President Barack Obama and British Prime Minister Gordon Brown are sounding optimistic about a coordinated effort to pull the world out of recession. A possible deal at the G20 summit in London could include $100 billion to boost global trade and $500 billion to help emerging nations. Amid European opposition, Washington is apparently easing off a push for governments to pump more money into economic stimulus programs. Germany and France still say more needs to be done to rein in excesses in financial markets.
Thousands of demonstrators jammed downtown London, railing against the financial crisis and marking what they call “Financial Fool’s Day.” Ahead of this week’s global summit, they hoisted effigies of the “Four Horsemen of the Apocalypse,” represented as war, climate chaos, financial crimes and homelessness. Police are lining the streets and helicopters hovered overhead. Some buildings were been boarded up and some bankers wore jeans instead of suits to blend in with the crowd. At least eight people were reported arrested.
The number of planned job cuts announced by U.S.-based employers declined for the second consecutive month in March, according to Challenger, Gray & Christmas. Job cut announcements fell 19.3 per cent to 150,411 from 186,350 in February. That’s the lowest decline since last October. It came on the heels of a 23 per cent decline in February. Last month’s total is 181 per cent higher than the same month a year ago. Job cuts seem to be stabilizing in the financial sector, but state and local governments have been struggling with falling tax revenue. Employers in the government/non-profit sector saw the heaviest downsizing in March, with 25,324 announced job cuts.
Unemployment rates moved higher in all of the nation’s largest metropolitan areas in February with Indiana’s Elkhart-Goshen and North Carolina’s Hickory-Lenoir-Morgantown registering the biggest annual increases. The Labor Department says all 372 metropolitan areas tracked saw their jobless rates rise in February from a year earlier. Elkhart-Goshen and Hickory-Lenoir-Morgantown were both hammered by manufacturing layoffs. Eklhart-Goshen’s jobless rate soared to 18 per cent, up 12.5 percentage points. The unemployment rate in Hickory-Lenoir-Morgantown jumped to 15.7 per cent, a 9.3 percentage point increase.
Scott & White Healthcare is merging with King’s Daughters Hospital and will create a freestanding regional children’s hospital on the King’s Daughters campus in Temple. The ownership of King’s Daughters will pass to Scott & White on Wednesday after the King’s Daughters board approved the merger. Scott & White officials say the hospital will continue operating King’s Daughters as an acute-care hospital for all ages until it completes the King’s Daughters conversion to a children’s hospital. The merger also must pass muster with the Federal Trade Commission and other regulatory agencies.
Nine people accounted for nearly 2,700 emergency room visits in central Texas over six years at a cost of $3 million to taxpayers and others. The patients — eight from Austin and one from Luling — went to emergency rooms 2,678 times between 2003 and 2008. Details are in a report from the nonprofit Integrated Care Collaboration. The providers care for low-income and uninsured patients. The report was presented last week to the Travis County Healthcare District board. The Austin American-Statesman reports that — of the nine patients — eight have drug abuse problems, seven were diagnosed with mental health issues and three were homeless. Five are women whose average age is 40. Four are men whose average age is 50. Experts say solutions include referring some frequent users to mental health programs or primary care doctors.
A federal judge in Oklahoma City is granting class-action status to a $27 million lawsuit that accuses a Houston energy company of shortchanging royalty owners. The royalty owners claim XTO Energy has underpaid them 15 to 20 per cent on about 290 natural gas wells in the Oklahoma panhandle and southwestern Kansas. The lawsuit says XTO sells the natural gas to a wholly owned subsidiary at below-market prices then later sells the gas for higher prices. XTO denies the allegation and says the royalty owners are not suffering a deduction in their payments. About 220 of the wells are in the Oklahoma panhandle and about 70 are in Kansas.
The National Association of Realtors says pending U.S. home sales rose in February from a record low a month earlier as buyers took advantage of deeply discounted prices and low interest rates. The real estate group said its seasonally adjusted index of pending sales for previously occupied homes rose 2.1 per cent–in line with expectations–to 82.1 in February from January’s record low of 80.4. The index, which started in 2001, tracks signed contracts to purchase existing homes. Typically there is a one- to two-month lag between a contract and a done deal. Because of falling home prices and mortgage rates, homeownership is more affordable than it’s been since at least 1970, when the realtor group began tracking it.
