100 countries worldwide. The World Bank Group comprises five closely associated institutions that collarborate to support development projects worldwide: The International Bank for Reconstruction & Development (IBRD), the oldest of the World Bank Group institutions, aims to reduce poverty in middle-income and creditworthy low-income countries by promoting sustainable development through loans, guarantees, risk management products, and (nonlending) analytic and advisory services. IBRD has 185 member countries. IBRD's commitments in FY06 totaled $14.1 billion. The International Development Association (IDA) provides highly concessional financing to the world's 81 poorest countries. IDA's interest-free credits and grants help support country-led proverty reduction strategies in key policy areas, including raising productivity, providing accountable governance, building a healthy investment climate, and improving access to basic services, including education and health care. IDA has 166 member countries. IDA's commitments in FY06 totaled $9.5 billion. The International Finance Corporation (IFC) is the private-sector investment entity of the World Bank Group. It invests in sustainable private enterprises in developing and transitional countries without requiring sovereign guarantees. It provides equity, long-term loans, structured finance and risk management products, as well as technical assistance and advisory services to its clients. IFC has 179 member countries. IFC's commitments in FY06 totaled $8.2 billion. The Multilateral Investment Guarantee Agency (MIGA) provides noncommercial guarantees (insurance) for foreign direct investment in developing countries. It addresses concerns about investment environments and perceptions of risk, which often inhibit investment, by providing political risk insurance. MIGA's guarantees offer investors protection against noncommercial risks such as expropriation, currency inconvertibility, breach of contract, war, and civil disturbance. MIGA has 171 member countries. MIGA's issuances in FY06 totaled $1.3 billion. The International Centre for Settlement of Investment Disputes (ICSID) is designed to facilitate the settlement of investment disputes between foreign investors and host states. It encourages foreign investment by providing neutral international facilities for conciliation and arbitration of investment disputes, thereby fostering an atmosphere of mutual confidence between states and foreign investors. Many international agreements concerning investment refer to ICSID's arbitration facilities. ICSID has 143 member countries. Print

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Former Jefferson County financial adviser sentenced following guilty plea in bid rigging case BIRMINGHAM, Alabama -- A consultant paid by Jefferson County to analyze interest rate swaps has been sentenced to two years' probation and ordered to pay a combined $5.5 million in fines and restitution for his role in rigging bids for municipal bond contracts.David Rubin, 52, of CDR Financial Products, Inc, was sentenced today by U.S. District Judge Kimba Wood in Manhattan. The judge ordered Rubin to pay $3.5 million in fines and guarantee his defunct former firm's $2 million share.CDR acted as a financial adviser for Jefferson County in early 2000s and collected nearly $2.3 million in fees for giving the okay to billions in bonds and interest-rate swaps mostly under former Jefferson County Commission President Larry Langford.A federal jury convicted Langford in 2009 of accepting bribes. He was sentenced to 15 years in prison the following year.CDR was a big proponent of the Jefferson County swaps that soured after interest rates went in the opposite direction of what CDR predicted. It added more than $700 million to county's overall sewer debt at the time. CDR wasn't charged with wrongdoing in Jefferson County. The swaps were later forgiven but that still left Jefferson County hundreds of millions of dollars in debt and the county filed bankruptcy in November, 2011.The commission exited the second largest municipal bankruptcy in December.In 2011, Rubin pleaded guilty on behalf of himself and his Beverly Hills, California-based firm admitting he took kickbacks for running sham auctions for investments. He was charged in a federal probe of bid and auction rigging in the municipal bond market.

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/ Socially Responsible Investing Apply Author: emschulze Subject: Re: Oil & gas companies CAN be green BOSTON, Dec. 27 /PRNewswire/ -- KLD & Co., Inc., a provider of social research services for institutional investors, announced today that it has added a pair of Texas natural gas companies, Kinder Morgan, Inc. (NYSE: KMI - news)* and Mitchell Energy and Development Corp. (NYSE: MND - news), to its benchmark Domini 400 Social Index (DSI 400).The newest additions increase the DSI 400's exposure to the energy sector, which tends to be underrepresented in environmentally and socially screened indexes. Launched in May 1990, the DSI 400 was the first benchmark for equity portfolios subject to multiple broad-based social screens. The DSI 400 is a market capitalization-weighted common stock index modeled on the S&P 500.``Kinder Morgan and Mitchell Energy have commendable environmental and social records. These attributes make them precisely the type of energy companies KLD looks for as additions to the DSI 400,' said KLD research analyst Kyle Johnson, spokesman for the DSI committee. ``Mitchell Energy has been forward-thinking in its approach to the environment since 1972. Kinder Morgan stands out in its industry for the company's emphasis on diversity in its workforce, and its generous employee benefits program.'Kinder Morgan, Inc. (KMI)*, based in Houston, TX is one of the largest midstream energy companies in America, operating more than 30,000 miles of natural gas and product pipelines in 26 states, with market cap of over $5.6 billion.KMI has one woman in a senior line executive position, Deborah A. McDonald, who is president of the KMI's Natural Gas Pipeline Company of America (NGPL) subsidiary. In its unusually liberal employee benefits package the company offers 12 weeks of paid maternity leave, health and other benefits coverage to same-sex domestic partners of its employees, stock options to all employees at point of hire, and a cash profit sharing program that has paid out every year since 1997. In addition, the company derived virtually all of its FY 1999 revenues from natural gas, a fuel with substantial environmental advantages over oil and coal.Mitchell Energy and Development is a natural gas and oil exploration and production company with a market cap in excess of $3 billion, ranking it among the nation's largest independent producers of natural gas and natural gas liquids (NGLs). The company finds, develops and produces natural gas and oil, primarily onshore in Texas, and enhances the value of these assets through its gas gathering, processing and marketing operations.In 1972 the company's CEO, George Mitchell, founded the Center for Global Studies, a university-coordinated program focusing on sustainable development through studies of resource constraints, economic growth, and environmental quality. In 1999 Mitchell used an idle production platform to create an artificial reef off the coast of Galveston, TX, and contributed $300,000 towards its maintenance. The Texas Parks and Wildlife department commended the project and the reef has become a breeding ground for local fish. Since 1991, the company has created 45 acres of marsh habitat in the Aransas National Wildlife Refuge for the endangered whooping crane.ABOUT KLDHeadquartered in Boston, KLD provides social research for institutional clients who wish to integrate social criteria into their investment decisions. To meet the needs of social investors, KLD offers performance benchmarks, corporate accountability research, and compliance and consulting services comparable to those provided by financial research service firms.KLD recently announced the launch of the KLD Broad Market Social Index (BMSI). The BMSI is the most extensive social investing benchmark available, including all Russell 3000 companies that pass KLD's multiple broad-based social screens (roughly 2300.)- Kinder Morgan is in no way associated with KLD. Post New

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Sirius XM: A Tale of Two Stocks AAPL GOOG LMCA MSFT SIRI NEW YORK (TheStreet) -- When I was asked to contribute a story that is fitting of Charles Dickens' masterpiece "A Tale of Two Cities," the first name that I thought of was Sirius XM . After Sirius rose to prominence by signing exclusive deals with high-profile talents including Howard Stern and securing rights to the National Football League and Major League Baseball, the financial crisis brought the company to its knees. With no one buying cars -- which Sirius needed to increase its satellite radio subscriptions -- bankruptcy seemed the last resort. Essentially, while most companies can proclaim "the best is yet to come," very few, unlike Sirius, are able to truly appreciate "the worst of times" without detailing a near-death experience. From an investor's/trader's perspective, however, the "best and worst" have different meanings. For me, my best and worst as a trader came when mistiming the movement of Sirius' stock. More Headlines Those Who Want to Boost the Global Economy Should Have More Kids The Best of Times: 84% Gains A company recovering from or teetering on the brink of bankruptcy means a lot of things to different people. For some, it's a sign of poor fundamentals and an absolute sign to stay away from the stock. For others who have a higher risk threshold, bankruptcy is a "haystack" and there's a needle to find in there somewhere. I was in the latter category. >>Also see: A BlackBerry Bull Who's Way Above Consensus>> I figured that with a bit of luck I'd find three needles and possibly 10,000 more. My goal was not to get rich. I never believed it was possible playing a penny stock. I wanted to beat Wall Street. But having sat at many poker tables in Las Vegas, I also understood the odds. Many Sirius XM geniuses still proclaim they timed the bottom perfectly and bought in at 5 cents per share in February 2009. I was not that smart. In fact, I still argue today that this was a dumb move that turned out to be smart -- even if the potential loss was (relatively) minimal. What's the difference between 5 cents and 20 cents? Or even 30 cents? Poker players know that to make money, one has to be willing to leave money on the table. This means that you can't get too greedy. It pays to be patient and watch to ensure that you have a winning hand. Accordingly, my first trade in Sirius occurred one month later -- on March 17 2009. I bought a little over 15 thousand shares at 32 cents. 123

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Herbalife Circus: Expect More Entertainment (Update1) Written by: Chris Ciaccia HLF (Updated from 11:06 a.m. EST to include comments from Icahn on CNBC in the 15th and 16th paragraphs.) NEW YORK ( TheStreet) -- Let the games begin. Just a month after their very public battle on CNBC, the fight between Carl Icahn and Bill Ackman just ratcheted up another level, with Icahn revealing he has close to a 13% stake in Herbalife (HLF) . Icahn filed a 13D on Thursday , showing he has accumulated a stake in the multi-level marketing (MLM) company. The interesting part is that it's mostly in options, and the majority of it was accumulated this week, in anticipation of a deluge of regulatory filings. More Headlines PayPal's Deal with Visa Leaves Investors Questioning Benefits Pandora Offers Enough Positives to Paint Rosy Picture of Steady Growth Amazon’s Next Frontier: Banking? Volkswagen Suspends South Korean Sales of Diesel, Petrol Models Facebook, Twitter Get Downgrades As Analysts Warn On High Expectations In the filing, Icahn noted that Herbalife "has a legitimate business model, with favorable long-term opportunities for growth. The Reporting Persons Icahn intend to have discussions with management of the Issuer regarding the business and strategic alternatives to enhance shareholder value, such as a recapitalization or a going-private transaction." Ackman, through his Pershing Square Capital Management hedge fund, is short some 20 million shares of the company, which he called a fraud last year. Ackman has even gone so far as to set up a Web site devoted to his thesis on the company, factsaboutherbalife.com. The short position caused Herbalife to respond last month, with executives calling the claims false. "The allegation that Herbalife is a pyramid scheme is bogus. Make no mistake: Today's announcement isn't about Herbalife's business model. It's about Bill Ackman's business model," the company said in a statement. The Wall Street Journal reported last month that the Securities and Exchange Commission has opened an inquiry into Herbalife. Herbalife CEO Michael O. Johnson has appeared repeatedly on CNBC to defend his firm, which he has described as a "legitimate company." Then there was this bizarre statement from Herbalife demanding a correction from the NY Post last month. It's become a circus, except now we have billionaires involved, instead of Barnum & Bailey. This spat is clearly personal, boiling down to the fact that Icahn simply does not like Ackman, alleging that he reneged on a deal in the past. Since then, Icahn, 76, has clearly held a grudge against the 46-year-old hedge fund manager. The battle on CNBC in January between Icahn and Ackman was one of the most entertaining segments on financial television in years -- maybe ever. Icahn cursed repeatedly, saying he was given permission to say "whatever the hell I wanna say." He even accused CNBC host Scott Wapner of trying to bully him. The amazing thing about this story is that it doesn't stop at Icahn and Ackman. Dan Loeb, another hedge fund heavyweight, recently announced that he owns 9 million shares, or 8% of Herbalife. In a letter to investors, Third Point's Loeb refuted Ackman's claims that Herbalife is a pyramid scheme. "The pyramid scheme is a serious accusation that we have studied closely with our advisors. We do not believe it has merit," Loeb wrote in the letter. 12

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FDIC's Bair pushes aggressive mortgage planThe FDIC chairwoman unveils plan that would streamline modifications to put delinquent borrowers in affordable mortgages. EMAIL | PRINT | SHARE | RSS By Tami Luhby, CNNMoney.com senior writerLast Updated: November 14, 2008: 4:31 PM ET ROAD TO RESCUE Home prices up for 1st time in 3 years New home sales: 'Really good news' Wall Street: Here comes the hard part 7 regional banks fail Banker: "TARP helped avert a global calamity" FDIC Chairwoman Sheila Bair NEW YORK (CNNMoney.com) -- In a surprise move, FDIC Chairwoman Sheila Bair Friday unveiled details of her plan to have the government help delinquent homeowners.There are two key elements to the proposal. First, housing payments for delinquent borrowers two months or more late would be reduced to 31% of gross monthly income. To get there, mortgage rates could be set as low as 3% for five years, before increasing at an annual rate of 1 percentage point until they hit the prevailing market rate. Loan terms could be extended as long as 40 years.Second, to encourage servicers and investors to participate, the government would share up to 50% of the losses if a borrower who had been helped ended up in default anyway. The risk of re-default had been one obstacle to getting lenders on board with systematic modification plans. In addition, the FDIC would pay servicers who process mortgages $1,000 for each re-worked loan.The plan is expected to initially help 2.2 million borrowers get new loans; after some borrowers re-default, 1.5 million would ultimately keep their homes, the FDIC estimated.The plan would cost an estimated $24.4 billion, which Bair has said could come from the $700 billion bailout Congress approved last month."It is imperative to provide incentives to achieve a sufficient scale in loan modifications to stem the reductions in housing prices and rising foreclosures," the Federal Deposit Insurance Corp. said in a statement Friday. A record 1.2 million homes were in foreclosure during the second quarter of 2008, according to the Mortgage Bankers Association, and the problem is only expected to get worse. Some estimates say another 2 million families could lose their homes to foreclosure in the next two years. This flood hurts the national economy as well, depressing home values and consumer spending.Unless Bair's proposal gets the Treasury Department's blessing, it would have to be approved by Congress or wait for review by the Obama administration.Power struggleBair's move Friday sets up a public power struggle not often seen within an administration. The FDIC chairwoman has long wanted the government to take a more active role in helping troubled homeowners. She initiated a similar plan at IndyMac, one of the largest mortgage lenders, after the agency took it over in mid-July.Bush administration officials, however, have resisted her efforts, instead unveiling a plan Tuesday to streamline modifications of loans held or guaranteed by Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500).Treasury Secretary Henry Paulson has backed away from supporting Bair's plan. A Treasury spokeswoman Friday referred to comments Paulson made on Wednesday."We must be careful to distinguish this type of assistance, which essentially involves direct spending, from the type of investments that are intended to promote financial stability, protect the taxpayer, and be recovered under the TARP legislation," he said. Bair, however, is optimistic."I don't think it's dead," Bair told National Public Radio on Friday. "I think we're still talking. [Paulson] didn't close the door completely. It's just where the money comes from is really the issue we're debating."Congressional Democrats, however, have continued to press for increased assistance to homeowners. They have publicly backed Bair, which could give her proposal the push needed for adoption.Executives from the nation's largest financial institutions told the Senate Banking Committee Thursday they too support Bair's efforts in combating foreclosures. The committee's chairman, Sen. Christopher Dodd, D-Conn., has long argued that both the government and servicers need to do more to help distressed homeowners. "All of these measures frankly have not produced anywhere near the results we hoped they would," said Dodd, adding it's "terribly regrettable" that the Paulson is not behind her plan. Acknowledging that many Americans who are paying their mortgages may be angry that their neighbors are getting help, Bair said that foreclosure hurts everyone in a neighborhood by bringing down home values."These escalating foreclosures are creating more and more downward pressure on home prices, which is having a very negative impact on our economy," Bair said on National Public Radio Friday. Americans should realize "it's in [their] economic self-interest to get this situation stabilized."No principal reductionUnlike some other government programs, the FDIC proposal would not reduce the principal to bring it in line with the home's current value. Instead it would allow part of the principal to be deferred free of interest to the end of the loan. Borrowers who sell or refinance before paying off the debt would have to pay the principal at that time or work out a short-sale with the bank, where the servicer agrees to forgive the outstanding balance.Some consumer advocates consider principal reduction key to assisting borrowers in areas where property values have plummeted, leaving many with mortgages greater than their home's worth - or "underwater."With the Hope for Homeowners program implemented last month, mortgages would be written down to 90% of the home's current market value and borrowers would be refinanced into 30-year fixed-rate mortgages insured by the Federal Housing Administration.The FDIC's program, on the other hand, would not be as beneficial for underwater homeowners. For situations where the mortgage is worth more than the home, the government's loss-sharing arrangement would gradually decline to 20% before ending for homes where the loan-to-value exceeds 150%. The loss-sharing arrangement would last for eight years. Only mortgages below the conforming loan limits for Fannie Mae and Freddie Mac - up to $625,500 depending on location - would qualify.The agency is not pursuing principal reductions because it can achieve affordable monthly payments without them, said Andrew Gray, FDIC spokesman.Also, it's easier to convince investors to agree to a workout if the loan balance is not changed. When the principal is lowered, the value of loan modification over foreclosure is reduced.IndyMac as a modelAt IndyMac, agency officials have already modified 5,000 troubled mortgages, achieving affordable payments through interest rate modifications in 70% of the cases. Another 20,000 delinquent borrowers are in the process of having their income verified.Taking over IndyMac allowed the FDIC to put into practice its call for a streamlined system to mortgage modifications, a move other servicers have since followed. Until then, loans were being adjusted on a case-by-case basis, which overwhelmed servicers and increased the flood of foreclosures.Payments on the modified IndyMac loans, which are being adjusted to between 31% and 38% of income, are lowered by $380 on average, Bair told lawmakers last month.A total of 65,000 borrowers, or 10% of IndyMac's loan portfolio, were delinquent when the government took over. The agency is reaching out to another 20,000 delinquent borrowers, while the remaining 20,000 borrowers are not eligible for help for a variety of reasons, including that they are investors who don't live in the home or owners who have already turned in the keys.The agency is adjusting both loans that IndyMac owns and those it services that have been bundled into securities and sold to investors. According to the FDIC, officials are not having trouble convincing investors - who are often accused of blocking modifications - that they'll recover more if the loan is adjusted rather than if it goes into foreclosure."You demonstrate to investors that modifications are the better alternative," Gray said.Consumer advocates support BairConsumer advocates have repeatedly said the economy and housing market won't recover until more is done to help stem the tide of foreclosures. They don't feel the current foreclosure mitigation efforts undertaken by the Bush administration and by banks are sufficient.The FDIC plan, however, will do more to help troubled homeowners and do it more quickly, they said."Chairman Bair's proposal has the potential to have an impact of the size and scope necessary to get ahead of the foreclosure crisis and put the economy back on its moorings," said John Taylor, head of the National Community Reinvestment Coalition, an association of more than 600 community-based organizations.Several banks, including JPMorgan Chase, Citigroup and Bank of America, have recently announced plans that would also modify mortgages so that monthly payments are between 31% and 38%, depending on the servicer. They project these efforts will assist nearly 1 million delinquent borrowers. The government, meanwhile, has pushed lenders to do more, mainly through voluntary measures, such as the Hope for Homeowners program. On Tuesday, federal officials announced a mandatory program to modify delinquent mortgages owned or guaranteed by Freddie and Fannie. But housing counselors said this program wouldn't address the vast majority of subprime loans, which are outside of Freddie and Fannie's reach. At Dodd's hearing Thursday, several community activists voiced their support of Bair's efforts, even before the details were announced. "The Sheila Bair-FDIC proposal is just an absolute no-brainer," said Martin Eakes, head of the Center for Responsible Lending. "There's just no reason why we shouldn't get it done in the next week." First Published: November 14, 2008: 8:08 AM ETWho benefits from the new Fannie-Freddie plan 85,000 homes lost in October U.S. mortgage plan falls short Bailout needs time to work: Official

