Federal Reserve cuts key interest rate by quarter-point…Gas pipeline explodes on Mexico’s east coast…FCC orders competition for cable operators enjoying exclusivity with apartment buildings…
The Federal Reserve, confronted with surging oil prices and a slumping housing market, is cutting a key interest rate by a quarter-point–the second rate cut of the year. The easing of monetary policy comes after a stronger, half-point rate cut that was delivered in September. In its statement, the Fed says the risks of inflation and growth are roughly balanced, seeming to leave open the question of future rate moves. The decision came on a 9-1 vote with the president of the Kansas City Regional Fed Bank dissenting, arguing that he preferred no change in the federal funds rate. Many analysts have said this reduction probably won’t be the last, as the central bank tries to help the economy overcome a host of problems. The housing slump continues, while the credit crunch has improved since its worst point in August. Just today, crude oil futures have jumped to new highs. In addition, the government reported that third-quarter growth was stronger than expected.
A 16-inch gas pipeline exploded today in the Mexican Gulf Coast state of Tabasco–forcing some evacuations. Pemex didn’t immediately confirm the reports carried by news media. But state officials say the pipeline explosion happened in the town of Huimanguillo. Workers immediately shut down the pipeline and were burning off excess gas remaining in the ducts. The accident comes after the deaths of 21 workers following a platform-rig collision last week in the Gulf of Mexico that also spewed oil and natural gas. Also, Pemex has reopened two of Mexico’s three Gulf oil ports after being forced to close them due to bad weather. One port remains closed. The weather forced the company to reduce crude production by 600,000 barrels a day earlier this week.
An oilfield services company in Houston that fired four contract workers for hanging nooses at a factory has contacted the government about the case. FMC Technologies disclosed the noose-hangings this week–saying it’s permanently barred the contract workers from all its facilities. The first incident–with two men and a woman–occurred about one month ago. The second, involving one man, was last week. In both incidents, nooses were displayed in a factory at the company’s Houston headquarters. FMC Technologies declined to name the four workers or their employers. Chief Executive Peter Kinnear says FMC Technologies has zero tolerance for harassment or discrimination. FMC has engaged the FBI, Equal Employment Opportunity Commission and Texas Workforce Commission in its investigation.
Federal regulators have ordered competition for cable operators who have traditionally had a lock on apartment buildings. The Federal Communications Commission has approved a rule to ban exclusive agreements between cable operators and apartment buildings. FCC Chairman Kevin Martin says the change should help lower cable rates for millions of subscribers who live in the buildings and other multi-unit dwellings. That should give a boost to telecom firms, like Verizon Communications and AT&T, looking to offer video services along with high-speed internet access and phone service.
Hollywood’s major labor unions are lining up in support of TV and film writers as their contract talks with producers head toward a midnight strike deadline. A powerful branch of the Teamsters Union has told its 4,500 members that the union has a legal obligation to honor its contract with producers but that individual members can honor picket lines if the writers strike. Teamsters local 399 represents truck drivers, casting directors and location managers. Members of the Screen Actors Guild are also voicing strong support for the writers. But officials have said guild members are obligated to report to work even if there is a writers strike. Writers want more money from DVD sales and distribution of shows via the Internet and devices like cell phones.
Following recent recalls of millions of Chinese-made toys, House Speaker Nancy Pelosi says it’s time for an overhaul of the Consumer Product Safety Commission. And Pelosi says if the agency’s chief opposes that, she ought to go too. In a letter to a Senate committee last week, acting Chairwoman Nancy Nord criticized a Democratic bill that would double the CPSC’s funding and give it greater authority to inspect and recall products. Nord said that could have “the unintended consequence of hampering” consumer product safety by making it more difficult for the agency to do its job. Pelosi says any agency chief who would say something like that after the recent run of recalls doesn’t understand “the gravity of the situation.” The White House also opposes the legislation, which is headed to the full Senate for consideration.
Death hasn’t dampened Elvis Presley’s earning power. The king’s estate has earned an estimated $49 million in the past 12 months, reclaiming the number one spot on Forbes’ list of top-earning dead celebrities. He last topped the list in 2005. Presley died in 1977. John Lennon ranks second with earnings of $44 million. George Harrison was fourth with $22 million.