FutureGen site announcement expected this morning…National Association of Homebuilders sentiment remains low…Consumers delay shopping, knowing there’s a full weekend before Christmas, when bargains will be even better…
FutureGen Alliance officials this morning will announce the site of the FutureGen power plant—whether it will be in one of two towns in Illinois, or in one of two towns in Texas. The site for the coal-fired, near-zero emissions power plant will be made a nine this morning, Houston time, from the National Press Club in Washington. Since July 2006, four final sites have been reviewed—Mattoon and Tuscola in Illinois, and Odessa and Jewett in Texas. The $1.8 billion experimental plant will use coal but pump pollutants underground where they’ll be stored. The plant will be funded by tax dollars and a group of private energy companies that are investing in the project and its technology. Texas Railroad Commission Chairman Michael L. Williams, who heads the Texas FutureGen effort, will speak at 9:30 a.m. about the site selection from Austin.
A December reading of the sentiment of U.S. homebuilders remains at a record low for the third straight month. The National Association of Home Builders announced its December housing market index reading of 19–the lowest level since readings began in January 1985. The index gauges perceptions of builders on conditions and expectations for home sales over the next six months. Index readings higher than 50 indicate positive sentiment. The index has been below 50 since May of last year, has declined for eight straight months this year and has been unchanged since October. Tighter lending standards and rising defaults among borrowers have meant fewer buyers for builders like Fort Worth-based D.R. Horton, Pulte Homes and Dallas-based Centex. Association economist David Seiders says many builders are bracing themselves for the winter months when home buying traditionally slows. He says they’re scaling down their inventories and repositioning themselves for the time when market conditions can support an upswing in building activity.
Despite generous discounting and expanded shopping hours earlier in the season, many stores are finding themselves in the same predicament as in recent years: waiting for those last-minute shoppers in the final days before Christmas who seem to be procrastinating even more than a year ago. Based on early reports from analysts and malls, sales results were generally unimpressive this past weekend. Shoppers were held back by a snow storm that spread a mix of sleet, freezing rain and snow from the Great Lakes States to New England. Consumers, fretting about economic worries, were also delaying their shopping even more this year, knowing there’s a full weekend before Christmas, when the bargains will be even better. Meanwhile, for online retailers, which likely finished their busiest days last week, their fate appears to be already sealed: holiday sales didn’t live up to industry’s hopes as lower-income shoppers pulled back on spending amid a housing slump. comScore reports that online sales from November 1st through December 14th rose 18 percent, below the 26 percent growth rate seen in the year-ago period and below the 20 percent projection for the season.
The Port Commission of the Port of Houston Authority is considering a two-year, $2.9 million contract to Republic Waste Services to provide trash disposal and recycling, as well as a $220,000 hazardous waste removal contract with CES Environmental Services at its regular Tuesday meeting.
Plains Exploration & Production has agreed to sell its oil and gas properties to subsidiaries of Los Angeles-based Occidental Petroleum and Fort Worth-based XTO Energy for about $1.8 billion, according to the Houston Business Journal.
The maker of the Blackberry smart phone announced it will put its U.S. headquarters in the Dallas area. Research in Motion has chosen Irving–and says it will employ more than 1,000 people over the next several years. Co-chief Executive Jim Balsillie says Research in Motion is expanding operations to pursue sales and service opportunities around the world. He said Irving offered a talented work force and strong infrastructure. Irving is the home to the nation’s largest company, ExxonMobil, and to Kimberly-Clark and Zale Corporation. Research in Motion will occupy more than 100,000 square feet in Riverside Commons, a recently renovated six-building office complex on 13 acres along State Highway 114. The company’s world headquarters are in Waterloo, Ontario.
KBR expects to post earnings of $1.30 to $1.60 a share for 2008. The Houston-based military contractor and construction and engineering company offered no other financial guidance. Wall Street analysts polled by Thomson Financial expect earnings of $1.51 a share. That forecast typically excludes any potential one-time items. The company was spun off from Houston-based Halliburton in April. KBR’s been in the news in the past week over rape allegations from a former female worker in Iraq. The chairman of the House Judiciary Committee and other lawmakers have asked the Justice Department to give a full account of its investigation into the alleged 2005 assault. KBR has said it couldn’t comment on specifics of the case but that the safety and security of its employees were its top priority. A Congressional hearing is scheduled Wednesday.