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commentsRegulators defend Wall Street reformsBy Jennifer Liberto @CNNMoney July 21, 2011: 12:58 PM ET Fed Chairman Ben Bernanke testifies before the Senate Committee on Banking, Housing, Urban Affairs on The Wall Street Reform Act on July 21, 2011.WASHINGTON (CNNMoney) -- Federal regulators on Thursday updated senators on the progress of financial system reforms that went into law a year ago, and they defended against criticisms about the pace at which reforms are being implemented.In testimony to the Senate Banking committee on the one year anniversary of the Dodd-Frank Act, regulators kept pointing out the purpose of the financial reforms, such as reining in complex and potentially destructive financial products and heading off more bank bailouts to avert financial collapse. The regulators all said the new rules will make the financial system more stable and better able to survive crises. "As we work together to implement financial reform, we must not lose sight of the reason that we began this process: Ensuring that events like those of 2008 and 2009 are not repeated," said Ben Bernanke, chairman of the Federal Reserve Board. "Our long-term economic health requires that we do everything possible to achieve that goal."A year after Dodd-Frank's passage, a new process is in place to wind down failing financial firms and avert bailouts, and the new Consumer Financial Protection Bureau launched today as an independent agency to regulate credit cards and mortgages among other financial products. But no one knows whether the federal government will truly allow banks to fail. And no one knows how effective the new consumer bureau will be, especially because it still lacks a Senate-confirmed director.Already, regulators have missed many deadlines to issue new rules and studies. And lawmakers may not give regulators the funding needed to carry out and enforce the new rules.Mary Schapiro, head of the U.S. Securities and Exchange Commission, said the agency has proposed or adopted two-thirds of the 90 rules it is required to roll out by the law."While some feel we are moving too quickly and others feel we are not moving rapidly enough, I believe we are proceeding at a pace that ensures we get the rules right," Schapiro said. Committee senators on both sides of the aisle blamed each other for lack of progress on certain aspects of reforms.Elizabeth Warren vs. House GOP, round 3"Unfortunately, these reforms have been under constant attack since this bill was signed into law," said Senate Banking chief Tim Johnson, a South Dakota Democrat. In one such "attack," Senate Republicans have vowed to block the confirmation of a director to the Consumer Financial Protection Bureau, unless Democrats agree to make the bureau more subject to oversight and restructured to be governed by a panel, instead of a director.But ranking Republican Sen. Richard Shelby of Alabama, defended the Republicans' move."Secretary Geithner also claims that Republicans are blocking nominations 'so that they can ultimately kill reform'," Shelby said. "However, Senate Republicans have been clear that the structure of the Bureau of Consumer Financial Protection needs to be properly reformed before we consider any nominee to lead it."Banks risk crisis trying to 'starve' reform: GeithnerPresident Obama nominated Richard Cordray on Monday to head the new Consumer Financial Protection Bureau. Yet, it's unclear whether Cordray, former Ohio attorney , will get a chance to serve.Sen. Jack Reed, a Rhode Island Democrat, asked Schaprio about efforts to cut funding to the SEC and how the agency would be able to go after bad behavior on a limited budget."Our capacity to keep up with that kind of volume on a declining budget will be really impacted," said Schapiro, who added that this worries financial firms that are following the rules. "Everybody has a stake in these agencies' ability to do their jobs." Related ArticlesWall Street reform: A year down a bumpy road Obama nominates Ohio's ex-attorney general to lead consumer bureau

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Search Economists say national sales tax plan has pros, cons Observers say proponents and foes both exaggerate impacts of disputed national sales tax proposal that's become a political football. Posted: Friday, October 29, 2004 A proposed national sales tax that's become a hot issue in congressional elections is neither as awful as Democrats claim nor as awesome as Republicans boast. That's what economists say about a proposal by U.S. Rep. John Linder, R-Ga., that's been endorsed by dozens of GOP House members. At least seven Democratic House candidates and one for the U.S. Senate are hoping to benefit from a television advertising blitz against the measure. Among the targets: U.S. Reps. Max Burns of Sylvania, seeking re-election in Georgia's 12th Congressional District, and Johnny Isakson, the GOP's U.S. Senate nominee in Georgia. John Barrow of Athens, Burns' challenger and U.S. Rep. Denise Majette of Stone Mountain, Isakson's foe, say the tax would devastate the middle class. Burns and Isakson, however, say it would lower the overall tax burden for lower- and middle-income income people. And, by taxing consumption rather than income, they add, it would promote savings, investment and growth. Meanwhile, television ads, press releases and even an interactive Web site fling conflicting claims about how much a gallon of milk, car or coat might cost under the plan. Who do economists think is right? They disagree, too. But the closest thing to a one-word answer is: neither. "There are pros and there are cons," said Richard J. Cebula, professor of economics at Armstrong Atlantic State University. "It's hard to come down solidly on either side of the issue." Michael Reksulak, assistant professor of economics at Georgia Southern University, agrees with the opponents that say the plan would hurt poor- and middle-income people. But proponents say two features of the plan work against that. First of all, they say, families would receive a rebate of the sales tax on spending up to the federal poverty level. And the costs of what people buy now are inflated by other taxes that would go away under a sales tax plan. So pre-sales-tax prices of those goods would drop sharply, supporters add. Cebula and Kevin Hassett, economic policy studies director at the American Enterprise Institute, a Washington, D.C. think tank, generally agree. But both say that scenario is a bit too rosy. Hassett thinks the tax could be designed so most poor and middle-income consumers would be neither helped nor hurt. But Reksulak remains skeptical. "I suspect the only way you could do that," he said, "is for the tax rate to be so high that the whole plan would be politically unacceptable." Cebula thinks that, even with the features touted by supporters, the middle class might fair a little worse than they do now and the rich a little better. But a national sales tax, he adds, would eliminate the time and aggravation of record keeping and compilation and the costs of accountants. "If you look at time as money and assume that these things take many people hundreds of hours a year," he said, "there's an indirect cost of several thousand dollars." Cebula and Hassett also support the proponents' view that, at least over the long run, a national sales tax would promote economic growth. That might be true in theory, Reksulak said, but practical problems might reduce additional growth to "close to zero." Indeed, economists seem to agree that the plan looks better on paper than in practice. As people faced higher after-tax prices, Cebula said, most also would have more money to spend, because no taxes will be withheld from their checks. "People will have to re-calculate the way they make their buying decisions and their family budgets. And the higher prices will lead to sticker shock. At first, a lot of people might reduce consumption." The result, he says, might be a mild recession lasting three or more months. Reksulak predicts enforcement problems stemming from widespread attempts to avoid and evade taxes. Exemptions - probably for medical expenses and home purchases - would be needed to make any such plan politically palatable, he says. Hassett thinks most of the practical problems could be solved by using a system called a value-added-tax. Although it's similar to a sales tax, he said, it is administered differently and has been used successfully in Europe. Cebula says that, no matter what adjustments are made, some people would suffer a lot. The hardest hit, he said, would be accountants, tax lawyers and taxpayers who now have major itemized deductions. "The thing to remember," he said, "is that, no matter what anyone tells you, any time you overhaul the tax system, there will be winners and losers." MICHAEL REKSULAK SOCIAL ISSUES MAX BURNS GOP HOUSE STONE MOUNTAIN TELEVISION ADVERTISING BLITZ JOHN LINDER GEORGIA SOUTHERN UNIVERSITY CONGRESSIONAL ELECTIONS RICHARD J. CEBULA JOHN BARROW WASHINGTON, D.C. UNITED STATES SENATE DENISE MAJETTE AMERICAN ENTERPRISE INSTITUTE AMERICAN ENTERPRISE INSTITUTE DIRECTOR GOP'S U.S. SENATE ARMSTRONG ATLANTIC STATE UNIVERSITY ARMSTRONG ATLANTIC STATE UNIVERSITY Savannah Morning News © 2016. All Rights Reserved. Contact Us | Privacy Policy

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| Thu Jan 28, 2016 5:12pm GMT Annual GDP growth slows to weakest in nearly three years in fourth quarter LONDON Britain's economy ended 2015 on a soft note after the annual pace of growth slowed to its weakest in nearly three years as the global economic slowdown weighed on its previously rapid expansion.Fourth-quarter gross domestic product grew by 0.5 percent, up slightly from 0.4 percent in the three months to September, the Office for National Statistics said on Thursday, and in line with economists' forecasts.Output in the three months to December was 1.9 percent higher than a year earlier, down from 2.1 percent in the third quarter and the smallest increase since early 2013.The figures are likely to ease worries that Britain is facing a sharp economic slowdown, as domestic demand appears to have remained resilient. But they suggest that the robust growth of the past two years will not return until the world economy regains strength.Bank of England Governor Mark Carney said last week that he wanted to see above-average growth and a pick-up in wages before raising rates, and economists now do not expect the central bank to move until the tail end of this year. For 2015 as a whole, Britain's economy grew 2.2 percent, down from 2.9 percent in 2014, when it was the fastest-growing major advanced economy. The global slowdown means Britain is still likely to have remained near the top of the pack in 2015.Global growth has slowed since the middle of 2015 as China's rapid expansion lost pace and a slump in oil and commodity prices roiled other emerging economies.Last week the International Monetary Fund forecast that Britain's economy would maintain an annual growth rate of 2.2 percent through 2015, 2016 and 2017 -- slightly above the average for other advanced economies. The ONS said the slight pick-up in the quarterly rate of growth was driven by Britain's large services sector, which expanded by 0.7 percent, its fastest rate in just over a year, helped by gains in business and financial services.Industrial output recorded its first fall since late 2012. Manufacturers have reported being buffeted by weak foreign demand and the strength of sterling, and mild weather also depressed demand for oil and gas during part of the quarter. Construction output dropped by 0.1 percent on the quarter after a 1.9 percent fall in the previous three month period. However, consumer demand has remained broadly solid, with previous data showing retail sales enjoying their strongest quarter of growth in a year, bolstered by falling prices in stores and record levels of employment. (Reporting by David Milliken and Ana Nicolaci da Costa) Workers walk on the production floor of Invertek Drives based in Welshpool, Wales, April 24, 2015. Reuters/Rebecca Naden

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Accounting & Tax Nordstrom’s State Tax Gambit Fails The courts say that shifting trademark royalty collection to subsidiaries in other states did not release the upscale retailer from its Maryland tax obligation. Robert Willens November 10, 2008 | CFO.com | US share One of the most venerable techniques for reducing state and local tax burdens has been to transfer intangible assets — such as trademarks and trade names — to an entity incorporated in a state other than the one in which the transferor conducts business. The transferor then enters into a licensing agreement with the transferee and pays royalties to the transferee. From the government’s perspective, if the transferee is not subject to tax in the state because it lacks “nexus” in the state the transferor’s business is conducted, the group will realize an overall tax savings. The same would be true if the transferee was subject to low or no taxes in its state of incorporation with respect to the royalty income. Avoiding Budget Busters Evaluating Cash Flow Strategies in the Wake of Global Uncertainties Nordstrom Invests in Supply-Chain Software The result would parallel the outcome achieved by many multinational organizations that engage in “transfer pricing” gambits. The idea is to shift income from high to low tax jurisdictions and, if the trademark shifting device works as planned, such a beneficial shift would indeed occur. Unfortunately, this strategy has rarely stood up to scrutiny, and the latest company to find that its tax planning did not bear fruit is the high-end retailer Nordstrom, which had its tax plan struck down in October. The case concerns the liability for Maryland income taxes for the years 2002 through 2004, specifically regarding two Nordstrom subsidiaries that do not do business in Maryland and own no tangible property in the state. Nordstrom set up the subsidiaries in the following manner: Nordstrom, a national retailer with 150 stores in 27 states, was operating several stores in Maryland. In 1996, the retailer incorporated NIHC and NTN in Colorado, and contributed to NIHC a license agreement authorizing it to license the use of Nordstrom’s trademarks in exchange for 100 percent of NIHC’s stock. Later, Nordstrom incorporated N2HC, in Nevada, and contributed cash to N2HC in exchange for all of its stock. Still later, Nordstrom transferred its “marks” to NTN and, shortly thereafter, transferred its stock in both NTN and NIHC to N2HC in exchange for the cash that Nordstrom had used to capitalize N2HC. Next, NIHC distributed as a dividend to N2HC, the license agreement. Eventually, N2HC entered into a license agreement with Nordstrom under which N2HC granted Nordstrom a license to use the Nordstrom trademarks in exchange for royalty payments. Throughout the period, N2HC maintained an office in Portland, Oregon, which was staffed by a full-time “intangible property specialist.” After evaluating its structure, Nordstrom contended that N2HC was not subject to Maryland corporate income tax because in the parent company’s estimation, N2HC was actively engaged in managing, maintaining, enhancing, and protecting the “marks” that had been entrusted to it. The tax court disagreed, however, based on its definition of nexus. (See Nordstrom, Inc. v. Maryland Comptroller, Md. T.C. No. 07-IN-00-0317, October 24, 2008.) The court concluded that the test applicable when determining “nexus” with respect to an entity — a finding of which would subject N2HC to Maryland taxation — is whether the out-of-state affiliates have “real economic substance as separate business entities.” Here, Nordstrom paid royalties to N2HC of approximately $200 million for each of the years in question. N2HC, upon receipt of the royalties, loaned back to Nordstrom approximately two-thirds of each year’s royalties. Therefore, the court concluded that the payment by Nordstrom to N2HC, and the subsequent loans from N2HC to Nordstrom, were not arms-length market transactions. Moreover, the court accorded significance to the fact that the operating expenses of N2HC were “minimal” compared to its royalty income. Nexus exists, the court observed, independent of physical presence because of interrelated activities of commonly-owned and controlled corporations. Indeed, the judge found that in the Nordstrom case, NIHC and N2HC lacked real economic substance as separate business entities. Accordingly, their activities in Maryland must be considered as the activities of their parent, Nordstrom. As a result, there were substantial activities in Maryland, and quite clearly Nordstrom had a constitutional nexus with Maryland. To be sure, the tax court often has ruled against parent companies with greater claims of economic substantial than Nordstrom seemed to showed here. For example, even when a parent has a licensing agreement with a subsidiary that has a semblance of real business activity — and actively participates through its employees in the management and operation of the property — the courts will find that such entity lacks real economic substance as a separate business entity. This recent Nordstrom finding, therefore, subjects the licensor to state taxes because the requisite nexus is found to exist. At this point, it will be nothing short of a miracle if one of these trademark shifting arrangements withstands judicial scrutiny. ← But What’s Your Screen Name? Icons No More →

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Banking & Capital Markets Playing Favorites It's tempting to feel grateful for every customer you have. You should fight that feeling. Josh Hyatt January 1, 2009 | CFO Magazine share Ready to meet the new Chief Profitability Officer? OK, then, grab a mirror: you’re it. No need to have new business cards printed, you’re still the CFO as well. But you now have additional duties in line with the company’s new recession-fighting strategy: use profitable customers to drive corporate value. The concept has been around for some time, but it has acquired a fresh urgency in today’s climate. By pinpointing your profitable customers and looking for more ways to serve them, you may be able to coax new life into the bottom line. Give Them Credit But for You I’ll Charge an Additional 10 Percent How to Manage in a Down Economy Once those favored customers are defined and divided into homogeneous groups, CFOs will be expected to track their value like any other asset on the balance sheet. By overlaying certain metrics — such as buying needs, cost to serve, and strategic value — management can gain insight into exactly which group of users it should be courting and keeping. It might aim its promotions toward upper-middle-class women, for instance, or younger married males with a fondness for fancy gadgets. It won’t be going after everybody anymore; value-crushing customers, who just buy what’s on sale, won’t get any special attention at all. “In a time of limited resources, management has a desperate need to figure out its priorities,” says Larry Selden. “Now is the time to segment your customers.” Selden, professor emeritus at Columbia University and co-author of Angel Customers and Demon Customers, contends that the bottom 20 percent of customers can drain profits by at least 80 percent, while the top 20 percent can generate 150 percent of a company’s profit. So why not study that upper crust, delicately breaking it into subsegments that share the same needs? Categorizing customers by demographics or geography or product purchases, as many companies do, doesn’t give managers a clue as to where the high-opportunity needs are lurking. In the long run, precision targeting will generate profits far in excess of any incremental cost. Unfortunately, that won’t be the case in the near term, because such intensive analysis is time-consuming and expensive. Furthermore, there are likely to be expenses associated with reorganizing operations and training front-line employees in how to look at the data so that they know, right on the spot, that the customer in front of them would be receptive about an extended warranty. As much as spending money on the analysis may irk CFOs, Selden reasons that “now is the time to do it. Expectations on earnings are low, so in the short term it’s not going to make much difference if you spend the money on customer segmentation.” That’s probably a much more engaging task than what most CFOs have their staffs doing now — monitoring the cash cycle and modeling what-if scenarios to make sure there’s enough working capital on hand. That can be pretty routine work. If days sales outstanding is stretching out — the average DSO increased from 39.7 to 41 between 2006 and 2007, according to consulting firm REL — it’s time to sic corporate counsel on the worst offenders. If your revenue model presumes that 10 percent of customers will pay late, it’s crucial to work the spreadsheet, updating projections to account for the fact that that number may be inching toward 20 percent. But to move the company beyond mere survival, what they should do, says Selden, is “change the company from being product-centric to being customer-centric. In an economy where there are real cost constraints, you can’t serve everybody to the same degree.” As companies realize this, “the most capable customers and the most capable suppliers will get together and get bigger and better,” predicts Jonathan Byrnes, a consultant and a senior lecturer at Massachusetts Institute of Technology. Every CFO, says Byrnes, should start acting as “the chief profitability officer, in charge of making more money from existing customers without adding any costly initiatives.” The Un-chosen At most companies, about 30 percent of customers aren’t profitable — and two-thirds of those aren’t ever going to be, according to Byrnes. Some have been plied with discount upon discount over the years, surrendered by quota-driven salespeople and approved by sales managers whose compensation depended on volume. But armed with further insight into your customers, “you don’t have to discount, because you know you have something they value,” says Selden. Such selectivity means that, like bouncers at glitzy nightspots, executives will almost certainly have to “fire customers,” as management gurus put it. “With less business to go around, a company has got to know where it can contribute the most value,” says Barbara Bund, author of The Outside-In Corporation. “That’s where its future growth is going to come from.” Splitting with unprofitable customers is far less dramatic than, say, any Hollywood bust-up. It may simply entail having a frank conversation about what you can and can’t do for them. Is there a more cost-effective way to handle their account? Maybe replacing customized items with a standardized version, or asking them to rely on Web-based support, or helping smooth out erratic ordering patterns. By Selden’s estimate, it takes about six months to produce a customer-profitability analysis and segment the results into a portfolio of needs-based customers. Using software analytics, Selden sifts through cost data, records of individual transactions, and customer demographics. Selden’s consulting firm, Selden and Associates, has developed a process to perform this function — a much more comprehensive approach than CRM software systems. He first ranks money-making customers on a spectrum from least to most profitable. He splits that list into subgroups of customers that share certain needs based on their buying patterns, behaviors, or other information. The company also talks with customers. Once a company is armed with such information, it’s in a good position to calmly explain to certain customers why it can’t continue serving them in the same way. But rather than issuing an ultimatum, it can indulge in a dialogue with unprofitable customers, showing them why prices have to go up, but also offering suggestions as to how they can cut corners. For instance, customers often request overnight delivery because they don’t trust their suppliers. Why not settle for a slower, cheaper route? Retailers can discourage profit-puncturing customers by cutting off their coupon supply, or adding a restocking fee on returned merchandise. These moves may foster a “you can’t fire me, I quit” attitude among unprofitable customers. Your company’s newfound mission — the one that will serve as a competitive advantage, long after the word bailout has returned to its maritime roots — is to devote all of your resources to fulfilling and expanding your relationship with your profitable accounts. For certain retailers, that means crafting bundles of products that will be both appealing to customers and profitable — promoting an entire outfit, for instance, rather than just one discounted sweater. At Best Buy, that meant trying to change the behavior of roughly one million customers it had identified as unprofitable. The retailer also made it harder for the small number of aisle-wandering abusers to, say, return merchandise after applying for the rebate and then buy it back at the lower price that gets slapped on returned merchandise. The outcome: “Best Buy is doing better than all of the pure-play consumer-electronics companies,” notes Selden. By stark comparison, rival Circuit City has filed for bankruptcy protection and is closing nearly 200 stores; Tweeter, which manages about 100 stores, is shutting down. “Best Buy is well positioned,” notes Selden. “It will be getting an increasing share of the existing market.” From Customer to Partner As you get closer to your profitable customers, the relationship may take one more step: collaboration. By helping those customers increase their profitability — working on long-term planning, say, or winnowing the supply chain — you can become about as close to indispensable as possible. “Companies exist within four walls,” says Byrnes. “What a company should do is create a bigger box around the business by moving the boundaries.” Perhaps in a variation of that spirit, Google and Procter & Gamble began swapping employees last year, with two detergent-brand managers working inside the Googleplex and a pair of Google employees shifting to Cincinnati. Presumably, P&G wanted to know more about online marketing, while Google soaked up smarts about customer research. The flow of information between companies can lead not only to increased business between them, but also to wholly new opportunities. Until recently, Corporate Transportation Group (CTG), a “black” car service based in Brooklyn, counted among its customers both Bear Stearns and Lehman Brothers. Last year, the company began selling its proprietary software to similar services, which “gets us inside some interesting places,” says CFO Vadim Zilberman. “We realize things that are done differently.” As for his own customers, “they love to be visited as much as possible, not just during negotiating season,” he adds. Last year, while visiting a bank customer, a CTG account manager picked up word of a new building going up in midtown Manhattan. CTG became the exclusive supplier to the building’s eventual tenants by creating a customized dispatcher-free platform. The ultimate alliance is what Byrnes calls “customer operating partnerships,” which can easily boost business by at least 25 percent. In these pacts, vendors and their valued customers braid the separate strands of their supply chains together. The customer isn’t just strategically positioned to pick up additional business; operating deep inside the business, it has now built a barrier to entry for potential rivals. “It makes it very hard to displace,” says Byrnes. The companies naturally broaden their contact with one another. So, for instance, instead of dealing exclusively with a price-driven purchasing agent, the supplier’s management team will interact with higher-level executives, who tend to be oriented more toward value. They are likely to be more receptive when you pitch them on the idea of crowning you “a master supplier” and offer to manage their inventory. By streamlining the inbound product flow and consolidating their billing, you’ll save them money. Your own profits will fatten as you find opportunities to make the supply chain more efficient, cutting out any redundant or disjointed steps. The idea may take some time to gain traction. One pasta maker wanted to take over a supermarket chain’s ordering process. Sensing reluctance, the pasta company came up with a plan designed to reassure them: We’ll park a truck full of pasta in your lot, the supplier said, and anytime we don’t deliver you can take what you need — for free. The truck wasn’t there for long. Says Byrnes: “You want to find a way to extend your business far into their operations for your mutual benefit. You’ll grow together.” Providing close-to-the-market data can also create a bond. In consumer electronics — or, for that matter, any product with a short life-cycle — a supplier can be a valuable source of information about when the item’s profits have begun eroding, suggesting that shipping should be winding down. Such data is more valuable than ever, given the pressures on margins. “Customers are going to be receptive to help now because they are under so much financial pressure,” says Byrnes. But before you shift any resources in their direction, try to look beyond the data, assessing their overall strategy and sizing up their leadership team. They may be profitable for you now, but what are their prospects? “In this economy, we are being very cautious about who we develop relationships with,” says Linda Booker, CFO of IDI, a $2 billion commercial-real-estate developer in Atlanta. “Before we work with anyone, we’re paying utmost attention to their balance sheet. We ask them about their relationship with their bank, what debt is maturing over the next five years; we explore their ability to refinance. We’re extra-careful.” Relationships Take Work CFOs have to be extra-careful too, monitoring the performance of the company’s “portfolio of customers” on a regular basis, says Selden. If that sounds like a lot of work — well, it is. “This is not a trivial undertaking,” warns Selden. “But the fact that it’s really, really hard is great. Segmentation becomes a competitive weapon.” It just takes time. “This is a fundamental rethinking of a business,” says David Reibstein, a professor of marketing at the University of Pennsylvania’s Wharton School of Business. “We’re going to see more companies investing in this, finding out the value of their customers and paying more attention to some of them.” The ultimate goal: to have more value-laden relationships with fewer customers. Not that any company will execute with 100 percent accuracy. “The truth is,” says Bund, “you never know as much as you want to know.” But you may soon come to know a lot more than your competitors do. Josh Hyatt is a contributing editor of CFO. ← Layoffs Take a (Brief) Holiday Waterford’s Bleak Gaze in the Crystal Ball →

