Christmas mailing deadlines for online purchases loom…Long-term mortgage interest rates fall to lowest level since early this year…Survey finds suburban poor now outnumber inner-city counterparts…
If you want to get that gift package where it’s supposed to go on time, you’d best get moving. A study conducted by Bizrate Research for Shopzilla and the Shop.org Web site finds you have about a week left to shop online before retailers start scaling back shipping guarantees. According to a poll of 76 online retailers, the number of retailers who guarantee that standard shipping orders placed by December 18th or 19th will be delivered by Christmas Day nearly doubled from last year. About a-third of retailers standard shipping deadlines are December 15th, 16th, or 17th and almost a quarter are December 14th. The survey also finds that 25 percent of online retailers say their sales are at least 50 percent higher than last year at this time. Another 26 percent put growth at between 25 and 49 percent.
Long-term mortgage interest rates have fallen to their lowest level since early this year. Freddie Mac reports the 30-year fixed-rate mortgage was averaging 6.11 percent this week compared with 6.14 percent a week ago. That’s the lowest since the week ending January 19th, when it averaged 6.1 percent. The average for the 15-year loan, often used for refinancing, came in at 5.84 percent. It hasn’t been that low since the week ending February 9th, when it averaged 5.83 percent Freddie Mac Vice President and Chief Economist Frank Nothaft says rates were kept lower by continued signs of slowing in the housing market and weakness in the manufacturing sector.
Fannie Mae has erased $6.3 billion in profit in a long-awaited restatement. The move caps an accounting scandal that stunned financial markets and brought the ouster of top executives along with a record fine against the government-sponsored mortgage lender. The correction of its earnings from 2001 through June of 2004 was ordered by the Securities and Exchange Commission two years ago. The new figure, however, is well below Fannie Mae’s earlier estimate of $10.8 billion. The reworking of its accounting is costing the company about $1 billion this year to conduct. Fannie Mae finances one of every five home loans in the U.S.
Consumer borrowing posted its biggest one-month decline in 14 years during October. The Federal Reserve says a big drop in auto loans pushed borrowing down at an annual rate of six-tenths percent following a revised increase of two percent in September. The October drop was the biggest drop since borrowing plunged one percent in October of 1992. Demand for auto loans and other types of non-revolving credit declined at a 3.3 percent rate, following a small four-tenths percent gain in September. Revolving credit, which includes credit cards, rose 4.1 percent.
A study of the nation’s 100 largest metro areas found the suburban poor outnumbered their inner-city counterparts for the first time last year. The review found more than 12 million suburban residents were living in poverty. Suburban McAllen had the highest poverty rate last year–at 43.9 percent. On the opposite end, suburban Des Moines, Iowa, had the lowest poverty rate–at 3.7 percent. The report was written for the Brookings Institution, which is a Washington think tank. Researchers studied poverty figures for the 100 largest metropolitan areas, measuring changes from 1999 to 2005–the most recent data available. Nationally, the poverty rate leveled off last year at 12.6 percent after increasing every year since the decade began. The federal government defined the poverty level for 2005 as $15,577 for a family of three.
Some lawmakers back a plan to require more disclosure about damaged vehicles–especially since Hurricane Katrina. The 2005 storm swamped parts of the Gulf Coast. The National Highway Traffic Safety Administration would have to require the insurance industry to disclose information on flooded and damaged vehicles in an accessible database. Houston Congressman Gene Green says a vehicle may look good, but unless you crawl under that car and tear it apart–you won’t know what’s happening. The Washington news conference featured a mud-caked 2001 Honda Accord that was flooded in Maryland. Recyclers say that car could be refurbished and sold at a profit. States have different laws on a vehicle’s title history. A spokeswoman for the American Insurance Association says the group shares concerns about fraudulent vehicle titling–but doesn’t yet have a position on the bill.
Russian prosecutors have uncovered more than 100 violations of environmental, labor and migration law at a Royal Dutch Shell oil and liquified natural gas project on Sakhalin Island, according to the news agency RIA-Novosti. Russian officials have threatened since the summer to pull key permits at the Sakhalin-2 development and initiate economic sanctions. Shell last year announced the cost of the project would double to $22 billion, but Russian officials have not yet approved the costs.
Atlanta-based AGL Resources is building a $180 million natural gas storage facility in the Spindletop salt dome in Beaumont. The Golden Triangle Storage facility could triple in size with potential future expansion. Houston-based Pivotal Energy Development, an AGL Resources unit, is finalizing engineering plans and obtaining regulatory permits, with construction beginning in 2008. The first salt dome cavern is slated to begin operations in 2010.
Duke Energy Gas Transmission plans to expand its Gulf Coast natural gas storage facilities over the next six years. The gas will be stored in salt caverns in Liberty County, as well as in Louisiana and Mississippi. The Houston-based company is a division of North Carolina-based Duke Energy. Duke Energy plans to spin off Duke Energy Gas Transmission early next year in a new company called Spectra Energy.
Illinois-based HSBC Credit Center is opening its fourth Houston-area consumer lending branch this month. It’s West Little York Road location will be the fourth of five new locations by the end of the year across the state. A branch will open in Austin, and there are branches in Pasadena, San Antonio, Dallas, Fort Worth and El Paso.