The Houston apartment market is seeing rising rental rates even as occupancy declined 0.18 per cent in February, according to a report from O’Connor & Associates. Average rental rates have increased slightly to $743.44. Many proposed apartment construction projects are on hold. A large number of developers are seeking HUD loans for financing. If job losses mount, occupancy could trend downward as tenants look more to roommates to cut costs.
Construction spending fell for a fifth straight month in February as another big drop in home building offset a slight rebound in nonresidential construction. The Commerce Department says February construction activity dropped 0.9 per cent, better than the 1.5 per cent decline economists expected. Total construction has been falling since October. The level of activity is at the slowest pace in nearly five years. The weakness in February reflected a 4.3 per cent drop in housing construction, which pushed the level down to the lowest in 11 years.
A trade group’s measure of the health of the manufacturing sector contracted for the 14th straight month in March, but at a slower pace than expected. The Tempe, Arizona-based Institute for Supply Management says its manufacturing index rose to 36.3 per cent last month from 35.8 per cent in February. Economists surveyed by Thomson Reuters expected the index to rise to 36. A reading below 50 signals contraction. The index hit a 28-year low of 32.9 in December. The report says declines in new orders and employment persisted, but moderated a bit. Still, none of the 18 manufacturing industries grew in March.
The Port Commission of the Port of Houston Authority has approved the award of a $35.9 million construction contract to McCarthy Building Companies for work on the Bayport Terminal container yard. The commission also approved an agreement with Texas Southern University to spend $2 million toward its development of undergraduate and graduate maritime transportation management and security degree programs.
Only one U.S. company successfully raise capital to go public in the first quarter, according to a study released by Connecticut-based Renaissance Capital, as reported in the Houston Business Journal. Only two companies worldwide managed to complete IPOs. Only 43 IPOs by U.S. companies made it to market in 2008, raising total proceeds of $43 billion. That compares with 2007 IPOs in 2007 that raised $59.7 billion.
March may have been another dismal month for U.S. auto sales, but at least it wasn’t as bad as February. General Motors’ sales fell 45 per cent from a year earlier, while Ford reported a 41 per cent drop. Sales at Chrysler, Toyota, Honda and Nissan were just a few points better. Despite the declines from a year ago, GM, Ford, Chrysler and Toyota all posted double-digit improvements from February, when industry wide U.S. sales hit their lowest point in more than 27 years.
Republican Governor Rick Perry opposes accepting federal economic stimulus money for the state’s unemployment system. The Associated Press reports his Texas Enterprise Fund for businesses steadily pulls in tens of millions of dollars from the dwindling Texas unemployment tax pool. The arrangement is getting more scrutiny at the capitol, as more Texans lose their jobs, as Perry’s opposition to federal government money persists and as the Enterprise Fund and its sister account, the Emerging Technology Fund, increasingly come under fire from legislators. Perry spokeswoman Allison Castle said lawmakers, not the governor, determine the funding source for the fund. She says Perry is not voicing a preference on receiving unemployment tax money. A large chunk of the money comes from general state revenue. Under existing law, one-tenth of one per cent of taxable wages paid by businesses to the Texas Unemployment Trust Fund goes into a holding account. Each October, if the amount of money in the unemployment insurance fund is above a certain level, 75 per cent of that holding account money goes to the Texas Enterprise Fund and 25 per cent to a Skills Development Fund to help retrain workers. Now some legislators are questioning whether the division of money is fair and whether unemployment tax money should go to the Enterprise Fund at all. Representative Norma Chavez of El Paso has filed legislation seeking to split the holding account money — up to $160 million per two-year budget cycle — 50-50 between the Enterprise Fund and the Job Skills Development Fund.
Quantum Resources Management is moving its headquarters from Denver to Houston, according to the Houston Chronicle. Quantum acquires mature oil and gas properties and uses technology to squeeze more life from the fields.
Mexico’s central bank says the money Mexicans living abroad sent home in February fell three per cent compared to the same period in 2008. Even so, the drop was less than in January, when remittances were down 12 per cent compared to January 2008. Remittances have been dropping because of the U.S. recession as well as a crackdown on illegal immigration that has stemmed migration. The bank reported that Mexicans sent back $1.8 billion in February, compared to $1.5 billion in January. Last year was the first time remittances have fallen year-to-year since the bank started tracking the money 13 years ago. Mexico’s second largest foreign income source plunged 3.6 per cent to $25 billion in 2008 compared to $26 billion in 2007.