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Financial Literacy - Growing your bottom line Tax breaks that help you get ahead Student loan interest. Once you've graduated college and left behind the final exams and toga parties, it's time to start repaying college loan debt.Fortunately, the government provides relief. Borrowers can reduce their tax burden by up to $2,500 for qualified educational expenses. As long as your modified adjusted gross income is under $55,000 ($110,000 for a joint return), you qualify for the full deduction.If your MAGI is higher than those amounts, the deduction gradually phases out. You're out of luck and won't qualify for the deduction if your MAGI is $70,000 or more ($140,000 or more if you file a joint return).You also must file a joint return if you're married, and you cannot claim the deduction if you're a dependent of someone else.One of the key concerns of families is who gets to claim the deduction: the parent or the child? "In cases where parents and children are both paying for school with loans, the family needs to determine which taxpayer gets the tax benefit," says Kay Bell, a tax expert who writes Bankrate's "Eye on the IRS.""The first thing to keep in mind is that the taxpayer who can claim this deduction must be personally liable for the loan. Essentially, if the loan is taken out by a parent to pay for a child's education, the interest on that loan may be deducted by the parent as long as the child was the parent's dependent when the loan was received. When a parent pays a loan taken out by the child but the parent is not legally liable, the child, not the parent, gets the deduction. If both the parent and the child obtain education loans and, for example, it's in the child's name but the parent is a cosigner on the loan, the determination of who gets the deduction depends on whether the child was a dependent."You generally can continue to take this deduction for the life of the loan as long as you are making interest payments and remain within the income guidelines.3. Tax credits for higher learningHope credit. The federal government provides two tax credits for students and parents to help offset the increasing costs of higher education. These credits reduce the amount of income tax you owe at the end of the year. "You need to sit down if you have a kid in college and see who's going to benefit the most from taking that credit," says Kay Bell, a tax expert who writes Bankrate's "Eye on the IRS" blog. "They're different amounts and for different situations."You can take a Hope credit of up to $1,650 for qualified educational expenses paid for you, your spouse or an eligible dependent for whom you claim an exemption on your tax return. However, a student with a felony drug conviction cannot take the credit. advertisementYou can claim the credit for tuition, books and certain student fees, but not for room and board. The maximum tax credit is $1,650 per eligible student.The Hope credit is limited to the first two years of enrollment at an eligible educational institution. The student must be enrolled at least half-time in a program that leads to a degree, certificate or other recognized education credential. The credit can be used only twice for the same student. Connect with us Compare Rates

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Cardiff City shares set for sale on stock market, reports say 24 May 2013 Last updated at 08:52 BST Malaysian billionaire Vincent Tan is reported to be considering selling shares in Cardiff City football club, according to the Reuters news agency. It follows the team's recent promotion to the Premier League. Mr Tan recently pledged his long-term commitment to Cardiff City following previous reports that he would consider offers to sell the club.Football finance expert Geoff Mesher, a partner at Tempest forensic accountancy, explains the implications of such move to Bethan Rhys Roberts and Oliver Hides on BBC Radio Wales.

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Bloomberg Anywhere Remote LoginDownload SoftwareService Center MENU Homepage Markets Stocks Currencies Commodities Rates + Bonds Economics Magazine Benchmark Watchlist Economic Calendar Tech Silicon Valley Global Tech Venture Capital Hacking Digital Media Bloomberg West Pursuits Cars & Bikes Style & Grooming Spend Watches & Gadgets Food & Drinks Travel Real Estate Art & Design Politics With All Due Respect Delegate Tracker Culture Caucus Podcast Masters In Politics Podcast What The Voters Are Streaming Editors' Picks Opinion View Gadfly Businessweek Subscribe Cover Stories Opening Remarks Etc Features 85th Anniversary Issue Behind The Cover More Industries Science + Energy Graphics Game Plan Small Business Personal Finance Inspire GO Board Directors Forum Sponsored Content Sign In Subscribe States Face Tough Choice on Medicaid Funds After Ruling William Selway and Alex Wayne June 28, 2012 — 11:43 PM EDT Share on FacebookShare on TwitterShare on WhatsApp Share on LinkedInShare on RedditShare on Google+E-mailShare on TwitterShare on WhatsApp Share on FacebookShare on TwitterShare on WhatsApp Share on LinkedInShare on RedditShare on Google+E-mailShare on TwitterShare on WhatsApp The U.S. Supreme Court ruling on President Barack Obama’s health-care overhaul forces Republicans in states that opposed the measure to make a difficult choice. If the states go along with an expansion of the Medicaid program, they get federal money that covers the bulk of the costs. In doing so, they would also have to embrace a portion of a law that they rejected as unconstitutional or too costly. The law was designed to open the state-run program to an estimated 17 million low-income Americans by forcing states to loosen income limits for those who can qualify. The court yesterday modified the measure by saying the federal government can’t threaten to withhold existing money from states that don’t fully comply with the Medicaid expansion. “There’s probably a small group, at least initially, who won’t do it,” said Ray Scheppach, the former executive director of the National Governors Association who is now a professor of public policy at the University of Virginia in Charlottesville. “It’s part political. It’s part fiscal. There’s pressure on them both ways.” Republicans won control of the majority of governorships in the 2010 elections, when concern about the expanded role of government under Obama boosted turnout among the party’s voters. Republican state leaders have opposed Obama’s 2010 Patient Protection and Affordable Care Act, and yesterday criticized the Supreme Court’s decision to uphold the core of the law, which requires individuals to obtain health insurance. ‘Unaffordable’ ExpansionRepublican leaders of states that challenged the health-care law in court -- including Texas, Florida, Virginia, Ohio and Indiana -- say they’re not sure their states will opt in. Florida Attorney General Pam Bondi, a Republican, called a Medicaid expansion “massive” and “unaffordable.” “We will have a choice on Medicaid, which is good,” Bondi told reporters outside the state Capitol in Tallahassee. “We do have to decide what to do and we have to do it very quickly.” Texas Health and Human Services Executive Commissioner Tom Suehs said in a statement the state is analyzing the ruling to decide how to proceed. “I’m pleased that it gives states more ability to push back against a forced expansion of Medicaid,” he said. Virginia Governor Robert McDonnell, the chairman of the Republican Governors Association, told reporters in Richmond that he is considering the ruling and hasn’t made any decisions. He said the expansion of Medicaid, which now consumes about one-fifth of the state budget, will cost the state an added $2.2 billion over the next decade. ‘Vast Expansion’“That’s going to be a vast expansion in the amount of money going from the general fund,” McDonnell said. The Medicaid expansion would cost states $21 billion through 2019, according to the Kaiser Commission on Medicaid and the Uninsured, a non-profit group that researches health care. The federal government would contribute $444 billion, the group said in the report. The Medicaid program has put added financial pressure on states after the longest recession since the Great Depression as more residents were thrown out of work. As tax revenue tumbled, states were forced to close more than $500 billion of budget gaps. Following the Supreme Court’s decision, Republican state leaders issued statements faulting a program they said ceded an excessively large role to the federal government. Congressional Republicans vowed to repeal the law, as did Mitt Romney, the former Massachusetts governor and Republican presidential candidate. ‘Everybody In’Democrats celebrated the ruling. Illinois Governor Pat Quinn said his state will expand the Medicaid program. “We want everybody in, nobody left out,” he told reporters. The law signed by Obama expands Medicaid to cover all Americans earning as much as 133 percent of the federal poverty level, or about $30,657 for a family of four this year, overruling eligibility rules that now vary by state. The federal government would pay 100 percent of the costs of the expansion until 2017. After that, states’ share of the expansion rises to a maximum of 10 percent of the cost. Should a state choose not to expand Medicaid, that may affect coverage for those who earn too much to qualify for the program and won’t receive subsidies offered under the law. Insurance for that group may be prohibitively expensive. Coverage Gap“Very low income people may be covered,” said Bruce Siegel, president and chief executive officer of the Washington-based National Association of Public Hospitals and Health Systems. “Lower middle-class and above may be covered. You could potentially have this group of people around the poverty line, millions of people, who are sort of out of luck.” With pressure in Washington to curb the federal government’s budget deficits, state leaders may decide not to expand Medicaid out of concern that Congress might force them to cover more of the costs, said Marjorie Baldwin, a professor of economics at Arizona State University who tracks health care. “Given the current state of state budgets, we could expect some states would decide they can’t do that,” she said. While some states may decide against expanding Medicaid, most will likely choose to do so given that the bulk of the funding will come from the federal government, said I. Glenn Cohen, an assistant professor at Harvard Law School who follows health-care policy. “It’s possible that some governors will, mostly for political reasons, do it, but I still suspect most governors will decide to expand Medicaid in keeping with what the federal government wants to do,” Cohen said. “The deal Congress has offered them going forward is really, really good.” ‘Screwy Opinion’New Jersey Governor Chris Christie, who last month vetoed a Democratic bill that would establish a health exchange in the state, said his administration was still trying to make sense of the decision. “It was a screwy opinion: to say you can’t mandate that people must buy something yet you’ll tax them if they don’t,” Christie said yesterday on his “Ask the Governor” radio show. He called an aspect of the ruling that limited the federal government’s power to require states to expand Medicaid like a “rainbow on a cloudy day.” The law marks the biggest change to the U.S. health system since Medicare and Medicaid were established in 1965. It was designed to expand coverage to at least 30 million people -- primarily by expanding Medicaid and setting up markets where consumers could buy insurance -- while controlling the soaring costs of health care. The law was challenged by 26 Republican-controlled states and a small-business trade group. They contended the measure exceeded Congress’s constitutional powers to regulate interstate commerce and impose taxes. The challenge focused on the insurance mandate, which requires Americans to get coverage by 2014 or pay a penalty. The concept was championed by Republicans years ago as an alternative to Democratic proposals for a single government-run health system. Before it's here, it's on the Bloomberg Terminal. LEARN MORE Health Barack H Obama

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Why Did Goldman Get A $3 Million Gov't Gift For "National Security" Lawrence Delevingne WIth all the company's riches, why is a Goldman Sachs (GS) subsidiary getting a $3 million earmark from Washington? Politico: A mining company owned by Goldman Sachs and two private equity funds is in line to get a $3 million earmark for work at a rare earth elements mine in Mountain Pass, Calif. — raising questions as to why Congress would take on some of the risk for a bailed-out investment giant that’s already making a profit. As the article notes, Molycorp's mine is a rich source of elements used to produce powerful magnets for precision-guided weapons, hand-held communication devices, wind turbines and hybrid cars. California Republican Rep. Jerry Lewis inserted the earmark for the mine into the House Defense appropriations bill, reasoning that it's a national security concern. The other major source for the minerals, China, could cut exports. This concern is fair, though probably overblown. There's a lot of hype about China limiting exports of so-called rare earth metals, but that's far from clear -- plus, how does the taxpayer subsidizing Goldman Sachs change anything? Of course, the chance to line up at the government trough is a big reason why companies get into areas relating to green or weaponry. Goldman and Molycorp didn't immediately respond to our requests for comment. Critics blast a mining subsidiary's earmark.

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Are You Covered if Your Broker, Bank or Fund Fails? Leslie Geary, Bankrate.com Tuesday, 16 Sep 2008 | 12:51 PM ET As some of Wall Street's most venerable firms topple, even the most hardened individuals are wondering if their assets are adequately protected. This week the markets opened with the news that investment bank Merrill Lynch was scooped up by Bank of America , ending its 94-year reign as one of the world's most recognized brokerage houses. Lehman Brothers , another investment bank, announced its filing for Chapter 11 bankruptcy. This follows the collapse of other financial institutions, most notably Bear Sterns, bought up in March by J.P. Morgan Chase . Officials and other experts were quick to assure investors that money is safe. "People don't need to be panicking. Unless you've had some massive fraud and conversion, and the brokerage is stealing money -- and there's no evidence of that -- the funds should still be good," says Mark Maddox, former securities commissioner for the state of Indiana and investor attorney. "Consumers don't need to worry; they don't have to stand in line and draw assets from brokerage accounts." In a statement, Lehman said that none of its broker-dealer subsidiaries or other subsidiaries are included in the bankruptcy filing. Furthermore, it is "exploring the sale of its broker-dealer operations, which continue to operate." Its customers, including those of Lehman and Neuberger Berman, can "continue to trade or take other actions with respect to their accounts," Lehman said. Meanwhile, the Securities and Exchange Commission said in a statement that Lehman customers "will benefit from their extensive protections under SEC rules, including segregation of customer securities and cash as well as insurance by the Securities Investor Protection Corp." That's all well and good. But how do the Securities Investor Protection Corp., or SIPC, and other agencies protect you? As it turns out, there are safety nets to catch you, but how much protection you have depends largely on the kind of assets you own and where you hold them, be they certificates of deposit, a pension plan or a checking account. Security for brokerage accountsSIPC is funded by private "member" firms. Brokerage losses, including 401(k) and other retirement plans held at Fidelity or Vanguard, for example, are protected by SIPC up to $500,000 per person, per account. Of that amount, up to $100,000 in cash losses are included. If you have, for instance, a retirement fund and a "rainy day" fund at a brokerage, each of those separate accounts would be protected up to the $500,000 threshold, says SIPC President Stephen Harbeck. _____________________________________Worried About Your Assets? Timely Advice from Bankrate.com: Bankrate Calculator: How Much Should You Invest in Your 401(k)?What FDIC ProtectsHow to Tell if Your Retirement Plans are on Track To qualify for SIPC protection, your brokerage must be a member. Most firms are. In fact, firms that are registered brokerages with the Securities and Exchange Commission, "are virtually required to become members of SIPC," says Harbeck. In the event your brokerage firm goes out of business, the SIPC wouldn't likely be involved in making you whole (unless funny business, such as fraud, was involved on the firm's side). Your holdings would likely be transferred to another brokerage firm, where you could lay claim to them. If fraud was the problem, then the SIPC would step in and oversee the transfer of any remaining assets as well as replace any missing securities. But doing business with a SIPC-member institution isn't a guarantee for an automatic bailout. Investors who have losses due to improper trading must prove they complained about how transactions were conducted. If you've done nothing to prove you objected to how assets were handled, SIPC "has to assume you assented to the trade," says Harbek. William P. Thornton Jr., a lawyer at Stevens & Lee in Reading, Pa., represented a client against SIPC when Old Maple Securities failed. Thornton spent two and a half years in court before getting back roughly $100,000 cash from SIPC. "SIPC typically hires a trustee, and they either grant or deny claims that were filed. Historically, there have been a high number of denials forcing investors to litigate with SIPC," says Thornton. "Every case is unique." Read More: When a Pension Fails

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Sophos To Sell Majority Stake To Apax Partners byStefanie Hoffman on May 4, 2010, 3:36 pm EDT Security and data protection company Sophos said Tuesday that it signed a deal to sell off the majority of its business to private equity group Apax Partners for $830 million. While Apax Partners will retain the bulk of the assets, Sophos founders Jan Hruska and Peter Lammer will get a "significant minority" shareholding in the company at the conclusion of the transaction. Meanwhile, TA Associates, a Sophos minority shareholder since 2002, will sell its full interest to Apax Partners. Executives implied that they are leaving on a high note, given that the company has a strong cash flow, $260 million in sales revenues for 2010, more than $330 million in billings. In addition, executives tout that the company falls into second place behind McAfee for data protection suites, and third behind Symantec and McAfee in endpoint suites. "As the market continues its migration from point solutions to tailored, unified security suites, Sophos' strategy to offer the world's most resilient, cost-effective solutions without any additional complexity remains key," said Sophos CEO Steve Munford, in a statement. "Apax's financial backing, combined with Sophos' deep understanding of security and data protection is great news for our customers, prospects and partners. It is also a testament to the effort of all those who helped bring Sophos to where it is today." Apax Partners, which backs and bolsters enterprise companies with long-term equity financing, invests in a range of sectors, including retail and consumer, tech and telecom, media, health care, and financial and business services. Executives at Apax Parters said that they tagged the security software space as an "attractive investment" and a strong growth area, in light of the fact that businesses continually face an exponentially increasing amount of malicious threats such as botnets, Trojans and viruses every day. "We are delighted to have the opportunity to back Sophos as well as its excellent CEO and management team," said Salim Nathoo, tech and telecom team partner at Apax Partners. "Sophos is a very strong platform and is gaining market share. Apax's strong track record and industry-specific knowledge in the technology sector makes Sophos a perfect fit, and we look forward to working closely with this high-growth business going forward."

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Housing Collapse, GSEs Dominate House Financial Services April Agenda March 22, 2013 • Reprints The House Financial Services Committee’s April schedule marks a continuation of Chairman Jeb Hensarling’s (R-Texas) agenda to reform the housing market, with five hearings scheduled to examine government-sponsored enterprises Fannie Mae and Freddie Mac, the Federal Housing Administration and the Department of Housing and Urban Development. Those dates will add to the five hearings the committee has already conducted this year regarding on the topic. In particular, the committee has investigated how government policies may have contributed to the housing market meltdown, and how the secondary market can be reformed to reduce taxpayer liability and include more private investment. Hensarling favors a privatization of the GSEs. In his opening remarks during a March 19 hearing in which Acting Federal Housing Finance Administration Director Edward DeMarco updated the committee on the progress of the GSEs’ conservatorships, Hensarling said he was “determined” that the hearing would be the last time DeMarco or his successor will testify before the committee pens GSE reform legislation. “This I define as legislation to once and for all abolish Fannie Mae and Freddie Mac as government-sponsored enterprises,” Hensarling said. “And two, one that would truly create a sustainable housing policy. Sustainable for our economy, sustainable for those seeking the goal of homeownership, and sustainable for hard-working taxpayers who should never, ever, be called upon again to bail out Wall Street.” Credit union trade associations haven’t necessarily opposed GSE reform, but both CUNA and NAFCU have stressed that any reforms must include assurances that credit unions would continue to have unencumbered access to the secondary mortgage market. In a March 18 letter to the Senate Banking Committee, which also conducted a hearing on housing reform earlier this week, NAFCU President/CEO Fred Becker said NAFCU does not support full privatization of the GSEs because of serious concerns that credit unions could be shut out from the secondary market. NAFCU supports the creation or existence of multiple GSEs that would perform the essential functions currently performed by Fannie Mae and Freddie Mac, but added that the GSEs should be self-funded, without any dedicated government appropriation. “GSE’s fee structures should, in addition to size and volume, place increased emphasis on quality of loans,” Becker wrote. “Credit union loans provide the quality necessary to improve the salability of agency securities.” Two hearings – on April 10 and April 16 – will discuss regulatory relief for small community financial institutions. Although the schedule does not mention credit unions specifically, and hearings discussing regulatory burden have so far this year focused on banks, a committee staffer told Credit Union Times on Tuesday the committee does plan to conduct a hearing that will focus on credit union regulatory burden. Other topics on the schedule include the U.S. role in the International Monetary Fund and the so-called “too big to fail” status of big banks. All hearings will take place in the Financial Services Committee’s main hearing room, 2128 Rayburn. The committee said in a release that its schedule is tentative and will depend upon witness availability and other factors that may require changes. Therefore, each meeting will become final only when the official notice is distributed.