Working to reassure American consumers, President Bush says the nation’s credit crunch and mortgage problems pose challenges but that the overall economy is sound. In a speech to the Rotary Club of Stafford, Virginia, Bush said, “we’ve had a pretty good economic run,” while noting that consumer confidence has eroded as turmoil in the housing and credit market have battered the economy. Bush also said he will veto any attempt by Congress to raise taxes, saying he doesn’t think Congress “needs any more money.” The Fredericksburg, Virginia, audience included members of Congress, state and local officials and business and community leaders from northern Virginia.
Hopes that the nation’s trade troubles could be easing got a boost with news that the trade deficit fell in the third quarter to the lowest level in two years. Figures from the Commerce Department show the shortfall in the current account trade dropped by 5.5 percent to $178.5 billion during the July-September quarter. That was better than expected and the smallest imbalance since the deficit stood at $173.4 billion deficit in the third quarter of 2005. The current account is the most comprehensive measure of trade. It includes not only trade in products and services but also investment flows between countries. The improvement reflects in part the decline of the dollar against many other major currencies. A weaker dollar makes American products cheaper in foreign markets while making foreign goods more expensive for American consumers.
Two more members of the Houston Rockets have signed deals to establish the team’s brand in the Chinese retail market, according to the Houston Business Journal. Coach Rick Adelman has signed as a consultant to Chinese athletic apparel manufacturer Anta Sports Products. Guard Bonzi Wells has become the third Houston player to sign an endorsement deal with Anta, joining Steve Francis and Luis Scola.
The billboard industry is squarely behind a proposal to allow digital billboards on Texas highways, but many members of the general public oppose the idea. More than 750 people submitted comments to the Texas Department of Transportation during a three-month period ending earlier this month. The Texas Transportation Commission will take up the proposal in February. It would give cities authority over whether to allow the electronic, changeable billboards in their jurisdictions. Critics of the signs say they would be ugly and distracting for drivers. Supporters say they aren’t a safety hazard and note the proposal’s restrictions, such as rules against moving images or flashing lights on the signs. The billboard industry also argues that the signs are good for businesses and the economy, and could be used to broadcast emergency messages.
Two Houston-area real estate firms have jointly purchased an office building in Greenway Plaza, according to the Houston Business Journal. A partnership between Dinerstein and Fritsche Anderson Realty Partners acquired the seven-story building on Richmond earlier this month.
A rising demand for ethanol is taking a toll on sea life in the Gulf of Mexico. Ethanol is made from corn, which American farmers are growing more of than at any time since the depression. The nation’s corn crop is fertilized with millions of pounds of nitrogen-based fertilizer. And when that nitrogen runs off fields in corn belt states, it makes its way to the Mississippi River and eventually pours into the Gulf, where it contributes to a growing “dead zone.” That’s a 7,900-square-mile patch so depleted of oxygen that fish, crabs and shrimp suffocate. With demand for corn booming, some researchers fear the dead zone will expand rapidly, with devastating consequences. Farmers realize the connection between their crop and problems downstream. But with the price of corn soaring, it doesn’t make sense to grow anything else. And growing corn isn’t profitable without nitrogen-based fertilizer.
The Senate has approved a $286 billion farm bill that expands federal farm subsidies. The bill, which passed by a 79-14 margin, includes money for farmers who grow wheat, barley, oats, soybeans and other crops. It also includes money for fruit and vegetable growers. Sugar producers would get increased loan rates, and dairy programs are also extended in the measure. President Bush is threatening a veto, saying Congress should be cutting government payments at a time of record crop prices. He also has threatened to veto a House version passed in July. White House opposition has so far had little impact on the politically popular bill. Farm-state Senators defeated a number of attempts to derail the bill and reduce government payments to large growers.