Airlines are offering cheaper fares into June, indicating they’re worried about filling planes right up to the start of the peak travel season. Tom Parsons with discount travel site bestfares.com says airlines are offering seats as cheap as $78 round trip on many routes. Parsons says — for example — prices of $98 and below are available to 30 cities from Baltimore, and $138 from more than 50 cities to Las Vegas. The Associated Press reports most major U.S. airlines reported sharply lower traffic for January and February — with some of the declines hitting double digits. Carriers have been cutting capacity to adjust to sagging demand. Parsons said most of the current fare sales require a 14-day advance purchase and travel must be completed by June 17th. The best prices are usually midweek, and there are blackout dates around Memorial Day.
A survey from CareerBuilder.com and USA Today indicates employers are focused more on keeping employees than on hiring. Some 2,500 human resource professionals and 4,400 workers in private companies were polled, according to the Houston Business Journal. About 64 per cent of employers say they expect no change in the number of full-time permanent employees in the second quarter. Forty-two per cent of employers expect to increase salaries in the second quarter.
The Supreme Court has ruled for employers who want to force unionized workers to pursue their age discrimination claims through arbitration instead of a federal lawsuit. In a 5-4 decision, the court said an arbitration agreement negotiated between an employer and a union is binding on workers and strips them of their option to take complaints to court. In the majority opinion, Justice Clarence Thomas said “we hold that a collective-bargaining agreement that clearly and unmistakably requires union members to arbitrate age discrimination claims is enforceable as a matter of federal law.” The four liberal justices dissented from the ruling.
The Supreme Court has ruled that the government may consider cost in deciding whether to order power plants to undertake environmental upgrades that would protect fish. The court’s decision is a defeat for environmentalists who had urged the justices to uphold a favorable federal appeals court ruling that could have required an estimated 554 power plants to install technology that relies on recycled water for cooling. By reducing water intake, the closed-cycle cooling also results in fewer fish being sucked into the system or smashed against screens. The 2nd U.S. Circuit Court of Appeals in New York said that the Clean Water Act does not allow cost to be used when deciding what technology would best minimize environmental impacts. The ruling is being seen as a victory for the power industry. But some environmentalists are trying to be optimistic. Environmentalists have been backing an appeals court ruling that could have required hundreds of power plants to install technology that relies on recycled water for cooling. But a lawyer for the RiverKeeper Group says the issue is now up to the EPA. He says “we have all the confidence in the world that the Obama administration will do the right thing.”
The Kroger supermarket chain says it’s recalling some store brand mayonnaise sold in three states because it may be contaminated with salmonella. Cincinnati-based Kroger says the recall involves 32-ounce plastic jars of Kroger Lite Mayo sold in Kroger stores in southwest Ohio, northern Kentucky and southeast Indiana. The suspect jars have a “sell by” date of “Sep-25-09.” Kroger says no illnesses have been reported. A company spokeswoman said that Kroger was informed by an outside supplier of possible salmonella contamination in an egg product used to make the mayo. She did not have the name of the supplier. Customers who bought the mayonnaise are being told not to consume it but to return it to the store.
Amazon’s Kindle might soon be getting new competitors in the market for electronic book devices. Tony Lewis, who heads an initiative within Verizon Wireless to provide access to non-phone devices, says that five companies have approached Verizon about wireless connections for e-readers. Lewis wouldn’t say which manufacturers, but he hints that they are looking at entering parts of the e-book market that the Kindle doesn’t focus on, like college textbooks. Amazon launched the second version of the Kindle a month ago. It uses Sprint Nextel’s wireless network to provide near-instant access to a store with 100,000 books.
Thirteen Texas companies and among 89 Energy Star award-winning organizations recognized by the Environmental Protection Agency. Four are in Houston — CEMEX USA, CenterPoint Energy, Hines and Transwestern. Organizations are recognized in Sustained Excellence, Partner of the Year and Excellence categories. Energy Star was introduced by the EPA in 1992 as a voluntary, market-based partnership to reduce greenhouse gases through increased energy efficiency.