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Articles 2016 Summits & Events HIS HIGHNESS THE AMIR AL-SABAH FAMILY AL DIWAN AL AMIRI MARTYRS BUREAU THE HISTORIC DOCUMENTATION CENTER ABOUT KUWAIT Vision of his highness the amir His Highness the Amir of Kuwait, Sheikh Sabah Al Ahmad, addresses attention in many occasions to supporting the Kuwaiti economy by keeping abreast of the great economic movement which the entire world is undergoing. His Highness the Amir has adopted the principle of free economy and opening the field for the Kuwaiti economy in order for the economies of the region to compete. His Highness called for eliminating the difficulties for local and international investors, reducing bureaucratic restrictions, enacting new laws to protect and encourage investment in order for Kuwait to become a financial and economic hub in the region and the world. Here is Kuwait taking its first steps to accomplish the noble desire of His Highness the Amir of Kuwait, Sheikh Sabah Al Ahmad, by executing the development plan for (2010/2011- 2013/2014), the law of which was ratified by His Highness on 21 February 2010, which will continue for four years up to the end of March 2014, consisting of 13 articles, the overall of which confirmed on achieving the justice of distributing development projects returns between citizens on one hand, and contribute in funding such projects on the other hand. Further, it has necessitated that the government refer the bills set forth under the general framework of the plan to the National Assembly during the next two years for considering them and enacting them in the form of a law. The five year plan comprises the State of Kuwait’s vision in 2035, aimed at transferring Kuwait into a financial and commercial hub attracting investment, where the private sector leads the economic activity, the spirit of competition is increased and production efficiency raised in light of an institutional supportive body of the State, as well as establishing values, maintaining social identity, realizing human development, balanced development and providing suitable infrastructure, advanced legislations and encouraging business environment. Among the most prominent aspirations comprised by the vision is to restore the regional pioneering role of the State of Kuwait as a financial and commercial hub, reviving the central role of the Kuwaiti private sector in leading developing, rebuilding the important and various roles of the State, its bodies and institutions to provide the means of enablement and supporting to work and production, providing the appropriate infrastructure and suitable legislations and the favorable business environment to encouraging development, provide the controls and climate to ensure total human and balanced development aimed at establishing the values of the society, maintaining its identity, building citizenship, achieving justice and means of honorable living, supporting and establishing the democratic system based on the respect of the constitution and compliance with the same to ensure justice, political participation and freedoms. Through this plan, the Kuwaiti government aims at establishing a new ideology for strategic planning and visions to transform into a true reality, and will act as the first move towards attaining the desired vision for 2035, aimed at transforming Kuwait into a financial and international hub, as per the directions of His Highness the Amir of Kuwait, Sheikh Sabah Al Ahmad Al Jaber Al Sabah, the leader of the modern advancement of the State of Kuwait. © - 2016. Al-Diwan Al-Amiri. All rights reserved.

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Remarks by Vice Chairman Roger W. Ferguson, Jr. Before the Institute of International Bankers, Washington, D.C. A Supervisory Perspective on Disaster Recovery and Business Continuity Good morning. I would like to thank the members of the Institute of International Bankers for the opportunity to speak about disaster recovery and business continuity. This topic has been receiving a great deal of attention at the Federal Reserve and in the financial industry as a whole since September11. It's fair to say that following September 11, we (bankers and supervisors alike) have a renewed appreciation of the meaning of the term "emergency preparedness." The Federal Reserve and other regulators, both here and abroad, have been analyzing the aftermath of the terrorist attacks with a view toward strengthening the overall resilience of the financial system. This work has benefited from discussions with leading members of the financial services industry over the past several months. In this presentation, I want to give you a flavor of the ideas and issues under review. Since many of you had first-hand experience of the impact of September 11, I do not intend to dwell on the details of the operational breakdowns and related challenges that faced institutions in lower Manhattan. Suffice it to say that, through a fortuitous combination of existing plans, people, systems, and tools and an extraordinary level of cooperation among market participants, the financial system recovered remarkably quickly from the tragedy. However, we cannot assume that the same combination will always work in our favor, and therefore, regulators and the public have a strong common interest in learning from our horrific experience of September 11. What Did We Learn? Let me review some of the key lessons that we believe have emerged from September 11. First, business continuity planning at many institutions, although improved by Y2K preparations, clearly had not fully taken into account the potential for wide-spread disasters and for the major loss or inaccessibility of critical staff. Some firms arranged for their backup facilities to be in nearby buildings for quite legitimate efficiency and convenience, and, as a result, lost both primary and backup sites. Very few firms planned for an emergency that would disrupt multiple sites in an entire business district, city, or region. Second, business concentrations, both market-based and geographic, intensified the impact of operational disruptions. Besides the geographic concentration of financial institutions within New York City, some critical market functions, particularly in the clearing and settlement of funds, securities, and financial contracts, rely on only a few entities. When even one of those entities has operational problems, many market participants feel the effects. Moreover, significant telecommunications vulnerabilities resulting from concentrations became evident when failures affected numerous institutions, both within and outside lower Manhattan. In fact, Federal Reserve staff were personally involved in setting priorities for the restoration of key telecommunications circuits supporting the financial services system during the week of September 11. Third, the events of September 11 graphically demonstrated the interdependence among financial-system participants, wherever located. Though organizations located outside the New York City area were affected much less than those within it, many felt the effects of the disaster. The difficulty customers and counterparties had in communicating with banks, broker-dealers, and other organizations in lower Manhattan seriously impeded their ability to determine whether transactions had been completed as expected. In some cases, some customers were affected by actions of institutions with which they did not even do business, for example, when funds or securities could not be delivered because of operational problems at other institutions. In fact, during the week of September 11 liquidity bottlenecks at times became so severe that the Federal Reserve needed to lend substantial amounts directly to institutions through the discount window, besides providing billions more in payment system float on uncleared checks, and through open market operations. We kept our payment systems open until nearly midnight each night that week as institutions attempted to clear out payment queues. Heightened liquidity needs were not limited to domestic financial institutions. The Federal Reserve set up swap lines with other major central banks to allow foreign banking organizations to obtain liquidity directly from their own authorities, to prevent U.S. liquidity imbalances from being transmitted overseas. Most important, we learned, as a result of these interdependencies, that contingency-planning decisions made by an individual institution may affect not only the safety and soundness of that institution but also the safety and soundness of other institutions and, indeed, the very functioning of the financial markets. As a result, we believe that coordinated discussions of sound practices for business continuity involving the financial industry and regulators are an important part of our response to the events of September 11. Steps Financial Institutions Are Taking Let me turn to steps that institutions are taking to improve their own preparedness and business continuity planning. September 11 may lead to changes in institutions' planning for emergencies, as well as changes in their ongoing operations. In addition to a range of tactical steps, such as enhancing security measures, updating communication plans, and strengthening real-time data backup, institutions also are making some interesting strategic choices. For example, many institutions use a traditional model of business continuity that is based on an "active" operating site with a corresponding backup site, often with separate sites for data processing and for business operations. This strategy generally relies on relocating staff from the active site to the backup site and on maintaining backup copies of technology and data that are up-to-date. In the traditional model, backup capabilities are ensured through periodic testing. Even so, maintaining the effectiveness of backup sites, staff, and systems that are not routinely used for production is often difficult. For example, during the week of September 11, many institutions found that disaster-recovery plans of particular business lines were not always accessible or up-to-date, and sometimes the backup and primary sites used different hardware and software versions. Finally, the assumption that key personnel could be relocated was not always well founded. In contrast, some institutions are now moving toward a "split operations" model, in which two or more active operating sites provide backup for one another. Each site can absorb some or all of the work of another for an extended time. For banking organizations with nationwide operations (particularly those that have grown through mergers), such sites are often hundreds of miles apart. For international firms, routine workloads can be shared among sites in different countries or different continents. This strategy can provide almost-immediate resumption capacity, depending on the systems supporting the operations and the communications and operating capacity at each site. The strategy also addresses many of the key vulnerabilities of the traditional model. For example, technology must be kept current at all active operating sites for normal business operations to proceed. At the same time, the split-operations approach can have significant costs, in terms of maintaining excess capacity at each site and of adding operating complexity. This approach may be more suited to some types of business activities, such as trading, clearing, and settlement, than to others. Other business-continuity models may be able to provide a high degree of resilience. Over time, technological change will significantly affect the range of business continuity strategies and, importantly, their relative costs and benefits. Whatever operating model they chose, financial institutions clearly are reassessing the range of scenarios they need to address in their business-continuity planning. Such scenarios posit effects on business operations over much broader geographic areas than previously imagined (such as a city or a metropolitan area) and involve consequences that could harm or significantly disperse an organization's critical employees. Institutions are also exploring methods to provide a greater diversity of telecommunications services and to eliminate points of failure. Contract provisions and audit oversight of telecommunications vendors may heighten attention to this critical vulnerability. At the same time, many recognize that overcoming telecommunications vulnerabilities will be extremely difficult given the current physical infrastructure. In the longer term, establishing diverse telecommunications methods (such as Internet and wireless) and moving toward wider geographic diversification of operations may address these vulnerabilities. Industrywide discussions with telecommunications providers may help institutions to avoid some of the vulnerabilities exposed on September 11. Some institutions are reexamining arrangements with disaster-recovery vendors because they have found that these vendors' "first-come, first-served" policies mean just that. Testing of backup plans is also receiving renewed focus. Testing is seen no longer as a compliance issue or an item on a checklist but as a critical part of business operations. In the wake of September 11, many market participants found themselves operating from their backup sites and discovered they had problems connecting and communicating with the backup sites of other displaced entities. As a result, financial institutions now seem receptive to coordinated testing between backup facilities. In addition, several public and private-sector initiatives have begun to examine the issue of coordinated crisis management communication. Overall, I believe that financial institutions are addressing many of the key vulnerabilities. In large part, the market will demand this. Customers increasingly require assurances that their financial institutions' operations will continue as expected even in the event of a disaster. We need to maintain our focus on this issue even as the harsh memories of September 11 fade. We must also find ways to make business-continuity planning more consistent, more coordinated, and more transparent across the industry. With that in mind, I will discuss some of the steps that regulators are taking. Steps Regulators Are Taking The Federal Reserve and other financial services regulators want these lessons to be addressed before the next disaster, whenever and whatever it may strike. First, we are talking to our industry colleagues about appropriate sound practices. However, I would stress that we still have a lot to learn from financial institutions and from experts in business-continuity planning. No one knows for certain which threats (both man-made and natural) we are most likely to face in the coming years. We have much less experience modeling and predicting these operational risks than we do credit or market risks, and indeed some threats may be too idiosyncratic to be modeled at all. As a result, a prudential supervisory model appears preferable at this time. Through the routine supervisory process, we are talking to institutions about the robustness of their disaster-recovery planning but are stopping short of setting detailed regulatory standards at this point. Although I anticipate that we will issue updated supervisory guidance and examination procedures for business continuity before long, I am not certain that we want to approach this issue with a checklist. In this process, we are working closely with other regulators, including the other federal banking regulators and the Securities and Exchange Commission. Cities and regions outside New York City are not without risk and also need to consider reasonable threats, both man-made and natural. I am therefore pleased that many institutions in those cities and towns, like their colleagues based in New York City are seriously considering updating and implementing business-continuity plans. Institutions also need to define their targets for recovery from a disaster in a consistent manner. Although in practice, expectations for recovery time may differ depending on the scenario, some critical functions, including those safeguarding and transferring funds and financial assets, are so vital to the domestic and global financial system that they arguably should continue with minimal, if any, disruption, even in the event of a major regional disaster. Clearly, all institutions need to plan to continue serving their customers in a major disruption, and supervisory standards have required them to do so for many years. In addition, it is increasingly clear that the operational resilience of the largest institutions in key markets needs to reflect their systemic impact across the financial sector. Expectations should be highest for institutions whose activity can significantly affect other institutions, such as major clearing and settlement entities, and institutions that act as financial "utilities" in some of their functions. However, we need to balance competing issues. We have an ongoing interest in the safety and soundness of individual institutions, as well as in systemic financial stability. But we also recognize that, even though the largest nationally and internationally active U.S. and foreign banking institutions have a key role to play in financial stability, they also participate in a competitive marketplace. Thus, we need to be careful not to create undue burden on a handful of institutions. Conclusion Six months after September 11, much has been planned and achieved, but we still have much to do. We must sustain the current drive to minimize or eliminate the vulnerabilities I have discussed. We must view September 11 as a wake-up call to improve the resilience of financial markets and institutions. We cannot afford to ignore the lessons learned. I ask for your cooperation in what we view as a partnership. We were there for those who needed us on September 11 and in the days that followed, and we will be there again, if necessary. But we also look to financial institutions to conduct an honest appraisal of their vulnerabilities--or to listen to our appraisal of them in our routine supervision over the institutions' U.S. operations--and to take the necessary actions to remedy any significant operational weaknesses and deficiencies. I wish us all the best in this endeavor. Return to top Home | News and events Accessibility | Contact Us Last update: March 4, 2002, 8:30 AM

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The $1 Dozen: These CEOs Practically Work for Free As fellow Fool Alyce Lomax has opined on countless occasions, CEO pay in this country is out of control. For the most part there tends to be a major disconnect between a company's performance and a CEO's pay, leading many investors to call for "pay-for-performance" packages for many of our nation's largest companies. Whether you believe it or not, some of these CEOs are actually listening to their shareholders and have proactively reduced their base salaries to next to nothing -- and I mean that literally! Here are 12 CEOs who in 2011 received either $1 as their base salary or, in some cases, absolutely nothing at all: Hewlett-Packard (NYSE: HPQ ) $1 Citigroup (NYSE: C ) $1 Whole Foods Market (Nasdaq: WFM ) $1 Richard Kinder Kinder Morgan (NYSE: KMI ) $1 Mark Zuckerberg* Rob McEwen US Gold/Minera Andes Matthew Lambiase Malon Wilkus Richard Fairbank Capital One Financial Strauss Zelnick Take-Two Interactive Source: Forbes; Huffington Post. Based on 2011 salary (does not include bonuses, options, or other forms of compensation). *Zuckerberg's salary will drop from $500,000 to $1 in 2013. Don't get me wrong -- these CEOs don't work for free. Many of them are eligible for bonuses, stock options, or a combination of the two, while others have a very large stock holding within their company. Wilkus receives a base salary of almost $1.5 million for his work at parent company American Capital. In the end, though, this meets the common goal of shareholders in that a CEO vested in his company's stock is much more likely to work toward growing the business -- and, subsequently, shareholder equity -- than one receiving a large payday regardless of the performance of the business. Small pay = big success? Not so fast...A $1 salary doesn't guarantee success, however. Sometimes a $1 salary is initiated in order to save cash. This is exactly what former Research In Motion (Nasdaq: RIMM ) co-CEOs Jim Balsillie and Mike Lazaridis did. If you ask any of the BlackBerry-maker's current shareholders, they'll probably tell you the duo was still overpaid, since the company continues to lose smartphone market share hand-over-fist. Similarly, Citigroup's Vikram Pandit and recently hired Hewlett-Packard CEO Meg Whitman decided it was in their best interest to receive a base salary of $1 in order to cut costs. These two CEOs represent a class of leaders that reactively reduced their salaries. In Citigroup's case, the need to raise huge amounts of capital necessitated cutting costs and restoring a public image tarnished by the foreclosure fallout. For HP, its failed Leo Apotheker experiment and its inability to gain market share in any of its major business segments required cost-cutting measures. Strength in numbers -- very tiny numbersThen again, a $1 or no-salary base has proven quite effective for investors, based on the history of most of the aforementioned companies. Richard Kinder, CEO and founder of Kinder Morgan, owned about 216 million class 'A' shares of his company as of Jan. 31., or about 40% of the outstanding shares in that class. If there's any CEO out there who has a vested interest in the performance of his or her business, it's Richard Kinder. Not only did Mr. Kinder not sell any of his shares since the company went public in 2006, but he also implemented a solid dividend payout of $1.24 per year. This 3.4% yield is padding his pockets and taking shareholders along for the ride. It also doesn't hurt that Kinder Morgan's stock is over 22% over the trailing 52-weeks. The people's championWhole Foods CEO John Mackey has been a shareholders' champion as well, taking only a $1 salary since 2006. That year, in a letter to shareholders, Mackey wrote, "I have reached a place in my life where I no longer want to work for money, but simply for the joy of the work itself and to better answer the call to service that I feel so clearly in my own heart." It's no surprise that earlier this year Fortune labeled Whole Foods as the 32nd best company to work for. Executives are still capped at 19 times the average full-time salary. Mr. Mackey's passion for his business has clearly been passed on not only to his employees, but also his stock price, which is nearing an all-time high. Perhaps no CEO's minute salary is more chronicled than that of former Apple CEO Steve Jobs. Having received a $1 salary for more than a decade, Jobs transformed his computer company into the largest company in the world. Now that's effective leadership! Foolish roundupA tiny salary doesn't necessarily make for a great CEO, but those who are willing to back up their pay with stock holdings and performance incentives are historically going to have shareholders on their side more often than not. I'm not such a radical that I feel a CEO should be thrown out the window altogether, but most of these dozen are setting an example that the rest of the market would be wise to pay attention to. Disagree with me? Let me and your fellow Fools know about it in the comments section below. Also, consider tracking these companies with your free and personalized watchlist. If you're interested in another company that could wind up at the top of investors' thankful list, then I invite you to download a copy of our latest special report, "The Motley Fool's Top Stock for 2012." For the low, low price of free you can find out which company our chief investment officer feels is poised to outperform this year! Don't miss out! Add Citigroup to My Watchlist. Add Whole Foods Market to My Watchlist. Add Oracle to My Watchlist. Add Kinder Morgan to My Watchlist. Add Chimera Investment to My Watchlist. Add American Capital Agency to My Watchlist. Add Capital One Financial to My Watchlist. Add Take-Two Interactive to My Watchlist. The Motley Fool owns shares of Citigroup, Whole Foods, Google, Oracle, Chimera Investment, Take-Two Interactive, and Apple. Motley Fool newsletter services have recommended buying shares of Whole Foods, Google, Take-Two Interactive, and Apple, as well as creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy that is always the right price: free! On March 06, 2012, applefan1 wrote: Yeah, and some of them are overpaid. FoolishMikee wrote: A non-scientific view but WFM had the highest return for 2011 of +44.06%. Three papers written along the same lines are:'Where are the shareholders mansions? CEOs’ home purchases, stock sales, and subsequent company performance', in which Yermack and Liu conclude "We find that CEOs who acquire extremely large properties exhibit inferior ex post stock performance".Performance for pay? The relationship between CEO incentive compensation and futurestock price performanceIt’s All About Me: Narcissistic CEOs and Their Effects on Company Strategy and Performance

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2016-30/0359/en_head.json.gz/21135

Smith & Wesson Aims to Win in the Long Run Firearms in the U.S. are bread and butter, regardless of strengthening societal concerns. This leading manufacturer has both the internal and external factors it needs to hit a bull's-eye. Michael Lewis (TMFMadMardigan) Mar 5, 2014 at 5:15PM Proving that over the long-term guns and ammo are a sure bet for investors, Smith & Wesson (NASDAQ:SWHC) is skyrocketing again based on strong earnings and guidance. Though the company took a hit last year with the end of a distribution agreement for its Walther firearm products, demand remains strong for all of its products, led by handgun brand M&P. Fundamentally, Smith & Wesson is a very strong business. The company has a beautiful balance sheet and has delivered a rare example of a well-executed buyback program. Topping off the thesis is a very comfortable valuation for investors. Fired up The highlight of Smith & Wesson's business continues to focus on the M&P polymer handguns, which saw 30% revenue growth in the past quarter. Companywide, net sales grew 16.7% to $145.9 million, after excluding the decreased sales from last year's expired distribution agreement. Operating expenses rose a little much, though it appears to be a short-term trend due to the implementation of the company's ERP business management solutions program. Even with the slightly bruised operating margin, net income from continued operations came in at $0.35 per share in the third quarter of fiscal 2014, a huge gain from the year-ago $0.26 per share. Full-year guidance encouraged investors further, as management bumped the numbers up to $615 million-$620 million in sales, with adjusted earnings per share in the range of $1.39-$1.42. Why it wins Smith & Wesson attracts polar opinions considering the heightened media attention to guns and regulation of firearms. The market seems to have a certain amount of regulatory risk baked into the stock, as even though it is growing at a brisk pace, the forward earnings ratio on the low end of the company's 2014 guidance is just 9.8 times. Smith & Wesson has taken 20% of its outstanding shares off the table since late 2012. While buybacks are not all they're cracked up to be, this one is proving to add plenty of shareholder value, as the stock has appreciated 120% over a two-year period. The company's balance sheet is pristine, with a small cash pile of $45.3 million and zero long-term debt. The company allocates its capital among research and development and capital structure enhancement, while still delivering some free cash flow from operations. Operationally and fundamentally, Smith & Wesson has a ton going for it and should appeal to value-oriented and growth-hungry investors. There is, of course, a chance for harsher regulations in the future, but investors should not be concerned in the meantime. The political implications of a wide-reaching overhaul of firearm laws are daunting for even the most ambitious liberal politicians. While the moral issues remain as strong as ever, a purely financial discussion of the business does not include substantial regulatory concern. All in all, Smith & Wesson is an appealing long-term stock with tailwinds that won't die down anytime soon. Michael Lewis has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Michael is a value-oriented investment analyst with a specific interest in retail and media businesses. Before coming to the Fool, Michael worked with private investment funds focusing on deep value and special situations. Currently living in the media capital of the world--Los Angeles, California. Article Info Smith and Wesson Holding NASDAQ:SWHC Smith & Wesson Holding vs. Sturm, Ruger & Company: Which One Does Better for Investors? Instant Analysis: Smith & Wesson Holding Corp Reports Booming Sales, Hikes Revenue and Earnings Guidance Smith & Wesson Holding Corp Should Be Very Worried About These Numbers (Hint: It's Not FBI Background Checks) Why Gunmakers Smith & Wesson and Sturm Ruger Rallied This Week Better Buy: Smith & Wesson Holding Corporation vs. Sturm, Ruger & Co.