Texas Attorney General Greg Abbott says the state will receive more than $15.7 million under a national settlement with Schering-Plough. All 50 states allege that the pharmaceutical company failed to provide the Medicaid program with the lowest drug prices as is required by law. The $225 dollar civil settlement resolves allegations that the company used deceptive marketing and sales pitches to influence physicians. The New Jersey-based firm is the maker of Claritin and Clarinex.
The Seminole tribe of Florida is buying the Hard Rock restaurant and casino empire. That includes its massive collection of rock ‘n’ roll memorabilia. It is a $965 million deal with British casino and hotel company Rank Group. The business includes more than 100 Hard Rock Cafes, four Hard Rock hotels, two Hard Rock Casino Hotels and two concert venues. The tribe also gets a massive collection of rock memorabilia. It comprises some 70,000 items including one of Madonna’s bustiers, a pair of Elton John’s high-heeled shoes and guitars formerly owned by Jimi Hendrix, Bob Dylan, Eric Clapton and Chuck Berry. The sale, which is subject to shareholder approval, is scheduled to be completed in March.
The first of what the Pentagon hopes will be thousands of F-35 fighter jets will likely make its maiden flight next week in Texas. A Marine Corps official announced final ground checks are under way on the plane, also known as the Joint Strike Fighter. That testing must be completed before the plane can fly from the Fort Worth facility of its lead contractor–defense giant Lockheed Martin. Brigadier General David Heinz says that flight could come as early as Monday, although bad weather is forecast. The F-35 will likely be the largest defense contract ever, with a current overall cost of $275 billion stretched over the next two decades. The military will use the F-35 to replace a fleet of aging planes for the Marines, Air Force and Navy.
Blockbuster expects the number of consumers who rent movies at stores will continue to decline. But Dallas-based Blockbuster plans to offset that with online rentals. Chief Financial Officer Larry Zine said Blockbuster has closed 400 U.S. stores in the past year and believes it’s close to the optimum number of outlets. Zine predicted more consolidation in the industry, which includes a couple of large chains and lots of independent stores. He made the comments at an investor conference in Santa Monica, California. Blockbuster dominates the rental store business but faces fierce competition from online rentals and discounters. Blockbuster began offering free rentals to Netflix members who tear off the address flaps from the envelopes they use to mail back movies. The free rentals are good at Blockbuster stores through December 21st.
The nation’s two largest railroads this year have hauled record amounts of coal from mines in northeast Wyoming and southeast Montana. But Union Pacific and Fort Worth-based Burlington Northern Santa Fe are still struggling to keep up with utility demand and existing contracts. Jim Owen with the utility trade group Edison Electric Institute says if utilities run low on coal during the winter, they might be forced to buy fuel on the open market at higher prices that could be passed on to customers. The problems began in May of 2005 when two derailments leading out of the Powder River Basin revealed that accumulated coal dust in the rail bed made the line unstable. Repairs disrupted traffic and slowed deliveries for months. Experts say track capacity on Burlington Northern and Union Pacific’s networks is the main obstacle to delivering more coal. But mines and utilities also have a role to play because the pickup and delivery track setup affects how quickly trains can be loaded or unloaded.
Cattle rustlers have come a long way since the horseback raids of the Old West. Experts say thieves nowadays often load animals into 18-wheelers and simply drive off. The Texas and Southwestern Cattle Raisers Association this week announced plans to offer rewards for help catching rustlers. Almost 5,200 cattle were recovered in 2005–more than double the previous year’s number–by the Fort Worth-based associaton’s field detectives. Experts say that ranchers–among them former Houston Astros and Texas Rangers pitcher Nolan Ryan–have been targeted because of the high cost of beef. The man accused in the theft of 31 of Tyan’s cattle, Jerome Heath Novak, has been charged with stealing 289 animals in eight southeast Texas counties. Novak is jailed on $350,000 bond.
An initial public offering this week promises to glide into its first day of trading. Heelys makes a convertible roller-skate sneaker aimed at kids and young teens. The Carrollton, Texas,-based company is slated to sell as much as $113 million worth of stock in an IPO Friday on the Nasdaq–as HLYS. Heelys’ products are carried by sporting goods stores such as the Sports Authority and Modell’s, as well as department stores like Nordstrom.
The Houston-area company that manages a mall Santa photo booth near Denver is vowing to improve security after a sex offender was found working at the booth. Authorities say 40-year-old Jonathan Yeoman had the job of photographing children sitting on Santa’s lap at the Westminster Mall outside Denver. Cypress, Texas-based Sepia Photo Promotions runs the booth. It says that Yeoman never mentioned on his application that he did six years in an Illinois prison in the 1990s for child molestation. Sepia President Jeff Angelo says there have been no complaints that Yeoman did anything inappropriate with children at the set or obtained any photos for himself. And he says the company is reviewing possible legal action against yeoman. The photo display is now closed, and yeoman and the site manager–his wife–have been fired. Sepia Photo says it will henceforth turn over a list of all employees to police for background checks. That’s in addition to background checks the company says it already does.