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2016-30/0359/en_head.json.gz/21431

Brave Thinkers Think you're too small for big data? Think again Embracing a big data mindset Micro answers to macro trends The application of data High-speed social impact Tailored to your tastes The Pivot Point Jan Eberly is back Inside: Greater China Rewriting the news, one animation at a time A Montessori movement The big business of shoe style HKUST and Kellogg mark anniversary Think you're too small for big data? Think again. By Glenn Jeffers | Illustration by thirst Every time a finger presses down on a mouse button or a track pad or the surface of a smart phone; every time a link is highlighted and a processor whirls in compliance; every time a new page opens containing an ad or a product, maybe both — that click is recorded. Imagine that click, which indicates likes, dislikes, preferences and partialities, grouped together with personal information from your social media page, your tweets and posts, keywords in your web-based email, and your phone's GPS sensor (hey, you're the one who posted on Foursquare). Now, imagine all that information grouped together with that of every person with a Facebook or Twitter page, Amazon account or on a Groupon mailing list. If you can, you're beginning to understand the exponentially growing ball of empirical information now commonly known as "big data." At its core, big data is the raw information people provide every day via sensor information, digital media, transaction purchases and even web searches, says Florian Zettelmeyer, the Nancy L. Ertle Professor of Marketing at the Kellogg School of Management. That information gets parsed out to data centers and stored in digital warehouses, where it waits to be used in targeting consumer audiences and predicting behavior. "There's a lot of it," Zettelmeyer says. "And it has all of these implications for computing." It has transformed online commerce. Now middle-market companies and startups are mining big data for business growth But as big as you think big data is, it's actually bigger. According to ViaWest, a Colorado-based data center and managed services provider, we create 2.5 quintillion (or 2.5 x 1018) bytes of data daily. That's "we" as in Earthlings. By comparison, that's like filling up 57.5 billion 32GB iPads every day. Many have seen big data impact their everyday lives, from targeted ads in Gmail to a list of suggested items on Amazon. But now, smaller companies are beginning to apply this model, lopping off small chunks of this amorphous data. Sharon Herd was fed up. A native of Georgia, Herd spent years training new owners on how to run franchises such as Carvel Ice Cream, Schlotzsky's and Cinnabon. It was her turn. In 2007, she left the corporate world and opened Tropic Tan, a tanning salon in Kennesaw, Ga. about 25 miles north of Atlanta. For years, Herd saw steady growth in her business. And in February 2012, she saw an opportunity to move to a bigger location, buy more tanning beds and upgrade her website. First, she went to her local bank. But despite her job experience, a strong credit score and a husband with a landscaping business, Herd was denied. Next, she tried for a merchant cash advance, which provides small businesses with a lump-sum advance that's repaid through future credit card sales. But the interest was too high, Herd says, and the application process was tedious to a fault. "They wanted 12 months of history," says Herd, 43. "I had to pull all of my records. They wanted me to change credit card companies. I had this sickening feeling that I was making the worst decision of my life." On her computer late one night, Herd looked up On Deck Capital, a New York-based lending company, which specializes in small-business loans. She had used On Deck before and received a $5,000 loan to help with startup costs. And rather than use her personal credit score or submit her to a lengthy application process, Herd knew On Deck used big data. To qualify for an On Deck loan, business owners must first log onto the company's website and create a business profile. That profile links to data sources including online banking, accounting and merchant processing. On Deck then combines that information with social, tax, industry and firmographic (location, number of employees, etc.) data to create what it calls the "On Deck Score." With that score, On Deck can determine within days not only if a business is eligible for a loan, but also how much it can receive. Part of the expediency comes from the fact that On Deck supplies short-term loans of up to 18 months that range between $5,000 and $150,000. Another factor: Most banks lack an effective way to analyze small businesses for loans and fall back to treating them like individual borrowers, says Andrea Gellert '96, senior vice president of marketing for On Deck. "They treat a loan application for $30,000 the same way they would treat a loan application for $2 million," she says. "Because they can't put the same kind of resources into a smaller loan as they would a larger loan, they've started to use personal credit as a proxy for business credit." With a more accurate way to determine a business's viability, On Deck has become a go-to lender for small businesses in need of quick cash. The company, started in 2006 by entrepreneur Mitch Jacobs, has grown as well, providing more than $400 million in small-business loans at a time when banks are still leery about lending. Last year, Inc. Magazine added On Deck to its list of the 500 fastest-growing companies in the country. As for Herd, she received a loan of $14,000, moved to the larger location, bought the additional tanning beds and upgraded her website. Within a month, she had nearly 100 new customers. "They have done everything they said they were going to do," Herd says. "When I'm looking to expand again, I'll call them." But using big data can become expensive quickly. Though advances in technology have helped drive down the cost of front-end tools including sensors and GPS tracking chips, storage and analytics can be pricey. "You have to have the storage space and the know-how," says PJ Lamberson, a senior lecturer in the management and organizations department at Kellogg. "The real challenge is to realize how much of an actual benefit you're going to get. You can go through a data-mining exercise and that may not be much better than using a simpler model." "The real challenge is to realize how much of an actual benefit you're going to get. You can go through a data-mining exercise and that may not be much better than using a simpler model." PJ Lamberson Senior Lecturer in Management and Organizations, Kellogg School of Management A venture-backed company, On Deck offset its costs by partnering with credit-reporting agency Equifax to develop the On Deck Score. Gellert acknowledges that building this kind of technology and expertise can be daunting for some businesses, but whatever expense the company incurs is worth it to stay ahead of its competition. "We're light years ahead in terms of synthesizing and understanding this information," she says. "We're pioneers in this space." It helps that On Deck models for business viability. Making big data operational, especially for marketing purposes, is tougher. While the speed of processing enormous chunks of data has greatly improved, businesses still struggle with analyzing that information and using it to predict consumer behavior. They can monitor an observed behavior — clicks leading to a purchase, for instance — but identifying why a consumer wanted that purchase in the first place is trickier to uncover, Zettelmeyer says. Take, for example, Oreo. There's a model that can predict how many boxes of the popular cookie a store will sell given such variables as money spent on advertising, unit price, a competing store's price, etc. Now, turn to Oreo's official Facebook page, which has more than 32 million "likes." Can those "likes" translate into actual purchases? If so, how? Is that something you can model out? "A lot of our psychological understanding of what makes consumers behave is not terribly well developed for measuring and predicting behaviors that we're not able to track," Zettelmeyer says. The solution might be as easy as simplifying the model, says Lamberson, especially when it comes to small business. Rather than spend money tracking amorphous data that may or may not help, small businesses can use models that require a few well-established data points. "You can use a scaled-down model that's accessible to anyone with a laptop," he says. "If you are a mom-and-pop, you can easily keep track of sales and promotions and then run a regression and a relatively simple algorithm or model." For Adaptly, a New York-based firm that manages ad campaigns over various social media platforms, the solution is using more accurate data. Adaptly uses first-party data, information generated directly from consumers (in this case, social media users), to design its cross-platform ad campaigns instead of third-party data, which comes from cookies across the Internet. That first-party information is about 98 percent accurate as opposed to about 15 percent from third-party data, says Nikhil Sethi, co-founder of Adaptly and a 2010 McCormick School of Engineering and Applied Science graduate. Using analytics, Sethi can draw on that first-party data to custom-build a target audience that already has expressed interest in a specific product or pursuit via tweet, post or message. "There's no real guesswork going on," Sethi says. "If I have a brand and I realize that my consumer set is related to people who like rock music, if I were in advertising, I would design a campaign that would target groups of people who like rock music." "But with social [media], with integrations to applications like Spotify," he says, "I can get first-person data not just on what genre they listen to but specific titles and specific artists, a specific type of data, and build a much better analysis of who that person is and what they're doing and the best way to reach them." That formula has worked for Adaptly. What started as an NUvention course project, an interdisciplinary partnership between Northwestern schools including Kellogg, has grown to a 70-employee company that's amassed more than $13 million in venture capital and clients ranging from Showtime Networks to Kraft Foods Group. Sethi still contends with problems like storage and analytics — "I can't take a Facebook data set and use it for ESPN," he says — but he believes first-person data is key to filtering out the vital information from the glut. "It creates an identity that's more reflective of who you are." The technology will catch up with the data, Zettelmeyer says, rendering issues like analytics and shortage moot and bringing down its expense. It will make big data more accessible to businesses of all sizes. Next : Embracing a big data mindset

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2016-30/0359/en_head.json.gz/21438

Financing a Musical Passion Composer Aaron Grad of Seattle, Washington, used the crowd-sourcing site Kickstarter.com to raise money for his latest project: building a unique instrument and producing an album. By Anjelica TanSee my bio, plus links to all my recent stories., November 2012 Follow @AnjelicaTan Why did you become a composer? I grew up in an incredibly musical household. I was surrounded by instruments and always listening to great music. I was drawn to music and started playing guitar, writing songs and forming bands. SEE ALSO: Six Steps to Starting Your Own BusinessTell us about your current project. I’m building a one-of-a-kind instrument called an electric theorbo for my new album and for perform­ances. The instrument is an electric version of a 14-string baroque lute. Building the theorbo involved significant upfront costs, so I decided to do a Kickstarter campaign to raise $5,000. What did your fund-raising pitch involve? It required making a short video. After I posted it on Kickstarter, I e-mailed my friends, put the video on my Web site and Facebook, and spread the word by phone to let people know what was happening. I was shocked by how quickly it came together. I hit my goal after about two weeks and made more than $400 beyond that. It was touching to see how generous people were. How did you make your first album, The Father Book? The inspiration for the songs comes from a clavichord my father built when he was a young man. He was a keyboard player and loved baroque music. I had the instrument with me in Brooklyn while I was studying jazz at NYU. By that point my father had died, so this was a very tangible connection I had to him. I recorded everything at home in my little studio with one microphone. The only professional help I had was in getting it mastered. What did you learn from that experience? I lost some money in the process of making the album. It showed me that I couldn’t keep losing money on these big dream projects of mine. What else do you do? I make most of my income as an artistic consultant, writing program notes for orchestras and classical music organizations. It’s an excellent day job. How would you advise someone pursuing a passion? Do what it takes to earn money when it’s time to earn money, and be brave enough to take risks when it’s time to take risks. This article first appeared in Kiplinger's Personal Finance magazine. For more help with your personal finances and investments, please subscribe to the magazine. It might be the best investment you ever make. More on CAREERS » Online Communities Help Raise Start-Up Cash SLIDE SHOW: 10 Great Cities for Starting a Business

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2016-30/0359/en_head.json.gz/21546

How you can be a smart market timer Commentary: To get top dollar, buy, reinvest, rebalance and hold BOSTON (MarketWatch) — Investors complain a lot about the performance of their mutual funds, but they’d be a lot happier and do better financially if they simply got the same results as those funds earn. Instead, a new study from investment researcher Morningstar Inc. shows that investors habitually get the worst from their funds, earning lower returns than the investment vehicles they are buying. Worried about inflation? Hedge with gold(2:44) The prospect of inflation in Japan as the yen weakens may prompt people to turn to gold as a currency hedge. The WSJ's Clementine Wallop talks about what to expect from gold demand in India and China as well as Japan. You don’t have to settle for that. To see why, consider the latest research from Russel Kinnel, Morningstar’s director of fund research, who compared a straight average of fund returns to an asset- or dollar-weighted average investor return. Dollar-weighted returns are designed to show a fund’s results based on when money moves in or out; they show if investors are chasing performance, buying funds only after a big runup or losing faith and selling before a rebound. Kinnel found that over the decade ended in 2012, the average stock fund returned 7.05% annually, but the average investor netted 6.1%. In certain asset classes the disparity is much greater. Kinnel found that the average international equity fund earned almost 10% a year, but the average investor in those funds netted under 7%. The discrepancy was also large in municipal-bond funds over the last decade — surprising because this not a place where shareholders typically chase performance. Indeed, with munis being one of the least-volatile investments, the asset class is a petri dish for the problem. Kinnel surmises that investors actually did the right thing and threw money into the category after its one year in the red (2008), and enjoyed double-digit gains in 2009. But as worries about muni defaults captured the headlines, investors bailed out to avoid the potential storm and missed big up years in both 2011 and 2012. Time and money Giving into fear or greed is the root cause here, but investors may not recognize that their behavior contributes to the shortfall. “Mutual funds are long-term investments and the way to get a superior return is to hold it for a long time,” said Kinnel. “It used to be that people made decisions based on the fund’s returns over the last few years. Now it seems to be that they make decisions based on the 24-hour news cycle and what they just heard. Either way, they’re making bad decisions.” Here’s how that plays out. The typical investor buys funds only after a strong run of good results, thus they are buying high. Their money did not get that positive performance stretch, however; they only get what happens next. If the fund slows or falters, the fund’s performance may still be positive but the investor hasn’t really experienced those gains. If the investor sells when the fund falters, they not only lock in a loss or poor results, but they also go a bit insane, repeating the process again — buying another fund that has been hot — but expecting different results. Here’s how to get the performance close to what the fund provides: You must reinvest dividends and distributions and make additional deposits either regularly or when the fund seems undervalued, rather than when it has made the account statement look fat. INVESTING COMMENTARY IN Back to 1987 for stocks? Our Trading Deck has been home to a spirited debate over whether we're in for a crash. • L.A. Little: Don't worry | Michael Gayed: Worry • The warning signs of a 1987-style crash Hulbert: Stocks as overvalued as at 2007 high “Macro timing is bad for people because they fool themselves into thinking they can outsmart the market,” Kinnel said. “They hear some news or see some hot numbers and they don’t realize that in jumping on this bandwagon, what they are saying is ‘There’s a lot more good news coming, even though I don’t know anything more than anyone else about this.’” It’s important to recognize that lackluster dollar-weighted returns are caused by the individual investor, not the fund, and that they happen to people who own good funds. “The one way you can wreck a diversified portfolio of solid, low-cost mutual funds is by doing a lot of market calls,” Kinnel said. “You could be moving from a great emerging-market bond fund into a U.S. equity fund the next; both could be good funds, but if your timing is off, all you are going to get is the worst of them both, instead of holding on and letting the fund do the work and getting the best of them both.” Balance and rebalance Avoiding the problem involves striking an appropriate balance between fear and greed — and not acting on either. In fact, the best way to come ensure performance that is close to what the fund delivers is to rebalance a portfolio. In rebalancing, investors prune their leaders and spice up their laggards to put their portfolio back to its target asset allocation. In a simple example, say an investor is trying to have a 50-50 mix of stocks and bonds, and a market runup makes it so the portfolio is 55% stocks; rebalancing would require moving 5% of assets out of stocks and into bonds to re-establish the 50-50 split. That’s one of the few times investors actually sell high and buy low. Experts about investor behavior note that investors don’t need to ignore human nature, but rather have to understand it. “They will gravitate toward winners. … That will be fine, so long as they own those winners long enough to get through the times when they’re not doing so well, because the winner you buy today is not going to go up all the time in all conditions,” says Donald MacGregor of MacGregor-Bates, a Eugene, Ore.-based firm that does judgment- and decision-making research. Added Morningstar’s Kinnel: “I don’t think you can ask investors to buy bad funds, thinking that they will go up and the good ones will go down. What you can do is recognize that if you buy a fund because you think it’s good, you have to be willing to stick with it. It didn’t build that good track record by going straight up, so you can’t expect it to go straight up from when you buy it.”

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2016-30/0359/en_head.json.gz/21547

The death of the mortgage broker? AnnaMaria Andriotis New rules about how mortgage brokers are paid will start next year AnnaMariaAndriotis The mortgage broker’s days may be numbered. Starting next year, mortgage brokers, who serve as middlemen between homebuyers and lenders, will be subject to new rules that experts say could push many to leave the business. Issued by the Consumer Financial Protection Bureau last week, the new rules prohibit brokers from raking in more compensation in exchange for placing borrowers in more expensive mortgages; they also disallow brokers from getting paid by both the borrower and the lender on a mortgage transaction. While the rules will make working with a broker safer for consumers, experts say they may also leave them with fewer brokers to choose from. “It certainly does put some of the more marginal players on the fence,” says Keith Gumbinger, a vice president at mortgage-info website HSH.com. Reuters For borrowers, this unintended consequence may make shopping for a mortgage more difficult. Brokers tend to have access to a large number of lenders and are able to quickly determine the best loans and rates available. Without brokers, mortgage applicants have to contact banks themselves, going from institution to institution until they have a list of mortgage products and rates they qualify for. They can also search mortgage-shopping sites, but many of those sites only provide referrals, without giving consumers enough information to comparison shop. Of course, there have also been plenty of risks to working with brokers as well. Critics contend that brokers were among the main causes of the housing crash, putting borrowers into risky mortgages that they couldn’t afford because they had a financial incentive to do so—a big reason why the new rules were created. But now that a lot of the shadier brokers have left the field and the new rules wipe away much of the risk to working with the brokers who remain, the bigger challenge for consumers will likely be finding a broker who can give them access to many lenders. Over the past few years several large banks, including Wells Fargo and Bank of America, have announced they’re no longer working with independent mortgage brokers. (Some of those banks have said that mortgages originated by their own loan officers performed better while others have cited difficulty in controlling negotiations between independent brokers and clients.) The decline of mortgage brokers has been underway for several years. That’s been largely due to the real-estate downturn that pushed many of them out of the market and earlier regulations for the industry that made it costlier to be a broker. The National Association of Mortgage Brokers currently has roughly 5,000 members, down from 25,000 in 2006, says Don Frommeyer, president of the association. Experts say the disappearing broker has made things harder for mortgage applicants. “Consumers are already having a difficult time getting a mortgage,” says Brad Hunter, chief economist at Metrostudy, a housing market research and consulting firm. And if the number of brokers does decline further, he adds, “that could have an impact, making it more challenging for borrowers to get loans.” Mortgage brokers’ share of home loans has also dropped as their numbers have declined. During the last two years, mortgage brokers accounted for about 10% of total mortgage originations, compared to 20% in 2008 and more than 30% from 2004 through 2006, according to Inside Mortgage Finance, a trade publication. Opinion: Obama's mortgage freebies(3:14) Basil Petrou on the Consumer Financial Protection Bureau's new mortgage rules and how the feds control nearly every corner of the housing market. Photo: Associated Press Those figures could decline further due partly to the rising costs that accompany the new rules and declining profits, says Mark Goldman, senior loan officer with C2 Financial Corp., a San Diego-based mortgage brokerage firm. New players are also unlikely to emerge. “They’ve raised the barriers of entry into mortgage brokerage,” he says. Going forward, borrowers who use brokers will soon have more protections than in the past. It’s less likely that they’ll be steered into a mortgage with a higher interest rate or fees or one that charges a penalty for paying it off in advance. Also, brokers won’t be able to make more money by sending a client to buy title insurance from an affiliate. Those who have difficulty finding a broker should consider checking out LendingTree.com, which finds lenders within its network that will consider your loan based on your personal information. Separately, consumers who have a relationship with a bank—whether it’s a deposit or brokerage account or wealth management ties—should consider asking the institution if it offers any discounts on rates, closing costs or other mortgage fees. For their part, most mortgage brokers who are still around say they’ve already implemented most of the new compensation rules, which were initially announced in the Dodd-Frank Wall Street Reform and Consumer Protection Act that was signed into law in 2010 and a Federal Reserve compensation rule that kicked in the following year. (The CFPB’s announcement finalizes those regulations.) Brokers who haven’t done so yet will need to change their practices over the next year to comply with the new rules.

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2016-30/0359/en_head.json.gz/21560

U.S. companies sitting on a record $1.9 trillion in cash, and shareholders want their share Polly Brown of Riesel, Texas, shops for holiday gifts at the Family Dollar store, in Waco, Texas, in this Dec. 14 file photo. By RACHEL BECK Associated Press NEW YORK – Companies stopped paying dividends and stockpiled cash during the Great Recession, and shareholders didn’t complain. Now they want a reward for their patience. American companies are holding $1.9 trillion in cash, a record. The large businesses that make up the Standard & Poor’s 500 index, all of which answer to public shareholders, have $940 billion on hand – $300 billion of it accumulated since late 2008, says Howard Silverblatt, senior index analyst at S&P. Shareholders want the companies to start putting that cash to use. The most pressure is coming from activist investors, who buy stakes in companies and then try to influence management to make certain changes that they say are in shareholders’ interest. “We’ve been in bunker mentality for too long,” says Eric Jackson, who runs the hedge fund Ironfire Capital. He predicts that activist shareholders are about to become “a lot noisier.” The loudest investors are finally being heard. Companies are letting go of some cash: Since the start of this year, 116 companies in the S&P 500 have raised their dividend, up from 78 a year ago. Overall, S&P 500 companies have paid out $16.6 billion more this year in dividends than last year. Companies are buying back more of their own stock. Kohl’s, Conoco and Intel all recently announced buyback plans recently. Stock buybacks by S&P 500 companies increased to a record $86.4 billion in the final quarter of 2010, the latest data available. That was 81 percent more than the same period the year before. Investors like buybacks because they tend to push up a stock’s price since earnings are divided among fewer shares. Companies are doing bigger deals than they did a year ago. Global mergers and acquisitions were valued at $755 billion for the first three months of the year, 24 percent more than the same period last year, according to financial data-tracker Dealogic. The number of deals declined slightly, to 9,568 this year from 9,825 in early 2010. Large investors want higher dividends because it means more cash in their pockets to make other investments. Individual investors, especially retirees who depend on dividends for a big part of their income, want more cash to live on. With acquisitions, investors hope the deals will eventually lead to higher corporate profits. Investors also don’t want companies to let cash sit in the bank since interest rates are nearly zero, which means the money isn’t earning much. “The best use of cash is to deploy it,” says Bill Miller, chairman and chief investment officer of mutual fund giant Legg Mason Capital Management. “If companies could maintain profitability and generate cash two years ago ... then they don’t need that kind of cash on their books today.” What has happened over the past few months at Family Dollar illustrates the tension between companies and investors. Hedge fund Trian Fund Management disclosed last July that it had bought a 6.6 percent stake in Family Dollar. Trian is run by activist investor Nelson Peltz, who is known for making big investments and then forcing change at companies. When the investment was announced, Trian said it would work with Family Dollar to boost sales and open new stores, and that it had ideas on how the retailer could use its cash. At the time, the dollar-store chain’s cash balance ran about $503 million, a record high. By September, Family Dollar had announced plans to spend $750 million, including some cash and some new debt, to buy back its stock. In January, Family Dollar increased its quarterly dividend by 2.5 cents, to 18 cents a share. Family Dollar says it worked with Trian to boost shareholder value. “They shared their ideas and we listened,” spokesman Josh Braverman says. He also noted that some of what Trian wanted, including the buybacks and more rapid expansion, was in the works before Trian invested. But Trian still wasn’t satisfied. It made a $7 billion, all-cash, hostile bid for control of Family Dollar on Feb. 15 and announced it had raised its stake in Family Dollar to 7.9 percent, making it the largest shareholder. Family Dollar rejected the bid in early March, saying it undervalued the business, and adopted a defense strategy to discourage unsolicited offers. Trian responded by sending a letter to Family Dollar’s board saying that the company had “embarked on a path of poor corporate governance.” Trian didn’t respond to a request for additional comment. It has already seen the value of its investment rise. Since it disclosed its investment in July, Family Dollar stock has gained about 26 percent, to about $52. Fights like this are likely to be more common this year if companies don’t accelerate their use of cash. “Activists are interested in getting an outcome, but most do not need to storm the castle to get it,” says David Rosewater, a partner at the law firm Schulte Roth & Zabel who advises companies and investors on shareholder activism. Shareholder Joseph Stilwell, who mostly invests in community banks through his investment firm Stilwell Group, has spent the last few months meeting with corporate managers privately to discuss what he’d like to see done with the money. Those discussions usually happen in winter, well ahead of annual shareholder meetings that typically take place in the spring. That’s when investors elect the board and vote on other proposals. If he doesn’t see a resolution to his liking, he says he might seek a board seat, or as a last resort, file a lawsuit. In the past, he has filed lawsuits to have directors removed from boards for breaching their responsibility to shareholders. Some companies recognize that shareholders are focused on their ballooning cash balances. Kohl’s, the discount department store chain, had a record $2.3 billion in cash on its books at the end of its fiscal year in January. The company recently announced plans for its first dividend, with a payout of 25 cents a quarter. The company also said it would more than triple its stock buyback program to $3.5 billion. “We have had a very strong, consistent performance, and we wanted to make sure to give back to our shareholders,” Kohl’s CEO Kevin Mansell tells The Associated Press. General Electric, with a cash balance of about $20 billion for its industrial businesses spree. In the past five months, it has announced acquisitions worth more than $11 billion, mostly in its energy business. One of the biggest bids came this week — a $3.2 billion deal for a French power conversion company. Overall, GE has almost $80 billion in cash. The financial parts of its businesses, like lending arm GE Capital, are required to keep more resources on hand. GE has also raised its quarterly dividend twice in the last seven months, first from 10 cents to 12 cents a share and then from 12 to 14. For the year, that means it would pay out 56 cents a share. Two years ago, GE’s dividend was more than twice that – $1.24 a year. Like many companies, it has a long way to go before it starts rewarding shareholders as well as it did before the Great Recession. Comments

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Rediff News All News Financial Stability Unit Subscribe via RSS Rediff.com » News » Financial Stability Unit News for Financial Stability Unit Debunking 10 myths about China and the South China Sea An international tribunal in the Hague ruled in favor of the Philippines Tuesday, concluding that there was no legal basis for China to claim historic rights to resources within South China Sea...... Historic Iran nuclear deal reached, international sanctions lifted The United States and the European Union on Sunday lifted biting oil and financial sanctions on Iran and released about $100 billion of its assets after United Nations inspectors concluded that...... US Congress attacks Pakistan: 'Acts only an enemy would commit' 'The clique that runs that country is treating us like suckers. We are very foolish, giving people money who involve themselves in activity that's harmful to America.' 'When you look at the cold...... PM aims for desi boost for India's military build-up Excerpts from Prime Minister Narendra Modi's speech at the Combined Commanders Conference on board the INS Vikramaditya at sea, off the coast of Kochi. IMAGE: Prime Minister Narendra...... Modi, Japan's Shinzo Abe put bullet train on track, sign defence agreements Taking their robust bilateral ties to a new level, India and Japan on Saturday inked a number of pacts in key areas of defence and nuclear energy as well as building of first bullet train network...... India changing tax laws for stability, predictability: Jaitley India is gradually transforming most of its taxation laws for a greater degree of stability and predictability, Finance Minister Arun Jaitley on Thursday said, stressing that the proposed...... There is a need to revive investment cycle: Jaitley Finance Minister Arun Jaitley, who took stock of the macroeconomic parameters at a meeting of the Financial Stability and Development Council (FSDC) on Saturday, highlighted the need to improve...... How the government can stabilise the rupee The author explains how the government could make a real difference in the financial markets. Let me cut to the chase. What are the options left for the government to bring some stability back to...... RBI Governor may not be FSDC's vice-chairman The Reserve Bank of India governor may not be made the vice-chairman of the Financial Stability and Development Council, as was done in the case of the recently set up joint committee to sort out...... Bill to replace ULIP ordinance soon Amid the Reserve Bank expressing reservations over the Unit Linked Insurance Products (ULIPs) ordinance, the Finance Ministry on Tuesday said a bill to replace the ordinance would be placed in the...... Financial Fair Play is a contradiction, says Mourinho Chelsea manager Jose Mourinho. Photograph: Suzanne Plunkett/Reuters UEFA's Financial Fair Play (FFP) rules are "a contradiction" and only serve to protect big clubs with a long history of...... Web results for Financial Stability Unit Melker Schorling, Sweden's quiet tycoon with the Midas touchBy Mia Shanley and Niklas Pollard STOCKHOLM (Reuters) - Business tycoon Melker Schorling, one of Sweden's most prominent investors, says he is... ...https://in.news.yahoo.com/melker-schorling-swedens-quiet-tycoon-midas-touch-112910863--sector.html Ban Ki-moon condemns 'despicable crime' against innocentsUnited Nations: UN Secretary-General Ban Ki-moon led the world body's strong condemnation of the terror attack on a peaceful demonstration in... ...http://m.firstpost.com/world/kabul-attack-ban-ki-moon-condemns-despicable-crime-against-innocents-2912460.html Bankers guarded on new scheme to fix bad loansKolkata, July 24 Bankers are looking forward to the Reserve Bank of India 's (RBI's) new scheme to tackle bad loans. But they are also keeping... ...http://www.prokerala.com/news/articles/a665985.html Thousands of schools, universities and foundations to be sealed in TurkeyANKARA, Turkey - Aiming to prevent any further unrest in the country, Turkey's President Recep Tayyip Erdogan has signed a decree that would shut... ...http://www.bombaynews.net/index.php/sid/246098639 Chronicles About United States of Europe by Stanley Coutinho03:26 pm FOLLOW US: CHRONICLES On Our Troubled Times Written by Thomas Piketty Translated by Seth Ackerman Penguin 2016 Pp 181 Rs.699 We... ...http://www.freepressjournal.in/latest-news/chronicles-about-united-states-of-europe-by-stanley-coutinho/895559

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MONEY MENSCH EXPERT VIEW Middle East economy slumps in face of Syrian refugees By Alex Brummer, November 4, 2013The influx of Syrian refugees has put a weight on the Middle East economy, from Lebanon to Jordan and Turkey (Photo: AP)Hope for economic prosperity in the Middle East and North Africa in the wake of the Arab Spring have been dashed by successive crises in the region. Global disappointment at the situation was palpable at the annual International Monetary Fund and World Bank meeting in Washington this month. Tunisia, where economic reform first sparked after the immolation of a disgruntled fruit-seller over rising food prices in December 2010, has reportedly reverted back to turmoil after a ballooning of state debt and mismanagement. Egypt, the most populous of the region’s countries, has seen the elected but ineffectual Muslim Brotherhood government of Mohamed Morsi ousted, America’s military aid budget slashed (despite Israeli opposition) and has dismally failed to put an IMF stabilisation package in place. The civil crisis in Syria has cast a pall over the region. The influx of 760,000 Syrian refugees could be equated to an economic earthquake in Lebanon. Syrian refugees that have set up camp in Jordan, an excess of 525,000, have stopped King Abdullah’s economy in its tracks. Iran has been battered by sanctions and the rich oil exporting states of the Gulf are suffering from sub-optimal production levels. Israel, that is included in the IMF’s tables, is the only country that appears to be in good health. The IMF is predicting growth of 3.8 per cent this year, moderating to 3.3 per cent next year; modest inflation of just 1.6 per cent in 2012 rising to 2.1 per cent in 2014 and unemployment at 6.8 per cent of the workforce. That compares to a jobless rate of 13.2 per cent in Saudi Arabia and 13 per cent in Egypt. The biggest challenge facing the Middle East and North Africa region is the need to create jobs. In the richer oil-producing countries many of the jobs in the private sector are being filled by expatriates. The IMF’s top economist of the region Masood Ahmed says that the main dialogue between the IMF and policymakers is “about building jobs for nationals in the private sector”. But Syria remains to overwhelming political and economic problem in the region. A path to the destruction of chemical weapon dumps has been plotted. But the spill-over effects to neighbours has been enormous. Britain’s Secretary of State for International Development says that the refugee problem in Lebanon is the equivalent of “15 million people arriving in Britain”. The UK’s response to the crisis has been to set aside £500 million from the foreign aid budget towards the children of Syrian refugees. UK Jewish charity WJR has raised £130,000 for the Syrians in Jordan refugee camps. The impact of civil war in Syria has been pronounced in the region. Last year the area had an economic renaissance with output spurting 5.6 per cent. This year it has slumped to 2.8 per cent. Governments have sought to combat the hardship by piling on the subsidies for basic staples and stepping up wages and pensions in the public sector. But all that has done is raise the standing budgetary problem. The World Bank strategy for dealing with this is to try and bring the disadvantaged groups, including women and ethnic minorities, into the workforce. But that requires a move away from the state sector by encouraging entrepreneurship and innovation. In Egypt, for example, the Bank is backing 4,000 small enterprises and is funnelling credit to women to develop businesses. In the Palestinian territories, where the Quartet powers are seeking to put together a $3 billion economic development plan to support the peace process, the World Bank has been increasing its subvention, providing $56.4 million in special financing in 2013. The effort to strengthen the economy of the Palestinian territories is unlikely to be helped by the decision of the European Union to suspend financial assistance for projects that straddle the “green line” border between Israel and the Palestinian territories. Many of Israel’s science research institutions, that have facilities in the territories or are engaged in technology projects in the West Bank, could be affected. What is clear is that such politically driven policy will do nothing to contribute to the economic of a region struggling to find better and more durable economic models. Jewish charity launches appeal for Syrian refugees Last updated: 5:26pm, November 4 2013 MORE ON..United Nations SEE ALSOJewish charity launches appeal for Syrian refugees Social media manager in bid to break Guinness World Record pitching her ‘Little App’ to Richard Branson Ex-Labour Enterprise Tsar Lord Sugar to do the same job for the Tory government Fortune of £13 billion makes Reuben brothers UK’s richest Thousands to sue Israeli ‘scam’ investment companies through London law firm

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Corporate Directors Cautiously Optimistic on Economic Growth A possible collapse in the economic recovery is still at the forefront of many minds, according to the NACD The National Association of Corporate Directors offered a meandering and milquetoast assessment of the economy and where it’s headed, reflecting the overall fits and starts markets have experienced since the official end of the economic crisis. Beginning with a review of the levels of first-quarter versus second-quarter optimism in 2011 and 2012, the association says its cautious optimism is “fortified by peer indices.” The Conference Board’s Consumer Confidence Index has risen for the last three months, it notes, reaching 87.3—a height not seen since 2008. Similarly, TCB’s CEO Confidence Index went from a Q1 score of 54 to 62 in Q2. “Still, perceptions that the economic recovery will collapse [are] still at the forefront of many minds,” the NACD noted. “During the time the BCI survey was in the field, Federal Reserve Chairman Ben Bernanke’s statement that the Federal Reserve’s program of quantitative easing may eventually lessen caused a short shock in the markets.” The market shock may have been reflected in the boardroom’s short-term confidence score. While looking ahead three months respondents demonstrated hesitancy by producing a score of 53, this exact same score was produced when respondents reflected on the prior three months’ economic conditions, according to the association. Confidence in the long-term state of the economy has steadied their outlook. Directors rated their economic confidence in the next year with a score of 64.1. In prior years, after Q1, this measure has typically dropped at least 3.5 points. This quarter, however, the decline was only 0.9, potentially revealing an increased emphasis on the long term. When asked about current conditions as compared to one year ago, directors responded with an optimistic score of 66. The market’s steady growth appears to have translated into a similar outlook with regard to hiring practices. Thirty-four percent of respondents said they expected to increase the workforce in the next three months. Thirty-two percent made the same claim last quarter. The percentage of those who believe their company’s hiring practices will contract or remain the same in the next quarter has decreased to 11.5% and 54.1%, respectively. Check out Wal-Mart’s Troubles May Be Canary in a Coal Mine by Ben Warwick on ThinkAdvisor. Ben Warwick

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USCANADALog In Conifer and Vastardis to merge By Iris Dorbian The Conifer Group and Vastardis Capital Services Holdings said Monday that they have agreed to merge. Conifer Group CEO Jack McDonald will become president and CEO of the newly combined company Conifer Financial Services while William Vastardis, founder and President of Vastardis, will be named chairman. Headquartered in San Francisco, Conifer is a hedge fund services provider. Vastardis is a independent fund administration firm. SAN FRANCISCO and NEW YORK, Feb. 3, 2014 /PRNewswire/ — The Conifer Group, LLC (“Conifer”), and Vastardis Capital Services Holdings LP (“Vastardis”) announced today they have signed a definitive merger agreement to combine their respective businesses. The newly formed company, to be called Conifer Financial Services, LLC, will be one of the largest independent alternative asset services firms offering expanded capabilities to clients on a global scale. At inception, Conifer Financial Services will have combined assets under administration (AUA) of more than $70 billion and offer trade execution services to over 200 clients worldwide. Jack McDonald, currently CEO of Conifer Group, will become President and CEO. William Vastardis, Founder and President of Vastardis, will be named Chairman. The merger brings together Conifer’s clients in the hedge fund industry with Vastardis’ clients in the fund of fund, endowment/foundation, private equity, and venture capital spaces. It also dramatically increases the scale and scope of services that both Conifer and Vastardis will be able to provide their clients, creating a larger global footprint with offices in San Francisco, New York, the British Virgin Islands, Singapore, and Toronto. “Combining our two firms will yield significant benefits for our clients and employees and allows us to realize scale in an industry that increasingly demands it,” said Mr. McDonald. “The Conifer and Vastardis teams will continue to serve their clients seamlessly while augmenting our sophisticated technology and service offerings.” Conifer Financial Services will be headquartered in San Francisco, with plans underway to combine their respective New York and San Francisco locations. Clients will continue to be served by their current client service teams, and there will be no immediate change to the respective “front end” reporting systems. The combination of the Conifer and Vastardis businesses, people, and technologies creates a firm that can provide portfolio accounting, reporting, investor services, tax services, data warehousing, trade execution, prime brokerage, and customized technology solutions. The new Conifer Financial Services will be able to deploy these capabilities across the asset class and strategy spectrum to pensions, endowments, family offices, hedge funds, private equity and venture capital managers, RIAs, and traditional asset managers. The merger is expected to close at the end of the first quarter of 2014, following regulatory approvals and customary closing conditions. “We are extremely excited to be joining with Jack and the Conifer team to create a larger and more global, independent fund administrator that will serve a variety of alternative asset management clients and institutional investors,” said Mr. Vastardis. “The newly formed firm will provide us with a tremendous platform to grow our business around the world, as well as give employees more opportunities for professional development and cross-training into new product areas.” About The Conifer Group, LLC The Conifer Group, LLC is a leading provider of services to the hedge fund industry that includes global fund accounting and administration, middle- and back-office operations, prime brokerage and trade execution services. Conifer’s comprehensive platform of business and operations solutions appeals to both start-up and established managers by allowing them to focus exclusively on asset gathering and investing. Headquartered in San Francisco and with offices in New York, the British Virgin Islands, and Nova Scotia, Conifer has been in business since 1989. For more information, please visit www.conifer.com. About Vastardis Capital Services, LLC Founded in 2003, Vastardis Capital Services is an independent fund administration firm serving institutions and alternative asset managers. Providing full-service, outsourced investment administration, portfolio accounting, performance measurement and reporting, investor and tax services are the cornerstone of its business. Since its founding Vastardis has become a global organization with offices in New York City, San Francisco, Singapore and Toronto. For more information, please visit www.vastcap.com.

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Greece gets first bailout cash • Combined €20bn from EU and IMF will prevent default • Tourism minister resigns over husband's €5m unpaid tax bill • Government getting tough on tax evasion Angela Gerekou stepped down as deputy tourism minister after a national newspaper revealed that her pop star husband owed more than €5m in unpaid taxes and fines. Photograph: Nikolas Giakoumidis/AP Graeme Wearden and Helena Smith in Athens Last modified on Tuesday 18 May 2010 09.18 EDT Greece will receive the first slice of its €110bn (£94bn) rescue package later today, just in time to prevent the eurozone's weakest member defaulting on its debts. The EU will formally lend Greece €14.5bn, with the International Monetary Fund contributing €5.5bn. The €20bn loan will allow Greece to repay €8.5bn of government bonds which mature on Wednesday. "The first tranche of financial assistance for Greece is being transferred … and the IMF will do its part in parallel," EU economy commissioner Olli Rehn announced last night following a meeting of European finance ministers in Brussels. The €110bn loan was agreed last month, and is meant to give Greece protection while it brings in unpopular austerity measures in an attempt to cut its deficit. Ten-year Greek government debt is currently trading at a yield, or interest rate, of 8.4% – making it prohibitively expensive for Greece to borrow from the financial markets. The country has a total national debt of around €300bn, and its deficit in the last year is estimated at 13.6% of GDP. Facebook Twitter Pinterest The arrival of the aid was overshadowed by the embarrassing resignation of a government minister after it emerged that her husband, a popular singer in Greece, owed more than €5m in unpaid taxes and fines. Angela Gerekou, deputy minister of culture and tourism, stepped down after a national newspaper broke the news. Gerekou had filed joint tax returns with Tolis Voskopoulos for many years. Voskopoulos had a string of hits in the 1960s and 1970s, but his real estate assets have now been frozen and he faces criminal prosecution. Although one of Greece's greatest old-timers, and most frequent performers, the star had claimed earnings of only €3,000 a month, the pro-government Ta Nea proclaimed on its front page. Other newspapers reported that with around €5.5m owed to the Greek state in outstanding taxes, the singer's file had been "well known to economy ministry officials" for months. The Greek government said in a statement: "Angela Gerekou has submitted her resignation for reasons of sensitivity and sensibility, so that there cannot be the slightest pretext to hurt the government." Gerekou was seen as a protege of prime minister George Papandreou, who has pledged to overhaul Greece's tax system to prevent richer citizens hiding their income or assets. Her resignation came just days after the Greek government launched a high-profile campaign to name-and-shame tax evaders. In the first step, the finance ministry named 60 doctors and dentists facing legal action for under-reporting their incomes. "This idea that you're a successful tough guy if you evade taxes and deceive the state has got to change," Papandreou declared last week. Three former government ministers are reportedly being investigated for misuse of government funds and within hours of Gerekou's resignation being accepted the justice minister tabled draft legislation in parliament that that will lift the immunity of politicians suspected of wrongdoing. Dimitris Droutsas, the deputy foreign minister, said: "[Gerekou's resignation] is a message from the government and especially the prime minister that there is equal justice for all." The extent of the tax avoidance by the richest in Greek society has fuelled the anger among ordinary citizens against the tax rises and salary cuts being implemented by Papandreou in return for the €110bn aid package.

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6 Things Newlyweds Need to Know About Their First Joint Tax Return It's almost always better to file jointly, but you have to know when it's not -- and how to do it right when you do. Kathryn Tuggle NEW YORK (MainStreet) -- If you tied the knot in 2013, there are a few things you and your spouse should consider before filing your taxes April 15. Experts weigh in on the top six things to keep in mind when you make your love IRS-official: 1. It doesn't matter when you got married. Even if you got married at 11:55 p.m. Dec. 31, 2013, you can still file jointly, explains Kay Bell, tax expert for Bankrate.com. "You don't have to have been married for the full year," Bell says. "As long as you were married for a few minutes in 2013, you're able to file jointly." In other words, the IRS doesn't care when you got hitched. A couple that got married Jan. 1 will be entitled to the exact same joint filing deductions and benefits as a couple that married Dec. 31. Married taxpayers filing jointly will get a standard deduction of $12,200 for 2013, and those married filing separately will get a $6,100 deduction, according to the IRS. 2. Build a spreadsheet of all your deductions and write-offs. As a single person, your deductions may not have amounted to much, but now that you're married, it's time to put your heads together and see if the standard deduction is still right for you, says Erin Ballard, director of marketing for CreditCardInsider.com, a credit card comparison site. "You both need to sit down and take a look at your charitable deductions, your business expenses, anything that you may be able to write off for last year," Ballard says. "If you think of something, jot it down in a spreadsheet." If you didn't do this during 2013, it's OK, Ballard says. The important thing is that you start doing it as soon as possible and keep a running tally throughout 2014. "It's much easier to keep a record as you go along rather than doing the end-of-year scramble every April, which is horrible." 3. Know that it's almost always better to file jointly. Married and filing separately is not the same as filing as a single person, Bell explains. Also see: What to Do If You're Missing a W-2 Tax Form>> "The old joke is that one return is easier for the IRS to process than two, so they make it to your advantage to file jointly," she says. There are very few cases where filing separately is a better option than filing jointly, says Mark Luscombe, principal federal tax analyst at CCH, a Walters Kluwer company. "If you are married filing separately you can't take advantage of certain tax breaks -- in many ways you get penalized for filing separately," Luscombe says. With that said, there are some instances where it can be advantageous. For example, if one spouse had significant medical expenses in 2013 that exceeded 10% of their adjusted gross income. "It might be harder to get over that 10% threshold if you are married filing jointly, so in that case it would make more sense for the couple to file separately," he explains. Also, keep in mind that filing jointly means joint liability -- if you have any doubt that your spouse is being honest about their deductions or earnings, it's best to file separately. Prev To Downsize or Not to Downsize: The Retiree's Question Many retirees may find their house is difficult and expensive to maintain in retirement. Here's what to consider if you're thinking of downsizing during your golden years. 10 Reasons Hiring an Older Worker May be the Best Decision You Ever Make It turns out older workers are wiser and can bring more to your team than you ever expected. 5 Things Boomer Employees With Millennial Managers Should Never Do You may be older and wiser, but that kid is still your boss and there are certain generational behaviors that won't go well in today's workplace. 5 Questions to Ask Before You Take the Plunge and Quit Your Day Job Are you ready to take a chance on a new job or a new industry?

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Home > Finance and Economy > archive > Ministry of Economy attends UNCTAD Public Symposium Ministry of Economy attends UNCTAD Public SymposiumJune 28, 2014 10:08 am An official UAE delegation led by the Ministry of Economy participated in the United Nations Conference on Trade and Development (UNCTAD) Public Symposium that was held recently at the Palais de Nation in Geneva, Switzerland. Marking the 50th founding anniversary of UNCTAD, the symposium was attended by UN Secretary General Ban Ki-moon and Mukhisa Kituyi, Secretary General of UNCTAD, in addition to a number of ministers and diplomats from the member states of the United Nations. The Emirati delegation included His Excellency Obaid Salem Saeed Nasser Al Zaabi, UAE Ambassador to the United Nations and International Organizations in Geneva, His Excellency Hani Al Hamli, General Secretary, Dubai Economic Council, Aisha Al Kubaisi, Director of International Organizations Affairs in the Ministry of Economy, Badr Al Mushrikh, Manager of the UAE Office at World Trade Organisation (WTO), as well as representatives from the Abu Dhabi Council for Economic Development, Dubai Economic Council, Department of Economic Development in Abu Dhabi, and the Department of Economic Development in Dubai. Speaking of the ministry’s participation, Aisha Al Kubaisi said: “The symposium coincides with the 50th anniversary of the establishment of UNCTAD. The plenary session discussed challenges facing sustainable development, which is one of the main goals of the UNCTAD. We also explored methods to increase cooperation and integration among states. “UNCTAD plays a major role in supporting developing countries in maximizing the benefits of international trade, facing the challenges of globalization through integrating them into the global economy on an equitable basis, and sustainable development efforts.” The symposium examined challenges hindering the development process to identify practical ways to address these challenges. It also aimed to contribute to the UN General Assembly discussions on the post-2015 development agenda with a series of plenary sessions and break-out meetings that brought together government officials, civil society and other stakeholders. Al Hamli, General Secretary, Dubai Economic Council, said: “The UAE has actively engaged in resolving international trade, investment and development issues. The symposium offered a viable opportunity for government officials as well as academics and private sector businesses from 194 countries to come together for an open and interactive discussion pertaining to international issues that impact development, enabling them to exchange opinions, expertise and best practices.” Aisha Al Kubaisi held a meeting with Ukhisa Kituyi, Secretary General of UNCTAD, during which they discussed mutual cooperation between the Ministry of Economy and UNCTAD. The UAE delegation also participated in a number of meetings and seminars that discussed UNCTAD’s efforts in achieving sustainable development. Ways to enhance international cooperation towards achieving the post-2015 development agenda and the use of trade as a viable means to sustainable development and a brighter future for the world at large were further reviewed. By Related Posts:Attractiveness of private sector to be highlighted at upcoming Emirati Youth ForumTBY signs MoU with the Sharjah Economic Development DepartmentThe Foreign Exchange and Remittance Group holds its Annual General Meeting 2014

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P.O. Box 930 Everett, WA 98206 Meet an 18-year-old real-estate agent Real estate agent Caleb Houvener has his whole career in front of him, but he's had plenty of youthful practice. SHARE: By Kurt BatdorfThe Herald Business Journal Published: Monday, March 18, 2013, 12:01 a.m. << Prev Kurt Batdorf / The Herald Business Journal Caleb Houvener, a 2012 graduate of Jackson High School in Mill Creek, is one of the youngest licensed real estate agents in Washington. He's 18. LYNNWOOD -- Caleb Houvener has always been a guy with entrepreneurial ideas.It started in fifth grade, when he wrote silly slogans such as "fuzzy hot dogs" and "green bananas" on masking tape affixed to rubber bands. He sold the novelty wristbands for 25 cents each to his classmates at Cedar Wood Elementary School."I liked seeing the expression of people's faces when they got what they wanted," he said.Houvener's move to Cedar Park Christian School in junior high brought a new enterprise. Think Jamba Juice for the eighth grade."I would take orders for Houvy's Smoothies, which I would bring for students the next morning," he said.The endeavor didn't last long. School administrators shut things down just a couple of weeks after he started, but he was undeterred."It kept feeding the fire, growing my desire to be selling things," Houvener said outside a Starbucks.He spent a couple of years helping his father, Paul, a real estate agent, rehabilitate investment homes. That gave him seed money for his next venture as a sophomore at Jackson High School in Mill Creek: shopping garage sales for stuff that he could fix and sell on Craigslist.Houvener said the venture let him buy his own car and pay for his own insurance and other expenses.It was a learning experience. He grossed "a little over $10,000," he said, but he didn't make money on everything he bought and sold. The worst purchase was irreparable ultralight camping gear."I made a lot of mistakes," he said. "Any $100 to $300 slip-up really hurt. It was up and down."After graduation, Houvener spent a semester at Calvary Chapel Bible College in Hawaii but hankered to work in sales. He returned home after his parents visited and he started 60 hours of online testing to become a licensed real estate agent.Houvener passed the exam Jan. 9.He's just 18, making him one of the youngest licensed real estate agents in Washington state.Houvener is a broker for the Bellevue office of The Force Realty, a paperless company whose agents work primarily online. His territory stretches from Bellevue to north Everett. His parents are also agents with The Force Realty."We encouraged him to do a lot of different things," said his mother, Gale Houvener. "We didn't try to pigeonhole him into real estate.""Kids these days never do what their parents do," Paul Houvener said. "The decision to go that route was his own."It's kind of funny to talk to Houvener about the two months he's spent working full time in real estate. When he earned his license, January marked only the second consecutive month of year-over-year price increases in Snohomish County. He was 12 when the real estate bubble burst in 2007 and prices started their long decline.He said it was hard then to see how the market crash and recession affected his friends and their families, but now he says he's thankful he can enter the business at an opportune time.Houvener's working hard to get listings and close his first sale, mostly working with friends and through his Facebook page. He helped get occupants into four high-end rentals, which gave him some income. Now he said he's "trying to beat the odds" of getting his first commission before the year is out, since most new agents need more than a year to close their first sale.Houvener exudes a teenager's confidence, but he's trying to be realistic about his prospects for success in light of his age and experience."I want to shoot for the stars, possibly get into commercial buildings, hotels, fitness clubs, houses. Which of those will happen? I don't know," he said. "I thrive off the unknown, but it's also so daunting."Mark Bornstein, Houvener's supervisor at The Force, said the new agent has a bright future because of his positive attitude and integrity. Bornstein said he relates to Houvener since he also earned his real estate license at age 18, 46 years ago."Oh, I love the enthusiasm a young person brings," Bornstein said. "Caleb has a very fresh and aggressive approach to do the right thing for people."Houvener said he'd be happy making $25,000 while he builds his reputation and clientele to make that first sale.Meanwhile, he's making another move -- out of his parents' house to his own place in Bothell by April 1."I think I'll like the independence, but I owe a lot to them to help me get on my feet," Houvener said of his parents."He's finding some creative, innovative ways to raise money," Paul Houvener said. "He gets dressed up in a tie five days a week. He's doing some things I never thought of doing in real estate.""He is simply a winner," Gale Houvener said. "I'm excited for him. He has layers and layers of ideas."Kurt Batdorf: 425-339-3102; kbatdorf@heraldnet.com. Story tags » • Human Interest • Lynnwood • Small business • Real Estate

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Moves to establish a local Islamic bank face hurdles [NEWS IN FOCUS] Korea is hoping to attract funds from oil-rich Middle East countries by setting up a local Islamic bank in the country, but the effort is still facing many challenges.The Islamic Bank Korea Organizing Committee was established in January 2009 under the auspices of the League of Arab States Chamber of Commerce in Korea.The group is being led by Rhee Dong-wook, a Muslim convert, and Lee Tong-ho, a former president of Korea Development Bank. Their plans call for opening an Islamic bank, tentatively called Al Amir Bank.Al Amir Bank would be based on the principles of Islamic Shariah law, which bans charging interest on financial transactions.But the committee has had problems finding Islamic investors, preferably from the Gulf region. “Qatar Islamic Bank was one of the Islamic banks that was interested in entering the Korean market, but it eventually withdrew its plan as it faced challenges in dealing with the domestic banking laws,” said Lee.He noted that local banking laws make it difficult for Islamic banks to establish a foothold in Korea because they are at variance with Islamic financial principles.“The type of Islamic bank that the committee is seeking to establish is still undecided,” Lee Jong-won, head of Sharia Finance, a local investment consulting firm specializing in attracting Islamic funds in Korea, told the JoongAng Daily.“Most likely it will be one that would be established with the help of a foreign Islamic bank,” he said.One problem Korea is confronting is that one of the most prominent banks from the Middle East in operation here is Iran’s Bank Mellat, whose operations were recently suspended as part of Korea’s sanctions against Iran for its suspected nuclear weapons program.In addition, Korea has yet to approve proposed tax changes for the issuance of Islamic Sukuk bonds by Korean companies due to opposition from local Christian groups, which could create the impression that Korea is hostile to Muslims.Local financial officials say the government must resolve the issue to improve Korea’s image as a country that wants to attract funds from the Middle East.By Jung Jae-yoon [jyj222@joongang.co.kr] Tweet

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A suburban Cleveland couple reflect nation's willingness to spend LinkedIn Google+ U.S. economic data so far this year offer a mix of good and bad, but Scott Loehrke and his wife, Jackie, who live in suburban Cleveland, remain on the optimistic side.The Loehrkes are featured in this Associated Press story that examines why workers/consumers, despite plenty of evidence that the economy remains soft, are in a mood to spend these days.Last Friday, the government reported that consumers spent 3.2% more on an annual basis in the January-March quarter than in the previous quarter — the biggest jump in two years, according to the AP. The numbers “highlighted a broader improvement in Americans' financial health that is blunting the impact of the (payroll) tax increase and raising hopes for more sustainable growth.”Mr. Loehrke, 25, in March went ahead with some car repairs that could have been delayed, the story notes, and he and his wife plan to vacation in May in Mexico.Both “feel secure in their jobs,” the AP says; Mr. Loehrke is a salesman for a company that makes T-shirts, cups, key chains and other promotional products, while Mrs. Loehrke is a pharmacist."Everything that we've planned to do we're still doing," Mr. Loehrke says.The Loehrkes seem to do most everything right, financially. They have student debt “and so are focused on keeping their expenses in check,” the AP notes. For instance, they both drive used cars, which has “enabled them to build up some savings and made it easier to absorb the payroll tax increase.”Lower consumer debt levels are helping support new spending throughout the economy, the AP notes, and consumers are benefiting from cheaper gas prices and rising home values and stock prices.“No one should write off the consumer simply because of the 2 percentage-point increase in payroll taxes," Bernard Baumohl, chief economist at the Economic Outlook Group, tells the AP. "Overall household finances are in the best shape in more than five years."This and that Good work: Cleveland law firm Thompson Hine LLP said Robyn Minter Smyers, chairwoman of the firm's Diversity & Inclusion Initiative and a partner in its real estate practice, won the Leadership Excellence Award from the Ohio Diversity Council.The award “recognizes senior leaders making a significant impact through leadership of diversity and multicultural initiatives,” Thompson Hine said.“Robyn has moved the needle on our Diversity & Inclusion Initiative,” said Deborah Z. Read, Thompson Hine's managing partner, in a statement. “She brings energy and ideas, and she pushes our firm forward on our internal goals and objectives. Robyn walks the walk and talks the talk. She is a particularly effective leader because she believes in what she supports.”For instance, Ms. Smyers guides Thompson Hine's collaboration with Forest City Enterprises and the Greater Cleveland Partnership's Commission on Economic Inclusion to present diversity training for C-level executives in Northeast Ohio.Ms. Smyers said, “I am proud to work at a law firm that embraces diversity and inclusion as much as I do.”She is the second Thompson Hine partner to be honored by the Ohio Diversity Council. Last year, Anthony C. White received the organization's Multicultural Leadership Award.Time for a raise: Hospitals are about to get a pay raise from the U.S. government for treating patients in the nation's Medicare program.The U.S. Centers for Medicare and Medicaid Services plans to raise payments 0.8% beginning Oct. 1 for services that elderly and disabled patients receive after they're admitted to hospitals, Businessweek.com reports. Long-term care hospitals that treat patients after they're discharged from acute-care centers would see a 1.1% increase.The proposed payment changes “would raise government spending for hospital care by about $53 million next year, including programs that aim to discourage hospitals from readmitting patients soon after they are discharged and to punish hospitals that too frequently spread infections to patients,” according to the website. A final rule on the fiscal 2014 payments is scheduled to be issued by Aug. 1.Medicare pays more than $100 billion a year to hospitals. Feeling restless: Forbes.com reports that Americans are moving from city to city “more than ever before,” as more than 10% of citizens moved from 2011 to 2012.“As more and more Americans engage in nontraditional jobs, such as freelancing, working flexible hours or pursuing startup ventures, job-hopping has become the new norm among the American work force,” according to the website.The tenure of employees has decreased; the median number of years an American worker has been at his or her current job is 4.6 “and there has been an increase in the proportion of workers in jobs with less than one year of tenure,” Forbes.com says.You also can follow me on Twitter for more news about business and Northeast Ohio.

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Uganda and the IMF Policy Support Instrument (PSI) Views and Commentaries Sign up to receive free e-mail notices when new series and/or country items are posted on the IMF website. Modify your profile A Budget for Energy, An op-ed by Peter Allum,Advisor, African Department, IMF An op-ed by Peter Allum Advisor, African Department Published in The New Vision (Uganda) Last Thursday's budget was not only the first Kisanja budget, but also the first since Uganda moved into the group of countries that no longer need to borrow from the International Monetary Fund (IMF). Tanzania has also made this transition. Instead of new loans, the government has asked the IMF to monitor its macroeconomic policies, and conduct semi-annual economic "check-ups" under its Policy Support Instrument (PSI) facility. This is a new program through which the IMF provides technical advice to its member countries. It is common for governments to launch new policies at budget time, but they often face funding constraints. Uganda's budget rests on the twin pillars of domestic revenues and donor funding (in about a 60-40 proportion). For the 2006/07 fiscal year, donor funding is expected to total roughly $870 million in grants and net loans, matching the record levels of the previous year. But stable funding, even at record levels, is not good enough when the value of Uganda's economy is expanding 12-15 percent each year on account of price increases, population growth, and improved productivity. Despite continued high dollar inflows, donor funding has fallen substantially in relation to GDP since 2003/04. Projected inflows in the coming year are projected to fall nearly one percent of GDP. To make up for the decline in donor funding relative to GDP, efforts are underway to boost domestic revenue collections by modernizing the Uganda Revenue Authority (URA) and improving tax efficiency. Over time, the goal is to raise revenue collections from the current 13 percent of GDP to 15 percent or more. But this will take some years, and the government can achieve quick revenue increases only through new taxes. The measures which Finance Minister Suruma announced to raise revenues will only compensate for only a fraction of the large decline in donor funding relative to GDP. As a result, domestic revenues and donor funding, taken together, are expected to decline by perhaps 0.8 percent of GDP in 2006/07. This is almost equal in size to the entire budget of the ministry of health. In addition to challenges on the funding side, the government faces difficult spending decisions. A clear priority is to address the power crisis. Electricity generation plummeted 28 percent between early 2005 and early 2006. This reduced economic growth to around 5 percent in 2005/06, down from almost 6 percent in earlier years. Given the extent of the load-shedding, things could have been much worse. Indeed, production by Uganda's largest manufacturers, surveyed by Uganda Bureau of Statistics, rose 4 percent between early 2005 and the same period this year. Evidently, these companies kept going through a combination of more flexible work hours and the use of back-up generators. There are no statistics on the smaller, informal manufacturing operations, and they have probably fared less well, since they do not have the same access to bank financing or alternative power supplies. But even if the immediate impact of the power crisis has been less than might have been feared, corporate profitability has undoubtedly taken a hit. Unless the power crisis is rapidly addressed, falling investments could well lead to larger declines in production, employment, and incomes. The 2006/07 budget provides funding of over 2 percent of GDP to address the energy sector crisis, more than four times the allocation in 2004/05. These resources, funded by donors and from domestic revenues, will partly fund the installation and operation of new petroleum-based power plants over the coming year, and cover government costs relating to the future Bujagali and Karuma hydro facilities. Without the recent electricity tariff increases, the cost to the budget of the power crisis would have been even larger. Indeed, electricity tariff policy is currently more important for sound public finances than tax policy. Electricity tariffs that appropriately reflect the cost of power generation will provide critical funding for new power capacity while also encouraging energy saving. As it grapples with a tight budget, the government's most trying challenge is how to fund the country's energy needs. It has sought to do so in part by maintaining a very tight rein on spending outside the energy sector. Consequently, other sectors received little or no increase in funding in 2006/07, other than a few priority areas like education, where funds were specifically allocated toward a salary increase for primary school teachers. Indeed, the government is introducing some of its priority programs, such as universal post-primary education and the rural development strategy, in a phased manner to reduce their upfront costs. Despite this challenging prioritization, the relatively tight limits on non-energy spending have not compensated for the decline in budget funding and expansion of energy-related spending. As a result, the budget deficit is now projected to increase in the coming year, in contrast to the decline that was anticipated when the government's macroeconomic program was approved for support under the IMF's PSI facility. Given Uganda's strong track record of macroeconomic management and the nature of the energy crisis, the IMF may consider, later this year, adjusting the targets under the PSI program to reflect these new realities. The larger fiscal deficit is not, however, entirely without consequences. In the past, donor funding adequately covered the gap between spending and domestic revenues. This allowed the government to save a small amount each year, by paying off some of its treasury bill debts. In the coming year, donor funding will no longer be large enough to close this gap, and the government will need to borrow rather than save (that is, issue new t-bills or bonds). This risks putting upward pressure on interest rates, and may encourage banks to invest in government securities rather than productive private sector loans. The Bank of Uganda will need to manage this shift toward government borrowing, and the domestic debt situation, very carefully to limit any adverse impact on private sector credit. The coming year is one of tough choices, given the decline in donor funding in relation to GDP. The sudden and costly emergence of the energy crisis has made a difficult situation even more so. Allocating scarce funds to energy has left resources for other programs severely limited. On the positive side, however, the cost to the budget from the energy sector is likely to diminish in future years. The company responsible for energy distribution, UMEME, will benefit from higher tariffs and is planning to reduce the transmission and distribution losses that it inherited.

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Resource Center Current & Past Issues eNewsletters This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers, click the "Reprints" link at the top of any article. Wall Street Has Two Months to Meet Overseas Policy CFTC moves effective date to Jan. 14 for policy requiring Dodd-Frank compliance on swaps trades made by U.S.-based traders on behalf of overseas affiliates. By Silla Brush and Robert Schmidt, Bloomberg November 27, 2013 The top U.S. derivatives regulator gave Wall Street two months to abide by a new policy imposing Dodd-Frank Act rules on banks when they arrange trades domestically and then book them overseas. The Commodity Futures Trading Commission (CFTC) postponed a Nov. 14 advisory that undermined a legal interpretation Wall Street had found buried in a footnote, number 513, in an earlier agency document. Banks relied on the footnote to keep swap deals off electronic platforms and away from the agency’s rules that were put in place in the wake of the 2008 financial crisis. In a letter released yesterday, the agency said that it agreed to the delay after swaps dealers said they needed “additional time” to “allow them to organize their internal policies and procedures to come into compliance.” The Nov. 14 advisory said that U.S.-based traders who arrange, negotiate, or execute a deal—even on behalf of an overseas affiliate—must comply with Dodd-Frank, which gave the agency oversight of the swap markets. Along with its potential to disrupt their current deals, banks are concerned that the language in the opinion is broad enough to expose their overseas swaps to more regulation. The delay comes as two Wall Street trade groups, the Securities Industry and Financial Markets Association (Sifma) and the International Swaps and Derivatives Association, are preparing to sue the CFTC as early as this week over foreign guidance the agency issued in July. The Nov. 14 advisory interprets that guidance. The delay gives derivatives dealers until Jan. 14 to comply with the new policy. One of the banks’ biggest complaints has been that the agency refused to publicly state when it would take effect. Five-Year Fight Gensler and the industry have been locked in a five-year battle over rules to make the $693 trillion derivatives market safer and less opaque. How to apply the new regulations overseas has been among the most contentious issues, with Goldman Sachs Group Inc., JPMorgan Chase & Co., and other swap dealers pushing to limit the CFTC’s reach into other jurisdictions. The biggest banks conduct at least half their swaps business with overseas clients, according to some estimates. Gensler has fought to extend his agency’s authority into foreign transactions, pointing out that several major financial failures, including the collapse of American International Group Inc., originated in overseas units. After the CFTC guidance quashed their interpretation of the footnote, the industry decided to sue the agency, claiming that it didn’t follow the proper procedures for issuing regulations, according to people briefed on the matter. Cheryl Crispen, a spokeswoman for Sifma, said the association is exploring “all available options” in response to the CFTC actions. A spokesman for Isda, Steven Kennedy, said the association is “extremely concerned” about the impact of the recent advisory opinions. Copyright 2016 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. Pain Points in New Banking Relationships Company Credit Swaps in U.S. Fall to Six-Year Low International Swaps and Derivatives Association 36 Derivatives Association 4 Steven Kennedy 2

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Republic of Estonia and the IMF Republic of Lithuania and the IMF Republic of Latvia and the IMF Sign up to receive free e-mail notices when new series and/or country items are posted on the IMF website. Modify your profile Latvia and the Baltics—a Story of Recovery By Christine Lagarde, Managing Director, International Monetary Fund By Christine Lagarde Managing Director, International Monetary Fund Riga, June 5, 2012 Thank you President Bērziņš for your warm welcome and to other dignitaries, distinguished guests, and the audience for taking the time to participate in this important conference. It is a great pleasure to be here today in this beautiful city of Riga to celebrate the remarkable achievements of Latvia and the Baltic countries over the past few years. It is fitting that we are meeting in this fantastic building—the Great Guild—which was founded in 1353 by members of the Hanseatic League. The Hanseatic merchants turned Riga and Tallinn into vibrant centers for trade in the 14th century, and their reach and dynamism reached all corners of Europe. It is a fitting symbol for the open, vibrant, and—above all—integrated approach that the Baltics, and indeed the whole of Europe, need to embrace today to overcome their challenges and succeed in their ambitions. To get the ball rolling with this conference, I would like to talk briefly about three things: First, on the context: a look at how far Latvia and the Baltics have come. Second, on the lessons: just how did Latvia and the Baltics do it? And what lessons should policymakers elsewhere learn from their experience? Third, on the road ahead: how can Latvia and the Baltics integrate further with Europe while avoiding the pitfalls that have caused problems for other countries? Crisis and recovery Let me begin with the context. As you all know too well, the Baltic nations have been tested severely over the past number of years. Latvia alone lost a fifth of its output in just two years, 2008 and 2009. Unemployment rose above 20 percent, and double this among young people. Poverty increased and people from all walks of life endured great suffering. The other Baltics also went through incredibly tough times. And yet while challenges remain today, you have pulled through. You have returned to strong growth and reduced unemployment, even if it remains far too high at around 16 percent. You have lowered budget deficits and kept government debt ratios to some of the lowest in the European Union. You have become more competitive in world markets through wage and price cuts. You have restored confidence and brought down interest rates through good macroeconomic policies. We are here today to celebrate your achievements, but also to make sure that you can build on this success as you look to the future. How did they do it? How did Latvia and the Baltics do it? It certainly was not luck. With the turmoil affecting their neighbors and trading partners, nobody can argue that the Baltics were dealt a good hand. They were not just pushing a huge boulder—they were pushing it up a steep hill. That said, there was no simple recipe for success. Rather, it was the right combination of policies, the right degree of support, and the right level of determination all coming together. If we want to single out one factor for Latvia, it would be the impressive determination. This had a number of dimensions: After a difficult start to the program, we soon saw strong political will and ownership. Especially during the difficult decisions made in 2009, politicians took the long view over the short view. At a very basic level, everybody knew what needed to be done. They understood that the huge spike in spending in the years leading up to the crisis could not be sustained. It was almost a feeling of “easy come, easy go”—mistakes were made, and mistakes had to be fixed. Latvia decided to bite the bullet. Instead of spreading the pain over many years, the country stood together and did what needed to be done up front. And the achievement was incredibly impressive—in the first year of its program, Latvia implemented fiscal adjustment of more than 8 percent of GDP. Total adjustment for the whole program is even higher, at around 15 percent of GDP. Latvia also had a clear end goal—euro adoption. This meant that everybody knew where they were going, and Latvia has stayed the course. To cushion the hardship, the government agreed to protect the poorest and most vulnerable people by strengthening the social safety net. So even in an atmosphere of major budget cuts, Latvia expanded and improved unemployment assistance. I am pleased to note that the IMF, working with the World Bank and the European Commission, helped spearhead these efforts. And even though this was intended initially only as an emergency measure, it will be important to keep social safety net protection in place as long as the unemployment rate remains so high and poverty remains a problem. The case of Latvia also shows how strong internal commitment can go hand-in-hand with strong external support, as the international community rallied to help the country get back on its feet. Latvia’s partners put together an impressive financing package of €7.5 billion. I should also single out the strong cooperation among Latvia’s external partners—the European Commission, the IMF, the Nordic countries, a few other countries including Poland, as well as the ECB. And let us also not forget the assistance from the World Bank and the EBRD. This was critical to the program’s success. But what really made it work was the high level of ownership—this was your program, your objectives, your future on the line. Our role was simply to help. Let me now turn to my third and final point: the road ahead, and the key challenges facing the Baltic countries as they return to growth and—for Latvia and Lithuania—prepare to join the euro. I see three priorities. First, Latvia still needs to deliver on the program’s exit strategy of euro adoption. This should remove exchange rate uncertainty, reduce interest rates, and promote integration with the rest of Europe. Second, regardless of whether or not they join the euro, all three Baltic countries need to continue to implement the reforms necessary to make sure they can thrive under a fixed exchange rate. These reforms include raising labor productivity and boosting competitiveness to put them on a permanent path of higher growth and more inclusive growth. What kind of reforms do I mean? Product market reforms are central to higher productivity and growth. And labor markets also need to work for all, making sure that everybody who wants a job can find one, and that the economy can readily adapt to the realities of the future, within an environment of inclusive growth. To survive under a fixed exchange rate or common currency, fiscal policy also will need to remain disciplined—Latvia’s proposed Fiscal Discipline Law is a good step in the right direction. Third, all three Baltic countries could do more to support social cohesion. Income inequality in the Baltics is among the highest in Europe—in Latvia, the top 20 percent earns seven times more than the bottom 20 percent. There is an urgent need to create jobs—for young people, for the long-term unemployed, for those nearing retirement age who will find it difficult to re-train. A greater push to reduce inequality would also help a lot—IMF research shows that a more equal distribution of income is good for both macroeconomic stability and sustained growth, so it’s win-win. This means smarter investment in education, a move towards more progressive taxation, and a stronger—but well-targeted—social safety net. Right now, Latvia spends only about half the EU average on social programs, so there is room to do more. Let me conclude briefly. I believe the future of Latvia is bright. In a spirit of sustained solidarity and sheer determination, it has passed through a great ordeal, and is now well on the road to a better future. Speaking for the IMF, I am proud to have been part of Latvia’s success story, alongside our European Commission and Nordic partners. Going forward, we will stick with you. We will continue helping the Latvian people walk the road you have chosen, which includes entering the door of the eurozone. As Rainis, the great Latvian poet, once said: “The one who will endure is the one who is willing to change” (“Pastāvēs, kas pārvērtīsies”) I think this embodies the spirit of the Latvian people. Latvia will endure, it will succeed, it will thrive—of this I am certain. With that I will yield the floor to the many distinguished speakers here today for what I am sure will prove a fascinating discussion. Thank you.

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One need not look further than the biotech ETF IBB to see the basics of this analysis played out. As you can see here, the sector was hit by the 2000 Nasdaq bubble which fully deflated in 2002, but not irreparably so. From 2000 until the beginning of 2012, biotech did nothing but consolidate. There were ups, there were downs, 2008 was bad but not so bad, and suddenly, for no glaringly obvious reason, it just took off at the beginning of 2012 and we're at all-time highs. A look at a chart of IBB's largest holding, Regeneron (REGN), will give you a more concentrated idea of what's going on here. As you can see, the 2000 Nasdaq bubble barely made a blip compared to what is happening now with REGN. I do not mean to minimize Regeneron's accomplishments since the beginning of 2012, which have been astronomical. Its revenues from last quarter almost equal those from all of FY 2011. And its earnings last quarter are nearly equal to its losses in all of 2011. That is certainly nothing to sneeze at and absolutely deserves its gains. But that's it.... the run is over now. Its P/E ratio is over 90. Let's face it, anyone who wants to buy now is too late. But there is an alternative for those who love biotech. Call it biotech's cousin, the "biotech hardware" subsector. What I mean is, any drug that has to be approved by the FDA I would consider biotech software as opposed to hardware. Much like a computer program, a company spends enormous sums programming a drug and testing what it can do. Most, however, forget about the hardware, the testing equipment, the diagnostic services that each and every hospital requires just as much as the drugs themselves. The positives of diagnostic equipment are that they are much easier and less expensive to pass through government regulations. The Clinical Laboratory Improvement Amendments (CLIA) program, passed by Congress in 1988, is what regulates diagnostic hardware, and it only requires two clinical phases to meet approval. In terms of stock trends, the diagnostic companies are on a completely different wavelength from biotech. Let's take a look at the big names in the industry and see what they've been doing over the past decade. One of the biggest in biotech hardware is Quest Diagnostics (DGX). It has been consolidating since April 2002. Keep in mind that before its big breakout, biotech consolidated for a similar amount of time. This is the stuff that makes big breakouts possible. That, and its net income is down since 2009, though its revenues are steadily up since then. This dissonance, I think, creates the conditions for a buy, as it is easier to cut down operating costs than it is to generate new revenue. That, and its quarterly dividend has tripled since last year, so the company is looking for investors. Rather than get distracted by biotech, I'd look for stocks like this, begging for holders. Another staple of biotech hardware is Lab Corp. (LH) The story here is similar to Quest. Taking the very long view, this stock hasn't done much since 1992 when it topped at $70 a share, totally off the radar of most other stocks and the entire market in general. For the past 5 years, Lab Corp. has followed biotech proper almost to a tee, when all of a sudden at the beginning of 2012 the two began wildly diverging and biotech proper broke away. Don't be distracted by the disproportional gains of biotech. Focus on the continual consolidation of biotech hardware and you'll see in it a call of opportunity. Here's another: Bio Reference Labs (BRLI), a $768M company, almost a total enigma. It has never followed general market trends and seems to be plotting its own rhythm totally independently. It was hit a lot harder in 2011 than most stocks were hit in 2008. The Nasdaq bubble barely had any effect on it at all. BRLI is what I would call a leader in the biotech hardware sector, eventhough it is not a large cap, as it has grown steadily since 2003 and continues on an uptrend. Taking a more recent snapshot, revenues are up 18% since last year, and income up 16%, indicating steady growth year over year. BRLI is the example I expect the rest of this lagging market to follow in the next 5-10 years. To end off a rounded survey, we have Amarantus Bioscience (AMBS.OB). This stock is not for investors simply out to catch the next trend. Rather, I mention it here as a speculative play based on the fact that it is a penny stock microcap with the rare quality of having feet in both biotech subsectors at once. Unlike most development stage biotech companies, Amarantus is focusing on both hardware and software. Hardware being inordinately easier to pass through government regulations, it is the key to maintaining a steady revenue stream while the big potential money makers, the drugs themselves, push through clinical trials. Right now, Amaranatus is in the late stages of CLIA approval for its Parkinson's and Alzheimer's diagnostic tests. Assuming these pass and it starts generating a steady revenue stream from sales (certainly not a given) that don't rely on research grants from Parkinson's foundations, the company will have an easier time pushing through its main product Mesencephalic Astrocyte-derived Neurotrophic Factor (OTC:MANF). Amarantus is researching this product candidate mainly as a treatment for Parkinson's disease, as it is designed to correct protein misfolding in the brain, which is speculated to be a main cause of Parkinson's onset. What the future has in store for MANF I do not know. It is certainly not going to make Amarantus any money in the near future. But what is certain is that a company like Amarantus needs a steady revenue stream to have any chance for its big bets like MANF for Parkinson's, still a long way from approval. It has a chance at accomplishing that with the sparsely regulated hardware approach to making it in biotech, an approach I believe, considering the lengthy consolidation the subsector has had for over a decade, will generously outperform the biotech sector proper over the next 5-10 years. In order to take advantage of this, the safest approach would be to buy a basket of biotech hardware companies in proportion to proven stability and hold. In terms of risk, we've seen from the charts that in times of market turmoil, biotech hardware has generally been less affected overall. Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.About this article:ExpandTagged: Investing Ideas, Quick Picks & Lists, Healthcare, SA SubmitProblem with this article? Please tell us. Disagree with this article? Submit your own.Top Authors|RSS Feeds|Sitemap|About Us|Contact UsTerms of Use|Privacy|Xignite quote data|© 2016 Seeking Alpha

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ACI Worldwide to Buy Online Resources Corp. January 31, 2013 • Reprints Online Resources Corp., one of the pioneers in online banking for credit unions, is being sold to ACI Worldwide. The $126.6 million cash deal calls for ACI Worldwide to buy Chantilly, Va.-based ORCC for $3.85 per share. Buying ORCC’s preferred stock pushes the sticker price to about $263 million, ACI said Thursday. The purchase price is an 83% premium over ORCC’s most recent closing price of $2.10 a share, and ACI said both companies’ boards have approved the offer. The purchase was the second major takeover announced Thursday among major credit union technology providers joining the FIS buyout of mFoundry, and the third this month, following Fiserv Inc.’s purchase of Open Solutions Inc. Fiserv and FIS are very large companies buying much-smaller competitors. The ACI-ORCC deal involves companies of roughly similar size and marks ACI’s second acquisition in the credit union space, following the 2011 purchase of S1 Corp., which itself had recently bought PM Systems, both providers of online banking and other e-commerce technology. Founded in 1989 by Matt Lawlor, Online Resources has about 450 credit unions among its more than 1,000 client financial institutions and billers. The company processes more than 245 million bill payment transactions annually and its payments engine is connected to more than 9,000 billers. ACI Worldwide said it provides electronic payments and banking for more than 1,650 financial institutions, retailers and processors around the world, including 14 of the leading global retailers, and 24 of the world's 25 largest banks. “Built on our heritage of producing highly reliable and trusted solutions, ACI Worldwide’s mission is to deliver universal payment solutions that provide control, choice and flexibility to our customers while maintaining their peace of mind,” said Philip Heasley, president/CEO of the Naples, Fla.-based company. “Online Resources’ robust product set and talented employee base of online banking and payment experts is well-aligned with this focus and our desire to lead in a category undergoing accelerating change,” Heasley said in a statement. ORCC President/CEO Joe L. Cowan said, “I believe the combination of the two companies will allow the Online Resources product suite to now achieve its full potential in the banking and biller markets, provide even better services and functionality for our clients and customers, and create additional opportunity for our dedicated and hardworking employees.” For the 12 months ending Sept. 30, 2012, the companies combined generated pro forma revenue of approximately $860 million and adjusted EBITDA of $182 million, ACI said in a statement, and the deal is being financed by a $300 million loan from Wells Fargo Bank. In a letter to ORCC customers, Heasley said, “ACI is a global leader in payments, with customers in over 80 countries and 38 years of payments expertise. We are recognized as a leader in online banking – serving the corporate, business and consumer banking needs of large banks, community banks and credit unions. The online banking business has been a strategic focus of ACI since our acquisition of Politzer & Haney in 2006. “ACI is committed to market-leading investment in our products, infrastructure and people. We apply more than 18% of revenue to R&D on an annual basis. We have a world-class global hosting organization. In addition, our support team is renowned for delivering the world class, 24x7x365 support that is essential to banking and payments. “ “Over the coming weeks, we expect to finalize the acquisition of Online Resources, allowing us to work closely with you as we build our plans for these market-leading solutions. During the next few months you should expect continued communications detailing these plans and roadmaps.”

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« Fan Walk for Manches... | Main | Cape Town's best... » Property, the "obvious choice" for investors Surprisingly, says Jason Lee, Rawson Commercial National Manager, the "obvious" advantages of investing in property are often not fully understood or appreciated by a wide range of people, even though they may have been highly successful in other fields. "This," he adds "is always something of a mystery to me because, after all, the simple fact that most of us live and work in buildings, one would think this would give us a basic understanding of property and its intrinsic merits. "In practice, however, we whose job it is to try and steer investment into property, find time and again that those we are dealing with are seduced by an apparently more attractive investment channel elsewhere, usually in the money market or in a business option - and I would hate to tell you how frequently in my experience these 'exciting' opportunities in business have resulted in the investor virtually losing all or most of what he has put in." This, said Lee, is probably the reason why the banks, while still fundamentally pro-property, are, traditionally cautious when it comes to funding a new business - or even the expansion of an existing successful enterprise. "The first excellent reason for going the property route," said Lee, "is that the chances of getting finance (anything from 70 to 100%) are good. If, however, you invest in a business; a. You will be unlikely to get finance of over 50%; b. Your re-payment period will be significantly shorter (very often only three to five years) and this is likely to cause financial stress; c. The bank will reserve the right to pull out at short notice, with all payment of the remaining debt becoming immediately due. d. Interest rates on the money borrowed are normally very high and comparable to overdraft rates on private accounts. "None of this applies to a property investment. Here, as mentioned, substantial bonds are still available to those with good track records and the repayment period will be two or three times as long as that of a business loan. Furthermore, the bank is required in law to follow due process in procuring outstanding debt and the bank's first recourse is to the property itself." "These fundamental differences between property and other asset investments, said Lee, are often not acknowledged by commentators and analysts. In particular, he said, these people tend to overlook the huge advantage of being able to gear a property investment, thereby effectively maximising the investor's return on equity. "If I buy a R1 million investment policy and cash it in, say, two to three years, for R1,2 million, I will have made a 20% return on my cash invested. If, on the other hand, I buy R1 000 000 property with a 20% deposit and an 80% bank loan, and sell it after the same period for 1,2 million, the return on cash invested is 100%." Right now, said Lee, investors are flocking back to commercial property and one of the main reasons for this is that, in the money markets, many investors are now having to be content with returns that are below the current inflation rate (currently fluctuating at around 6.2%). "Looking at Rawson's commercial portfolio," says Lee, "any analyst can see that this type of property will almost invariably achieve an 8 to 10% return from day one, thus providing inflation beating returns and capital growth over time." "When all is said and done, the basic lack of mystery and the fact that it is easily understood, ensures that property remains a safe haven for investment." Rawson Press Release Posted at 04:39PM Jun 13, 2012 by Editor in Market | Comments[18]

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